Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue remained consistent with the prior quarter but exceeded the year-ago level. Free cash flow and its margin improved substantially compared with both periods.
- Cash conversion was robust as operating cash flow grew faster than revenue, leading to a higher free cash flow margin.
- Compared with the prior quarter, operating cash flow and free cash flow both increased sharply, despite higher capital expenditure. Relative to the same quarter a year earlier, all cash flow metrics improved significantly.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$392.6M
Trailing twelve-month free cash flow.
Quarter free cash flow
$265.6M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$316.9M
Cash generated by operations before capital spending.
CapEx
$51.3M
Capital spending and related asset purchases.
FCF margin
25.0%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $887.9M | -$18.6M | $24.0M | -$42.5M | -4.8% |
| 2023-06-30 | $1.0B | $83.1M | $29.9M | $53.2M | 5.3% |
| 2023-09-30 | $1.1B | $140.1M | $23.8M | $116.3M | 10.9% |
| 2023-12-31 | $1.1B | $316.9M | $51.3M | $265.6M | 25.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 274.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$1.3B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Strong Operating Cash Flow
Operating cash flow improved markedly from both the prior quarter and the year-ago quarter, driving a substantial increase in free cash flow and margin.
The strength in operating cash flow was the primary factor behind the quarter's free cash flow growth.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion was robust as operating cash flow grew faster than revenue, leading to a higher free cash flow margin.
Compared with the prior quarter, operating cash flow and free cash flow both increased sharply, despite higher capital expenditure. Relative to the same quarter a year earlier, all cash flow metrics improved significantly.
Monitor the trajectory of capital expenditure, as it rose sequentially and year-over-year while revenue held steady.