Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue, operating cash flow, and free cash flow all declined compared to both the prior quarter and the same quarter last year. The free cash flow margin weakened sequentially and was significantly lower than a year ago.
- Operating cash flow as a proportion of revenue was lower than the prior quarter and much lower than a year ago. Capital expenditure was higher than the prior quarter but lower than the year-ago quarter, resulting in free cash flow and free cash flow margin that weakened sequentially and declined sharply year over year.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all lower, while capital expenditure was higher. Compared to the same quarter one year earlier, all metrics were lower, with free cash flow margin showing a substantial decline.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$304.2M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$377.1M
Cash generated by operations before capital spending.
CapEx
$72.9M
Capital spending and related asset purchases.
FCF margin
24.5%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $2.3B | $616.2M | $74.4M | $541.8M | 24.0% |
| 2023-12-31 | $1.8B | $853.3M | $59.5M | $793.8M | 45.0% |
| 2024-03-31 | $1.3B | $430.0M | $40.1M | $389.9M | 29.4% |
| 2024-06-30 | $1.2B | $377.1M | $72.9M | $304.2M | 24.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 235.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$5.9B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Weakening Cash Generation
The decline in operating cash flow was the strongest observable driver, as it fell more sharply than revenue on a sequential and year-over-year basis. This directly reduced free cash flow and compressed the free cash flow margin.
Lower operating cash flow was the primary factor behind the weakened free cash flow and margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a proportion of revenue was lower than the prior quarter and much lower than a year ago. Capital expenditure was higher than the prior quarter but lower than the year-ago quarter, resulting in free cash flow and free cash flow margin that weakened sequentially and declined sharply year over year.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all lower, while capital expenditure was higher. Compared to the same quarter one year earlier, all metrics were lower, with free cash flow margin showing a substantial decline.
Monitor the trajectory of capital expenditure relative to operating cash flow, as it increased sequentially while cash generation weakened.