Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved compared to both the prior quarter and the year-ago quarter. Revenue was higher while operating cash flow decreased sequentially but rose sharply year-over-year, supported by a higher margin.
- Operating cash flow exceeded capital expenditure, generating positive free cash flow and a margin that strengthened year-over-year but weakened sequentially. The conversion from revenue to free cash flow reflects the interplay between higher operating cash flow and increased capital spending relative to the prior quarter.
- Compared to the immediately preceding quarter, free cash flow and margin were lower, with lower operating cash flow and higher capital expenditure. Compared to the same quarter one year earlier, free cash flow and margin were higher, driven by a significant increase in operating cash flow despite slightly higher capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$689.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$132.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$191.0M
Cash generated by operations before capital spending.
CapEx
$59.0M
Capital spending and related asset purchases.
FCF margin
8.0%
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 | $1.5B | $455.0M | $45.0M | $410.0M | 27.1% |
| 2023-03-31 | $1.6B | $23.0M | $64.0M | -$41.0M | -2.6% |
| 2023-06-30 | $1.6B | $229.0M | $41.0M | $188.0M | 11.4% |
| 2023-09-30 | $1.7B | $191.0M | $59.0M | $132.0M | 8.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 70.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$3.4B | 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 increase
Operating cash flow rose markedly compared to the same quarter last year. The filing attributes the year-to-date increase to higher operating results, partially offset by higher working capital, including unfavorable changes in accounts payable and accrued expenses.
This increase was the primary factor behind the year-over-year improvement in free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow exceeded capital expenditure, generating positive free cash flow and a margin that strengthened year-over-year but weakened sequentially. The conversion from revenue to free cash flow reflects the interplay between higher operating cash flow and increased capital spending relative to the prior quarter.
Compared to the immediately preceding quarter, free cash flow and margin were lower, with lower operating cash flow and higher capital expenditure. Compared to the same quarter one year earlier, free cash flow and margin were higher, driven by a significant increase in operating cash flow despite slightly higher capital expenditure.
Monitor the trend in capital expenditure relative to operating cash flow, as higher spending this quarter partially tempered free cash flow generation.