Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was lower than the prior quarter but higher than a year ago. Free cash flow turned negative, driven by operating cash flow that was lower than both comparison periods and capital expenditure that was higher than a year ago.
- Operating cash flow was lower than revenue in both comparisons, resulting in a negative free cash flow margin. Capital expenditure exceeded operating cash flow, causing free cash flow to be negative.
- Compared to the prior quarter, revenue and operating cash flow were lower, while capital expenditure was slightly lower, but free cash flow weakened from positive to negative. Compared to the same quarter last year, revenue was higher, but operating cash flow and free cash flow were lower, and capital expenditure was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$5.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$709.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.4B
Cash generated by operations before capital spending.
CapEx
$2.1B
Capital spending and related asset purchases.
FCF margin
-1.7%
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 | $45.0B | $5.0B | $1.9B | $3.1B | 6.9% |
| 2023-09-30 | $43.8B | $4.6B | $2.2B | $2.4B | 5.4% |
| 2023-12-31 | $46.0B | $2.5B | $2.3B | $197.0M | 0.4% |
| 2024-03-31 | $42.8B | $1.4B | $2.1B | -$709.0M | -1.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -53.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.9% | 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 Decline
Operating cash flow was lower than both the prior quarter and the same quarter last year, while revenue was mixed relative to those periods. This was the strongest observable factor behind the negative free cash flow.
The decline in operating cash flow, despite higher revenue year over year, was the primary reason free cash flow turned negative.
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 in both comparisons, resulting in a negative free cash flow margin. Capital expenditure exceeded operating cash flow, causing free cash flow to be negative.
Compared to the prior quarter, revenue and operating cash flow were lower, while capital expenditure was slightly lower, but free cash flow weakened from positive to negative. Compared to the same quarter last year, revenue was higher, but operating cash flow and free cash flow were lower, and capital expenditure was higher.
Monitor whether operating cash flow can recover to cover capital expenditure, as the current quarter shows a shortfall.