Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin improved sequentially as operating cash flow increased and capital expenditure remained stable, though it was lower than the same quarter one year earlier. Management states the company maintains a strong financial position with balance sheet flexibility.
- Revenue was slightly higher than the prior quarter, and operating cash flow increased substantially. Capital expenditure was little changed, so free cash flow rose and the free cash flow margin widened.
- Compared with the immediately preceding quarter, free cash flow and margin both improved. Versus the same quarter one year earlier, free cash flow and margin were lower, as operating cash flow declined while revenue was similar.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.6B
Cash generated by operations before capital spending.
CapEx
$332.0M
Capital spending and related asset purchases.
FCF margin
16.1%
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 |
|---|---|---|---|---|---|
| 2022-04-29 | $8.1B | $2.1B | $389.0M | $1.7B | 20.6% |
| 2022-07-29 | $7.4B | $1.1B | $426.0M | $657.0M | 8.9% |
| 2022-10-28 | $7.6B | $922.0M | $323.0M | $599.0M | 7.9% |
| 2023-01-27 | $7.7B | $1.6B | $332.0M | $1.2B | 16.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 101.6% | 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.
Sequential operating cash flow improvement
Operating cash flow increased from the prior quarter, while capital expenditure remained stable, leading to higher free cash flow and margin.
This drove a sequential expansion in free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly higher than the prior quarter, and operating cash flow increased substantially. Capital expenditure was little changed, so free cash flow rose and the free cash flow margin widened.
Compared with the immediately preceding quarter, free cash flow and margin both improved. Versus the same quarter one year earlier, free cash flow and margin were lower, as operating cash flow declined while revenue was similar.
Monitor whether operating cash flow can sustain its recent level, given the decline compared to the same quarter one year earlier.