Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue, operating cash flow, and free cash flow all declined compared to both the prior quarter and the same quarter last year. The free cash flow margin weakened sequentially and was substantially lower than the year-ago period.
- Operating cash flow as a proportion of revenue was lower than the prior quarter and significantly lower than the year-ago quarter. Capital expenditure increased relative to the year-ago period, further reducing free cash flow conversion.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all lower, while capital expenditure was slightly higher. Versus the same quarter one year earlier, all metrics except capital expenditure were lower, with capital expenditure being higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$478.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.3B
Cash generated by operations before capital spending.
CapEx
$823.0M
Capital spending and related asset purchases.
FCF margin
6.4%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $7.7B | $1.5B | $717.8M | $802.6M | 10.4% |
| 2024-03-30 | $8.1B | $460.0M | $670.0M | -$210.0M | -2.6% |
| 2024-06-29 | $8.1B | $1.5B | $801.0M | $684.0M | 8.5% |
| 2024-09-28 | $7.4B | $1.3B | $823.0M | $478.0M | 6.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 191.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 11.1% | 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.
Weaker Cash Generation
Operating cash flow declined more sharply than revenue on a sequential and year-over-year basis, indicating a lower cash conversion rate. This was the strongest observable driver of the free cash flow decrease.
The combination of lower operating cash flow and higher capital expenditure resulted in a materially reduced free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a proportion of revenue was lower than the prior quarter and significantly lower than the year-ago quarter. Capital expenditure increased relative to the year-ago period, further reducing free cash flow conversion.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all lower, while capital expenditure was slightly higher. Versus the same quarter one year earlier, all metrics except capital expenditure were lower, with capital expenditure being higher.
Monitor the trend in capital expenditure relative to operating cash flow, as higher spending combined with lower cash generation compressed free cash flow.