Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin improved compared to the same quarter last year but weakened from the prior quarter. The changes were driven by shifts in operating cash flow and capital expenditure.
- Revenue was lower than the prior quarter, while operating cash flow decreased more sharply and capital expenditure rose, causing free cash flow and its margin to decline. Compared to the same quarter last year, revenue was slightly lower but operating cash flow was higher and capital expenditure was similar, resulting in an improved free cash flow margin.
- Free cash flow was lower than the preceding quarter due to a weaker operating cash flow and higher capital expenditure, but was higher than the same quarter one year earlier. The free cash flow margin weakened sequentially but improved year-over-year.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$7.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$728.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.3B
Cash generated by operations before capital spending.
CapEx
$571.0M
Capital spending and related asset purchases.
FCF margin
3.6%
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 |
|---|---|---|---|---|---|
| 2024-02-02 | $18.6B | $1.1B | $620.0M | $488.0M | 2.6% |
| 2024-05-03 | $21.4B | $4.3B | $382.0M | $3.9B | 18.2% |
| 2024-08-02 | $23.6B | $3.2B | $426.0M | $2.7B | 11.6% |
| 2024-11-01 | $20.2B | $1.3B | $571.0M | $728.0M | 3.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 42.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.8% | 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
Operating cash flow decreased from the prior quarter, lowering free cash flow despite a slight drop in revenue. Year-over-year, operating cash flow was higher, supporting free cash flow improvement.
The sequential decline in operating cash flow is the primary factor behind the weaker 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 was lower than the prior quarter, while operating cash flow decreased more sharply and capital expenditure rose, causing free cash flow and its margin to decline. Compared to the same quarter last year, revenue was slightly lower but operating cash flow was higher and capital expenditure was similar, resulting in an improved free cash flow margin.
Free cash flow was lower than the preceding quarter due to a weaker operating cash flow and higher capital expenditure, but was higher than the same quarter one year earlier. The free cash flow margin weakened sequentially but improved year-over-year.
Monitor the relationship between capital expenditure and operating cash flow, as capital expenditure increased while operating cash flow declined sequentially.