Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
GameStop's free cash flow turned negative this quarter, driven by operating cash outflow and capital spending. The deficit narrowed from the same period last year, and the company maintains a liquidity cushion of cash, marketable securities, and available credit facilities.
- Revenue declined both sequentially and year-over-year. Operating cash flow moved from positive to negative, while capital expenditure remained relatively stable, resulting in a negative free cash flow margin.
- Compared to the immediately preceding quarter, free cash flow and operating cash flow both weakened significantly as revenue dropped. Versus the same quarter one year earlier, both operating cash flow and free cash flow improved, despite lower revenue.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$255.2M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$111.8M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$102.7M
Cash generated by operations before capital spending.
CapEx
$9.1M
Capital spending and related asset purchases.
FCF margin
-9.0%
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 |
|---|---|---|---|---|---|
| 2022-07-30 | $1.1B | -$103.4M | $20.5M | -$123.9M | -10.9% |
| 2022-10-29 | $1.2B | $177.3M | $13.0M | $164.3M | 13.8% |
| 2023-01-28 | $2.2B | $338.2M | $11.6M | $326.6M | 14.7% |
| 2023-04-29 | $1.2B | -$102.7M | $9.1M | -$111.8M | -9.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 221.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.7% | Lower capital intensity usually supports FCF margin. |
| Net cash | $1.0B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Cash Flow Reversal Risk
Operating cash flow shifted from a positive position in the prior quarter to a negative this quarter, while revenue declined. This combination led to negative free cash flow.
If operating cash flow does not return to positive, free cash flow will remain under pressure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue declined both sequentially and year-over-year. Operating cash flow moved from positive to negative, while capital expenditure remained relatively stable, resulting in a negative free cash flow margin.
Compared to the immediately preceding quarter, free cash flow and operating cash flow both weakened significantly as revenue dropped. Versus the same quarter one year earlier, both operating cash flow and free cash flow improved, despite lower revenue.
Monitor the trajectory of operating cash flow, which turned negative this quarter after a strong positive result last quarter.