Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue remained stable, but operating cash flow turned sharply negative, resulting in a deeply negative free cash flow margin. This marked a significant weakening compared to both the prior quarter and the same quarter last year.
- With revenue unchanged, the conversion from sales to cash deteriorated because operating cash flow fell from positive to negative while capital expenditure decreased only modestly. The resulting free cash flow was deeply negative, far below the positive levels seen in the comparison periods.
- Compared to the immediately preceding quarter, free cash flow and free cash flow margin sharply weakened, driven by a large swing in operating cash flow. Versus the same quarter one year earlier, the deterioration was even more pronounced, as operating cash flow had been higher and capital expenditure had been lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$739.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$2.0B
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$1.8B
Cash generated by operations before capital spending.
CapEx
$246.0M
Capital spending and related asset purchases.
FCF margin
-32.3%
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 | $6.0B | $2.0B | $358.0M | $1.6B | 27.1% |
| 2024-03-31 | $6.0B | $767.0M | $375.0M | $392.0M | 6.5% |
| 2024-06-30 | $6.3B | $1.0B | $269.0M | $752.0M | 12.0% |
| 2024-09-30 | $6.3B | -$1.8B | $246.0M | -$2.0B | -32.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -148.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.9% | 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.
Operating Cash Flow Swing
Operating cash flow shifted from positive in both comparison periods to negative in the current quarter, while revenue remained flat. The filing notes that management discussed liquidity in the MD&A section, but no specific cause for the swing is provided in the supplied context.
This negative operating cash flow drove free cash flow to a large deficit, reversing the surpluses seen in the prior quarter and the year-ago quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
With revenue unchanged, the conversion from sales to cash deteriorated because operating cash flow fell from positive to negative while capital expenditure decreased only modestly. The resulting free cash flow was deeply negative, far below the positive levels seen in the comparison periods.
Compared to the immediately preceding quarter, free cash flow and free cash flow margin sharply weakened, driven by a large swing in operating cash flow. Versus the same quarter one year earlier, the deterioration was even more pronounced, as operating cash flow had been higher and capital expenditure had been lower.
Monitor whether operating cash flow returns to positive territory in future periods, as the current quarter's negative swing is the primary factor behind the free cash flow deficit.