Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved sequentially despite a slight revenue decline, driven by a higher operating cash flow. Compared to the same quarter last year, free cash flow was substantially lower due to a reduced operating cash flow.
- Revenue was slightly lower than the prior quarter, but operating cash flow increased, leading to a higher free cash flow and an improved free cash flow margin. The margin remained below the level of the same quarter last year.
- Compared to the preceding quarter, free cash flow and free cash flow margin both improved, with operating cash flow rising despite a small drop in revenue. Versus the same quarter one year earlier, all metrics except revenue were lower, with operating cash flow and free cash flow notably weaker.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$8.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.3B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.6B
Cash generated by operations before capital spending.
CapEx
$319.0M
Capital spending and related asset purchases.
FCF margin
5.4%
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 | $39.9B | -$1.5B | $298.0M | -$1.8B | -4.5% |
| 2023-03-31 | $42.2B | $6.5B | $301.0M | $6.2B | 14.6% |
| 2023-06-30 | $43.7B | $1.9B | $350.0M | $1.6B | 3.7% |
| 2023-09-30 | $42.8B | $2.6B | $319.0M | $2.3B | 5.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 178.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.7% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$13.9B | 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
Operating cash flow increased compared to the prior quarter, while capital expenditure was slightly lower. This combination directly drove the improvement in free cash flow and margin.
Free cash flow margin rose sequentially, reflecting a more efficient conversion of revenue into free cash flow despite the revenue decline.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly lower than the prior quarter, but operating cash flow increased, leading to a higher free cash flow and an improved free cash flow margin. The margin remained below the level of the same quarter last year.
Compared to the preceding quarter, free cash flow and free cash flow margin both improved, with operating cash flow rising despite a small drop in revenue. Versus the same quarter one year earlier, all metrics except revenue were lower, with operating cash flow and free cash flow notably weaker.
Monitor the trend in operating cash flow, as its sequential improvement was the key factor behind the increase in free cash flow.