Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was flat sequentially but declined year-over-year, with the free cash flow margin narrowing. Operating cash flow decreased compared to the same quarter last year, while capital expenditures were lower.
- The company's cash conversion from revenue weakened year-over-year: operating cash flow and free cash flow each decreased, and the free cash flow margin contracted. Sequentially, revenue was unchanged, operating cash flow dipped slightly, and capital spending edged lower, resulting in free cash flow remaining stable with a lower margin.
- Compared to the preceding quarter, revenue held steady, operating cash flow was slightly lower, capital expenditure was reduced, and free cash flow was unchanged, with the margin declining modestly. Versus the same quarter a year ago, all metrics were lower, and the free cash flow margin contracted significantly.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.3B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.4B
Cash generated by operations before capital spending.
CapEx
$103.7M
Capital spending and related asset purchases.
FCF margin
33.8%
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 |
|---|---|---|---|---|---|
| 2023-06-25 | $3.2B | $1.1B | $78.7M | $1.0B | 32.6% |
| 2023-09-24 | $3.5B | $951.2M | $77.0M | $874.2M | 25.1% |
| 2023-12-24 | $3.8B | $1.5B | $115.3M | $1.3B | 35.6% |
| 2024-03-31 | $3.8B | $1.4B | $103.7M | $1.3B | 33.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 132.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.7% | 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.
Weaker Operating Cash Generation
Operating cash flow fell from the prior year and was also marginally lower than the previous quarter, driving the decline in free cash flow.
Free cash flow decreased on a year-over-year basis and the free cash flow margin narrowed.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
The company's cash conversion from revenue weakened year-over-year: operating cash flow and free cash flow each decreased, and the free cash flow margin contracted. Sequentially, revenue was unchanged, operating cash flow dipped slightly, and capital spending edged lower, resulting in free cash flow remaining stable with a lower margin.
Compared to the preceding quarter, revenue held steady, operating cash flow was slightly lower, capital expenditure was reduced, and free cash flow was unchanged, with the margin declining modestly. Versus the same quarter a year ago, all metrics were lower, and the free cash flow margin contracted significantly.
Monitor the trajectory of operating cash flow in coming quarters to assess whether the year-over-year decline persists.