Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved sequentially and year-over-year, with a higher margin. The increase was supported by stronger operating cash flow despite a slight revenue decline from the prior quarter.
- Revenue was lower than the previous quarter but higher than a year ago. Operating cash flow increased both sequentially and year-over-year, while capital expenditure rose compared to the prior year. Free cash flow and margin both improved.
- Compared to the preceding quarter, free cash flow improved despite lower revenue. Versus the same quarter last year, free cash flow rose substantially with a higher margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$477.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$604.0M
Cash generated by operations before capital spending.
CapEx
$127.0M
Capital spending and related asset purchases.
FCF margin
11.9%
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 | $4.1B | $454.0M | $98.0M | $356.0M | 8.7% |
| 2023-06-30 | $4.2B | $450.0M | $95.0M | $355.0M | 8.5% |
| 2023-09-30 | $4.2B | $523.0M | $125.0M | $398.0M | 9.5% |
| 2023-12-31 | $4.0B | $604.0M | $127.0M | $477.0M | 11.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 120.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$1.6B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Operating Cash Flow Growth
Operating cash flow increased both sequentially and year-over-year, driving free cash flow improvement. The filing notes that the increase in cash was primarily due to cash flows from operations and favorable year-over-year working capital, partially offset by higher capital expenditures.
This was the primary contributor to the higher free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than the previous quarter but higher than a year ago. Operating cash flow increased both sequentially and year-over-year, while capital expenditure rose compared to the prior year. Free cash flow and margin both improved.
Compared to the preceding quarter, free cash flow improved despite lower revenue. Versus the same quarter last year, free cash flow rose substantially with a higher margin.
Monitor the trend in capital expenditure, which was elevated year-over-year.