Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue reached a new high, yet the free cash flow margin narrowed as operating cash flow did not keep pace. Capital expenditure rose compared to both prior periods.
- Operating cash flow was lower than the prior quarter despite higher revenue, while free cash flow also declined. The free cash flow margin decreased relative to both the preceding quarter and the same quarter last year, indicating a weaker conversion of revenue into cash.
- Compared to the prior quarter, revenue improved but operating cash flow and free cash flow were lower, and the free cash flow margin weakened. Versus the same quarter last year, revenue, operating cash flow, capital expenditure, and free cash flow were all higher, but the free cash flow margin was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$60.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
$15.6B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$16.6B
Cash generated by operations before capital spending.
CapEx
$1.1B
Capital spending and related asset purchases.
FCF margin
39.5%
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 |
|---|---|---|---|---|---|
| 2024-04-28 | $26.0B | $15.3B | $369.0M | $15.0B | 57.5% |
| 2024-07-28 | $30.0B | $14.5B | $977.0M | $13.5B | 45.0% |
| 2024-10-27 | $35.1B | $17.6B | $813.0M | $16.8B | 47.9% |
| 2025-01-26 | $39.3B | $16.6B | $1.1B | $15.6B | 39.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 70.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.7% | Lower capital intensity usually supports FCF margin. |
| Net cash | $126.0M | 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 Lagged Revenue Growth
Revenue rose in the current quarter, yet operating cash flow fell compared to the prior quarter, and the operating cash flow increase over last year was not proportional to the revenue increase. This divergence is the primary factor behind the weaker free cash flow margin.
If operating cash flow does not align more closely with revenue, the free cash flow margin may remain under pressure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was lower than the prior quarter despite higher revenue, while free cash flow also declined. The free cash flow margin decreased relative to both the preceding quarter and the same quarter last year, indicating a weaker conversion of revenue into cash.
Compared to the prior quarter, revenue improved but operating cash flow and free cash flow were lower, and the free cash flow margin weakened. Versus the same quarter last year, revenue, operating cash flow, capital expenditure, and free cash flow were all higher, but the free cash flow margin was lower.
Monitor the trend in capital expenditure, which increased sequentially and year-over-year, as it directly impacts free cash flow.