Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was stable compared to a year earlier but slightly lower than the prior quarter. Free cash flow improved versus the prior quarter but weakened relative to the same quarter last year.
- Operating cash flow increased versus the prior quarter while capital expenditure slightly rose, leading to higher free cash flow and a stronger free cash flow margin. Compared to a year ago, operating cash flow declined, causing lower free cash flow and margin despite similar capital expenditure levels.
- Sequentially, free cash flow improved with a higher margin, driven by stronger operating cash conversion. Year over year, free cash flow weakened as operating cash flow was lower, offsetting the effect of stable revenue.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$525.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$565.0M
Cash generated by operations before capital spending.
CapEx
$40.0M
Capital spending and related asset purchases.
FCF margin
34.2%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $1.6B | $375.0M | $42.0M | $333.0M | 21.5% |
| 2022-09-30 | $1.6B | $232.0M | $41.0M | $191.0M | 12.3% |
| 2022-12-31 | $1.6B | $494.0M | $34.0M | $460.0M | 29.1% |
| 2023-03-31 | $1.5B | $565.0M | $40.0M | $525.0M | 34.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 173.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$4.4B | 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 Variability
Operating cash flow was the strongest observable driver of free cash flow changes, rising sequentially but dropping from a year ago. Compared to the year-ago quarter, even with similar revenue, operating cash flow was lower, directly reducing free cash flow.
Free cash flow and margin are sensitive to operating cash flow efficiency, which varied significantly between periods.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow increased versus the prior quarter while capital expenditure slightly rose, leading to higher free cash flow and a stronger free cash flow margin. Compared to a year ago, operating cash flow declined, causing lower free cash flow and margin despite similar capital expenditure levels.
Sequentially, free cash flow improved with a higher margin, driven by stronger operating cash conversion. Year over year, free cash flow weakened as operating cash flow was lower, offsetting the effect of stable revenue.
Monitor the trajectory of operating cash flow given its year-over-year decline despite stable revenue.