Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow increased relative to the prior quarter and the same quarter last year, while free cash flow margin improved. Revenue was lower than the prior quarter, but cash conversion strengthened.
- Free cash flow was higher than the prior quarter and the year-ago quarter, driven by operating cash flow that outpaced a modest increase in capital expenditure. The free cash flow margin improved compared to the prior quarter, indicating stronger cash generation per dollar of revenue.
- Compared to the prior quarter, revenue was lower but free cash flow and margin were higher. Versus the same quarter last year, operating cash flow and free cash flow were higher; revenue data for that period is not available.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.7B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.8B
Cash generated by operations before capital spending.
CapEx
$111.0M
Capital spending and related asset purchases.
FCF margin
31.6%
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 | 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% |
| 2023-09-30 | $5.4B | $1.8B | $111.0M | $1.7B | 31.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 232.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.1% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$10.7B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Stronger Operating Cash Flow
Operating cash flow increased both sequentially and year-over-year, supporting a higher free cash flow despite lower revenue sequentially. This improvement was the most significant observable factor in the cash conversion performance.
The free cash flow margin rose to a level above the prior quarter, reflecting a more efficient conversion of revenue into cash.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Free cash flow was higher than the prior quarter and the year-ago quarter, driven by operating cash flow that outpaced a modest increase in capital expenditure. The free cash flow margin improved compared to the prior quarter, indicating stronger cash generation per dollar of revenue.
Compared to the prior quarter, revenue was lower but free cash flow and margin were higher. Versus the same quarter last year, operating cash flow and free cash flow were higher; revenue data for that period is not available.
Monitor the trajectory of operating cash flow relative to revenue, as it was the primary driver of the margin expansion this quarter.