Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion improved markedly this quarter, with operating cash flow and free cash flow both higher than the prior quarter and the same quarter last year. The free cash flow margin strengthened, reflecting stronger cash generation relative to revenue.
- Revenue was lower than the prior quarter but comparable to the same quarter last year. Operating cash flow increased substantially compared to both periods, while capital expenditure was slightly higher. The resulting free cash flow was higher, and the free cash flow margin improved.
- Compared to the prior quarter, revenue was lower while operating cash flow, free cash flow, and margin were all higher. Versus the same quarter one year earlier, revenue was similar, but operating cash flow, free cash flow, and margin were all higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$11.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$3.7B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$4.6B
Cash generated by operations before capital spending.
CapEx
$903.0M
Capital spending and related asset purchases.
FCF margin
10.3%
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 |
|---|---|---|---|---|---|
| 2022-05-01 | $38.9B | $3.8B | $704.0M | $3.1B | 7.9% |
| 2022-07-31 | $43.8B | $3.4B | $743.0M | $2.6B | 6.1% |
| 2022-10-30 | $38.9B | $2.8B | $769.0M | $2.1B | 5.3% |
| 2023-01-29 | $35.8B | $4.6B | $903.0M | $3.7B | 10.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 109.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$38.4B | 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 growth
Operating cash flow increased compared to both the prior quarter and the same quarter last year, driving free cash flow higher despite a modest increase in capital expenditure.
The improvement in cash conversion supported a 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 prior quarter but comparable to the same quarter last year. Operating cash flow increased substantially compared to both periods, while capital expenditure was slightly higher. The resulting free cash flow was higher, and the free cash flow margin improved.
Compared to the prior quarter, revenue was lower while operating cash flow, free cash flow, and margin were all higher. Versus the same quarter one year earlier, revenue was similar, but operating cash flow, free cash flow, and margin were all higher.
Monitor the level of capital expenditure, which increased slightly compared to both the prior quarter and the same quarter last year.