Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow increased while capital expenditure rose modestly, resulting in higher free cash flow and an improved margin. The stronger operating cash flow was the primary driver of the quarter's cash generation.
- Revenue grew, and operating cash flow as a proportion of revenue strengthened, leading to a free cash flow margin that was higher sequentially and year-over-year. The conversion from revenue to free cash flow was supported by the increase in operating cash flow, which outpaced the modest rise in capital expenditure.
- Compared to the prior quarter, free cash flow and margin both improved, driven by higher operating cash flow. Relative to the same quarter a year ago, free cash flow and margin also increased, with operating cash flow higher and capital expenditure slightly higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$839.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$215.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$248.3M
Cash generated by operations before capital spending.
CapEx
$33.3M
Capital spending and related asset purchases.
FCF margin
21.4%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $915.5M | $272.4M | $34.1M | $238.3M | 26.0% |
| 2023-12-31 | $901.6M | $249.9M | $32.6M | $217.3M | 24.1% |
| 2024-03-31 | $964.1M | $198.6M | $30.3M | $168.3M | 17.5% |
| 2024-06-30 | $1.0B | $248.3M | $33.3M | $215.0M | 21.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 105.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$293.3M | 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 strength
Operating cash flow was significantly higher than the prior quarter and the year-ago quarter, directly lifting free cash flow. This was the most observable factor behind the quarter's performance.
Higher operating cash flow drove the improvement in free cash flow and margin, with capital expenditure having a limited offsetting effect.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue grew, and operating cash flow as a proportion of revenue strengthened, leading to a free cash flow margin that was higher sequentially and year-over-year. The conversion from revenue to free cash flow was supported by the increase in operating cash flow, which outpaced the modest rise in capital expenditure.
Compared to the prior quarter, free cash flow and margin both improved, driven by higher operating cash flow. Relative to the same quarter a year ago, free cash flow and margin also increased, with operating cash flow higher and capital expenditure slightly higher.
Monitor the trend in operating cash flow relative to revenue, as it was the strongest driver of free cash flow improvement this quarter.