Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned positive compared to the same period one year earlier, but decreased sharply from the prior quarter. Revenue was slightly lower, operating cash flow weakened, and capital expenditure rose.
- Operating cash flow as a proportion of revenue declined, while higher capital expenditure further reduced the conversion into free cash flow, resulting in a lower free cash flow margin.
- Compared to the prior quarter, free cash flow and margin weakened due to lower operating cash flow and higher capital spending. Versus the same quarter last year, free cash flow improved from negative to positive and margin strengthened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$160.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$448.0M
Cash generated by operations before capital spending.
CapEx
$288.0M
Capital spending and related asset purchases.
FCF margin
1.9%
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 |
|---|---|---|---|---|---|
| 2023-02-28 | $8.1B | $414.0M | $323.0M | $91.0M | 1.1% |
| 2023-05-31 | $8.5B | $468.0M | $223.0M | $245.0M | 2.9% |
| 2023-08-31 | $8.5B | $686.0M | $170.0M | $516.0M | 6.1% |
| 2023-11-30 | $8.4B | $448.0M | $288.0M | $160.0M | 1.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 82.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$1.3B | 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
The most observable driver of the quarter's free cash flow change was a significant drop in operating cash flow, which more than offset the lower capital expenditure compared to a year ago. Relative to the prior quarter, both operating cash flow and capital spending moved unfavorably.
Weaker operating cash flow reduced the cash available after necessary capital investment, pressuring free cash flow generation.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a proportion of revenue declined, while higher capital expenditure further reduced the conversion into free cash flow, resulting in a lower free cash flow margin.
Compared to the prior quarter, free cash flow and margin weakened due to lower operating cash flow and higher capital spending. Versus the same quarter last year, free cash flow improved from negative to positive and margin strengthened.
Monitor operating cash flow trends, as the combination of its decline and increased capital spending drove the quarter's free cash flow reduction.