Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue remained stable year over year and sequentially. Operating cash flow improved sharply from the prior quarter but declined from a year ago, while capital expenditure decreased from the previous quarter. Free cash flow stayed negative but narrowed sequentially, though the margin weakened compared to the same quarter last year.
- Operating cash flow covered only a portion of capital expenditure, resulting in negative free cash flow. The conversion rate improved sequentially but remained lower than the year-ago quarter.
- Compared to the prior quarter, operating cash flow increased substantially while capital expenditure decreased, leading to an improved free cash flow. Versus the same quarter a year ago, operating cash flow weakened and capital expenditure rose, causing a lower free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$1.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$229.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$188.0M
Cash generated by operations before capital spending.
CapEx
$417.0M
Capital spending and related asset purchases.
FCF margin
-21.3%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $943.0M | $49.0M | $243.0M | -$194.0M | -20.6% |
| 2022-09-30 | $1.1B | $185.0M | $323.0M | -$138.0M | -12.2% |
| 2022-12-31 | $1.1B | $1.0M | $611.0M | -$610.0M | -57.7% |
| 2023-03-31 | $1.1B | $188.0M | $417.0M | -$229.0M | -21.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -140.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 38.7% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$8.8B | 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 Level
Capital expenditure remained elevated, driving negative free cash flow despite stable revenue and improved cash flow from operations.
The high level of capital expenditure is the primary reason for negative free cash flow; any reduction would improve the metric.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow covered only a portion of capital expenditure, resulting in negative free cash flow. The conversion rate improved sequentially but remained lower than the year-ago quarter.
Compared to the prior quarter, operating cash flow increased substantially while capital expenditure decreased, leading to an improved free cash flow. Versus the same quarter a year ago, operating cash flow weakened and capital expenditure rose, causing a lower free cash flow margin.
Monitor the trend of capital expenditure and its impact on free cash flow, given the company's significant investment in infrastructure.