Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow both increased compared with the prior quarter and the same quarter last year. Free cash flow was level with a year ago and lower than the preceding quarter, driven by higher capital expenditure.
- Free cash flow margin weakened from the prior quarter and the year-ago quarter, as capital expenditure consumed a larger share of operating cash flow. Despite higher operating cash flow, the margin compression shows that cash conversion efficiency declined.
- Compared with the previous quarter, free cash flow was lower and free cash flow margin weakened; versus the same quarter a year earlier, free cash flow was stable while margin declined. Revenue and operating cash flow were higher on both comparisons.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$49.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$11.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$19.4B
Cash generated by operations before capital spending.
CapEx
$8.2B
Capital spending and related asset purchases.
FCF margin
28.7%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $34.1B | $20.4B | $6.5B | $13.9B | 40.7% |
| 2023-12-31 | $40.1B | $19.4B | $7.6B | $11.8B | 29.4% |
| 2024-03-31 | $36.5B | $19.2B | $6.4B | $12.8B | 35.2% |
| 2024-06-30 | $39.1B | $19.4B | $8.2B | $11.2B | 28.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 83.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 20.9% | 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.
Revenue growth underpins operating cash flow
Revenue was higher sequentially and year-over-year, and operating cash flow increased in both comparisons. This provided the foundation for substantial cash generation even as capital expenditure rose.
Stronger top-line performance enabled continued positive free cash flow despite higher investment spending.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Free cash flow margin weakened from the prior quarter and the year-ago quarter, as capital expenditure consumed a larger share of operating cash flow. Despite higher operating cash flow, the margin compression shows that cash conversion efficiency declined.
Compared with the previous quarter, free cash flow was lower and free cash flow margin weakened; versus the same quarter a year earlier, free cash flow was stable while margin declined. Revenue and operating cash flow were higher on both comparisons.
Monitor the trajectory of capital expenditure relative to operating cash flow, as its increase outpaced both metrics in the current quarter.