Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the current quarter, free cash flow margin improved markedly as operating cash flow increased substantially. Revenue also rose, while capital expenditure changed little.
- Revenue grew compared to both prior periods. Operating cash flow rose significantly, more than offsetting a modest increase in capital expenditure, resulting in much higher free cash flow and a stronger free cash flow margin.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow were higher, and the margin improved. Versus the same quarter one year earlier, the improvement was even more pronounced, with operating cash flow and free cash flow substantially higher and margin greatly strengthened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$908.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$661.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$743.0M
Cash generated by operations before capital spending.
CapEx
$82.0M
Capital spending and related asset purchases.
FCF margin
15.1%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $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% |
| 2024-03-31 | $4.4B | $743.0M | $82.0M | $661.0M | 15.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 131.9% | 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.
Operating Cash Flow Surge
Operating cash flow increased sharply from both the prior quarter and the year-ago quarter, providing the primary lift to free cash flow. Capital expenditure remained relatively stable, so the cash conversion improvement was driven entirely by higher operating cash flow.
The strengthened cash flow provides enhanced financial flexibility for the company.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue grew compared to both prior periods. Operating cash flow rose significantly, more than offsetting a modest increase in capital expenditure, resulting in much higher free cash flow and a stronger free cash flow margin.
Compared to the immediately preceding quarter, operating cash flow and free cash flow were higher, and the margin improved. Versus the same quarter one year earlier, the improvement was even more pronounced, with operating cash flow and free cash flow substantially higher and margin greatly strengthened.
Monitor the trajectory of operating cash flow given its substantial increase in the current quarter.