Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved significantly compared to both the prior quarter and the same quarter last year, driven by stronger operating cash flow while revenue remained stable. The free cash flow margin widened as a result.
- Operating cash flow converted into free cash flow more efficiently this quarter, as capital expenditure increased only modestly relative to the operating cash flow improvement.
- Compared to the immediate prior quarter, free cash flow and its margin improved, driven by higher operating cash flow. Versus the same quarter one year earlier, both free cash flow and margin were also higher, with operating cash flow stronger than the prior year.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$383.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$411.4M
Cash generated by operations before capital spending.
CapEx
$27.9M
Capital spending and related asset purchases.
FCF margin
25.7%
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 | $1.5B | $464.2M | $36.1M | $428.1M | 28.0% |
| 2023-03-31 | $1.5B | $174.4M | $24.8M | $149.6M | 10.2% |
| 2023-06-30 | $1.5B | $321.0M | $21.0M | $300.0M | 19.7% |
| 2023-09-29 | $1.5B | $411.4M | $27.9M | $383.5M | 25.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 175.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$2.0B | 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 Strength
Operating cash flow increased materially from both the prior quarter and the year-ago quarter, despite revenue being unchanged. This was the primary driver of the free cash flow improvement.
The higher operating cash flow directly lifted free cash flow and the free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow converted into free cash flow more efficiently this quarter, as capital expenditure increased only modestly relative to the operating cash flow improvement.
Compared to the immediate prior quarter, free cash flow and its margin improved, driven by higher operating cash flow. Versus the same quarter one year earlier, both free cash flow and margin were also higher, with operating cash flow stronger than the prior year.
Monitor whether the capital expenditure level remains contained as operating cash flow fluctuates.