Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion improved versus the same quarter last year as free cash flow margin increased, despite a lower revenue base. Relative to the prior quarter, cash generation weakened due to a decrease in operating cash flow and a slightly lower revenue level.
- Revenue was higher than the prior quarter but lower than a year ago. Operating cash flow decreased from the prior quarter but increased from the year-ago quarter, and capital expenditure was lower in both comparisons. Free cash flow margin improved sequentially and year-over-year.
- Compared to the immediately preceding quarter, operating cash flow was lower and free cash flow decreased. Against the same quarter one year earlier, operating cash flow was higher and free cash flow improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$642.1M
Trailing twelve-month free cash flow.
Quarter free cash flow
$136.6M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$156.6M
Cash generated by operations before capital spending.
CapEx
$20.0M
Capital spending and related asset purchases.
FCF margin
17.1%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $846.2M | $141.2M | $21.6M | $119.6M | 14.1% |
| 2023-09-30 | $793.4M | $226.6M | $20.1M | $206.5M | 26.0% |
| 2023-12-31 | $788.9M | $201.0M | $21.6M | $179.4M | 22.7% |
| 2024-03-31 | $800.5M | $156.6M | $20.0M | $136.6M | 17.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 112.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$714.6M | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Improvement in free cash flow margin
The free cash flow margin was higher compared to both the prior quarter and the same quarter last year, driven by a combination of lower capital expenditure and a sequential increase in revenue.
This strengthened free cash flow generation efficiency relative to revenue without relying on a larger revenue base.
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 but lower than a year ago. Operating cash flow decreased from the prior quarter but increased from the year-ago quarter, and capital expenditure was lower in both comparisons. Free cash flow margin improved sequentially and year-over-year.
Compared to the immediately preceding quarter, operating cash flow was lower and free cash flow decreased. Against the same quarter one year earlier, operating cash flow was higher and free cash flow improved.
Monitor the trajectory of operating cash flow relative to revenue, as it declined sequentially while revenue increased modestly.