Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was negative in the first quarter, though the deficit narrowed compared to both the prior quarter and the same quarter last year. Operating cash flow improved while capital expenditure remained relatively stable.
- Revenue was stable, while operating cash flow increased, leading to a higher cash conversion rate. Capital expenditure was little changed, so the improvement in free cash flow was driven by stronger operating cash generation.
- Compared to the prior quarter, free cash flow improved as operating cash flow rose and capital expenditure decreased slightly. Versus the same quarter last year, free cash flow also improved, with operating cash flow significantly higher and capital expenditure essentially flat.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$269.8M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$164.8M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$362.9M
Cash generated by operations before capital spending.
CapEx
$527.7M
Capital spending and related asset purchases.
FCF margin
-13.2%
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 | $1.3B | $323.8M | $591.7M | -$267.9M | -19.9% |
| 2022-09-30 | $1.8B | $888.8M | $498.2M | $390.6M | 21.2% |
| 2022-12-31 | $1.2B | $324.2M | $551.9M | -$227.7M | -18.5% |
| 2023-03-31 | $1.2B | $362.9M | $527.7M | -$164.8M | -13.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -113.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 42.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$10.2B | 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 Improvement
Operating cash flow was higher than both the prior quarter and the same quarter last year, providing the primary lift to free cash flow. This occurred even as revenue remained unchanged.
The stronger operating cash flow narrowed the free cash flow deficit without requiring a reduction in capital spending.
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 increased, leading to a higher cash conversion rate. Capital expenditure was little changed, so the improvement in free cash flow was driven by stronger operating cash generation.
Compared to the prior quarter, free cash flow improved as operating cash flow rose and capital expenditure decreased slightly. Versus the same quarter last year, free cash flow also improved, with operating cash flow significantly higher and capital expenditure essentially flat.
Monitor whether operating cash flow can sustain its improved level in coming quarters.