Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company's free cash flow improved sequentially from the prior quarter, as operating cash flow increased despite lower revenue. However, free cash flow remained negative and was weaker compared to the same quarter last year.
- Revenue was lower than the prior quarter but higher than a year ago. Operating cash flow increased sequentially but decreased year-over-year. Capital expenditure was slightly lower than the previous quarter but higher than the year-ago period. As a result, free cash flow and its margin improved from the prior quarter but weakened compared to the same quarter last year.
- Compared to the immediately preceding quarter, free cash flow improved as operating cash flow rose and capital expenditure edged lower. Year-over-year, free cash flow deteriorated due to lower operating cash flow and higher capital expenditure, despite higher revenue.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$3.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$527.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.3B
Cash generated by operations before capital spending.
CapEx
$1.8B
Capital spending and related asset purchases.
FCF margin
-10.9%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $4.8B | $901.0M | $1.7B | -$771.0M | -15.9% |
| 2022-12-31 | $4.7B | $729.0M | $2.0B | -$1.2B | -26.6% |
| 2023-03-31 | $5.6B | $484.0M | $1.9B | -$1.4B | -25.1% |
| 2023-06-30 | $4.8B | $1.3B | $1.8B | -$527.0M | -10.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -153.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 37.4% | 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.
Sequential improvement in operating cash flow
Operating cash flow increased from the previous quarter, narrowing the free cash flow deficit. This occurred even though revenue was lower, indicating a stronger cash conversion from operations.
If operating cash flow continues at this level, the company may move closer to positive free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than the prior quarter but higher than a year ago. Operating cash flow increased sequentially but decreased year-over-year. Capital expenditure was slightly lower than the previous quarter but higher than the year-ago period. As a result, free cash flow and its margin improved from the prior quarter but weakened compared to the same quarter last year.
Compared to the immediately preceding quarter, free cash flow improved as operating cash flow rose and capital expenditure edged lower. Year-over-year, free cash flow deteriorated due to lower operating cash flow and higher capital expenditure, despite higher revenue.
Monitor developments related to the ComEd franchise agreement with the City of Chicago, which is currently in effect but terminable upon one year's notice.