Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the first quarter, free cash flow turned positive and the margin improved sharply compared with the prior quarter. Operating cash flow also increased both sequentially and year-over-year.
- Revenue was stable, while operating cash flow rose significantly. With capital expenditure at a minimal level, free cash flow equaled operating cash flow, resulting in a high margin.
- Compared with the prior quarter, the large capital outlay was absent, converting a strongly negative free cash flow into a positive one. Versus the same quarter last year, operating cash flow was higher while prior-year capital spending data were unavailable.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
n/a
Trailing twelve-month free cash flow.
Quarter free cash flow
$959.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$959.5M
Cash generated by operations before capital spending.
CapEx
$0
Capital spending and related asset purchases.
FCF margin
32.2%
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 | $3.4B | $278.0M | n/a | n/a | n/a |
| 2022-09-30 | $4.2B | $993.5M | $1.0M | $992.4M | 23.5% |
| 2022-12-31 | $3.3B | $776.0M | $5.0B | -$4.2B | -127.8% |
| 2023-03-31 | $3.0B | $959.5M | $0 | $959.5M | 32.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 307.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$24.8B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Lower Capital Spending
Capital expenditure dropped sharply from the prior quarter, enabling free cash flow to match operating cash flow. This was the primary factor behind the swing to positive free cash flow.
The resulting free cash flow margin improved substantially, providing greater financial flexibility in the near term.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable, while operating cash flow rose significantly. With capital expenditure at a minimal level, free cash flow equaled operating cash flow, resulting in a high margin.
Compared with the prior quarter, the large capital outlay was absent, converting a strongly negative free cash flow into a positive one. Versus the same quarter last year, operating cash flow was higher while prior-year capital spending data were unavailable.
Monitor whether capital expenditure remains at current low levels or reverts to historical patterns.