Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow and margin weakened compared to both the prior quarter and the same quarter last year, as operating cash flow declined while revenue was stable year over year. Capital expenditure increased sequentially, further pressuring cash conversion.
- Revenue was stable compared to the year-ago period but lower than the prior quarter. Operating cash flow decreased significantly from both comparison periods, resulting in a lower free cash flow margin. Capital expenditure rose modestly year over year and more sharply from the prior quarter.
- Compared to the prior quarter, revenue and operating cash flow were lower, while capital expenditure was higher, leading to a much lower free cash flow margin. Versus the same quarter last year, revenue was unchanged but operating cash flow and free cash flow were lower, with margin narrowing.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$373.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$493.0M
Cash generated by operations before capital spending.
CapEx
$120.0M
Capital spending and related asset purchases.
FCF margin
12.3%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $3.2B | $270.0M | $74.0M | $196.0M | 6.1% |
| 2022-12-31 | $4.6B | -$531.0M | $79.0M | -$610.0M | -13.2% |
| 2023-03-31 | $4.1B | $1.6B | $84.0M | $1.5B | 36.3% |
| 2023-06-30 | $3.0B | $493.0M | $120.0M | $373.0M | 12.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 101.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.0% | 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 Decline
Operating cash flow weakened from both the prior quarter and the year-ago period, while revenue was stable year over year. This divergence was the strongest observable pull on free cash flow.
Lower operating cash flow materially reduced free cash flow and margin even as revenue remained stable.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable compared to the year-ago period but lower than the prior quarter. Operating cash flow decreased significantly from both comparison periods, resulting in a lower free cash flow margin. Capital expenditure rose modestly year over year and more sharply from the prior quarter.
Compared to the prior quarter, revenue and operating cash flow were lower, while capital expenditure was higher, leading to a much lower free cash flow margin. Versus the same quarter last year, revenue was unchanged but operating cash flow and free cash flow were lower, with margin narrowing.
Monitor the trajectory of operating cash flow, which drove the majority of the decline in free cash flow this quarter.