Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased from the previous quarter and from the same quarter last year, but operating cash flow declined, leading to lower free cash flow and margin. The filing notes a targeted inventory reduction effort contributed to a positive working capital change for the full year.
- Operating cash flow as a share of revenue weakened compared to the prior quarter and the year-ago quarter, as revenue grew while operating cash flow declined. Capital expenditure rose slightly from the prior quarter, resulting in a lower free cash flow margin.
- Revenue was higher than both the immediately preceding quarter and the same quarter one year earlier. Operating cash flow, free cash flow, and free cash flow margin were lower than both comparison periods, while capital expenditure was slightly higher than the prior quarter and stable versus the year-ago quarter.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$5.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.3B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.6B
Cash generated by operations before capital spending.
CapEx
$1.3B
Capital spending and related asset purchases.
FCF margin
7.0%
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 |
|---|---|---|---|---|---|
| 2024-03-31 | $17.3B | $2.5B | $1.1B | $1.4B | 7.8% |
| 2024-06-30 | $17.5B | $2.0B | $1.3B | $690.0M | 3.9% |
| 2024-09-30 | $17.5B | $3.5B | $1.2B | $2.3B | 13.3% |
| 2024-12-31 | $18.3B | $2.6B | $1.3B | $1.3B | 7.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 88.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$41.1B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Weaker operating cash flow conversion
Operating cash flow decreased from the prior quarter and was slightly lower than the year-ago quarter, even though revenue increased. This decline drove the reduction in free cash flow and margin, as capital expenditure remained relatively stable.
The weaker operating cash flow conversion reduced free cash flow and margin below the levels of the prior quarter and the year-ago quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a share of revenue weakened compared to the prior quarter and the year-ago quarter, as revenue grew while operating cash flow declined. Capital expenditure rose slightly from the prior quarter, resulting in a lower free cash flow margin.
Revenue was higher than both the immediately preceding quarter and the same quarter one year earlier. Operating cash flow, free cash flow, and free cash flow margin were lower than both comparison periods, while capital expenditure was slightly higher than the prior quarter and stable versus the year-ago quarter.
Monitor the trajectory of operating cash flow relative to revenue, as it declined despite revenue growth.