Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
This quarter's free cash flow turned positive and improved significantly compared to both the prior quarter and the same quarter a year ago. The free cash flow margin was positive, reflecting a strong cash conversion from revenue.
- Operating cash flow was substantially higher than capital expenditure, generating a healthy free cash flow. The free cash flow margin indicates a solid proportion of revenue was converted into free cash.
- Compared to the prior quarter, operating cash flow and free cash flow improved from negative to positive. Versus the same quarter last year, both operating cash flow and free cash flow were higher, while capital expenditure was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.4B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.5B
Cash generated by operations before capital spending.
CapEx
$101.0M
Capital spending and related asset purchases.
FCF margin
23.5%
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 | n/a | $1.4B | $128.0M | $1.3B | n/a |
| 2022-12-31 | n/a | $1.5B | $103.0M | $1.4B | n/a |
| 2023-03-31 | n/a | -$819.0M | $84.0M | -$903.0M | n/a |
| 2023-06-30 | $5.9B | $1.5B | $101.0M | $1.4B | 23.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 133.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.7% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$10.9B | 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 rebounded strongly from a negative prior quarter to a positive level, and was also higher than the year-ago quarter. This was the primary driver of the free cash flow improvement.
The strong operating cash flow underpinned the positive free cash flow and margin improvement.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was substantially higher than capital expenditure, generating a healthy free cash flow. The free cash flow margin indicates a solid proportion of revenue was converted into free cash.
Compared to the prior quarter, operating cash flow and free cash flow improved from negative to positive. Versus the same quarter last year, both operating cash flow and free cash flow were higher, while capital expenditure was lower.
Monitor the sustainability of operating cash flow, given the prior quarter's negative swing.