Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow and free cash flow both grew strongly in the current quarter, pushing the free cash flow margin to a level comparable with the same quarter last year. This performance represents a substantial improvement from the prior quarter's lower cash conversion, and the company's filing indicates it continues to rely on operating cash flow and available credit facilities to support its working capital and strategic initiatives.
- Revenue remained broadly stable, while operating cash flow rose significantly. Capital expenditure was modest, allowing most operating cash flow to convert into free cash flow at a high margin.
- Compared with the prior quarter, operating cash flow, free cash flow, and margin all increased substantially, reversing the prior period's weaker conversion. Relative to the same quarter one year earlier, the metrics were broadly stable, with slight variations in capital spending.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$972.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$307.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$315.0M
Cash generated by operations before capital spending.
CapEx
$8.0M
Capital spending and related asset purchases.
FCF margin
32.4%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $926.0M | $324.0M | $1.0M | $323.0M | 34.9% |
| 2023-06-30 | $943.0M | $226.0M | $4.0M | $222.0M | 23.5% |
| 2023-09-29 | $945.0M | $125.0M | $5.0M | $120.0M | 12.7% |
| 2023-12-29 | $948.0M | $315.0M | $8.0M | $307.0M | 32.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 216.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$8.8B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Operational Cash Generation
Operating cash flow rose sharply from the prior quarter, driving a recovery in free cash flow margin. This was the strongest observable factor in the quarter's performance.
Sustained operating cash flow at this level would support continued free cash flow generation and the company's capital allocation activities.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue remained broadly stable, while operating cash flow rose significantly. Capital expenditure was modest, allowing most operating cash flow to convert into free cash flow at a high margin.
Compared with the prior quarter, operating cash flow, free cash flow, and margin all increased substantially, reversing the prior period's weaker conversion. Relative to the same quarter one year earlier, the metrics were broadly stable, with slight variations in capital spending.
Monitor the sustainability of the elevated operating cash flow level relative to revenue, as the prior quarter showed a much lower conversion rate.