Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased compared to both the prior quarter and the same quarter last year. However, free cash flow turned negative due to a significant rise in capital expenditure, which outpaced operating cash flow.
- Operating cash flow was lower than the previous quarter but higher than the year-ago quarter. Capital expenditure was substantially higher than both comparison periods, resulting in negative free cash flow and a weakened free cash flow margin.
- Compared to the prior quarter, revenue improved while operating cash flow declined and capital expenditure rose sharply, flipping free cash flow from positive to negative. Versus the same quarter last year, revenue was higher, operating cash flow was lower, and capital expenditure increased markedly, also turning free cash flow negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$749.6M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$207.2M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$228.3M
Cash generated by operations before capital spending.
CapEx
$435.5M
Capital spending and related asset purchases.
FCF margin
-10.7%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $1.7B | $371.4M | $194.1M | $177.3M | 10.5% |
| 2023-06-30 | $1.8B | $665.7M | $178.3M | $487.4M | 27.8% |
| 2023-09-30 | $1.7B | $548.4M | $256.3M | $292.1M | 16.8% |
| 2023-12-31 | $1.9B | $228.3M | $435.5M | -$207.2M | -10.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -34.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 22.6% | 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.
Capital Expenditure Surge
Capital expenditure rose significantly compared to both the prior quarter and the same quarter last year, far exceeding the increase in operating cash flow. This shift was the strongest observable driver of the negative free cash flow.
The elevated capital expenditure directly caused free cash flow to turn negative despite higher revenue.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was lower than the previous quarter but higher than the year-ago quarter. Capital expenditure was substantially higher than both comparison periods, resulting in negative free cash flow and a weakened free cash flow margin.
Compared to the prior quarter, revenue improved while operating cash flow declined and capital expenditure rose sharply, flipping free cash flow from positive to negative. Versus the same quarter last year, revenue was higher, operating cash flow was lower, and capital expenditure increased markedly, also turning free cash flow negative.
Monitor the level of capital expenditure in upcoming quarters, as its substantial increase was the primary factor behind the negative free cash flow.