Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The current quarter's free cash flow margin improved compared to both the preceding quarter and the year-ago quarter, driven by higher operating cash flow. Revenue was also higher than both prior periods, supporting the cash generation.
- Revenue was higher than both the preceding quarter and the year-ago quarter. Operating cash flow as a percentage of revenue was also higher, reflecting improved cash conversion from sales.
- Compared to the preceding quarter, free cash flow and margin were higher, with operating cash flow higher and capital expenditure lower. Compared to the year-ago quarter, free cash flow and margin were also higher, despite higher capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$487.4M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$665.7M
Cash generated by operations before capital spending.
CapEx
$178.3M
Capital spending and related asset purchases.
FCF margin
27.8%
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 | $1.6B | $383.2M | $169.1M | $214.1M | 13.7% |
| 2022-12-31 | $1.7B | $437.9M | $139.2M | $298.7M | 18.0% |
| 2023-03-31 | $1.7B | $371.4M | $194.1M | $177.3M | 10.5% |
| 2023-06-30 | $1.8B | $665.7M | $178.3M | $487.4M | 27.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 115.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 10.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | n/a | 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 Improvement
Operating cash flow was higher than both the preceding quarter and the year-ago quarter, providing the primary lift to free cash flow. The filing cites operating activities, along with stock option exercises and employee stock purchases, as key sources of cash, partially offset by capital expenditures and share repurchases.
This improvement supported a higher free cash flow margin for the current quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than both the preceding quarter and the year-ago quarter. Operating cash flow as a percentage of revenue was also higher, reflecting improved cash conversion from sales.
Compared to the preceding quarter, free cash flow and margin were higher, with operating cash flow higher and capital expenditure lower. Compared to the year-ago quarter, free cash flow and margin were also higher, despite higher capital expenditure.
Monitor the level of capital expenditure, which was lower than the preceding quarter but higher than the year-ago quarter, as it remains a significant use of cash.