Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased while operating cash flow declined sharply, leading to a much lower free cash flow margin. Capital expenditure rose significantly, offsetting most of the operating cash flow and compressing free cash flow compared to the prior quarter.
- Free cash flow margin weakened to a single-digit level as operating cash flow as a proportion of revenue fell and capital expenditure rose. The conversion from revenue to free cash flow was strained by higher capital spending despite higher revenue.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow both decreased while capital expenditure increased, resulting in a lower free cash flow margin. Relative to the same quarter one year earlier, revenue and operating cash flow were higher, but capital expenditure also rose, and free cash flow was slightly lower with a weaker margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$77.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$5.9B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$35.8B
Cash generated by operations before capital spending.
CapEx
$29.9B
Capital spending and related asset purchases.
FCF margin
7.2%
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 |
|---|---|---|---|---|---|
| 2025-03-31 | $70.1B | $37.0B | $16.7B | $20.3B | 29.0% |
| 2025-06-30 | $76.4B | $42.6B | $17.1B | $25.6B | 33.4% |
| 2025-09-30 | $77.7B | $45.1B | $19.4B | $25.7B | 33.0% |
| 2025-12-31 | $81.3B | $35.8B | $29.9B | $5.9B | 7.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 15.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 36.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$16.0B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Capital Expenditure Increase
Capital expenditure rose substantially compared to both the prior quarter and the year-ago quarter. This was the strongest observable driver of the decline in free cash flow and margin.
Higher capital expenditure reduced free cash flow and margin despite higher revenue and operating cash flow compared to a year ago.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Free cash flow margin weakened to a single-digit level as operating cash flow as a proportion of revenue fell and capital expenditure rose. The conversion from revenue to free cash flow was strained by higher capital spending despite higher revenue.
Compared to the immediately preceding quarter, operating cash flow and free cash flow both decreased while capital expenditure increased, resulting in a lower free cash flow margin. Relative to the same quarter one year earlier, revenue and operating cash flow were higher, but capital expenditure also rose, and free cash flow was slightly lower with a weaker margin.
Monitor the trajectory of capital expenditure relative to operating cash flow, as elevated spending is absorbing a large portion of cash generation.