Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was lower than both the prior quarter and the same quarter last year. Operating cash flow and free cash flow turned negative, and the free cash flow margin weakened significantly compared to the year-ago period.
- Operating cash flow was negative, and after capital expenditure, free cash flow was also negative, resulting in a negative free cash flow margin. This represents a cash conversion that is lower than both the preceding quarter and the same quarter one year earlier.
- Compared to the immediately preceding quarter, revenue was slightly lower, operating cash flow and free cash flow were more negative, and the free cash flow margin weakened. Compared to the same quarter one year earlier, revenue was lower, operating cash flow and free cash flow shifted from positive to negative, and the margin declined sharply.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$3.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$1.7B
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$1.6B
Cash generated by operations before capital spending.
CapEx
$142.0M
Capital spending and related asset purchases.
FCF margin
-23.2%
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 | $7.5B | $1.5B | $90.0M | $1.4B | 19.0% |
| 2022-09-30 | $8.4B | -$1.4B | $100.0M | -$1.5B | -18.3% |
| 2022-12-31 | $7.7B | -$1.4B | $117.0M | -$1.5B | -19.8% |
| 2023-03-31 | $7.5B | -$1.6B | $142.0M | -$1.7B | -23.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 130.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$12.1B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Negative Operating Cash Flow
Operating cash flow turned negative this quarter, a reversal from the positive level in the same quarter last year. This is the strongest observable driver of the negative free cash flow and margin.
The negative operating cash flow directly caused free cash flow to be negative, despite capital expenditure being higher than both comparison periods.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was negative, and after capital expenditure, free cash flow was also negative, resulting in a negative free cash flow margin. This represents a cash conversion that is lower than both the preceding quarter and the same quarter one year earlier.
Compared to the immediately preceding quarter, revenue was slightly lower, operating cash flow and free cash flow were more negative, and the free cash flow margin weakened. Compared to the same quarter one year earlier, revenue was lower, operating cash flow and free cash flow shifted from positive to negative, and the margin declined sharply.
Monitor whether operating cash flow returns to positive levels in subsequent quarters, as the current negative cash flow is a notable change from the prior year.