Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow turned positive, driving a sharp improvement in free cash flow and margin despite lower revenue. The cash conversion cycle strengthened considerably compared to the prior quarter and remained above the year-ago level.
- A substantial increase in operating cash flow combined with stable capital expenditure produced strong free cash flow and a healthy margin. The conversion of revenue into cash improved markedly from the negative performance in the preceding quarter.
- Compared to the prior quarter, operating cash flow and free cash flow moved from negative to strongly positive, with margin rising from negative to positive. Relative to the same quarter one year earlier, free cash flow and margin were modestly lower, but operating cash flow remained solid.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.4B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.5B
Cash generated by operations before capital spending.
CapEx
$83.0M
Capital spending and related asset purchases.
FCF margin
40.4%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $3.0B | $493.0M | $120.0M | $373.0M | 12.3% |
| 2023-09-30 | $3.2B | $1.0M | $71.0M | -$70.0M | -2.2% |
| 2023-12-31 | $4.2B | -$536.0M | $79.0M | -$615.0M | -14.5% |
| 2024-03-31 | $3.4B | $1.5B | $83.0M | $1.4B | 40.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 197.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.4% | 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
The sharp reversal in operating cash flow from a large negative to a significant positive was the primary factor behind the quarter's strong free cash flow. This improvement occurred even as revenue declined from the prior quarter and the year-ago period.
The recovery in operating cash flow lifted free cash flow margin to a solid level, supporting financial flexibility.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
A substantial increase in operating cash flow combined with stable capital expenditure produced strong free cash flow and a healthy margin. The conversion of revenue into cash improved markedly from the negative performance in the preceding quarter.
Compared to the prior quarter, operating cash flow and free cash flow moved from negative to strongly positive, with margin rising from negative to positive. Relative to the same quarter one year earlier, free cash flow and margin were modestly lower, but operating cash flow remained solid.
Monitor whether the recent level of operating cash flow can be sustained as revenue remains below prior periods.