Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue rose compared to both the prior quarter and the same quarter last year. Operating cash flow increased from the prior quarter but was slightly below the year-ago level, resulting in a free cash flow margin that improved sequentially but declined year-over-year.
- Cash conversion improved from the prior quarter as revenue growth outpaced the increase in capital expenditure, leading to higher free cash flow. However, compared to the same quarter last year, operating cash flow was slightly lower despite higher revenue, indicating a weaker conversion rate.
- Sequentially, revenue, operating cash flow, free cash flow, and margin all improved. Year-over-year, revenue was higher but operating cash flow, free cash flow, and margin were lower, while capital expenditure was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$321.7M
Trailing twelve-month free cash flow.
Quarter free cash flow
$103.4M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$131.4M
Cash generated by operations before capital spending.
CapEx
$28.0M
Capital spending and related asset purchases.
FCF margin
10.4%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $858.9M | $52.8M | $27.1M | $25.7M | 3.0% |
| 2023-12-31 | $817.7M | $148.4M | $20.5M | $127.9M | 15.6% |
| 2024-03-31 | $880.7M | $87.2M | $22.4M | $64.7M | 7.4% |
| 2024-06-30 | $990.4M | $131.4M | $28.0M | $103.4M | 10.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 63.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.8% | 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.
Cash Flow Margin Decline
Revenue increased to a new high, but operating cash flow did not keep pace, falling slightly below the amount generated in the same quarter last year. This caused the free cash flow margin to compress relative to the year-ago period.
If operating cash flow growth continues to lag revenue growth, future free cash flow may be pressured.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion improved from the prior quarter as revenue growth outpaced the increase in capital expenditure, leading to higher free cash flow. However, compared to the same quarter last year, operating cash flow was slightly lower despite higher revenue, indicating a weaker conversion rate.
Sequentially, revenue, operating cash flow, free cash flow, and margin all improved. Year-over-year, revenue was higher but operating cash flow, free cash flow, and margin were lower, while capital expenditure was higher.
Monitor the relationship between revenue growth and operating cash flow, as the current quarter's cash generation efficiency fell short of the prior year's level.