Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow remained negative this quarter, though the deficit narrowed significantly from the same quarter one year earlier. Revenue declined sequentially but increased compared to the prior year, while operating cash flow followed a similar pattern.
- Operating cash flow was lower than revenue, and capital expenditure exceeded operating cash flow, resulting in a negative free cash flow and a negative margin.
- Compared to the preceding quarter, free cash flow and margin weakened as revenue and operating cash flow fell while capital expenditure remained stable. Compared to the same quarter one year earlier, free cash flow and margin improved substantially due to higher operating cash flow and slightly lower capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$2.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$457.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.4B
Cash generated by operations before capital spending.
CapEx
$1.9B
Capital spending and related asset purchases.
FCF margin
-8.5%
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 |
|---|---|---|---|---|---|
| 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% |
| 2023-09-30 | $6.0B | $1.5B | $1.9B | -$324.0M | -5.4% |
| 2023-12-31 | $5.4B | $1.4B | $1.9B | -$457.0M | -8.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -74.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 34.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$40.8B | 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 in the same quarter one year earlier, which was the primary factor behind the narrower free cash flow deficit.
The higher operating cash flow reduced the free cash flow deficit compared to the prior year.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was lower than revenue, and capital expenditure exceeded operating cash flow, resulting in a negative free cash flow and a negative margin.
Compared to the preceding quarter, free cash flow and margin weakened as revenue and operating cash flow fell while capital expenditure remained stable. Compared to the same quarter one year earlier, free cash flow and margin improved substantially due to higher operating cash flow and slightly lower capital expenditure.
Monitor the relationship between capital expenditure and operating cash flow, as capital expenditure has consistently exceeded operating cash flow, sustaining negative free cash flow.