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 increased from the prior quarter, leading to higher free cash flow and an improved margin. However, compared to the same quarter last year, free cash flow was lower and the margin weakened due to a larger rise in capital expenditure.
- Revenue rose from the prior quarter, and operating cash flow grew at a faster pace, resulting in higher free cash flow and an improved free cash flow margin. Capital expenditure also increased, but the conversion from revenue to free cash flow strengthened sequentially.
- Compared to the immediately preceding quarter, free cash flow and margin improved. Relative to the same quarter one year earlier, free cash flow was lower and the margin weakened, despite higher revenue and operating cash flow, due to a larger increase in capital expenditure.
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
$297.6M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$515.7M
Cash generated by operations before capital spending.
CapEx
$218.1M
Capital spending and related asset purchases.
FCF margin
9.8%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $2.7B | $767.6M | $159.5M | $608.2M | 22.9% |
| 2023-04-02 | $3.0B | $755.4M | $176.1M | $579.3M | 19.4% |
| 2023-07-02 | $2.5B | $294.4M | $154.4M | $140.0M | 5.6% |
| 2023-10-01 | $3.0B | $515.7M | $218.1M | $297.6M | 9.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 57.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.2% | 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.
Sequential free cash flow margin improvement
The free cash flow margin increased from the prior quarter, driven by a proportionally larger rise in operating cash flow relative to revenue.
This indicates a stronger cash conversion efficiency in the current quarter compared to the prior period.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue rose from the prior quarter, and operating cash flow grew at a faster pace, resulting in higher free cash flow and an improved free cash flow margin. Capital expenditure also increased, but the conversion from revenue to free cash flow strengthened sequentially.
Compared to the immediately preceding quarter, free cash flow and margin improved. Relative to the same quarter one year earlier, free cash flow was lower and the margin weakened, despite higher revenue and operating cash flow, due to a larger increase in capital expenditure.
Monitor the impact of the recently completed acquisition of manufacturing assets on future capital spending and cash generation.