Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow and margin improved significantly from the prior quarter, driven by a substantial increase in operating cash flow, while revenue was slightly lower. Compared to the same quarter a year earlier, free cash flow was slightly lower and margin was similar.
- Operating cash flow converted to free cash flow after deducting capital expenditure, which was lower than both prior periods. The free cash flow margin was high and nearly unchanged from a year ago.
- Versus the immediate preceding quarter, operating cash flow and free cash flow were much higher, while revenue was slightly lower. Versus the same quarter one year earlier, revenue was slightly lower, operating cash flow was slightly lower, and free cash flow was slightly lower, but margins were stable.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$8.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.9B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$3.0B
Cash generated by operations before capital spending.
CapEx
$40.0M
Capital spending and related asset purchases.
FCF margin
46.4%
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 |
|---|---|---|---|---|---|
| 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% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 134.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$23.6B | 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 Recovery
Operating cash flow improved sharply from the prior quarter's low level, returning to a range similar to the same quarter a year earlier. This was the strongest factor in free cash flow generation.
The improvement in operating cash flow substantially increased free cash flow and margin from the prior quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow converted to free cash flow after deducting capital expenditure, which was lower than both prior periods. The free cash flow margin was high and nearly unchanged from a year ago.
Versus the immediate preceding quarter, operating cash flow and free cash flow were much higher, while revenue was slightly lower. Versus the same quarter one year earlier, revenue was slightly lower, operating cash flow was slightly lower, and free cash flow was slightly lower, but margins were stable.
Monitor the level of operating cash flow, as it was the primary driver of the quarter's free cash flow and showed significant volatility compared to the prior quarter.