Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue continued to rise, but free cash flow margin contracted notably as operating cash flow fell sharply from the prior quarter. The current quarter's free cash flow was level with the year-ago quarter despite higher revenue.
- Revenue was higher, yet operating cash flow declined from the prior quarter, resulting in a lower free cash flow despite a moderate increase in capital expenditure. The free cash flow margin weakened compared to both the prior quarter and the year-ago quarter.
- Compared to the immediately preceding quarter, revenue was higher while operating cash flow, free cash flow, and free cash flow margin all weakened. Versus the same quarter one year earlier, revenue was higher, operating cash flow was slightly higher, free cash flow was stable, and free cash flow margin was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$72.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$13.5B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$15.4B
Cash generated by operations before capital spending.
CapEx
$1.9B
Capital spending and related asset purchases.
FCF margin
28.8%
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 |
|---|---|---|---|---|---|
| 2024-10-27 | $35.1B | $17.6B | $813.0M | $16.8B | 47.9% |
| 2025-01-26 | $39.3B | $16.6B | $1.1B | $15.6B | 39.5% |
| 2025-04-27 | $44.1B | $27.4B | $1.2B | $26.2B | 59.4% |
| 2025-07-27 | $46.7B | $15.4B | $1.9B | $13.5B | 28.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 51.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.1% | Lower capital intensity usually supports FCF margin. |
| Net cash | $3.2B | 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 Weakening
Operating cash flow declined sharply from the prior quarter even as revenue rose, producing a much lower free cash flow margin. The filing notes that cash provided by operating activities increased in the first half of the fiscal year compared to the prior year first half due to higher revenue, but the sequential quarter performance shows a notable pullback.
The weaker cash conversion rate is the strongest observable negative driver for free cash flow in the current quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher, yet operating cash flow declined from the prior quarter, resulting in a lower free cash flow despite a moderate increase in capital expenditure. The free cash flow margin weakened compared to both the prior quarter and the year-ago quarter.
Compared to the immediately preceding quarter, revenue was higher while operating cash flow, free cash flow, and free cash flow margin all weakened. Versus the same quarter one year earlier, revenue was higher, operating cash flow was slightly higher, free cash flow was stable, and free cash flow margin was lower.
Monitor the trend in operating cash flow relative to revenue, as the sequential decline in conversion efficiency was the most prominent change.