Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow and operating cash flow were lower sequentially, while revenue also slightly decreased. Compared to the same quarter last year, free cash flow improved with a higher margin, despite a smaller increase in revenue.
- Revenue declined from the prior quarter, and operating cash flow fell sharply, leading to a lower free cash flow margin. The conversion was driven primarily by the change in operating cash flow rather than capital expenditure, which was higher sequentially.
- Compared to the immediately preceding quarter, free cash flow and its margin weakened, with lower operating cash flow. Versus the same quarter one year earlier, free cash flow and margin improved, supported by higher operating cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$383.3M
Trailing twelve-month free cash flow.
Quarter free cash flow
$64.7M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$81.5M
Cash generated by operations before capital spending.
CapEx
$16.8M
Capital spending and related asset purchases.
FCF margin
11.9%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $508.6M | $16.3M | $9.9M | $6.5M | 1.3% |
| 2023-06-30 | $534.6M | $174.5M | $11.9M | $162.6M | 30.4% |
| 2023-09-30 | $571.4M | $157.1M | $7.6M | $149.5M | 26.2% |
| 2023-12-31 | $545.7M | $81.5M | $16.8M | $64.7M | 11.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 70.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.1% | 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.
Improved operating cash flow year-over-year
Operating cash flow was higher compared to the same quarter last year, which directly supported a stronger free cash flow despite a slight increase in capital expenditure. The change in operating cash flow was the strongest observable driver of the year-over-year improvement in free cash flow.
The year-over-year rise in operating cash flow was the primary factor behind the higher free cash flow margin this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue declined from the prior quarter, and operating cash flow fell sharply, leading to a lower free cash flow margin. The conversion was driven primarily by the change in operating cash flow rather than capital expenditure, which was higher sequentially.
Compared to the immediately preceding quarter, free cash flow and its margin weakened, with lower operating cash flow. Versus the same quarter one year earlier, free cash flow and margin improved, supported by higher operating cash flow.
Monitoring the trend in operating cash flow is key, as it is the primary source of variability in free cash flow between periods.