Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the current quarter, free cash flow turned positive and the margin improved significantly compared to both the prior quarter and the same quarter last year, despite lower revenue. Operating cash flow increased substantially, more than offsetting higher capital expenditure.
- Revenue was lower than the prior quarter and the year-ago quarter, yet operating cash flow was higher, resulting in a free cash flow margin that improved markedly. Capital expenditure increased, but the rise in operating cash flow drove free cash flow to a positive level.
- Compared to the immediately preceding quarter, revenue was lower while operating cash flow was substantially higher, capital expenditure was higher, and free cash flow improved from negative to positive. Versus the same quarter one year earlier, revenue was lower, operating cash flow was higher, capital expenditure was higher, and free cash flow and margin both improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$353.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$317.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$600.0M
Cash generated by operations before capital spending.
CapEx
$283.0M
Capital spending and related asset purchases.
FCF margin
25.7%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $682.0M | $555.0M | $353.0M | $202.0M | 29.6% |
| 2024-03-31 | $1.1B | $172.0M | $200.0M | -$28.0M | -2.7% |
| 2024-06-30 | $2.0B | $1.0M | $139.0M | -$138.0M | -7.0% |
| 2024-09-30 | $1.2B | $600.0M | $283.0M | $317.0M | 25.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 87.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 22.9% | 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 sharply relative to both the prior quarter and the year-ago period, even as revenue declined. This improvement was the primary factor behind the positive free cash flow and higher margin.
The higher operating cash flow more than compensated for increased capital spending, enabling strong free cash flow generation.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than the prior quarter and the year-ago quarter, yet operating cash flow was higher, resulting in a free cash flow margin that improved markedly. Capital expenditure increased, but the rise in operating cash flow drove free cash flow to a positive level.
Compared to the immediately preceding quarter, revenue was lower while operating cash flow was substantially higher, capital expenditure was higher, and free cash flow improved from negative to positive. Versus the same quarter one year earlier, revenue was lower, operating cash flow was higher, capital expenditure was higher, and free cash flow and margin both improved.
Monitor the deferred income tax payments under disaster tax relief, which are due in the near future and could affect cash flows.