Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow for the quarter improved significantly compared to the same period last year, driven by higher operating cash flow and lower capital expenditure. The free cash flow margin also expanded year over year.
- Revenue was stable sequentially, while operating cash flow declined; however, a sharp reduction in capital expenditure led to a slight increase in free cash flow and a marginal improvement in margin. Compared to the prior year, both revenue and operating cash flow rose, and lower capital spending further boosted free cash flow and margin.
- Sequentially, revenue was stable, operating cash flow and capital expenditure were lower, resulting in modestly higher free cash flow and a slightly improved margin. Year over year, revenue, operating cash flow, and free cash flow were all higher, with margin expanding.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.1B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.7B
Cash generated by operations before capital spending.
CapEx
$623.0M
Capital spending and related asset purchases.
FCF margin
4.9%
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 |
|---|---|---|---|---|---|
| 2024-11-30 | $22.0B | $1.3B | $818.0M | $500.0M | 2.3% |
| 2025-02-28 | $22.2B | $2.0B | $997.0M | $1.0B | 4.6% |
| 2025-05-31 | $22.2B | $2.5B | $1.5B | $1.0B | 4.7% |
| 2025-08-31 | $22.2B | $1.7B | $623.0M | $1.1B | 4.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 132.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.8% | 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 and Capital Expenditure Synergy
The quarter benefited from a combination of higher operating cash flow relative to the prior year and lower capital spending, which together amplified free cash flow. This synergy supported a marked improvement in free cash flow margin compared to the same quarter last year.
The combination has positioned the free cash flow margin above the year-ago level.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable sequentially, while operating cash flow declined; however, a sharp reduction in capital expenditure led to a slight increase in free cash flow and a marginal improvement in margin. Compared to the prior year, both revenue and operating cash flow rose, and lower capital spending further boosted free cash flow and margin.
Sequentially, revenue was stable, operating cash flow and capital expenditure were lower, resulting in modestly higher free cash flow and a slightly improved margin. Year over year, revenue, operating cash flow, and free cash flow were all higher, with margin expanding.
Monitor whether capital expenditure remains at the current reduced level or reverts toward prior levels.