Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion improved markedly in the current quarter as operating cash flow rose relative to both the preceding quarter and the same quarter one year earlier. The resulting free cash flow margin was higher than in either comparison period.
- Revenue was higher than both prior periods, while operating cash flow grew more than proportionally, and capital expenditure was between the two prior levels. This combination produced free cash flow that was higher than both the preceding quarter and the year-ago quarter, and the free cash flow margin also improved.
- Compared with the immediately preceding quarter, free cash flow and margin were both higher. Versus the same quarter one year earlier, free cash flow and margin also showed improvement.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$973.4M
Trailing twelve-month free cash flow.
Quarter free cash flow
$500.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$577.2M
Cash generated by operations before capital spending.
CapEx
$76.7M
Capital spending and related asset purchases.
FCF margin
28.6%
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 |
|---|---|---|---|---|---|
| 2023-02-28 | $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% |
| 2023-11-30 | $1.8B | $577.2M | $76.7M | $500.5M | 28.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 228.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$4.0B | 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 Strength
Operating cash flow increased substantially from both the prior quarter and the year-ago quarter, outpacing the change in revenue. This was the primary observable factor behind the higher free cash flow and margin.
The improvement in operating cash flow directly strengthened free cash flow generation and lifted the free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than both prior periods, while operating cash flow grew more than proportionally, and capital expenditure was between the two prior levels. This combination produced free cash flow that was higher than both the preceding quarter and the year-ago quarter, and the free cash flow margin also improved.
Compared with the immediately preceding quarter, free cash flow and margin were both higher. Versus the same quarter one year earlier, free cash flow and margin also showed improvement.
Monitor whether the elevated operating cash flow can be sustained in future quarters.