Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved significantly in the quarter driven by stronger operating cash flow. Revenue remained stable while capital expenditure increased slightly versus the prior year.
- Operating cash flow rose sharply compared to both the prior quarter and the year-ago period, resulting in a higher free cash flow margin despite stable revenue. Capital expenditure was unchanged from the prior quarter but moderately above the year-ago level.
- Compared to the previous quarter, free cash flow strengthened as operating cash flow increased while capital expenditure held steady. Relative to the same quarter last year, free cash flow also improved, with operating cash flow rising more than capital expenditure.
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
$469.1M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$477.3M
Cash generated by operations before capital spending.
CapEx
$8.2M
Capital spending and related asset purchases.
FCF margin
35.5%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $1.3B | $296.3M | $6.6M | $289.6M | 22.4% |
| 2022-09-30 | $1.3B | $357.0M | $6.1M | $350.9M | 27.0% |
| 2022-12-31 | $1.3B | $371.8M | $8.2M | $363.6M | 27.2% |
| 2023-03-31 | $1.3B | $477.3M | $8.2M | $469.1M | 35.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 209.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.6% | 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.
Stronger Operating Cash Flow
Operating cash flow was notably higher than in both the prior quarter and the same quarter last year. With revenue essentially unchanged, this was the primary factor lifting free cash flow and its margin.
The improved cash conversion from operations allowed free cash flow to reach a higher level without reliance on revenue growth.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow rose sharply compared to both the prior quarter and the year-ago period, resulting in a higher free cash flow margin despite stable revenue. Capital expenditure was unchanged from the prior quarter but moderately above the year-ago level.
Compared to the previous quarter, free cash flow strengthened as operating cash flow increased while capital expenditure held steady. Relative to the same quarter last year, free cash flow also improved, with operating cash flow rising more than capital expenditure.
Monitor whether capital expenditure trends remain stable or begin to increase, as it has moved slightly higher compared to the year-ago period.