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 from the prior quarter but rose sharply from a year ago. Capital expenditure decreased, leading to an improved free cash flow deficit and a narrower negative margin compared to both periods.
- Revenue was higher than both the prior quarter and the same quarter a year earlier. Operating cash flow declined from the preceding quarter but was significantly higher than the year-ago level. Capital expenditure was lower than in both comparison periods, and free cash flow, while still negative, improved markedly, with free cash flow margin also showing a less negative figure.
- Compared with the immediately preceding quarter, revenue was higher, operating cash flow and free cash flow both improved (less negative), and capital expenditure was lower. Versus the same quarter one year earlier, revenue, operating cash flow, and free cash flow all improved, while capital expenditure was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$3.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$165.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.2B
Cash generated by operations before capital spending.
CapEx
$1.4B
Capital spending and related asset purchases.
FCF margin
-2.8%
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 |
|---|---|---|---|---|---|
| 2023-06-01 | $3.8B | $24.0M | $1.6B | -$1.5B | -41.0% |
| 2023-08-31 | $4.0B | $249.0M | $1.5B | -$1.2B | -30.2% |
| 2023-11-30 | $4.7B | $1.4B | $1.8B | -$395.0M | -8.4% |
| 2024-02-29 | $5.8B | $1.2B | $1.4B | -$165.0M | -2.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -20.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 23.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$4.0B | 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 Reduction
Capital expenditure decreased from both the prior quarter and the year-ago quarter, which was the primary factor behind the narrower free cash flow deficit. The reduction in spending outpaced the decline in operating cash flow, resulting in improved free cash flow.
The free cash flow deficit narrowed significantly compared to both the prior quarter and the same quarter a year earlier.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than both the prior quarter and the same quarter a year earlier. Operating cash flow declined from the preceding quarter but was significantly higher than the year-ago level. Capital expenditure was lower than in both comparison periods, and free cash flow, while still negative, improved markedly, with free cash flow margin also showing a less negative figure.
Compared with the immediately preceding quarter, revenue was higher, operating cash flow and free cash flow both improved (less negative), and capital expenditure was lower. Versus the same quarter one year earlier, revenue, operating cash flow, and free cash flow all improved, while capital expenditure was lower.
Monitor the trend in operating cash flow, which declined sequentially despite higher revenue.