Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion improved sharply as operating cash flow rose while capital expenditure increased modestly, yielding a higher free cash flow margin. Revenue also grew compared to both the prior quarter and the same quarter last year.
- Operating cash flow increased more than capital expenditure, leading to a higher free cash flow and an improved free cash flow margin relative to revenue.
- Compared to the immediately preceding quarter, operating cash flow, free cash flow, and free cash flow margin all improved. Versus the same quarter one year earlier, revenue, operating cash flow, capital expenditure, free cash flow, and free cash flow margin were all higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$7.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.5B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$3.0B
Cash generated by operations before capital spending.
CapEx
$570.0M
Capital spending and related asset purchases.
FCF margin
36.7%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $5.9B | $2.2B | $528.7M | $1.7B | 28.2% |
| 2023-03-31 | $5.9B | $2.4B | $503.0M | $1.9B | 32.5% |
| 2023-06-30 | $6.5B | $1.7B | $526.0M | $1.1B | 17.7% |
| 2023-09-30 | $6.7B | $3.0B | $570.0M | $2.5B | 36.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 106.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 8.5% | 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 Growth
Operating cash flow increased substantially from both the prior quarter and the year-ago quarter, outpacing the rise in capital expenditure and driving free cash flow higher.
The stronger operating cash flow was the primary factor behind the improved 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 increased more than capital expenditure, leading to a higher free cash flow and an improved free cash flow margin relative to revenue.
Compared to the immediately preceding quarter, operating cash flow, free cash flow, and free cash flow margin all improved. Versus the same quarter one year earlier, revenue, operating cash flow, capital expenditure, free cash flow, and free cash flow margin were all higher.
Monitor whether operating cash flow can sustain its elevated level relative to revenue in future quarters.