Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow decreased compared with both the prior quarter and the year-ago quarter, even though revenue rose year over year. The decline was driven primarily by a sharp reduction in operating cash flow.
- Revenue increased year over year, but operating cash flow and free cash flow both fell, causing the free cash flow margin to contract relative to both the preceding quarter and the same quarter last year.
- Compared with the prior quarter, operating cash flow and free cash flow decreased substantially while capital expenditure also declined, yet the free cash flow margin still weakened. Versus the year-ago quarter, free cash flow was lower as well.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$318.9M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$342.0M
Cash generated by operations before capital spending.
CapEx
$23.1M
Capital spending and related asset purchases.
FCF margin
22.2%
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 | $1.3B | $551.2M | $70.1M | $481.1M | 36.0% |
| 2023-12-31 | $1.4B | $191.7M | $26.9M | $164.8M | 11.6% |
| 2024-03-31 | $1.4B | $830.4M | $221.9M | $608.5M | 45.0% |
| 2024-06-30 | $1.4B | $342.0M | $23.1M | $318.9M | 22.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 84.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.6% | 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.
Operating cash flow conversion
Operating cash flow dropped notably compared with both the prior quarter and the year-ago quarter, more than offsetting the reduction in capital expenditure and leading to a lower free cash flow.
If operating cash flow remains subdued, the free cash flow margin may continue to face pressure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased year over year, but operating cash flow and free cash flow both fell, causing the free cash flow margin to contract relative to both the preceding quarter and the same quarter last year.
Compared with the prior quarter, operating cash flow and free cash flow decreased substantially while capital expenditure also declined, yet the free cash flow margin still weakened. Versus the year-ago quarter, free cash flow was lower as well.
Monitor whether operating cash flow can recover toward historical levels, as it was the primary factor behind the lower free cash flow.