Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased compared to the prior quarter, while operating cash flow was slightly lower, resulting in a modest improvement in free cash flow. Compared to the same quarter last year, operating cash flow and free cash flow shifted from negative to positive, and the free cash flow margin turned positive.
- Operating cash flow was lower than revenue, and after deducting capital expenditure, free cash flow was positive with a single-digit margin. The conversion from revenue to free cash flow was positive but moderate.
- Compared to the immediately preceding quarter, revenue was higher, operating cash flow was slightly lower, capital expenditure was lower, and free cash flow was slightly higher, while the free cash flow margin weakened. Compared to the same quarter one year earlier, revenue was lower, operating cash flow and free cash flow improved from negative to positive, and the free cash flow margin turned positive.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$2.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$397.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$566.0M
Cash generated by operations before capital spending.
CapEx
$169.0M
Capital spending and related asset purchases.
FCF margin
5.1%
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 |
|---|---|---|---|---|---|
| 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% |
| 2023-06-30 | $6.2B | $570.0M | $182.0M | $388.0M | 6.2% |
| 2023-09-30 | $7.9B | $566.0M | $169.0M | $397.0M | 5.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 115.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.1% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$11.5B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Free cash flow turned positive year-over-year
The strongest observable driver is the shift in free cash flow from a large negative amount in the same quarter last year to a positive amount this quarter, driven by a substantial improvement in operating cash flow.
This change resulted in a positive free cash flow margin compared to a negative margin one year earlier.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was lower than revenue, and after deducting capital expenditure, free cash flow was positive with a single-digit margin. The conversion from revenue to free cash flow was positive but moderate.
Compared to the immediately preceding quarter, revenue was higher, operating cash flow was slightly lower, capital expenditure was lower, and free cash flow was slightly higher, while the free cash flow margin weakened. Compared to the same quarter one year earlier, revenue was lower, operating cash flow and free cash flow improved from negative to positive, and the free cash flow margin turned positive.
Monitor the trend in operating cash flow relative to revenue, as it slightly declined despite higher revenue.