Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved markedly compared to the same quarter last year, though it declined from the preceding quarter. The free cash flow margin strengthened year over year, reflecting better cash conversion.
- Revenue was slightly lower than the previous quarter but modestly higher than a year ago. Operating cash flow decreased from the prior quarter but increased significantly from the same quarter last year. Capital expenditure was slightly higher than the prior quarter but lower year over year, resulting in free cash flow that was lower sequentially but substantially higher than the year-ago period. The free cash flow margin, while lower than the prior quarter, improved markedly compared to a year earlier.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all lower, leading to a weakened free cash flow margin. Versus the same quarter one year ago, revenue was slightly higher, while operating cash flow and free cash flow were substantially higher, resulting in a much improved free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$787.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$899.0M
Cash generated by operations before capital spending.
CapEx
$112.0M
Capital spending and related asset purchases.
FCF margin
25.5%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $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% |
| 2024-06-30 | $3.1B | $899.0M | $112.0M | $787.0M | 25.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 245.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.6% | 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.
Year-over-Year Free Cash Flow Margin Expansion
The free cash flow margin improved substantially compared to the same quarter last year, driven by higher operating cash flow despite a slight increase in capital expenditures relative to that period.
This stronger margin indicates greater cash generation efficiency than a year ago, providing more financial flexibility for the company.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly lower than the previous quarter but modestly higher than a year ago. Operating cash flow decreased from the prior quarter but increased significantly from the same quarter last year. Capital expenditure was slightly higher than the prior quarter but lower year over year, resulting in free cash flow that was lower sequentially but substantially higher than the year-ago period. The free cash flow margin, while lower than the prior quarter, improved markedly compared to a year earlier.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all lower, leading to a weakened free cash flow margin. Versus the same quarter one year ago, revenue was slightly higher, while operating cash flow and free cash flow were substantially higher, resulting in a much improved free cash flow margin.
Monitor the sequential decline in operating cash flow, which was the primary factor behind the drop in free cash flow from the prior quarter.