Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow decreased compared to both the prior quarter and the same quarter last year. Free cash flow margin improved year-over-year but weakened sequentially.
- Operating cash flow as a percentage of revenue was lower than the prior quarter but higher than the year-ago quarter. Capital expenditure increased, resulting in free cash flow that declined from both comparison periods.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all lower, while capital expenditure was higher. Compared to the same quarter one year earlier, revenue and operating cash flow were lower, capital expenditure was higher, and free cash flow was lower, though free cash flow margin improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$6.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.3B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.7B
Cash generated by operations before capital spending.
CapEx
$354.0M
Capital spending and related asset purchases.
FCF margin
23.4%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $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% |
| 2023-09-29 | $5.6B | $1.7B | $354.0M | $1.3B | 23.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 116.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 6.3% | 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.
Decline in Operating Cash Flow
Operating cash flow decreased from both the prior quarter and the year-ago quarter, while capital expenditure rose. This combination drove free cash flow lower.
The reduction in operating cash flow was the primary factor behind the lower free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a percentage of revenue was lower than the prior quarter but higher than the year-ago quarter. Capital expenditure increased, resulting in free cash flow that declined from both comparison periods.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all lower, while capital expenditure was higher. Compared to the same quarter one year earlier, revenue and operating cash flow were lower, capital expenditure was higher, and free cash flow was lower, though free cash flow margin improved.
Monitor the trajectory of capital expenditure relative to operating cash flow, as it has increased in both comparisons.