Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow both improved compared to the same quarter last year, while free cash flow turned from negative to positive. Versus the prior quarter, operating cash flow and free cash flow decreased despite higher revenue.
- Operating cash flow exceeded revenue, yielding a free cash flow margin above revenue, with zero capital expenditure. The gap between operating cash flow and free cash flow was negligible, indicating no significant investment outlays.
- Compared to the preceding quarter, operating cash flow and free cash flow were lower even though revenue was higher, causing the free cash flow margin to weaken. Compared to the same quarter one year earlier, all metrics improved significantly, with operating cash flow and free cash flow shifting from negative to positive.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$370.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$370.0M
Cash generated by operations before capital spending.
CapEx
$0
Capital spending and related asset purchases.
FCF margin
76.1%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $361.0M | -$207.0M | $6.0M | -$213.0M | -59.0% |
| 2022-12-31 | $380.0M | $181.0M | $3.0M | $178.0M | 46.8% |
| 2023-03-31 | $441.0M | $828.0M | $0 | $828.0M | 187.8% |
| 2023-06-30 | $486.0M | $370.0M | $0 | $370.0M | 76.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 1480.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.0% | 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 Cash Flow Recovery
Operating cash flow improved substantially from a negative position one year ago, driving free cash flow positive for the current quarter. The absence of capital expenditure preserved the full benefit of operating cash flow.
Higher operating cash flow compared with the prior year quarter was the strongest driver of free cash flow improvement.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow exceeded revenue, yielding a free cash flow margin above revenue, with zero capital expenditure. The gap between operating cash flow and free cash flow was negligible, indicating no significant investment outlays.
Compared to the preceding quarter, operating cash flow and free cash flow were lower even though revenue was higher, causing the free cash flow margin to weaken. Compared to the same quarter one year earlier, all metrics improved significantly, with operating cash flow and free cash flow shifting from negative to positive.
Monitor the sustainability of operating cash flow, as it declined from the prior quarter despite revenue growth.