Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow both increased substantially compared to the prior quarter and the same quarter last year, driving a large positive swing in free cash flow. Free cash flow margin improved significantly versus both the preceding quarter and the year-ago period.
- Operating cash flow grew faster than revenue this quarter, converting a higher share of sales into cash. After subtracting capital expenditure, free cash flow was positive and the free cash flow margin expanded versus both comparison periods.
- Compared to the immediate prior quarter, revenue, operating cash flow, and free cash flow all increased, with free cash flow turning from negative to positive. Versus the same quarter one year earlier, all metrics were higher, and free cash flow margin was also higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$327.8M
Trailing twelve-month free cash flow.
Quarter free cash flow
$839.3M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.0B
Cash generated by operations before capital spending.
CapEx
$207.0M
Capital spending and related asset purchases.
FCF margin
30.3%
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 |
|---|---|---|---|---|---|
| 2022-05-01 | $1.6B | -$243.3M | $111.4M | -$354.6M | -22.0% |
| 2022-07-31 | $1.9B | $97.6M | $144.7M | -$47.1M | -2.5% |
| 2022-10-30 | $1.9B | $65.8M | $175.6M | -$109.8M | -5.9% |
| 2023-01-29 | $2.8B | $1.0B | $207.0M | $839.3M | 30.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 700.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.5% | 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 Strength
Operating cash flow increased substantially from both the preceding quarter and the year-ago quarter, outpacing the growth in revenue. This improvement was the primary observable factor behind the positive free cash flow and higher margin.
Higher operating cash flow more than offset the increase in capital expenditure, resulting in a significant improvement in free cash flow and free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow grew faster than revenue this quarter, converting a higher share of sales into cash. After subtracting capital expenditure, free cash flow was positive and the free cash flow margin expanded versus both comparison periods.
Compared to the immediate prior quarter, revenue, operating cash flow, and free cash flow all increased, with free cash flow turning from negative to positive. Versus the same quarter one year earlier, all metrics were higher, and free cash flow margin was also higher.
Capital expenditure rose in absolute terms versus both the prior quarter and the year-ago quarter; the impact on future free cash flow will depend on how operating cash flow trends relative to these outflows.