Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved sharply from a negative position a year ago, though it declined from the prior quarter. Operating cash flow was the primary driver of the positive swing versus last year.
- Revenue was stable compared to the prior quarter, but operating cash flow decreased, leading to a lower free cash flow margin. Capital expenditure increased slightly, further reducing free cash flow conversion.
- Compared to the prior quarter, free cash flow and free cash flow margin both weakened, driven by lower operating cash flow and higher capital expenditure. Versus the same quarter last year, free cash flow improved significantly from a negative level, with operating cash flow substantially higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$227.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$389.9M
Cash generated by operations before capital spending.
CapEx
$162.9M
Capital spending and related asset purchases.
FCF margin
10.3%
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 |
|---|---|---|---|---|---|
| 2023-01-29 | $2.8B | $1.0B | $207.0M | $839.3M | 30.3% |
| 2023-04-30 | $2.0B | $45.5M | $136.9M | -$91.4M | -4.6% |
| 2023-07-30 | $2.2B | $476.7M | $145.5M | $331.2M | 15.0% |
| 2023-10-29 | $2.2B | $389.9M | $162.9M | $227.0M | 10.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 91.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.4% | 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 recovery versus last year
Operating cash flow was substantially higher than the same quarter last year, turning free cash flow positive. This was the strongest observable driver of the year-over-year improvement.
Free cash flow moved from negative to positive compared to the prior year, despite a slight increase in capital expenditure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable compared to the prior quarter, but operating cash flow decreased, leading to a lower free cash flow margin. Capital expenditure increased slightly, further reducing free cash flow conversion.
Compared to the prior quarter, free cash flow and free cash flow margin both weakened, driven by lower operating cash flow and higher capital expenditure. Versus the same quarter last year, free cash flow improved significantly from a negative level, with operating cash flow substantially higher.
Monitor the trend in operating cash flow, as its decline from the prior quarter was the main factor behind the weakened free cash flow.