Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company reported negative free cash flow this quarter, but the margin improved significantly from both the prior quarter and the same quarter last year. Operating cash flow rose while capital expenditure remained similar to the year-ago level, resulting in a narrower deficit.
- Revenue was substantially higher than in the prior quarter and the year-ago quarter. Operating cash flow also increased, while capital expenditure was slightly lower than the year-ago quarter but higher than the prior quarter. Consequently, free cash flow was negative but the margin improved from sharply negative levels.
- Compared to the prior quarter, revenue and operating cash flow were higher, capital expenditure was higher, and free cash flow was less negative. Versus the same quarter last year, revenue and operating cash flow were higher, capital expenditure was essentially unchanged, and free cash flow was less negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$832.5M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$220.2M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$539.8M
Cash generated by operations before capital spending.
CapEx
$760.0M
Capital spending and related asset purchases.
FCF margin
-4.2%
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 |
|---|---|---|---|---|---|
| 2024-03-31 | $1.6B | $456.2M | $589.5M | -$133.3M | -8.1% |
| 2024-06-30 | $1.1B | $445.5M | $629.8M | -$184.3M | -17.5% |
| 2024-09-30 | $1.0B | $340.0M | $634.7M | -$294.7M | -28.2% |
| 2024-12-31 | $5.3B | $539.8M | $760.0M | -$220.2M | -4.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -98.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 14.4% | 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.
Revenue Increase
Revenue in the current quarter was markedly higher than in the prior quarter and the same quarter last year, contributing to a larger operating cash flow.
The higher revenue allowed the company to narrow its free cash flow deficit despite elevated capital spending.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was substantially higher than in the prior quarter and the year-ago quarter. Operating cash flow also increased, while capital expenditure was slightly lower than the year-ago quarter but higher than the prior quarter. Consequently, free cash flow was negative but the margin improved from sharply negative levels.
Compared to the prior quarter, revenue and operating cash flow were higher, capital expenditure was higher, and free cash flow was less negative. Versus the same quarter last year, revenue and operating cash flow were higher, capital expenditure was essentially unchanged, and free cash flow was less negative.
Monitor the trajectory of capital expenditure relative to operating cash flow, as the company continues to invest in infrastructure replacement programs noted in the filing.