Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the current quarter, free cash flow and margin improved from the previous quarter, turning positive after a negative result. Compared to the same quarter last year, both free cash flow and margin were lower, as capital expenditure increased while revenue declined.
- Revenue was higher than the previous quarter, and operating cash flow increased more than proportionally, resulting in a positive free cash flow margin. However, relative to the same quarter last year, revenue was lower, and although operating cash flow was slightly higher, a larger capital expenditure caused free cash flow margin to narrow.
- Compared to the previous quarter, free cash flow shifted from negative to positive, and the margin improved significantly. Versus the same quarter one year earlier, free cash flow and margin were lower, driven by a higher capital expenditure and lower revenue.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$383.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$510.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.7B
Cash generated by operations before capital spending.
CapEx
$1.2B
Capital spending and related asset purchases.
FCF margin
8.6%
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 | $5.3B | $758.0M | $836.0M | -$78.0M | -1.5% |
| 2022-12-31 | $5.4B | $1.1B | $1.0B | $22.0M | 0.4% |
| 2023-03-31 | $5.1B | $1.1B | $1.1B | -$71.0M | -1.4% |
| 2023-06-30 | $5.9B | $1.7B | $1.2B | $510.0M | 8.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 69.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 19.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$2.8B | 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 rose from the prior quarter, outpacing the revenue increase and turning free cash flow positive. This improvement was the strongest observable driver of the quarter's cash conversion.
The company moved from a free cash flow deficit to a surplus, reversing the previous quarter's negative margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than the previous quarter, and operating cash flow increased more than proportionally, resulting in a positive free cash flow margin. However, relative to the same quarter last year, revenue was lower, and although operating cash flow was slightly higher, a larger capital expenditure caused free cash flow margin to narrow.
Compared to the previous quarter, free cash flow shifted from negative to positive, and the margin improved significantly. Versus the same quarter one year earlier, free cash flow and margin were lower, driven by a higher capital expenditure and lower revenue.
Monitor capital expenditure, as its increase from the prior year period was a key factor in the lower free cash flow this quarter.