Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Nucor's free cash flow for the quarter ended July 1, 2023 increased compared to both the prior quarter and the year-ago quarter, driven by higher operating cash flow. The free cash flow margin also improved, reflecting stronger cash generation relative to revenue.
- Revenue was higher than the previous quarter but lower than a year ago. Operating cash flow rose significantly, while capital expenditure remained relatively stable, resulting in higher free cash flow and an improved free cash flow margin.
- Compared to the prior quarter, free cash flow and margin improved markedly, driven by higher operating cash flow. Versus the same quarter last year, free cash flow was higher despite lower revenue, as operating cash flow strengthened and capital expenditure was only slightly higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$6.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.4B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.9B
Cash generated by operations before capital spending.
CapEx
$525.4M
Capital spending and related asset purchases.
FCF margin
14.6%
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 |
|---|---|---|---|---|---|
| 2022-10-01 | $10.5B | $2.8B | $461.3M | $2.3B | 22.3% |
| 2022-12-31 | $8.7B | $2.5B | $517.9M | $2.0B | 23.1% |
| 2023-04-01 | $8.7B | $1.2B | $531.7M | $675.4M | 7.8% |
| 2023-07-01 | $9.5B | $1.9B | $525.4M | $1.4B | 14.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 95.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.5% | 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.
Strong Operating Cash Flow
Operating cash flow increased compared to both the prior quarter and the year-ago quarter, providing the primary lift to free cash flow. Capital expenditure showed little change, so the improvement in cash conversion came from higher cash generation on sales.
The higher free cash flow strengthens the company's financial flexibility and supports its capital allocation priorities.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than the previous quarter but lower than a year ago. Operating cash flow rose significantly, while capital expenditure remained relatively stable, resulting in higher free cash flow and an improved free cash flow margin.
Compared to the prior quarter, free cash flow and margin improved markedly, driven by higher operating cash flow. Versus the same quarter last year, free cash flow was higher despite lower revenue, as operating cash flow strengthened and capital expenditure was only slightly higher.
Monitor the company's liquidity position, which it highlighted as strong with cash and equivalents increasing from year-end levels.