Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was negative in the current quarter, matching the level from a year earlier but weakening sharply from the prior quarter. Revenue rose compared to both periods, yet operating cash flow turned negative, driving the free cash flow deficit.
- Revenue increased, but operating cash flow was negative, resulting in negative free cash flow and a negative free cash flow margin. Capital expenditure was lower than the prior quarter and similar to the year-ago quarter, but the negative operating cash flow overwhelmed the modest capex.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow weakened from positive to negative, and the free cash flow margin declined. Versus the same quarter one year earlier, all cash flow metrics and the margin were similar, with both periods showing negative free cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$1.1B
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$1.1B
Cash generated by operations before capital spending.
CapEx
$78.0M
Capital spending and related asset purchases.
FCF margin
-1.5%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $70.2B | $1.1B | $86.0M | $1.0B | 1.5% |
| 2022-12-31 | $70.5B | $1.7B | $108.0M | $1.6B | 2.2% |
| 2023-03-31 | $68.9B | $3.3B | $293.0M | $3.0B | 4.4% |
| 2023-06-30 | $74.5B | -$1.1B | $78.0M | -$1.1B | -1.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -118.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.1% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$3.0B | 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 Turnaround
Operating cash flow shifted from positive in the prior quarter to negative in the current quarter, while capital expenditure remained relatively stable. This reversal was the strongest observable driver of the free cash flow decline.
If operating cash flow does not return to positive levels, free cash flow will likely remain negative in the near term.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased, but operating cash flow was negative, resulting in negative free cash flow and a negative free cash flow margin. Capital expenditure was lower than the prior quarter and similar to the year-ago quarter, but the negative operating cash flow overwhelmed the modest capex.
Compared to the immediately preceding quarter, operating cash flow and free cash flow weakened from positive to negative, and the free cash flow margin declined. Versus the same quarter one year earlier, all cash flow metrics and the margin were similar, with both periods showing negative free cash flow.
Monitor the trajectory of operating cash flow, as its negative swing was the primary factor behind the free cash flow deficit.