Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow decreased from the prior quarter but increased compared to the same quarter last year. The free cash flow margin improved year over year despite a lower revenue base.
- Operating cash flow was higher than a year ago and capital expenditure was lower, resulting in an improved free cash flow margin. Sequentially, lower operating cash flow combined with slightly lower capital expenditure led to a weaker free cash flow margin.
- Revenue was lower than both the prior quarter and the same quarter last year. Operating cash flow and free cash flow were higher year over year but lower sequentially, and the free cash flow margin followed the same pattern.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$17.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$3.6B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$4.2B
Cash generated by operations before capital spending.
CapEx
$671.0M
Capital spending and related asset purchases.
FCF margin
9.4%
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 |
|---|---|---|---|---|---|
| 2023-01-29 | $35.8B | $4.6B | $903.0M | $3.7B | 10.3% |
| 2023-04-30 | $37.3B | $5.6B | $905.0M | $4.7B | 12.6% |
| 2023-07-30 | $42.9B | $6.6B | $792.0M | $5.8B | 13.5% |
| 2023-10-29 | $37.7B | $4.2B | $671.0M | $3.6B | 9.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 93.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | n/a | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Year-over-year operating cash flow growth
Operating cash flow was higher than the same quarter last year, while capital expenditure was lower. This combination was the primary observable factor behind the improved free cash flow year over year.
Higher operating cash flow contributed to free cash flow growth despite lower revenue.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was higher than a year ago and capital expenditure was lower, resulting in an improved free cash flow margin. Sequentially, lower operating cash flow combined with slightly lower capital expenditure led to a weaker free cash flow margin.
Revenue was lower than both the prior quarter and the same quarter last year. Operating cash flow and free cash flow were higher year over year but lower sequentially, and the free cash flow margin followed the same pattern.
Monitor the trajectory of operating cash flow given its sequential decline despite a year-over-year improvement.