Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased compared to both the prior quarter and the same quarter last year. Free cash flow margin weakened versus both periods, as capital expenditure rose from the year-ago level and operating cash flow did not keep pace with revenue growth.
- Operating cash flow was higher than the year-ago quarter but lower than the prior quarter, while capital expenditure increased from the year-ago level but decreased from the prior quarter. The resulting free cash flow was higher than the prior quarter but lower than the year-ago quarter, and the free cash flow margin declined sequentially and year-over-year.
- Compared to the prior quarter, revenue improved while operating cash flow weakened, capital expenditure decreased, and free cash flow improved but the margin weakened slightly. Versus the same quarter last year, revenue improved, operating cash flow weakened, capital expenditure increased, and both free cash flow and its margin weakened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$346.1M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$412.1M
Cash generated by operations before capital spending.
CapEx
$66.0M
Capital spending and related asset purchases.
FCF margin
18.2%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $1.9B | $338.7M | $42.3M | $296.4M | 16.0% |
| 2023-09-30 | $1.9B | $520.3M | $27.8M | $492.5M | 26.5% |
| 2023-12-31 | $1.7B | $434.3M | $111.2M | $323.1M | 18.7% |
| 2024-03-31 | $1.9B | $412.1M | $66.0M | $346.1M | 18.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 78.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.5% | 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.
Capital Expenditure Increase
Capital expenditure was higher than the same quarter last year, which reduced free cash flow despite higher revenue. The sequential decline in capex from the prior quarter was not enough to offset the year-over-year pressure on free cash flow margin.
The higher capital expenditure relative to the year-ago period was the strongest observable driver of the weakened free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was higher than the year-ago quarter but lower than the prior quarter, while capital expenditure increased from the year-ago level but decreased from the prior quarter. The resulting free cash flow was higher than the prior quarter but lower than the year-ago quarter, and the free cash flow margin declined sequentially and year-over-year.
Compared to the prior quarter, revenue improved while operating cash flow weakened, capital expenditure decreased, and free cash flow improved but the margin weakened slightly. Versus the same quarter last year, revenue improved, operating cash flow weakened, capital expenditure increased, and both free cash flow and its margin weakened.
Monitor the trend in capital expenditure relative to operating cash flow, as the year-over-year increase in capex contributed to the decline in free cash flow margin.