Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow remained negative in the current quarter, with a weaker margin compared to both the prior quarter and the same quarter one year earlier. Cash conversion from revenue worsened as the operating cash outflow increased relative to revenue.
- Revenue was higher than the prior quarter but lower than the year-ago quarter. Operating cash flow and free cash flow were negative and more negative than both comparison periods, leading to a significantly weakened free cash flow margin.
- Compared with the prior quarter, revenue improved while operating cash flow and free cash flow deteriorated. Compared with the same quarter a year ago, revenue declined and both cash flow measures also worsened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$14.8M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$5.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$5.5M
Cash generated by operations before capital spending.
CapEx
$14000
Capital spending and related asset purchases.
FCF margin
-1599.7%
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 |
|---|---|---|---|---|---|
| 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% |
| 2024-06-30 | $345000 | -$5.5M | $14000 | -$5.5M | -1599.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 12.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.1% | 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.
Operating Cash Outflow
Operating cash flow was more negative than both the prior quarter and the year-ago quarter, while revenue increased sequentially but declined year-over-year. This divergence drove the free cash flow margin markedly lower.
The persistent negative free cash flow margin highlights that the company's operations are not generating enough cash to cover capital spending, requiring external financing to sustain activities.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than the prior quarter but lower than the year-ago quarter. Operating cash flow and free cash flow were negative and more negative than both comparison periods, leading to a significantly weakened free cash flow margin.
Compared with the prior quarter, revenue improved while operating cash flow and free cash flow deteriorated. Compared with the same quarter a year ago, revenue declined and both cash flow measures also worsened.
Monitor the trajectory of operating cash flow, as the filing indicates that the increased cash use was primarily driven by an increase in prepaid expenses and a decrease in accounts payable, partially offset by lower inventories.