Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow both increased compared to the prior quarter and the same quarter last year. Free cash flow margin improved significantly versus both periods, driven by a lower capital expenditure relative to operating cash flow.
- Operating cash flow was substantially higher than revenue, resulting in a free cash flow margin above one thousand percent. Capital expenditure was a small fraction of operating cash flow, allowing most operating cash flow to convert into free cash flow.
- Compared to the prior quarter, revenue, operating cash flow, and free cash flow were all higher, while capital expenditure also increased. Versus the same quarter one year ago, revenue and operating cash flow were higher, capital expenditure was substantially lower, and free cash flow was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$394.9M
Trailing twelve-month free cash flow.
Quarter free cash flow
$315.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$347.9M
Cash generated by operations before capital spending.
CapEx
$32.9M
Capital spending and related asset purchases.
FCF margin
1418.5%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $22.2M | $307.6M | $639.1M | -$331.5M | -1490.0% |
| 2022-12-31 | $21.2M | $290.1M | $147.3M | $142.8M | 674.1% |
| 2023-03-31 | $21.4M | $281.6M | $13.1M | $268.5M | 1255.8% |
| 2023-06-30 | $22.2M | $347.9M | $32.9M | $315.0M | 1418.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 155.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 148.1% | 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.
Lower Capital Expenditure
Capital expenditure in the current quarter was lower than the same quarter one year ago, which directly supported a higher free cash flow despite a smaller increase in operating cash flow.
The reduction in capital expenditure was the strongest observable driver of the improvement in free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was substantially higher than revenue, resulting in a free cash flow margin above one thousand percent. Capital expenditure was a small fraction of operating cash flow, allowing most operating cash flow to convert into free cash flow.
Compared to the prior quarter, revenue, operating cash flow, and free cash flow were all higher, while capital expenditure also increased. Versus the same quarter one year ago, revenue and operating cash flow were higher, capital expenditure was substantially lower, and free cash flow was higher.
Monitor the level of capital expenditure relative to operating cash flow, as a significant change could alter the free cash flow conversion rate.