Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was higher than both the prior quarter and the same quarter a year earlier. However, free cash flow margin was unchanged from the prior quarter and significantly lower than the year-ago period, reflecting weaker operating cash flow conversion.
- Operating cash flow increased from the prior quarter but capital expenditure also rose, resulting in a free cash flow that was slightly lower. The free cash flow margin remained stable sequentially. Compared to the year-ago quarter, operating cash flow was substantially lower despite higher revenue, and capital expenditure was higher, leading to a much lower free cash flow and margin.
- Sequentially, free cash flow and margin were stable, with higher operating cash flow offset by higher capital spending. Year-over-year, free cash flow and margin weakened sharply as operating cash flow declined while revenue increased.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$607.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$229.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$389.0M
Cash generated by operations before capital spending.
CapEx
$160.0M
Capital spending and related asset purchases.
FCF margin
8.3%
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 |
|---|---|---|---|---|---|
| 2024-03-31 | $2.9B | $99.0M | $118.0M | -$19.0M | -0.7% |
| 2024-06-30 | $2.9B | $237.0M | $82.0M | $155.0M | 5.4% |
| 2024-09-30 | $2.9B | $345.0M | $103.0M | $242.0M | 8.3% |
| 2024-12-31 | $2.8B | $389.0M | $160.0M | $229.0M | 8.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -408.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$8.4B | 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 Efficiency
Revenue grew year-over-year, but operating cash flow fell significantly, causing free cash flow and margin to drop. This divergence between revenue and cash generation is the strongest observable driver of the quarter's results.
If this trend continues, future free cash flow may remain under pressure even if revenue grows.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow increased from the prior quarter but capital expenditure also rose, resulting in a free cash flow that was slightly lower. The free cash flow margin remained stable sequentially. Compared to the year-ago quarter, operating cash flow was substantially lower despite higher revenue, and capital expenditure was higher, leading to a much lower free cash flow and margin.
Sequentially, free cash flow and margin were stable, with higher operating cash flow offset by higher capital spending. Year-over-year, free cash flow and margin weakened sharply as operating cash flow declined while revenue increased.
Monitor the relationship between operating cash flow and revenue, as the year-over-year decline in cash conversion efficiency was the most notable change.