Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was lower than the prior quarter and the same quarter a year earlier, while operating cash flow and free cash flow were higher. The free cash flow margin improved compared with both periods.
- Operating cash flow was higher despite lower revenue, and capital expenditure was lower, resulting in a higher free cash flow and an improved free cash flow margin. The company defines free cash flow as operating cash flow less capital expenditures and considers it a key liquidity measure.
- Compared with the immediately preceding quarter, revenue was lower, operating cash flow was higher, capital expenditure was lower, and free cash flow and margin were higher. The same directional changes were observed when comparing with the same quarter one year earlier.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$987.5M
Trailing twelve-month free cash flow.
Quarter free cash flow
$345.8M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$383.5M
Cash generated by operations before capital spending.
CapEx
$37.7M
Capital spending and related asset purchases.
FCF margin
17.7%
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 | $1.5B | $338.6M | $45.0M | $293.6M | 19.9% |
| 2023-03-31 | $2.1B | $241.3M | $48.4M | $192.9M | 9.3% |
| 2023-06-30 | $2.1B | $195.3M | $40.1M | $155.2M | 7.4% |
| 2023-09-30 | $2.0B | $383.5M | $37.7M | $345.8M | 17.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 119.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.9% | 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.
Operating cash flow increase
Operating cash flow was higher than both the prior quarter and the same quarter a year earlier, despite lower revenue. This was the main contributor to the higher free cash flow and margin.
The increase in operating cash flow drove the improvement in free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was higher despite lower revenue, and capital expenditure was lower, resulting in a higher free cash flow and an improved free cash flow margin. The company defines free cash flow as operating cash flow less capital expenditures and considers it a key liquidity measure.
Compared with the immediately preceding quarter, revenue was lower, operating cash flow was higher, capital expenditure was lower, and free cash flow and margin were higher. The same directional changes were observed when comparing with the same quarter one year earlier.
Monitor capital expenditure trends, as they directly affect the calculation of free cash flow.