Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin improved versus the same quarter last year but declined from the immediately preceding quarter. Cash generation strengthened on a year-over-year basis despite a sequential pullback in revenue and operating cash flow.
- Operating cash flow exceeded capital expenditure, producing positive free cash flow. The conversion from revenue to free cash flow was stable, with margin higher year over year but lower sequentially.
- Compared with the preceding quarter, revenue, operating cash flow, and free cash flow were lower, and margin weakened. Compared with the same quarter one year earlier, all metrics were higher and margin improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$491.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$618.0M
Cash generated by operations before capital spending.
CapEx
$127.0M
Capital spending and related asset purchases.
FCF margin
11.8%
The share of revenue converted into free cash flow.
TTM FCF yield
6.1%
TTM FCF divided by market capitalization.
FCF reconciliation
Free cash flow is not a GAAP line item; it should be bridged from the cash flow statement.
| Operating cash flow | $618.0M | Cash generated by operations before capital spending. |
| Capital expenditures | $127.0M | Capital spending used to bridge CFO to FCF. |
| Free cash flow | $491.0M | Operating cash flow less capital spending. |
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $3.5B | $329.0M | $161.0M | $168.0M | 4.7% |
| 2022-09-30 | $3.6B | $863.0M | $165.0M | $698.0M | 19.6% |
| 2022-12-31 | $3.7B | $560.0M | $171.0M | $389.0M | 10.4% |
| 2023-03-31 | $3.7B | $417.0M | $164.0M | $253.0M | 6.9% |
| 2023-06-30 | $3.7B | $402.0M | $160.0M | $242.0M | 6.5% |
| 2023-09-30 | $3.7B | $583.0M | $146.0M | $437.0M | 11.7% |
| 2023-12-31 | $3.9B | $747.0M | $179.0M | $568.0M | 14.7% |
| 2024-03-31 | $3.7B | $522.0M | $145.0M | $377.0M | 10.1% |
| 2024-06-30 | $3.8B | $588.0M | $143.0M | $445.0M | 11.7% |
| 2024-09-30 | $3.9B | $721.0M | $150.0M | $571.0M | 14.7% |
| 2024-12-31 | $4.0B | $885.0M | $164.0M | $721.0M | 18.2% |
| 2025-03-31 | $3.8B | $568.0M | $142.0M | $426.0M | 11.1% |
| 2025-06-30 | $4.0B | $443.0M | $151.0M | $292.0M | 7.3% |
| 2025-09-30 | $4.1B | $908.0M | $136.0M | $772.0M | 18.8% |
| 2025-12-31 | $4.4B | $735.0M | $174.0M | $561.0M | 12.9% |
| 2026-03-31 | $4.2B | $618.0M | $127.0M | $491.0M | 11.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 179.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.1% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$13.9B | 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 increased year over year, supporting a higher free cash flow despite a sequential revenue decline. The company stated in its filing that operating cash flows are its principal source of liquidity, and this quarter's performance aligns with that view.
Continued operating cash flow growth underpins free cash flow generation and provides a foundation for liquidity management.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow exceeded capital expenditure, producing positive free cash flow. The conversion from revenue to free cash flow was stable, with margin higher year over year but lower sequentially.
Compared with the preceding quarter, revenue, operating cash flow, and free cash flow were lower, and margin weakened. Compared with the same quarter one year earlier, all metrics were higher and margin improved.
Monitor capital expenditure trends, as the current quarter's level was lower compared with both prior periods.
Valuation context
A cash-flow page should show how much investors are paying for the cash stream, without turning into a full DCF.
| Market capitalization | $34.8B | Used as the denominator for FCF yield. |
| TTM FCF yield | 6.1% | TTM free cash flow divided by market capitalization. |
| EV / TTM FCF | 23.0x | A quick valuation bridge, not a full DCF. |
Peer context
Free cash flow quality is easier to read against related public companies.
Risks and tripwires
Observable signals that would weaken the free cash flow thesis.
| Risk | Tripwire | Why it matters |
|---|---|---|
| FCF margin compression | FCF margin falls for two consecutive quarters. | Cash conversion may be weakening before earnings show it. |
| Capital intensity rises | CapEx/revenue moves materially above the recent run rate. | More operating cash flow would be consumed before becoming FCF. |
| Working capital drag | Inventory or receivables grow faster than revenue. | Reported growth may not translate into cash. |