Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned positive in the current quarter, supported by higher operating cash flow relative to capital expenditure. Revenue and operating cash flow both increased compared to the prior quarter and the same quarter last year.
- Cash conversion improved as operating cash flow rose while capital expenditure remained relatively stable, resulting in a positive free cash flow and a stronger free cash flow margin.
- Compared to the immediately preceding quarter, free cash flow and margin shifted from negative to positive, driven by higher revenue and operating cash flow. Versus the same quarter one year earlier, free cash flow also turned positive from negative, with operating cash flow higher and capital expenditure slightly higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$642.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.9B
Cash generated by operations before capital spending.
CapEx
$1.3B
Capital spending and related asset purchases.
FCF margin
10.3%
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 | $5.9B | $1.7B | $1.2B | $510.0M | 8.6% |
| 2023-09-30 | $5.9B | $1.2B | $1.2B | $58.0M | 1.0% |
| 2023-12-31 | $5.8B | $1.3B | $1.4B | -$42.0M | -0.7% |
| 2024-03-31 | $6.2B | $1.9B | $1.3B | $642.0M | 10.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 55.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 20.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$4.2B | 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 Improvement
Operating cash flow was the strongest observable driver, increasing from both the prior quarter and the year-ago quarter, which directly supported the positive free cash flow.
The higher operating cash flow was the primary factor turning free cash flow positive this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion improved as operating cash flow rose while capital expenditure remained relatively stable, resulting in a positive free cash flow and a stronger free cash flow margin.
Compared to the immediately preceding quarter, free cash flow and margin shifted from negative to positive, driven by higher revenue and operating cash flow. Versus the same quarter one year earlier, free cash flow also turned positive from negative, with operating cash flow higher and capital expenditure slightly higher.
Monitor whether the rise in trade accounts receivable, as indicated in the balance sheet, continues into the next quarter.