Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow and free cash flow margin declined compared to both the prior quarter and the same quarter last year. The decrease was driven by lower operating cash flow combined with higher capital expenditure.
- The conversion of revenue into operating cash flow weakened versus the prior quarter and the same period last year. With capital expenditure rising, the free cash flow margin contracted further.
- Compared to the prior quarter, revenue, operating cash flow, and free cash flow all moved lower, and the margin narrowed. Year over year, revenue was slightly higher but operating cash flow was lower, while capital expenditure increased markedly, resulting in lower free cash flow and a narrower margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$8.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.3B
Cash generated by operations before capital spending.
CapEx
$93.0M
Capital spending and related asset purchases.
FCF margin
41.1%
The share of revenue converted into free cash flow.
TTM FCF yield
7.3%
TTM FCF divided by market capitalization.
FCF reconciliation
Free cash flow is not a GAAP line item; it should be bridged from the cash flow statement.
| Operating cash flow | $2.3B | Cash generated by operations before capital spending. |
| Capital expenditures | $93.0M | Capital spending used to bridge CFO to FCF. |
| Free cash flow | $2.2B | Operating cash flow less capital spending. |
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $6.5B | -$514.0M | $38.0M | -$552.0M | -8.4% |
| 2022-09-30 | $6.5B | $3.1B | $64.0M | $3.0B | 46.0% |
| 2022-12-31 | $6.1B | $2.6B | $58.0M | $2.6B | 41.9% |
| 2023-03-31 | $5.7B | $3.0B | $55.0M | $2.9B | 51.2% |
| 2023-06-30 | $6.5B | $124.0M | $48.0M | $76.0M | 1.2% |
| 2023-09-30 | $6.3B | $3.0B | $40.0M | $2.9B | 46.4% |
| 2023-12-31 | $6.0B | $3.2B | $53.0M | $3.2B | 53.1% |
| 2024-03-31 | $5.6B | $2.9B | $35.0M | $2.8B | 51.0% |
| 2024-06-30 | $6.2B | -$75.0M | $29.0M | -$104.0M | -1.7% |
| 2024-09-30 | $6.3B | $2.6B | $31.0M | $2.6B | 41.2% |
| 2024-12-31 | $6.0B | $3.3B | $47.0M | $3.3B | 55.1% |
| 2025-03-31 | $5.3B | $2.7B | $38.0M | $2.7B | 51.0% |
| 2025-06-30 | $6.1B | $205.0M | $32.0M | $173.0M | 2.8% |
| 2025-09-30 | $6.1B | $3.1B | $54.0M | $3.0B | 50.1% |
| 2025-12-31 | $5.8B | $3.3B | $92.0M | $3.2B | 54.4% |
| 2026-03-31 | $5.4B | $2.3B | $93.0M | $2.2B | 41.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 102.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.7% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$21.1B | 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 substantially higher than both the prior quarter and the same quarter last year. Combined with a decline in operating cash flow, this drove the reduction in free cash flow and margin.
The rise in capital expenditure directly reduced free cash flow and compressed the margin, making near-term cash generation more dependent on the recovery of operating cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
The conversion of revenue into operating cash flow weakened versus the prior quarter and the same period last year. With capital expenditure rising, the free cash flow margin contracted further.
Compared to the prior quarter, revenue, operating cash flow, and free cash flow all moved lower, and the margin narrowed. Year over year, revenue was slightly higher but operating cash flow was lower, while capital expenditure increased markedly, resulting in lower free cash flow and a narrower margin.
Monitor the trajectory of capital expenditure to see if the elevated level persists and further pressures free cash flow.
Valuation context
A cash-flow page should show how much investors are paying for the cash stream, without turning into a full DCF.
| Market capitalization | $117.9B | Used as the denominator for FCF yield. |
| TTM FCF yield | 7.3% | TTM free cash flow divided by market capitalization. |
| EV / TTM FCF | 16.1x | A quick valuation bridge, not a full DCF. |
Peer context
Free cash flow quality is easier to read against related public companies.
Risks and tripwires
Observable signals that would weaken the free cash flow thesis.
| Risk | Tripwire | Why it matters |
|---|---|---|
| FCF margin compression | FCF margin falls for two consecutive quarters. | Cash conversion may be weakening before earnings show it. |
| Capital intensity rises | CapEx/revenue moves materially above the recent run rate. | More operating cash flow would be consumed before becoming FCF. |
| Working capital drag | Inventory or receivables grow faster than revenue. | Reported growth may not translate into cash. |