Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned negative this quarter as capital expenditure exceeded operating cash flow. Revenue was lower than the prior quarter but higher than the same quarter last year.
- Operating cash flow was lower than both the prior quarter and the year-ago quarter, while capital expenditure was higher than the prior quarter but lower than the year-ago quarter. The resulting free cash flow margin weakened to negative, compared to positive margins in both comparison periods.
- Compared to the prior quarter, revenue was lower and operating cash flow declined substantially, while capital expenditure increased. Versus the same quarter last year, revenue was higher but operating cash flow was lower, and capital expenditure was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$6.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$288.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$451.0M
Cash generated by operations before capital spending.
CapEx
$739.0M
Capital spending and related asset purchases.
FCF margin
-1.3%
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 |
|---|---|---|---|---|---|
| 2022-04-29 | $23.7B | $3.0B | $343.0M | $2.6B | 11.1% |
| 2022-07-29 | $27.5B | $3.0B | $344.0M | $2.7B | 9.8% |
| 2022-10-28 | $23.5B | $2.1B | $403.0M | $1.7B | 7.3% |
| 2023-02-03 | $22.4B | $451.0M | $739.0M | -$288.0M | -1.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -30.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$31.9B | 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 outpacing operating cash flow
Capital expenditure was higher than operating cash flow, leading to negative free cash flow. This contrasts with both the prior quarter and the year-ago quarter, where operating cash flow exceeded capital expenditure.
The shift from positive to negative free cash flow margin is the most notable change this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was lower than both the prior quarter and the year-ago quarter, while capital expenditure was higher than the prior quarter but lower than the year-ago quarter. The resulting free cash flow margin weakened to negative, compared to positive margins in both comparison periods.
Compared to the prior quarter, revenue was lower and operating cash flow declined substantially, while capital expenditure increased. Versus the same quarter last year, revenue was higher but operating cash flow was lower, and capital expenditure was lower.
Monitor whether operating cash flow can recover to cover capital expenditure, as the gap widened this quarter.