Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow and free cash flow improved significantly compared to both the prior quarter and the same quarter last year. The free cash flow margin expanded substantially over both comparative periods.
- Revenue increased, while operating cash flow grew at a faster pace, leading to a higher cash conversion rate. Capital expenditure declined sequentially and year-over-year, further boosting free cash flow and the free cash flow margin.
- Compared to the prior quarter, revenue, operating cash flow, free cash flow, and free cash flow margin all increased, while capital expenditure decreased. Versus the same quarter one year earlier, all metrics improved: revenue and operating cash flow were higher, capital expenditure was lower, and free cash flow and margin were higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$24.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$11.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$17.3B
Cash generated by operations before capital spending.
CapEx
$6.1B
Capital spending and related asset purchases.
FCF margin
34.9%
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 | $27.7B | $9.7B | $9.4B | $317.0M | 1.1% |
| 2022-12-31 | $32.2B | $14.5B | $8.8B | $5.7B | 17.8% |
| 2023-03-31 | $28.6B | $14.0B | $6.8B | $7.2B | 25.0% |
| 2023-06-30 | $32.0B | $17.3B | $6.1B | $11.2B | 34.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 143.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 19.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | $10.4B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Higher operating cash flow and lower capex
Operating cash flow increased substantially compared to both the prior quarter and the same quarter last year, while capital expenditure declined. This combination drove the strong expansion in free cash flow and free cash flow margin.
The simultaneous improvement in operating cash generation and capital discipline delivered a meaningfully higher free cash flow result.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased, while operating cash flow grew at a faster pace, leading to a higher cash conversion rate. Capital expenditure declined sequentially and year-over-year, further boosting free cash flow and the free cash flow margin.
Compared to the prior quarter, revenue, operating cash flow, free cash flow, and free cash flow margin all increased, while capital expenditure decreased. Versus the same quarter one year earlier, all metrics improved: revenue and operating cash flow were higher, capital expenditure was lower, and free cash flow and margin were higher.
Monitor future movements in capital expenditure, as its reduction was a key factor in the free cash flow improvement.