Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow more than covered capital expenditure, yielding a free cash flow margin that improved from both the prior quarter and the same quarter last year. Revenue was higher than the preceding quarter and the year-ago quarter, supporting the increase in cash generation.
- Operating cash flow was substantially higher than capital expenditure, resulting in a free cash flow margin that improved sequentially and year-over-year. The margin strengthened as revenue rose and operating cash flow grew faster than capital spending.
- Compared to the immediately preceding quarter, free cash flow and its margin were higher, driven by higher operating cash flow with a modest increase in capital expenditure. Versus the same quarter one year earlier, free cash flow and the margin were higher, as operating cash flow increased more than capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$821.3M
Trailing twelve-month free cash flow.
Quarter free cash flow
$401.7M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$423.8M
Cash generated by operations before capital spending.
CapEx
$22.1M
Capital spending and related asset purchases.
FCF margin
11.7%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $2.9B | -$84.6M | $23.2M | -$107.7M | -3.7% |
| 2023-06-30 | $3.0B | $299.5M | $13.4M | $286.1M | 9.4% |
| 2023-09-30 | $3.2B | $261.0M | $19.7M | $241.2M | 7.5% |
| 2023-12-31 | $3.4B | $423.8M | $22.1M | $401.7M | 11.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 189.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.6% | 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.
Strong Operating Cash Flow
Operating cash flow was materially higher compared to both the previous quarter and the year-ago quarter, and capital expenditure increased only modestly. This combination drove the improvement in free cash flow and its margin.
The higher operating cash flow was the strongest observable driver of the improved free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was substantially higher than capital expenditure, resulting in a free cash flow margin that improved sequentially and year-over-year. The margin strengthened as revenue rose and operating cash flow grew faster than capital spending.
Compared to the immediately preceding quarter, free cash flow and its margin were higher, driven by higher operating cash flow with a modest increase in capital expenditure. Versus the same quarter one year earlier, free cash flow and the margin were higher, as operating cash flow increased more than capital expenditure.
Monitor the trend in operating cash flow relative to revenue, as that relationship directly drives free cash flow conversion.