Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved significantly from the prior quarter and also increased compared to the same quarter last year. The improvement was driven by higher operating cash flow, while capital expenditure remained relatively stable.
- Revenue increased modestly, while operating cash flow rose sharply, leading to a substantial improvement in free cash flow and free cash flow margin. Capital expenditure was slightly lower than both the prior quarter and the year-ago quarter, further supporting free cash flow.
- Compared to the prior quarter, free cash flow and free cash flow margin both improved markedly, driven by higher operating cash flow. Versus the same quarter last year, free cash flow and margin also increased, with operating cash flow higher and capital expenditure lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$632.5M
Trailing twelve-month free cash flow.
Quarter free cash flow
$216.9M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$238.2M
Cash generated by operations before capital spending.
CapEx
$21.3M
Capital spending and related asset purchases.
FCF margin
39.2%
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 |
|---|---|---|---|---|---|
| 2023-08-31 | $535.8M | $155.7M | $635000 | $155.0M | 28.9% |
| 2023-11-30 | $542.2M | $155.1M | $16.5M | $138.7M | 25.6% |
| 2024-02-29 | $545.9M | $143.8M | $21.9M | $121.9M | 22.3% |
| 2024-05-31 | $552.7M | $238.2M | $21.3M | $216.9M | 39.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 137.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$974.6M | 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 Strength
Operating cash flow increased substantially from both the prior quarter and the year-ago quarter, outpacing revenue growth. This was the primary factor behind the improvement in free cash flow and margin.
Higher operating cash flow directly boosted free cash flow and margin, making it the strongest observable driver this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased modestly, while operating cash flow rose sharply, leading to a substantial improvement in free cash flow and free cash flow margin. Capital expenditure was slightly lower than both the prior quarter and the year-ago quarter, further supporting free cash flow.
Compared to the prior quarter, free cash flow and free cash flow margin both improved markedly, driven by higher operating cash flow. Versus the same quarter last year, free cash flow and margin also increased, with operating cash flow higher and capital expenditure lower.
Monitor whether operating cash flow can sustain its elevated level relative to revenue in future quarters.