Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow remained negative in the quarter, with operating cash flow improving sequentially but capital expenditure rising. The free cash flow margin weakened compared to the same quarter last year.
- Revenue was higher than the prior quarter, and operating cash flow increased, yet capital expenditure also rose, resulting in a negative free cash flow. The free cash flow margin improved from the prior quarter but was lower than a year ago.
- Compared to the immediately preceding quarter, revenue and operating cash flow were higher, while capital expenditure increased, leading to a smaller negative free cash flow and an improved margin. Versus the same quarter one year earlier, revenue was lower, operating cash flow was higher, capital expenditure was higher, and free cash flow was more negative with a weakened margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$710.7M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$361.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$399.2M
Cash generated by operations before capital spending.
CapEx
$760.2M
Capital spending and related asset purchases.
FCF margin
-26.1%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $1.9B | $683.4M | $557.1M | $126.3M | 6.7% |
| 2023-06-30 | $1.1B | $507.6M | $604.8M | -$97.2M | -9.1% |
| 2023-09-30 | $1.0B | $344.9M | $723.7M | -$378.8M | -37.8% |
| 2023-12-31 | $1.4B | $399.2M | $760.2M | -$361.0M | -26.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -152.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 55.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | n/a | 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 Growth
Capital expenditure was higher than both the prior quarter and the same quarter last year, outpacing the increase in operating cash flow. This was the strongest observable driver of the negative free cash flow.
Higher capital expenditure directly contributed to a more negative free 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.
Revenue was higher than the prior quarter, and operating cash flow increased, yet capital expenditure also rose, resulting in a negative free cash flow. The free cash flow margin improved from the prior quarter but was lower than a year ago.
Compared to the immediately preceding quarter, revenue and operating cash flow were higher, while capital expenditure increased, leading to a smaller negative free cash flow and an improved margin. Versus the same quarter one year earlier, revenue was lower, operating cash flow was higher, capital expenditure was higher, and free cash flow was more negative with a weakened margin.
Monitor the trend in capital expenditure relative to operating cash flow, as the gap widened year over year.