Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased from the prior quarter and the same quarter last year, but operating cash flow declined sharply, resulting in a minimal free cash flow margin. The acquisition of National Instruments and the planned divestiture of a majority stake in Climate Technologies are noted in the filing.
- Despite higher revenue, operating cash flow fell significantly, and capital expenditure remained similar, causing free cash flow to drop steeply. The free cash flow margin weakened markedly compared to both prior periods.
- Revenue was higher than the preceding quarter and the same quarter a year earlier. Operating cash flow, free cash flow, and free cash flow margin were all lower than both comparison periods.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$6.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$68.0M
Cash generated by operations before capital spending.
CapEx
$62.0M
Capital spending and related asset purchases.
FCF margin
0.2%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $3.5B | $740.0M | $59.0M | $681.0M | 19.7% |
| 2022-09-30 | $3.9B | $1.2B | $100.0M | $1.1B | 28.7% |
| 2022-12-31 | $3.4B | $418.0M | $59.0M | $359.0M | 10.6% |
| 2023-03-31 | $3.8B | $68.0M | $62.0M | $6.0M | 0.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 0.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.7% | 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 Flow Decline
The strongest observable driver was the sharp reduction in operating cash flow, which fell well below the levels of the prior quarter and the year-ago quarter, despite higher revenue. This directly caused free cash flow to contract.
The lower operating cash flow compressed free cash flow and the free cash flow margin to minimal levels.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Despite higher revenue, operating cash flow fell significantly, and capital expenditure remained similar, causing free cash flow to drop steeply. The free cash flow margin weakened markedly compared to both prior periods.
Revenue was higher than the preceding quarter and the same quarter a year earlier. Operating cash flow, free cash flow, and free cash flow margin were all lower than both comparison periods.
Monitor the trajectory of operating cash flow, as its decline was the primary factor behind the weakened free cash flow.