Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin weakened this quarter compared to both the prior quarter and the same quarter last year. The decline was driven by lower operating cash flow despite a slight increase in revenue.
- Revenue was higher than the prior quarter, but operating cash flow was lower, resulting in a lower free cash flow margin. Capital expenditure was also lower, which partially offset the cash flow decline.
- Compared to the prior quarter, free cash flow and margin were both lower. Versus the same quarter last year, free cash flow and margin were also lower, while revenue was slightly lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$868.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$196.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$235.0M
Cash generated by operations before capital spending.
CapEx
$39.0M
Capital spending and related asset purchases.
FCF margin
12.4%
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 |
|---|---|---|---|---|---|
| 2022-07-29 | $1.6B | $281.0M | $65.0M | $216.0M | 13.6% |
| 2022-10-28 | $1.7B | $214.0M | $77.0M | $137.0M | 8.2% |
| 2023-01-27 | $1.5B | $377.0M | $58.0M | $319.0M | 20.9% |
| 2023-04-28 | $1.6B | $235.0M | $39.0M | $196.0M | 12.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 80.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$73.0M | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Operating Cash Flow Decline
Operating cash flow was lower than both the prior quarter and the same quarter last year, despite revenue being higher than the prior quarter. This was the strongest observable driver of the reduced free cash flow.
The lower operating cash flow directly reduced free cash flow and margin, making it the key item to watch going forward.
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, but operating cash flow was lower, resulting in a lower free cash flow margin. Capital expenditure was also lower, which partially offset the cash flow decline.
Compared to the prior quarter, free cash flow and margin were both lower. Versus the same quarter last year, free cash flow and margin were also lower, while revenue was slightly lower.
Monitor operating cash flow trends, as it was the primary factor behind the weakened free cash flow this quarter.