Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved significantly from the prior quarter, driven by a sharp increase in operating cash flow. The free cash flow margin rose to a level higher than both the prior quarter and the same quarter last year.
- Revenue was higher than the prior quarter but lower than the same quarter last year. Operating cash flow rose sharply from the prior quarter, while capital expenditure remained stable, leading to a significant improvement in free cash flow and free cash flow margin.
- Compared to the prior quarter, free cash flow and margin improved markedly. Versus the same quarter one year earlier, free cash flow was higher, supported by a lower capital expenditure, even though revenue and operating cash flow were slightly lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.8B
Cash generated by operations before capital spending.
CapEx
$675.0M
Capital spending and related asset purchases.
FCF margin
29.5%
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 |
|---|---|---|---|---|---|
| 2023-01-31 | $7.8B | -$829.0M | $794.0M | -$1.6B | -20.8% |
| 2023-04-30 | $7.0B | $889.0M | $688.0M | $201.0M | 2.9% |
| 2023-07-31 | $7.0B | $1.5B | $671.0M | $854.0M | 12.2% |
| 2023-10-31 | $7.4B | $2.8B | $675.0M | $2.2B | 29.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 337.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 9.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$8.1B | 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
Operating cash flow increased sharply from the prior quarter, driving a substantial rise in free cash flow. This improvement occurred despite revenue being only modestly higher.
The higher operating cash flow was the primary observable factor behind the quarter's free cash flow margin expansion.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than the prior quarter but lower than the same quarter last year. Operating cash flow rose sharply from the prior quarter, while capital expenditure remained stable, leading to a significant improvement in free cash flow and free cash flow margin.
Compared to the prior quarter, free cash flow and margin improved markedly. Versus the same quarter one year earlier, free cash flow was higher, supported by a lower capital expenditure, even though revenue and operating cash flow were slightly lower.
Monitor capital expenditure levels, which decreased from the prior year.