Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
KeyCorp's free cash flow for the current quarter was higher than the preceding quarter but much lower than the same quarter one year earlier. Free cash flow margin improved sequentially but weakened dramatically year-over-year.
- Revenue was stable compared to the prior quarter, but operating cash flow declined. A reduction in capital expenditure allowed free cash flow to increase slightly, resulting in an improved free cash flow margin. Versus the year-ago period, revenue was lower and operating cash flow was significantly lower, leading to much lower free cash flow and margin.
- Quarter-over-quarter, revenue was stable, operating cash flow declined, capital expenditure decreased, free cash flow increased slightly, and free cash flow margin improved. Year-over-year, revenue was lower, operating cash flow was significantly lower, capital expenditure was slightly higher, free cash flow was substantially lower, and free cash flow margin weakened considerably.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$541.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$566.0M
Cash generated by operations before capital spending.
CapEx
$25.0M
Capital spending and related asset purchases.
FCF margin
155.9%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $457.0M | $1.6B | $35.0M | $1.6B | 339.2% |
| 2023-03-31 | $375.0M | $718.0M | $24.0M | $694.0M | 185.1% |
| 2023-06-30 | $348.0M | $582.0M | $50.0M | $532.0M | 152.9% |
| 2023-09-30 | $347.0M | $566.0M | $25.0M | $541.0M | 155.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 178.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.2% | 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.
Significant decline in operating cash flow year-over-year
Operating cash flow decreased substantially compared to the same quarter last year, while capital expenditure remained relatively stable, leading to a material reduction in free cash flow and margin. The filing includes discussions on risk factors and management's analysis of financial condition and results of operations.
The decline in operating cash flow was the strongest factor driving the year-over-year decrease in free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable compared to the prior quarter, but operating cash flow declined. A reduction in capital expenditure allowed free cash flow to increase slightly, resulting in an improved free cash flow margin. Versus the year-ago period, revenue was lower and operating cash flow was significantly lower, leading to much lower free cash flow and margin.
Quarter-over-quarter, revenue was stable, operating cash flow declined, capital expenditure decreased, free cash flow increased slightly, and free cash flow margin improved. Year-over-year, revenue was lower, operating cash flow was significantly lower, capital expenditure was slightly higher, free cash flow was substantially lower, and free cash flow margin weakened considerably.
Monitor the trajectory of operating cash flow, as it was the primary driver of changes in free cash flow.