Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Honeywell's cash generation improved markedly from the prior quarter, with free cash flow comparable to the same quarter last year. The free cash flow margin was lower year over year as revenue growth outpaced free cash flow expansion.
- Operating cash flow was stable compared to the same quarter a year earlier, while capital expenditure was slightly higher, resulting in free cash flow that was largely unchanged. The free cash flow margin weakened year over year as revenue increased more than free cash flow.
- Relative to the immediately preceding quarter, operating cash flow and free cash flow improved significantly, and the free cash flow margin expanded. Compared to the same quarter one year ago, free cash flow was stable but the margin declined.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$5.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.1B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.4B
Cash generated by operations before capital spending.
CapEx
$259.0M
Capital spending and related asset purchases.
FCF margin
10.6%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $9.2B | $1.8B | $249.0M | $1.6B | 16.9% |
| 2023-12-31 | $5.8B | $3.0B | $66.0M | $2.9B | 49.9% |
| 2024-03-31 | $8.2B | $448.0M | $233.0M | $215.0M | 2.6% |
| 2024-06-30 | $10.5B | $1.4B | $259.0M | $1.1B | 10.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 72.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$13.8B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Sequential Cash Flow Improvement
The company's management emphasizes increasing operating cash flows through revenue growth, margin improvement, and working capital efficiency. Operating cash flow increased substantially from the prior quarter, driving a corresponding improvement in free cash flow and margin.
This rebound brings free cash flow to a level comparable with the year-ago quarter, supporting ongoing capital allocation.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was stable compared to the same quarter a year earlier, while capital expenditure was slightly higher, resulting in free cash flow that was largely unchanged. The free cash flow margin weakened year over year as revenue increased more than free cash flow.
Relative to the immediately preceding quarter, operating cash flow and free cash flow improved significantly, and the free cash flow margin expanded. Compared to the same quarter one year ago, free cash flow was stable but the margin declined.
Monitor the level of capital expenditure, which was higher in the current quarter compared to both prior periods.