Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company reported negative free cash flow in the current quarter, driven by operating cash outflows that more than offset capital spending. Free cash flow margin turned negative, a sharp reversal from the prior quarter’s positive margin and similar to the year-ago level.
- Revenue was lower than the prior quarter but higher than a year ago. Operating cash flow was negative, resulting in negative free cash flow and a negative free cash flow margin after accounting for capital expenditure.
- Compared to the prior quarter, cash conversion weakened significantly as operating cash flow swung from positive to negative. Relative to the same quarter a year earlier, the cash conversion profile was broadly stable.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$801.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$461.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$390.0M
Cash generated by operations before capital spending.
CapEx
$71.0M
Capital spending and related asset purchases.
FCF margin
-14.9%
The share of revenue converted into free cash flow.
TTM FCF yield
7.3%
TTM FCF divided by market capitalization.
FCF reconciliation
Free cash flow is not a GAAP line item; it should be bridged from the cash flow statement.
| Operating cash flow | -$390.0M | Cash generated by operations before capital spending. |
| Capital expenditures | $71.0M | Capital spending used to bridge CFO to FCF. |
| Free cash flow | -$461.0M | Operating cash flow less capital spending. |
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $2.7B | $267.0M | $59.0M | $208.0M | 7.8% |
| 2022-09-30 | $2.6B | -$19.0M | $77.0M | -$96.0M | -3.7% |
| 2022-12-31 | $2.8B | $601.0M | $93.0M | $508.0M | 18.1% |
| 2023-03-31 | $2.7B | -$9.0M | $43.0M | -$52.0M | -1.9% |
| 2023-06-30 | $2.8B | $82.0M | $68.0M | $14.0M | 0.5% |
| 2023-09-30 | $2.8B | $335.0M | $53.0M | $282.0M | 10.0% |
| 2023-12-31 | $3.2B | $562.0M | $114.0M | $448.0M | 14.1% |
| 2024-03-31 | $2.8B | -$202.0M | $72.0M | -$274.0M | -9.8% |
| 2024-06-30 | $3.0B | -$9.0M | $90.0M | -$99.0M | -3.3% |
| 2024-09-30 | $2.7B | $213.0M | $77.0M | $136.0M | 4.9% |
| 2024-12-31 | $3.0B | $391.0M | $114.0M | $277.0M | 9.2% |
| 2025-03-31 | $2.7B | -$395.0M | $67.0M | -$462.0M | -16.9% |
| 2025-06-30 | $3.1B | $823.0M | $93.0M | $730.0M | 23.7% |
| 2025-09-30 | $3.2B | $118.0M | $102.0M | $16.0M | 0.5% |
| 2025-12-31 | $3.5B | $650.0M | $134.0M | $516.0M | 14.8% |
| 2026-03-31 | $3.1B | -$390.0M | $71.0M | -$461.0M | -14.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -309.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.3% | 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.
Trade Working Capital Increase
The filing indicates that a significant increase in trade working capital was the primary driver of the negative operating cash flow. This item absorbed cash during the quarter.
The increase in trade working capital was the largest observable factor converting operating results into negative free cash flow.
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 higher than a year ago. Operating cash flow was negative, resulting in negative free cash flow and a negative free cash flow margin after accounting for capital expenditure.
Compared to the prior quarter, cash conversion weakened significantly as operating cash flow swung from positive to negative. Relative to the same quarter a year earlier, the cash conversion profile was broadly stable.
Monitor the magnitude of changes in trade working capital, which was a key factor in the current quarter's operating cash outflow according to the filing.
Valuation context
A cash-flow page should show how much investors are paying for the cash stream, without turning into a full DCF.
| Market capitalization | $11.0B | Used as the denominator for FCF yield. |
| TTM FCF yield | 7.3% | TTM free cash flow divided by market capitalization. |
| EV / TTM FCF | n/a | A quick valuation bridge, not a full DCF. |
Peer context
Free cash flow quality is easier to read against related public companies.
Risks and tripwires
Observable signals that would weaken the free cash flow thesis.
| Risk | Tripwire | Why it matters |
|---|---|---|
| FCF margin compression | FCF margin falls for two consecutive quarters. | Cash conversion may be weakening before earnings show it. |
| Capital intensity rises | CapEx/revenue moves materially above the recent run rate. | More operating cash flow would be consumed before becoming FCF. |
| Working capital drag | Inventory or receivables grow faster than revenue. | Reported growth may not translate into cash. |