Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was stable versus the prior quarter but lower than the same quarter last year. Free cash flow margin weakened slightly from the prior quarter but improved compared to the year-ago quarter.
- Operating cash flow was stable relative to revenue, while capital expenditure was higher than the prior quarter, resulting in slightly lower free cash flow and a marginally weaker free cash flow margin. Compared to the year-ago quarter, operating cash flow was lower but capital expenditure was higher, yet free cash flow margin improved due to the larger decline in revenue.
- Compared to the prior quarter, revenue was stable, operating cash flow was stable, capital expenditure was higher, and free cash flow and free cash flow margin were slightly lower. Compared to the same quarter last year, revenue was lower, operating cash flow was lower, capital expenditure was higher, free cash flow was slightly lower, and free cash flow margin was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$7.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.6B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.9B
Cash generated by operations before capital spending.
CapEx
$329.0M
Capital spending and related asset purchases.
FCF margin
27.0%
The share of revenue converted into free cash flow.
Cash flow trend
A short quarterly history shows whether FCF is scaling with revenue or only spiking for one period.
| Period | Revenue | Operating CF | CapEx | FCF | FCF margin |
|---|---|---|---|---|---|
| 2022-09-30 | $7.7B | $2.0B | $277.0M | $1.7B | 22.6% |
| 2022-12-31 | $7.1B | $2.5B | $295.0M | $2.2B | 31.5% |
| 2023-03-31 | $5.9B | $1.9B | $266.0M | $1.7B | 28.3% |
| 2023-06-30 | $5.9B | $1.9B | $329.0M | $1.6B | 27.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 144.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | n/a | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Free Cash Flow Margin Improvement Year-over-Year
Despite lower revenue and operating cash flow compared to the year-ago quarter, free cash flow margin improved from the prior year. This was driven by a proportionally larger decline in revenue relative to the decline in free cash flow.
The free cash flow margin strengthened compared to the same quarter last year, indicating a more efficient conversion of revenue into free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was stable relative to revenue, while capital expenditure was higher than the prior quarter, resulting in slightly lower free cash flow and a marginally weaker free cash flow margin. Compared to the year-ago quarter, operating cash flow was lower but capital expenditure was higher, yet free cash flow margin improved due to the larger decline in revenue.
Compared to the prior quarter, revenue was stable, operating cash flow was stable, capital expenditure was higher, and free cash flow and free cash flow margin were slightly lower. Compared to the same quarter last year, revenue was lower, operating cash flow was lower, capital expenditure was higher, free cash flow was slightly lower, and free cash flow margin was higher.
Monitor the trend in capital expenditure, which was higher in the current quarter compared to both the prior quarter and the year-ago quarter.