Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion improved significantly compared to both the immediate prior quarter and the same quarter one year earlier. Revenue was slightly lower than the prior quarter but higher than the year-ago period.
- Revenue was slightly lower sequentially, while operating cash flow was higher and capital expenditure was lower, resulting in higher free cash flow and an improved free cash flow margin. Compared to the year-ago quarter, revenue was higher, operating cash flow was substantially higher, capital expenditure was stable, and free cash flow and margin were markedly higher.
- Compared to the immediate prior quarter, revenue was lower, operating cash flow was higher, capital expenditure was lower, and free cash flow and margin improved. Relative to the same quarter one year earlier, revenue was higher, operating cash flow was higher, capital expenditure was stable, and free cash flow and margin strengthened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$464.5M
Trailing twelve-month free cash flow.
Quarter free cash flow
$87.7M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$97.6M
Cash generated by operations before capital spending.
CapEx
$9.9M
Capital spending and related asset purchases.
FCF margin
16.3%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $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% |
| 2024-03-31 | $538.6M | $97.6M | $9.9M | $87.7M | 16.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 100.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.8% | 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 prior quarter and the year-ago quarter, driving the increase in free cash flow and margin. The filing context notes that the nine-month increase in operating cash flow was primarily due to an increase in accrued expenses.
This improvement in operating cash flow was the primary factor behind the higher free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly lower sequentially, while operating cash flow was higher and capital expenditure was lower, resulting in higher free cash flow and an improved free cash flow margin. Compared to the year-ago quarter, revenue was higher, operating cash flow was substantially higher, capital expenditure was stable, and free cash flow and margin were markedly higher.
Compared to the immediate prior quarter, revenue was lower, operating cash flow was higher, capital expenditure was lower, and free cash flow and margin improved. Relative to the same quarter one year earlier, revenue was higher, operating cash flow was higher, capital expenditure was stable, and free cash flow and margin strengthened.
Monitor revenue trends as the sequential decline occurred alongside an increase in operating cash flow, which may affect the sustainability of cash conversion.