Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was lower than the prior quarter and the same quarter last year, driven by a lower operating cash flow and higher capital expenditure. Revenue improved over both periods, but the cash conversion weakened.
- Revenue increased compared to both the prior quarter and the year-ago period, yet operating cash flow decreased, and capital expenditure rose. The resulting free cash flow and free cash flow margin were lower than in either comparison period.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow were lower, while capital expenditure was higher. Relative to the same quarter one year earlier, all three metrics—operating cash flow, capital expenditure, and free cash flow—moved in the same direction, with free cash flow declining more than the year-ago period.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$200.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$661.0M
Cash generated by operations before capital spending.
CapEx
$461.0M
Capital spending and related asset purchases.
FCF margin
2.5%
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 |
|---|---|---|---|---|---|
| 2023-01-27 | $7.7B | $1.6B | $332.0M | $1.2B | 16.1% |
| 2023-04-28 | $8.5B | $2.5B | $378.0M | $2.1B | 24.4% |
| 2023-07-28 | $7.7B | $875.0M | $354.0M | $521.0M | 6.8% |
| 2023-10-27 | $8.0B | $661.0M | $461.0M | $200.0M | 2.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 22.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.8% | 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 conversion
Operating cash flow was lower than both the prior quarter and the year-ago quarter, even though revenue was higher. This weaker conversion was the primary factor behind the decline in free cash flow.
The lower operating cash flow, together with increased capital expenditure, resulted in a free cash flow margin that was significantly below the prior quarter and the year-ago quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased compared to both the prior quarter and the year-ago period, yet operating cash flow decreased, and capital expenditure rose. The resulting free cash flow and free cash flow margin were lower than in either comparison period.
Compared to the immediately preceding quarter, operating cash flow and free cash flow were lower, while capital expenditure was higher. Relative to the same quarter one year earlier, all three metrics—operating cash flow, capital expenditure, and free cash flow—moved in the same direction, with free cash flow declining more than the year-ago period.
Monitor the trend in capital expenditure relative to operating cash flow, as the higher capital outlay combined with lower operating cash flow directly compressed free cash flow.