Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved significantly compared to the same quarter last year, driven by a substantial increase in operating cash flow. Relative to the prior quarter, free cash flow decreased as operating cash flow declined and capital expenditure rose.
- Revenue was stable compared to the prior quarter and higher than a year ago. Operating cash flow was lower than the prior quarter but much higher than the same quarter last year, leading to a free cash flow margin that weakened sequentially but improved year over year.
- Compared to the prior quarter, free cash flow and free cash flow margin were lower, with operating cash flow decreasing and capital expenditure increasing. Compared to the same quarter last year, free cash flow and free cash flow margin were substantially higher, driven by a much stronger operating cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$779.1M
Trailing twelve-month free cash flow.
Quarter free cash flow
$197.3M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$265.9M
Cash generated by operations before capital spending.
CapEx
$68.6M
Capital spending and related asset purchases.
FCF margin
11.7%
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 |
|---|---|---|---|---|---|
| 2022-11-30 | $1.7B | $401.4M | $95.2M | $306.2M | 18.1% |
| 2023-02-28 | $1.6B | $103.4M | $61.5M | $41.9M | 2.7% |
| 2023-05-31 | $1.7B | $290.8M | $57.1M | $233.7M | 14.1% |
| 2023-08-31 | $1.7B | $265.9M | $68.6M | $197.3M | 11.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 116.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.1% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$4.2B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Year-over-Year Operating Cash Flow Improvement
Operating cash flow was substantially higher than the same quarter last year, which was the strongest observable driver of the year-over-year improvement in free cash flow.
This drove a significant year-over-year increase in free cash flow and free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable compared to the prior quarter and higher than a year ago. Operating cash flow was lower than the prior quarter but much higher than the same quarter last year, leading to a free cash flow margin that weakened sequentially but improved year over year.
Compared to the prior quarter, free cash flow and free cash flow margin were lower, with operating cash flow decreasing and capital expenditure increasing. Compared to the same quarter last year, free cash flow and free cash flow margin were substantially higher, driven by a much stronger operating cash flow.
Monitor the trend in operating cash flow, as its sequential decline was the primary factor behind the quarter-over-quarter weakening in free cash flow.