Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion improved sharply from the prior quarter, with operating cash flow and free cash flow both rising while capital expenditure remained stable. The free cash flow margin increased, reaching a level similar to the year-ago quarter despite lower revenue.
- Revenue was higher than the prior quarter, and operating cash flow increased more than proportionally, driving a higher free cash flow margin. Capital expenditure was little changed, so the improvement in free cash flow was driven entirely by stronger operating cash flow.
- Compared to the prior quarter, revenue, operating cash flow, free cash flow, and free cash flow margin all improved. Versus the year-ago quarter, revenue was lower but free cash flow was similar, as the margin held stable.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.8B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.0B
Cash generated by operations before capital spending.
CapEx
$134.0M
Capital spending and related asset purchases.
FCF margin
13.3%
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 | $13.8B | -$16.0M | $192.0M | -$208.0M | -1.5% |
| 2023-04-30 | $12.9B | $636.0M | $130.0M | $506.0M | 3.9% |
| 2023-07-31 | $13.2B | $976.0M | $137.0M | $839.0M | 6.4% |
| 2023-10-31 | $13.8B | $2.0B | $134.0M | $1.8B | 13.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 189.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$6.5B | 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 lift
Operating cash flow rose meaningfully from the prior quarter, while capital expenditure was essentially flat. This allowed free cash flow to increase and the margin to widen, even though revenue was only moderately higher.
The quarter's cash conversion efficiency improved, with free cash flow growth outpacing revenue growth due to stronger operating cash flow.
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, and operating cash flow increased more than proportionally, driving a higher free cash flow margin. Capital expenditure was little changed, so the improvement in free cash flow was driven entirely by stronger operating cash flow.
Compared to the prior quarter, revenue, operating cash flow, free cash flow, and free cash flow margin all improved. Versus the year-ago quarter, revenue was lower but free cash flow was similar, as the margin held stable.
Monitor whether operating cash flow can sustain its level in the next quarter, as the sequential improvement was the primary driver of free cash flow growth.