Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the quarter ended Dec 31, 2024, free cash flow turned negative as operating cash flow moved to a deficit despite revenue remaining stable. This marks a sharp reversal from both the prior quarter and the same quarter a year ago.
- Revenue was unchanged from the prior quarter, but operating cash flow shifted from positive to negative, resulting in a negative free cash flow margin. Capital expenditure remained relatively stable, so the decline was driven entirely by the operating cash flow deficit.
- Compared to the preceding quarter, operating cash flow swung from a surplus to a deficit, causing free cash flow and margin to deteriorate significantly. Compared to the same quarter one year earlier, both operating and free cash flow were lower, as the year-ago period had positive albeit smaller figures.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$289.9M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$177.3M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$127.5M
Cash generated by operations before capital spending.
CapEx
$49.8M
Capital spending and related asset purchases.
FCF margin
-12.8%
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 |
|---|---|---|---|---|---|
| 2024-03-31 | $1.3B | -$53.5M | $65.3M | -$118.8M | -8.9% |
| 2024-06-30 | $1.4B | $371.5M | $85.4M | $286.1M | 20.9% |
| 2024-09-30 | $1.4B | $351.8M | $51.9M | $299.9M | 22.1% |
| 2024-12-31 | $1.4B | -$127.5M | $49.8M | -$177.3M | -12.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -46.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.6% | 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.
Operating Cash Flow Volatility
Operating cash flow turned negative in the current quarter, while revenue was stable. This was the single largest observable factor behind the free cash flow deficit, as capital expenditure did not change materially.
If operating cash flow does not recover, free cash flow may remain negative even if capital expenditure stays at current levels.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was unchanged from the prior quarter, but operating cash flow shifted from positive to negative, resulting in a negative free cash flow margin. Capital expenditure remained relatively stable, so the decline was driven entirely by the operating cash flow deficit.
Compared to the preceding quarter, operating cash flow swung from a surplus to a deficit, causing free cash flow and margin to deteriorate significantly. Compared to the same quarter one year earlier, both operating and free cash flow were lower, as the year-ago period had positive albeit smaller figures.
Monitor whether operating cash flow returns to a positive level in the next quarter, as its current deficit is the primary constraint on free cash flow.