Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow was positive but substantially lower than capital expenditure, resulting in negative free cash flow and a negative margin. Both revenue and operating cash flow declined from the prior quarter, while capital expenditure decreased but remained well above operating cash flow.
- Revenue generated a positive operating cash flow, but capital expenditure exceeded that cash flow, producing negative free cash flow and a negative margin. The conversion from revenue to free cash flow was weakened by the large capital outlay.
- Compared to the immediately preceding quarter, revenue and operating cash flow were lower, capital expenditure was lower, and free cash flow turned more negative. Versus the same quarter one year earlier, revenue and operating cash flow were higher, capital expenditure was significantly higher, and free cash flow shifted from positive to negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$35.4M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$350.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$482.4M
Cash generated by operations before capital spending.
CapEx
$832.9M
Capital spending and related asset purchases.
FCF margin
-8.5%
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 | $4.5B | $3.3B | $2.8B | $476.8M | 10.5% |
| 2023-03-31 | $4.4B | $789.9M | $766.3M | $23.7M | 0.5% |
| 2023-06-30 | $4.4B | $749.2M | $934.5M | -$185.4M | -4.3% |
| 2023-09-30 | $4.1B | $482.4M | $832.9M | -$350.5M | -8.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 295.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 20.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$402.9M | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Capital Expenditure vs. Operating Cash Flow Gap
Capital expenditure exceeded operating cash flow by a wide margin, causing free cash flow to be negative. This gap narrowed slightly from the prior quarter but remained much larger than a year ago.
The persistent shortfall between operating cash flow and capital expenditure is the primary observable factor weighing on free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue generated a positive operating cash flow, but capital expenditure exceeded that cash flow, producing negative free cash flow and a negative margin. The conversion from revenue to free cash flow was weakened by the large capital outlay.
Compared to the immediately preceding quarter, revenue and operating cash flow were lower, capital expenditure was lower, and free cash flow turned more negative. Versus the same quarter one year earlier, revenue and operating cash flow were higher, capital expenditure was significantly higher, and free cash flow shifted from positive to negative.
Monitor the ongoing level of capital expenditure relative to operating cash flow, as the gap continues to drive negative free cash flow.