Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue, operating cash flow, and free cash flow all declined compared to both the prior quarter and the same quarter last year. The free cash flow margin weakened significantly over both periods.
- Operating cash flow as a proportion of revenue was lower than the prior quarter and the year-ago quarter, while capital expenditure was higher in absolute terms compared to both periods. This resulted in a free cash flow margin that was lower than both the preceding quarter and the same quarter one year earlier.
- Compared to the immediately preceding quarter, revenue, operating cash flow, free cash flow, and free cash flow margin were all lower, while capital expenditure was higher. Versus the same quarter one year earlier, all metrics were lower, with operating cash flow and free cash flow showing the largest relative declines.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$5.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.0B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.7B
Cash generated by operations before capital spending.
CapEx
$651.0M
Capital spending and related asset purchases.
FCF margin
2.9%
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 | $36.3B | $1.1B | $532.0M | $591.0M | 1.6% |
| 2024-03-31 | $32.7B | $1.5B | $585.0M | $947.0M | 2.9% |
| 2024-06-30 | $37.9B | $3.2B | $487.0M | $2.8B | 7.3% |
| 2024-09-30 | $35.1B | $1.7B | $651.0M | $1.0B | 2.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 166.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.9% | 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 Decline
Operating cash flow was lower than both the prior quarter and the same quarter last year. The filing notes that net cash provided by operating activities decreased in the first nine months of 2024 compared to the same period in 2023, primarily due to a decrease in operating results and an unfavorable change in working capital.
The lower operating cash flow was the primary factor behind the weakened free cash flow and 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 as a proportion of revenue was lower than the prior quarter and the year-ago quarter, while capital expenditure was higher in absolute terms compared to both periods. This resulted in a free cash flow margin that was lower than both the preceding quarter and the same quarter one year earlier.
Compared to the immediately preceding quarter, revenue, operating cash flow, free cash flow, and free cash flow margin were all lower, while capital expenditure was higher. Versus the same quarter one year earlier, all metrics were lower, with operating cash flow and free cash flow showing the largest relative declines.
Monitor the trend in operating cash flow, as it declined more sharply than revenue compared to both the prior quarter and the year-ago quarter.