Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was slightly lower than both the prior quarter and the same quarter last year. Free cash flow and free cash flow margin improved year over year but weakened sequentially.
- Operating cash flow was higher year over year but lower than the previous quarter, while capital expenditure decreased sequentially and was unchanged from a year ago. As a result, free cash flow and its margin improved compared to last year but declined from the prior quarter.
- Compared to the immediately preceding quarter, all metrics weakened: revenue, operating cash flow, free cash flow, and margin were lower, and capital expenditure was also lower. Versus the same quarter one year earlier, revenue and capital expenditure were similar, while operating cash flow, free cash flow, and margin all improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$940.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.2B
Cash generated by operations before capital spending.
CapEx
$1.3B
Capital spending and related asset purchases.
FCF margin
4.3%
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 |
|---|---|---|---|---|---|
| 2022-11-30 | $22.8B | $1.5B | $1.9B | -$340.0M | -1.5% |
| 2023-02-28 | $22.2B | $2.3B | $1.3B | $998.0M | 4.5% |
| 2023-05-31 | $21.9B | $3.4B | $1.8B | $1.7B | 7.7% |
| 2023-08-31 | $21.7B | $2.2B | $1.3B | $940.0M | 4.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 87.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.9% | 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 Recovery
Year-over-year operating cash flow rose significantly, driving a substantial increase in free cash flow despite stable capital expenditure.
This improvement in cash generation provided greater financial flexibility compared to the prior year.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was higher year over year but lower than the previous quarter, while capital expenditure decreased sequentially and was unchanged from a year ago. As a result, free cash flow and its margin improved compared to last year but declined from the prior quarter.
Compared to the immediately preceding quarter, all metrics weakened: revenue, operating cash flow, free cash flow, and margin were lower, and capital expenditure was also lower. Versus the same quarter one year earlier, revenue and capital expenditure were similar, while operating cash flow, free cash flow, and margin all improved.
Monitor whether the sequential decline in operating cash flow and free cash flow persists or reverses in the coming quarters.