Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow were lower versus both the prior quarter and the same quarter last year, but free cash flow turned strongly positive compared to the prior quarter. The free cash flow margin improved sequentially while remaining slightly below the year-ago level.
- Operating cash flow as a share of revenue was higher than the prior quarter, indicating improved cash conversion. Capital expenditure was modestly lower sequentially, supporting a positive free cash flow after a negative prior quarter.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow both improved, with free cash flow shifting from negative to positive. Versus the same quarter a year earlier, revenue, operating cash flow, and free cash flow were all lower, while the free cash flow margin weakened slightly.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$762.4M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.1B
Cash generated by operations before capital spending.
CapEx
$310.3M
Capital spending and related asset purchases.
FCF margin
22.5%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $5.3B | $888.8M | $353.7M | $535.1M | 10.0% |
| 2022-12-31 | $4.5B | $955.7M | $340.5M | $615.2M | 13.7% |
| 2023-03-31 | $3.6B | $149.0M | $321.5M | -$172.5M | -4.8% |
| 2023-06-30 | $3.4B | $1.1B | $310.3M | $762.4M | 22.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 206.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 9.1% | 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 Rebound
Operating cash flow moved substantially higher from the prior quarter, driving the turnaround in free cash flow. This shift was the primary observable factor behind the improvement in cash generation.
The improvement in operating cash flow was the strongest driver of the sequential free cash flow increase.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a share of revenue was higher than the prior quarter, indicating improved cash conversion. Capital expenditure was modestly lower sequentially, supporting a positive free cash flow after a negative prior quarter.
Compared to the immediately preceding quarter, operating cash flow and free cash flow both improved, with free cash flow shifting from negative to positive. Versus the same quarter a year earlier, revenue, operating cash flow, and free cash flow were all lower, while the free cash flow margin weakened slightly.
Monitor the trajectory of operating cash flow and its sustainability relative to revenue in upcoming quarters.