Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow increased compared with both the prior quarter and the same quarter last year, supported by higher operating cash flow and lower capital spending. However, the free cash flow margin weakened sequentially while improving year over year, reflecting mixed cash conversion efficiency.
- Revenue was higher than the preceding quarter but lower than the year-ago quarter. Operating cash flow rose relative to both periods, while capital expenditure decreased. Consequently, free cash flow increased, and the free cash flow margin improved compared to the prior year but declined from the prior quarter.
- Compared with the preceding quarter, free cash flow was higher despite a larger revenue base, but the margin narrowed significantly. Versus the same quarter one year earlier, free cash flow rose and the margin expanded, as operating cash flow growth outpaced the revenue decline and capital spending was reduced.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$252.6M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$314.1M
Cash generated by operations before capital spending.
CapEx
$61.5M
Capital spending and related asset purchases.
FCF margin
20.7%
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 | $1.4B | $332.2M | $43.1M | $289.1M | 21.0% |
| 2022-09-30 | $1.3B | $309.9M | $59.9M | $250.0M | 19.0% |
| 2022-12-31 | $429.9M | $282.8M | $68.9M | $213.9M | 49.8% |
| 2023-03-31 | $1.2B | $314.1M | $61.5M | $252.6M | 20.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 74.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.0% | 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.
Stronger Free Cash Flow Generation
Free cash flow increased year over year due to a combination of higher operating cash flow and lower capital expenditure, despite a decrease in revenue. This improvement in absolute free cash flow drove the margin higher compared to the same quarter last year.
The year-over-year improvement in free cash flow margin indicates a more efficient cash conversion relative to revenue, supporting liquidity without relying on revenue growth.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than the preceding quarter but lower than the year-ago quarter. Operating cash flow rose relative to both periods, while capital expenditure decreased. Consequently, free cash flow increased, and the free cash flow margin improved compared to the prior year but declined from the prior quarter.
Compared with the preceding quarter, free cash flow was higher despite a larger revenue base, but the margin narrowed significantly. Versus the same quarter one year earlier, free cash flow rose and the margin expanded, as operating cash flow growth outpaced the revenue decline and capital spending was reduced.
Monitor the trend in operating cash flow relative to revenue, as the conversion rate shifted between periods.