Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company reported negative free cash flow and a negative margin for the quarter. Revenue was lower than the prior quarter and the same quarter last year, while operating cash flow improved versus the year-ago period but weakened sequentially.
- Cash conversion was negative, as operating cash flow and free cash flow were both negative. Revenue declined, while capital expenditure remained minimal, resulting in a free cash flow margin that was deeply negative.
- Compared to the immediately preceding quarter, revenue was lower, operating cash flow was more negative, and free cash flow margin weakened. Compared to the same quarter one year earlier, revenue was lower, but operating cash flow improved, while free cash flow margin remained more negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$13.8M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$3.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$3.5M
Cash generated by operations before capital spending.
CapEx
$6000
Capital spending and related asset purchases.
FCF margin
-1390.6%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $425000 | -$4.5M | $2000 | -$4.5M | -1061.2% |
| 2023-09-30 | $769000 | -$3.0M | $34000 | -$3.0M | -391.3% |
| 2023-12-31 | $420000 | -$2.7M | $0 | -$2.7M | -648.8% |
| 2024-03-31 | $255000 | -$3.5M | $6000 | -$3.5M | -1390.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -131.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.4% | 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.
Working capital changes
The filing indicates that a decrease in inventories and prepaid expenses, along with an increase in accounts payable, partially offset by a decrease in accrued liabilities, were the primary reasons for the reduced use of net cash from operating activities compared to the year-ago quarter.
These working capital movements helped reduce the cash consumed by operations compared to the prior year.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion was negative, as operating cash flow and free cash flow were both negative. Revenue declined, while capital expenditure remained minimal, resulting in a free cash flow margin that was deeply negative.
Compared to the immediately preceding quarter, revenue was lower, operating cash flow was more negative, and free cash flow margin weakened. Compared to the same quarter one year earlier, revenue was lower, but operating cash flow improved, while free cash flow margin remained more negative.
Monitor the revenue trend, as it declined from both the prior quarter and the year-ago quarter.