Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased compared to both the prior quarter and the same quarter last year. However, operating cash flow turned deeply negative, resulting in a significantly negative free cash flow and a weakened free cash flow margin.
- Despite higher revenue, operating cash flow was negative, which drove free cash flow to a large negative figure. The free cash flow margin was deeply negative, indicating that cash conversion from revenue was poor in this quarter.
- Compared to the immediately preceding quarter, revenue was higher but operating cash flow shifted from positive to negative, causing free cash flow and margin to weaken sharply. Versus the same quarter one year earlier, revenue was higher, while operating cash flow and free cash flow were both more negative, and the margin was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$1.6B
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$1.4B
Cash generated by operations before capital spending.
CapEx
$213.0M
Capital spending and related asset purchases.
FCF margin
-40.4%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $2.6B | -$182.0M | $177.0M | -$359.0M | -13.7% |
| 2023-03-31 | $2.7B | $3.2B | $233.0M | $2.9B | 109.7% |
| 2023-06-30 | $3.4B | $1.1B | $223.0M | $923.0M | 27.5% |
| 2023-09-30 | $3.9B | -$1.4B | $213.0M | -$1.6B | -40.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -373.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$1.2B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Negative Operating Cash Flow
Operating cash flow was negative this quarter, a sharp reversal from the positive figure in the prior quarter and a deeper negative compared to the same quarter last year. This was the strongest observable driver of the negative free cash flow.
The negative operating cash flow directly caused free cash flow to be deeply negative, despite higher revenue.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Despite higher revenue, operating cash flow was negative, which drove free cash flow to a large negative figure. The free cash flow margin was deeply negative, indicating that cash conversion from revenue was poor in this quarter.
Compared to the immediately preceding quarter, revenue was higher but operating cash flow shifted from positive to negative, causing free cash flow and margin to weaken sharply. Versus the same quarter one year earlier, revenue was higher, while operating cash flow and free cash flow were both more negative, and the margin was lower.
Monitor the magnitude of negative operating cash flow, as it is the primary driver of the large negative free cash flow this quarter.