Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow remained negative in the quarter, but showed significant improvement compared to the same period last year. Operating cash flow strengthened notably, though capital expenditure continued at a high level.
- Revenue growth supported higher operating cash flow, but substantial capital expenditure kept free cash flow negative. The free cash flow margin improved from a year ago, though it declined relative to the prior quarter.
- Compared to the immediately preceding quarter, revenue was higher but operating cash flow was lower, leading to a weaker free cash flow position. Versus the same quarter one year earlier, all metrics improved, with operating cash flow and free cash flow showing the strongest gains.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$2.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$775.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$992.0M
Cash generated by operations before capital spending.
CapEx
$1.8B
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 |
|---|---|---|---|---|---|
| 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% |
| 2024-03-31 | $6.0B | $992.0M | $1.8B | -$775.0M | -12.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -117.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 29.2% | 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.
Improvement in Operating Cash Flow
Operating cash flow increased substantially year-over-year, supported by higher revenue. This improvement was the primary factor behind the narrower free cash flow deficit compared to the prior year.
The stronger operating cash flow partially offset high capital expenditure, reducing the negative free cash flow position from the prior-year quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue growth supported higher operating cash flow, but substantial capital expenditure kept free cash flow negative. The free cash flow margin improved from a year ago, though it declined relative to the prior quarter.
Compared to the immediately preceding quarter, revenue was higher but operating cash flow was lower, leading to a weaker free cash flow position. Versus the same quarter one year earlier, all metrics improved, with operating cash flow and free cash flow showing the strongest gains.
Monitor capital expenditure levels, as they continue to absorb a significant portion of operating cash flow and delay free cash flow turning positive.