Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow and margin improved significantly in the current quarter compared with both the prior quarter and the same quarter last year. The improvement was driven primarily by a strong increase in operating cash flow relative to revenue.
- Cash conversion strengthened as operating cash flow rose faster than revenue, lifting the free cash flow margin to a higher level. Capital expenditure remained stable, allowing the increase in operating cash flow to flow through directly to free cash flow.
- Compared with the prior quarter, free cash flow and margin were substantially higher, reflecting a marked recovery in operating cash flow. Versus the same quarter one year earlier, both free cash flow and margin also improved, as revenue and operating cash flow exceeded prior-year levels.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$564.8M
Trailing twelve-month free cash flow.
Quarter free cash flow
$150.2M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$174.0M
Cash generated by operations before capital spending.
CapEx
$23.7M
Capital spending and related asset purchases.
FCF margin
26.3%
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 |
|---|---|---|---|---|---|
| 2024-05-31 | $552.7M | $238.2M | $21.3M | $216.9M | 39.2% |
| 2024-08-31 | $562.2M | $163.2M | $26.0M | $137.2M | 24.4% |
| 2024-11-30 | $568.7M | $86.4M | $25.9M | $60.5M | 10.6% |
| 2025-02-28 | $570.7M | $174.0M | $23.7M | $150.2M | 26.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 103.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$1.2B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Strong Operating Cash Flow
Operating cash flow increased substantially from the prior quarter and also rose from the same quarter a year ago, even as revenue grew only modestly. This was the primary factor behind the improvement in free cash flow and margin.
The surge in operating cash flow lifted free cash flow margin to a level well above both the prior quarter and the year-ago quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion strengthened as operating cash flow rose faster than revenue, lifting the free cash flow margin to a higher level. Capital expenditure remained stable, allowing the increase in operating cash flow to flow through directly to free cash flow.
Compared with the prior quarter, free cash flow and margin were substantially higher, reflecting a marked recovery in operating cash flow. Versus the same quarter one year earlier, both free cash flow and margin also improved, as revenue and operating cash flow exceeded prior-year levels.
Monitor whether the elevated operating cash flow relative to revenue can be sustained in future periods.