Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion weakened meaningfully from the prior quarter as operating cash flow declined sharply while capital expenditure rose slightly. Despite a moderate revenue decrease, free cash flow and free cash flow margin contracted significantly.
- Revenue was lower than the prior quarter but higher than the year-ago quarter. Operating cash flow fell substantially from the prior quarter but improved compared to the same quarter last year. Capital expenditure increased both sequentially and year over year. Free cash flow dropped steeply from the previous quarter but rose moderately versus the year-ago period. Free cash flow margin narrowed sharply from the prior quarter, though it was slightly wider than the same quarter one year earlier.
- Compared to the immediate prior quarter, cash conversion weakened materially due to a much lower operating cash flow and a higher capital expenditure. Versus the same quarter one year earlier, cash conversion improved slightly, supported by higher operating cash flow even as capital expenditure rose.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$5.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$584.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.1B
Cash generated by operations before capital spending.
CapEx
$504.0M
Capital spending and related asset purchases.
FCF margin
6.8%
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 |
|---|---|---|---|---|---|
| 2024-10-25 | $8.4B | $958.0M | $404.0M | $554.0M | 6.6% |
| 2025-01-24 | $8.3B | $2.6B | $476.0M | $2.1B | 25.3% |
| 2025-04-25 | $8.9B | $2.5B | $459.0M | $2.1B | 23.2% |
| 2025-07-25 | $8.6B | $1.1B | $504.0M | $584.0M | 6.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 55.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.9% | 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 contraction
Operating cash flow posted a significant sequential decline, which was the strongest observable driver behind the weakened free cash flow and margin. This occurred even as revenue decreased modestly.
The lower operating cash flow directly reduced free cash flow and compressed free cash flow margin versus the preceding quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than the prior quarter but higher than the year-ago quarter. Operating cash flow fell substantially from the prior quarter but improved compared to the same quarter last year. Capital expenditure increased both sequentially and year over year. Free cash flow dropped steeply from the previous quarter but rose moderately versus the year-ago period. Free cash flow margin narrowed sharply from the prior quarter, though it was slightly wider than the same quarter one year earlier.
Compared to the immediate prior quarter, cash conversion weakened materially due to a much lower operating cash flow and a higher capital expenditure. Versus the same quarter one year earlier, cash conversion improved slightly, supported by higher operating cash flow even as capital expenditure rose.
Monitor operating cash flow sustainability given its sharp sequential decline relative to the prior quarter.