Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
For the quarter ended December 31, 2023, free cash flow turned positive after a negative prior quarter, driven by a shift to positive operating cash flow and lower capital expenditure. However, free cash flow and margin were lower than the same quarter one year earlier.
- Revenue remained stable sequentially. Operating cash flow turned positive, and capital expenditure decreased, resulting in a positive free cash flow margin, compared to a negative margin in the prior quarter.
- Compared to the immediately preceding quarter, free cash flow and margin improved markedly. Compared to the same quarter one year earlier, revenue was higher but free cash flow and margin were lower, with operating cash flow slightly lower and capital expenditure higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$253.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$338.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$415.0M
Cash generated by operations before capital spending.
CapEx
$77.0M
Capital spending and related asset purchases.
FCF margin
8.2%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $3.8B | $68.0M | $62.0M | $6.0M | 0.2% |
| 2023-06-30 | $3.9B | $794.0M | $73.0M | $721.0M | 18.3% |
| 2023-09-30 | $4.1B | -$643.0M | $169.0M | -$812.0M | -19.9% |
| 2023-12-31 | $4.1B | $415.0M | $77.0M | $338.0M | 8.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 238.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.9% | 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.
Rebound in cash generation
Operating cash flow flipped from negative to positive, and capital expenditure was reduced, driving a substantial improvement in free cash flow. The free cash flow margin recovered from negative to positive.
This improved cash flow strengthens the company's liquidity position.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue remained stable sequentially. Operating cash flow turned positive, and capital expenditure decreased, resulting in a positive free cash flow margin, compared to a negative margin in the prior quarter.
Compared to the immediately preceding quarter, free cash flow and margin improved markedly. Compared to the same quarter one year earlier, revenue was higher but free cash flow and margin were lower, with operating cash flow slightly lower and capital expenditure higher.
Monitor the impact of the recently completed acquisition on operating cash flow and capital expenditure trends.