Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The quarter's free cash flow and margin improved significantly compared to both the prior quarter and the same quarter last year, driven by stronger operating cash flow. Revenue was stable sequentially and higher year over year.
- Revenue was stable sequentially and higher year over year. Operating cash flow improved markedly, while capital expenditure decreased relative to the prior quarter but increased from the year-ago quarter. Consequently, free cash flow and its margin improved compared to both periods.
- Compared to the prior quarter, free cash flow was higher due to both higher operating cash flow and lower capital expenditure. Versus the same quarter last year, free cash flow was higher as operating cash flow growth more than offset a modest increase in capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$314.9M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$462.6M
Cash generated by operations before capital spending.
CapEx
$147.7M
Capital spending and related asset purchases.
FCF margin
11.0%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $2.9B | $188.1M | $142.4M | $45.8M | 1.6% |
| 2022-09-30 | $2.9B | $710.5M | $143.9M | $566.6M | 19.2% |
| 2022-12-31 | $2.9B | $343.7M | $194.0M | $149.7M | 5.1% |
| 2023-03-31 | $2.9B | $462.6M | $147.7M | $314.9M | 11.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 272.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.1% | 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.
Stronger operating cash flow
The quarter's operating cash flow was higher than both the prior quarter and the year-ago quarter, supported by favorable working capital changes as indicated in the filing.
This drove a notable improvement in free cash flow and its margin relative to both comparison periods.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable sequentially and higher year over year. Operating cash flow improved markedly, while capital expenditure decreased relative to the prior quarter but increased from the year-ago quarter. Consequently, free cash flow and its margin improved compared to both periods.
Compared to the prior quarter, free cash flow was higher due to both higher operating cash flow and lower capital expenditure. Versus the same quarter last year, free cash flow was higher as operating cash flow growth more than offset a modest increase in capital expenditure.
Monitor the sustainability of working capital changes that contributed to the operating cash flow improvement, as noted in the filing.