Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was stable compared to the prior quarter and slightly lower than the same quarter last year. Operating cash flow and free cash flow improved from the prior quarter but were lower than the year-ago period, resulting in a free cash flow margin that strengthened sequentially but weakened year-over-year.
- Operating cash flow as a proportion of revenue was higher than the prior quarter but lower than the same quarter last year. After accounting for capital expenditure, free cash flow margin followed a similar pattern, reflecting a sequential improvement in cash conversion efficiency relative to the prior quarter.
- Compared to the immediately preceding quarter, revenue was slightly higher, operating cash flow was higher, capital expenditure was lower, and free cash flow was higher, leading to an improved free cash flow margin. Compared to the same quarter one year earlier, revenue was slightly lower, operating cash flow was lower, capital expenditure was slightly lower, and free cash flow was lower, resulting in a weakened free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$14.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.5B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$3.3B
Cash generated by operations before capital spending.
CapEx
$764.0M
Capital spending and related asset purchases.
FCF margin
16.0%
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 |
|---|---|---|---|---|---|
| 2024-09-30 | $16.7B | $9.3B | $783.0M | $8.5B | 51.1% |
| 2024-12-31 | $15.6B | $3.5B | $937.0M | $2.5B | 16.1% |
| 2025-03-31 | $15.5B | $2.5B | $1.3B | $1.2B | 7.5% |
| 2025-06-30 | $15.8B | $3.3B | $764.0M | $2.5B | 16.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 57.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$27.4B | 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 Volatility
Operating cash flow was higher than the prior quarter but significantly lower than the same quarter last year. The filing indicates that operating cash flow in the first six months was reduced by payments for collaborations, licensing agreements, and acquisitions, which were larger in the current period than in the prior year.
This variability in operating cash flow directly drove the sequential improvement but year-over-year weakening in 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 higher than the prior quarter but lower than the same quarter last year. After accounting for capital expenditure, free cash flow margin followed a similar pattern, reflecting a sequential improvement in cash conversion efficiency relative to the prior quarter.
Compared to the immediately preceding quarter, revenue was slightly higher, operating cash flow was higher, capital expenditure was lower, and free cash flow was higher, leading to an improved free cash flow margin. Compared to the same quarter one year earlier, revenue was slightly lower, operating cash flow was lower, capital expenditure was slightly lower, and free cash flow was lower, resulting in a weakened free cash flow margin.
Monitor the trend in operating cash flow, as it was lower year-over-year despite stable revenue, and the filing notes that operating cash flow was reduced by upfront and milestone payments related to collaborations and acquisitions.