Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Sequential free cash flow improved as revenue growth and lower capital expenditure more than offset a modest operating cash flow increase. However, year-over-year free cash flow weakened due to lower operating cash flow despite higher revenue.
- Cash conversion improved sequentially as operating cash flow grew while capital expenditure declined, resulting in a higher free cash flow margin relative to the prior quarter. Compared to the year-ago period, conversion decreased as operating cash flow contracted more than capital expenditure savings.
- Free cash flow and its margin strengthened from the previous quarter but weakened compared to the same quarter one year earlier, reflecting a mixed performance. Revenue increased in both comparisons but operating cash flow only improved sequentially.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$611.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.2B
Cash generated by operations before capital spending.
CapEx
$543.0M
Capital spending and related asset purchases.
FCF margin
7.9%
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 |
|---|---|---|---|---|---|
| 2023-10-31 | $7.4B | $2.8B | $675.0M | $2.2B | 29.5% |
| 2024-01-31 | $6.8B | $64.0M | $656.0M | -$592.0M | -8.8% |
| 2024-04-30 | $7.2B | $1.1B | $560.0M | $533.0M | 7.4% |
| 2024-07-31 | $7.7B | $1.2B | $543.0M | $611.0M | 7.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 119.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$8.2B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Operating Cash Flow Generation
Operating cash flow declined year-over-year despite revenue growth, indicating a potential shift in cash conversion efficiency. The sequential improvement was driven by moderate growth in cash from operations and lower capital spending.
If operating cash flow growth does not align with revenue trends, free cash flow margins could remain under pressure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion improved sequentially as operating cash flow grew while capital expenditure declined, resulting in a higher free cash flow margin relative to the prior quarter. Compared to the year-ago period, conversion decreased as operating cash flow contracted more than capital expenditure savings.
Free cash flow and its margin strengthened from the previous quarter but weakened compared to the same quarter one year earlier, reflecting a mixed performance. Revenue increased in both comparisons but operating cash flow only improved sequentially.
Monitor whether operating cash flow can sustain its sequential growth pace relative to revenue expansion.