Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was slightly higher than the prior quarter and notably higher than the same quarter last year. Free cash flow margin improved year over year but edged lower sequentially.
- The conversion of revenue into free cash flow is measured by the free cash flow margin. Operating cash flow, net of capital spending, produced free cash flow that was a lower proportion of revenue compared to the prior quarter but a higher proportion relative to the year-ago period.
- Compared to the prior quarter, operating cash flow and free cash flow were slightly lower, while capital expenditure decreased. Compared to the same quarter last year, all metrics improved, with revenue, operating cash flow, and free cash flow each higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$570.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$119.6M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$141.2M
Cash generated by operations before capital spending.
CapEx
$21.6M
Capital spending and related asset purchases.
FCF margin
14.1%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $824.0M | $198.1M | $16.3M | $181.8M | 22.1% |
| 2022-12-31 | $810.7M | $167.3M | $20.0M | $147.3M | 18.2% |
| 2023-03-31 | $845.4M | $147.9M | $26.6M | $121.3M | 14.3% |
| 2023-06-30 | $846.2M | $141.2M | $21.6M | $119.6M | 14.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 86.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$1.0B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Year-over-Year Free Cash Flow Improvement
Free cash flow margin increased compared to the same quarter one year earlier, driven by a larger increase in operating cash flow relative to the increase in revenue and capital expenditure.
This indicates stronger cash generation efficiency than the prior year period.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
The conversion of revenue into free cash flow is measured by the free cash flow margin. Operating cash flow, net of capital spending, produced free cash flow that was a lower proportion of revenue compared to the prior quarter but a higher proportion relative to the year-ago period.
Compared to the prior quarter, operating cash flow and free cash flow were slightly lower, while capital expenditure decreased. Compared to the same quarter last year, all metrics improved, with revenue, operating cash flow, and free cash flow each higher.
Monitor the trend in operating cash flow relative to revenue, as it declined sequentially despite stable revenue.