Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue declined compared to both the prior quarter and the same quarter last year. Operating cash flow decreased substantially, resulting in a lower free cash flow margin.
- With revenue lower and operating cash flow falling more sharply, the free cash flow margin weakened. Capital expenditure also decreased, but not enough to offset the drop in operating cash flow.
- Compared to the prior quarter, free cash flow and its margin were lower, driven by a decline in operating cash flow. Versus the same quarter last year, all metrics were lower, with operating cash flow and free cash flow showing the largest relative decreases.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$302.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$670.0M
Cash generated by operations before capital spending.
CapEx
$368.0M
Capital spending and related asset purchases.
FCF margin
3.5%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $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% |
| 2024-09-30 | $8.6B | $670.0M | $368.0M | $302.0M | 3.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 52.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.3% | 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 decline
Operating cash flow decreased significantly from both the prior quarter and the year-ago period. This was the strongest observable factor behind the lower free cash flow and margin.
The decline in operating cash flow directly reduced free cash flow and the margin, affecting the company's ability to fund shareholder returns as outlined in its capital allocation strategy.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
With revenue lower and operating cash flow falling more sharply, the free cash flow margin weakened. Capital expenditure also decreased, but not enough to offset the drop in operating cash flow.
Compared to the prior quarter, free cash flow and its margin were lower, driven by a decline in operating cash flow. Versus the same quarter last year, all metrics were lower, with operating cash flow and free cash flow showing the largest relative decreases.
Monitor the trajectory of operating cash flow, as it is the primary driver of free cash flow and the company's stated capital allocation target.