Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin improved significantly compared to the prior quarter and the same quarter last year, driven by a higher proportion of operating cash flow relative to revenue. Capital expenditure increased notably from both comparison periods, partially offsetting the operating cash flow growth.
- Revenue was lower than both the prior quarter and the year-ago quarter, yet operating cash flow was higher than both periods, indicating improved cash conversion. Capital expenditure rose substantially, resulting in free cash flow that was lower than the prior quarter but slightly below the year-ago level.
- Compared to the prior quarter, revenue decreased while operating cash flow increased, leading to a higher free cash flow margin. Versus the same quarter last year, revenue was lower but operating cash flow was higher, with capital expenditure also higher, resulting in a free cash flow margin that improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$711.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$202.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$555.0M
Cash generated by operations before capital spending.
CapEx
$353.0M
Capital spending and related asset purchases.
FCF margin
29.6%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $1.4B | $161.0M | $174.0M | -$13.0M | -1.0% |
| 2023-06-30 | $1.8B | $358.0M | $119.0M | $239.0M | 13.1% |
| 2023-09-30 | $2.0B | $454.0M | $171.0M | $283.0M | 14.2% |
| 2023-12-31 | $682.0M | $555.0M | $353.0M | $202.0M | 29.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 71.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 51.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$3.1B | 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 was higher than both the prior quarter and the year-ago quarter, despite lower revenue, indicating improved cash generation efficiency.
This stronger operating cash flow was the primary factor behind the improved free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than both the prior quarter and the year-ago quarter, yet operating cash flow was higher than both periods, indicating improved cash conversion. Capital expenditure rose substantially, resulting in free cash flow that was lower than the prior quarter but slightly below the year-ago level.
Compared to the prior quarter, revenue decreased while operating cash flow increased, leading to a higher free cash flow margin. Versus the same quarter last year, revenue was lower but operating cash flow was higher, with capital expenditure also higher, resulting in a free cash flow margin that improved.
Monitor the trajectory of capital expenditure, as it increased substantially from both the prior quarter and the year-ago quarter, which could pressure future free cash flow if operating cash flow does not keep pace.