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 compared to both the prior quarter and the same quarter last year. The gains were driven by a notable increase in operating cash flow relative to revenue.
- Revenue increased, while operating cash flow rose at a higher rate, resulting in improved free cash flow. Capital expenditure was higher than the prior quarter but lower than a year ago, which supported the free cash flow margin reaching a higher level.
- Sequentially, revenue, operating cash flow, free cash flow, and margin all rose, while capital expenditure was higher. Year over year, revenue, operating cash flow, and free cash flow were higher, capital expenditure was lower, and margin improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.6B
Cash generated by operations before capital spending.
CapEx
$355.0M
Capital spending and related asset purchases.
FCF margin
24.7%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $4.6B | $1.6B | $331.0M | $1.3B | 28.1% |
| 2023-03-31 | $4.5B | $1.1B | $339.0M | $791.0M | 17.4% |
| 2023-06-30 | $4.8B | $878.0M | $340.0M | $538.0M | 11.3% |
| 2023-09-30 | $4.9B | $1.6B | $355.0M | $1.2B | 24.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 126.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.3% | 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.
Strong Operating Cash Flow
Operating cash flow increased substantially compared to both the prior quarter and the same quarter last year, outpacing revenue growth. This improvement was the primary factor behind the higher free cash flow and margin.
The driver indicates enhanced cash generation efficiency, supporting stronger free cash flow conversion.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased, while operating cash flow rose at a higher rate, resulting in improved free cash flow. Capital expenditure was higher than the prior quarter but lower than a year ago, which supported the free cash flow margin reaching a higher level.
Sequentially, revenue, operating cash flow, free cash flow, and margin all rose, while capital expenditure was higher. Year over year, revenue, operating cash flow, and free cash flow were higher, capital expenditure was lower, and margin improved.
Monitor capital expenditure trends, as the sequential increase could pressure future free cash flow if revenue growth moderates.