Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow increased sequentially, while capital expenditure decreased slightly, leading to an improvement in free cash flow. Compared to the same quarter a year earlier, free cash flow was lower despite higher revenue, as capital expenditure was substantially higher.
- Revenue rose sequentially, operating cash flow improved, and capital expenditure fell slightly, resulting in higher free cash flow and an improved free cash flow margin. Year-over-year, the margin narrowed because capital expenditure increased more than operating cash flow relative to revenue.
- Sequentially, free cash flow and margin strengthened. Compared to the same quarter a year earlier, both free cash flow and margin weakened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$365.1M
Trailing twelve-month free cash flow.
Quarter free cash flow
$168.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$785.0M
Cash generated by operations before capital spending.
CapEx
$617.0M
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $1.9B | $760.0M | $827.9M | -$67.9M | -3.6% |
| 2023-03-31 | $2.2B | $692.0M | $530.0M | $162.0M | 7.3% |
| 2023-06-30 | $2.0B | $741.0M | $638.0M | $103.0M | 5.1% |
| 2023-09-30 | $2.1B | $785.0M | $617.0M | $168.0M | 8.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 60.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 29.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$11.3B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Sequential Operating Cash Flow Improvement
Operating cash flow increased compared to the prior quarter, supporting a higher free cash flow despite elevated capital expenditure. This sequential improvement was the most notable positive change in the quarter.
The rise in operating cash flow was the primary factor behind the sequential increase in free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue rose sequentially, operating cash flow improved, and capital expenditure fell slightly, resulting in higher free cash flow and an improved free cash flow margin. Year-over-year, the margin narrowed because capital expenditure increased more than operating cash flow relative to revenue.
Sequentially, free cash flow and margin strengthened. Compared to the same quarter a year earlier, both free cash flow and margin weakened.
Monitor the trajectory of capital expenditure, as it increased significantly from the prior year and directly affects free cash flow conversion.