Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue, operating cash flow, and free cash flow all weakened sequentially from the prior quarter but improved compared to the same quarter last year. The free cash flow margin narrowed significantly versus the preceding quarter and also declined from the year-ago level.
- Operating cash flow was substantially lower than revenue, resulting in a free cash flow margin that was well below the previous quarter's level. Capital expenditure remained a modest use of cash, so the conversion from operating cash flow to free cash flow was relatively efficient.
- Relative to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all sharply lower, and the free cash flow margin weakened significantly. Compared to the same quarter one year earlier, revenue and free cash flow were higher, while operating cash flow and the free cash flow margin were lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$400.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$417.0M
Cash generated by operations before capital spending.
CapEx
$17.0M
Capital spending and related asset purchases.
FCF margin
12.6%
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 |
|---|---|---|---|---|---|
| 2023-10-31 | $3.0B | -$97.0M | $84.0M | -$181.0M | -6.1% |
| 2024-01-31 | $3.4B | $613.0M | $63.0M | $550.0M | 16.2% |
| 2024-04-30 | $6.7B | $4.0B | $61.0M | $3.9B | 57.7% |
| 2024-07-31 | $3.2B | $417.0M | $17.0M | $400.0M | 12.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -2000.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$2.4B | 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 Decline
Operating cash flow decreased sharply from the prior quarter and was also lower than the year-ago quarter, even though revenue grew year over year. The decline in operating cash flow was the primary factor behind the drop in free cash flow and the narrowing of the free cash flow margin.
The lower operating cash flow directly reduced free cash flow and compressed the margin, making cash generation notably weaker this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was substantially lower than revenue, resulting in a free cash flow margin that was well below the previous quarter's level. Capital expenditure remained a modest use of cash, so the conversion from operating cash flow to free cash flow was relatively efficient.
Relative to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all sharply lower, and the free cash flow margin weakened significantly. Compared to the same quarter one year earlier, revenue and free cash flow were higher, while operating cash flow and the free cash flow margin were lower.
Monitor the trend of operating cash flow relative to revenue, as the conversion ratio fell considerably from both the prior quarter and the year-ago quarter.