Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was slightly lower than the prior quarter and the year-ago quarter, but operating cash flow and free cash flow improved substantially. The free cash flow margin expanded significantly, reflecting stronger cash conversion.
- Operating cash flow rose notably compared to both the preceding quarter and the same quarter last year, while capital expenditure was lower than the year-ago level though slightly higher than the prior quarter. As a result, free cash flow and free cash flow margin both improved markedly.
- Compared to the immediately preceding quarter, revenue was stable, operating cash flow increased, and free cash flow margin improved. Versus the same quarter one year earlier, revenue was lower, but operating cash flow and free cash flow margin were significantly higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$615.2M
Trailing twelve-month free cash flow.
Quarter free cash flow
$181.3M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$190.2M
Cash generated by operations before capital spending.
CapEx
$8.9M
Capital spending and related asset purchases.
FCF margin
27.9%
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 |
|---|---|---|---|---|---|
| 2022-10-31 | $683.6M | $173.4M | $12.1M | $161.4M | 23.6% |
| 2023-01-31 | $610.5M | $123.3M | $9.3M | $114.0M | 18.7% |
| 2023-04-30 | $650.2M | $164.6M | $6.0M | $158.5M | 24.4% |
| 2023-07-31 | $648.7M | $190.2M | $8.9M | $181.3M | 27.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 141.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$695.0M | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Strong Operating Cash Flow
Operating cash flow increased significantly compared to both the prior quarter and the year-ago quarter. The company's filing notes that improvements in accounts receivable and inventory, along with cash inflows from foreign exchange contract settlements, contributed to the change in operating assets and liabilities.
This drove a higher free cash flow margin and overall free cash flow improvement.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow rose notably compared to both the preceding quarter and the same quarter last year, while capital expenditure was lower than the year-ago level though slightly higher than the prior quarter. As a result, free cash flow and free cash flow margin both improved markedly.
Compared to the immediately preceding quarter, revenue was stable, operating cash flow increased, and free cash flow margin improved. Versus the same quarter one year earlier, revenue was lower, but operating cash flow and free cash flow margin were significantly higher.
Monitor capital expenditure levels, as they increased from the prior quarter while remaining below the year-ago amount.