Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow improved significantly, enabling positive free cash flow after capital expenditure. The free cash flow margin turned positive, reversing the negative margins of both the prior quarter and the same quarter last year.
- Revenue was lower than the prior quarter but higher than a year earlier. Operating cash flow turned positive from the prior quarter and from a negative level a year ago, leading to free cash flow of a positive amount after capital expenditure. The free cash flow margin improved to positive, compared with negative margins in both comparison periods.
- Compared with the prior quarter, revenue was lower, operating cash flow was higher, capital expenditure was lower, and free cash flow improved from a negative to a positive figure. Compared with the same quarter a year ago, revenue was higher, operating cash flow improved from negative to positive, capital expenditure was higher, and free cash flow improved from negative to positive.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.0B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.8B
Cash generated by operations before capital spending.
CapEx
$1.8B
Capital spending and related asset purchases.
FCF margin
2.5%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $40.2B | $2.9B | $1.7B | $1.2B | 3.1% |
| 2022-09-30 | $39.4B | $3.8B | $1.7B | $2.1B | 5.3% |
| 2022-12-31 | $44.0B | $1.2B | $2.1B | -$887.0M | -2.0% |
| 2023-03-31 | $41.5B | $2.8B | $1.8B | $1.0B | 2.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 58.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.3% | 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.
Operating cash flow recovery
Operating cash flow turned positive from negative in both comparison periods, which was the strongest observable driver behind the shift to positive free cash flow and positive margin.
This improvement directly enabled free cash flow to turn positive after capital expenditure.
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 earlier. Operating cash flow turned positive from the prior quarter and from a negative level a year ago, leading to free cash flow of a positive amount after capital expenditure. The free cash flow margin improved to positive, compared with negative margins in both comparison periods.
Compared with the prior quarter, revenue was lower, operating cash flow was higher, capital expenditure was lower, and free cash flow improved from a negative to a positive figure. Compared with the same quarter a year ago, revenue was higher, operating cash flow improved from negative to positive, capital expenditure was higher, and free cash flow improved from negative to positive.
Monitor whether operating cash flow can sustain its positive level in the next quarter given the higher revenue base from a year ago.