Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company generated lower free cash flow this quarter compared to the immediately preceding quarter, though it improved relative to the same quarter one year earlier. The decline in cash conversion was driven by a reduction in operating cash flow despite modest revenue growth.
- Revenue increased slightly from the prior quarter and from a year ago, but operating cash flow fell substantially from the prior quarter, resulting in a lower free cash flow margin. Capital expenditure remained stable at a minimal level.
- Compared to the prior quarter, operating cash flow, free cash flow, and free cash flow margin all weakened. Relative to the same quarter last year, all three metrics improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$156.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$158.0M
Cash generated by operations before capital spending.
CapEx
$2.0M
Capital spending and related asset purchases.
FCF margin
16.0%
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 |
|---|---|---|---|---|---|
| 2023-12-29 | $948.0M | $315.0M | $8.0M | $307.0M | 32.4% |
| 2024-03-29 | $964.0M | $1.4B | $3.0M | $1.4B | 144.7% |
| 2024-06-28 | $965.0M | $264.0M | $2.0M | $262.0M | 27.2% |
| 2024-09-27 | $974.0M | $158.0M | $2.0M | $156.0M | 16.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 96.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$7.8B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Cash Conversion Efficiency
Operating cash flow decreased significantly from the prior quarter even as revenue edged higher, causing the free cash flow margin to contract sharply. This indicates a decline in the company's ability to convert revenue into cash.
If operating cash flow remains subdued, free cash flow will continue to face pressure relative to the prior quarter's level.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased slightly from the prior quarter and from a year ago, but operating cash flow fell substantially from the prior quarter, resulting in a lower free cash flow margin. Capital expenditure remained stable at a minimal level.
Compared to the prior quarter, operating cash flow, free cash flow, and free cash flow margin all weakened. Relative to the same quarter last year, all three metrics improved.
Monitor whether operating cash flow recovers toward the level seen in the prior quarter, as it is the primary driver of free cash flow volatility.