Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion improved sharply from the prior quarter, with free cash flow turning positive. Revenue was lower than a year ago but free cash flow margin remained stable.
- Revenue increased sequentially, while operating cash flow swung from negative to positive, leading to positive free cash flow. Capital expenditure was similar to the prior quarter but higher than a year ago, resulting in a free cash flow margin that strengthened from a negative level to a positive one.
- Compared with the immediately preceding quarter, operating cash flow and free cash flow both improved significantly, with free cash flow turning from negative to positive. Relative to the same quarter one year earlier, revenue was lower, operating cash flow was similar, but higher capital expenditure reduced free cash flow, though the free cash flow margin was slightly higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$864.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.3B
Cash generated by operations before capital spending.
CapEx
$484.0M
Capital spending and related asset purchases.
FCF margin
10.0%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $10.6B | $1.7B | $394.0M | $1.3B | 12.0% |
| 2023-12-31 | $2.2B | $1.5B | $484.0M | $1.0B | 47.3% |
| 2024-03-31 | $8.3B | -$114.0M | $483.0M | -$597.0M | -7.2% |
| 2024-06-30 | $8.7B | $1.3B | $484.0M | $864.0M | 10.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 93.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.6% | 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
Operating cash flow reversed from a negative position in the prior quarter to a positive amount, which was the primary factor behind the swing in free cash flow. This improvement occurred even as revenue remained below the year-ago level.
The recovery in operating cash flow enabled the company to generate positive free cash flow and improve its free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased sequentially, while operating cash flow swung from negative to positive, leading to positive free cash flow. Capital expenditure was similar to the prior quarter but higher than a year ago, resulting in a free cash flow margin that strengthened from a negative level to a positive one.
Compared with the immediately preceding quarter, operating cash flow and free cash flow both improved significantly, with free cash flow turning from negative to positive. Relative to the same quarter one year earlier, revenue was lower, operating cash flow was similar, but higher capital expenditure reduced free cash flow, though the free cash flow margin was slightly higher.
Monitor capital expenditure trends relative to operating cash flow, as the current level is higher than the prior year and may influence future free cash flow generation.