Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the second quarter of fiscal 2024, NXP Semiconductors generated free cash flow with a margin above the year-ago level but below the prior quarter. Operating cash flow decreased sequentially while capital expenditure also declined, resulting in lower free cash flow compared to the first quarter.
- Revenue was unchanged from the prior quarter, while operating cash flow contracted. Capital expenditure was reduced, but free cash flow and free cash flow margin weakened sequentially. Relative to the same quarter last year, revenue was lower, but operating cash flow improved slightly and capital expenditure was lower, leading to higher free cash flow and margin.
- Compared to the immediately preceding quarter, free cash flow and margin decreased. Versus the same quarter one year earlier, free cash flow and margin increased.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$576.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$761.0M
Cash generated by operations before capital spending.
CapEx
$185.0M
Capital spending and related asset purchases.
FCF margin
18.4%
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 |
|---|---|---|---|---|---|
| 2023-10-01 | $3.4B | $988.0M | $200.0M | $788.0M | 22.9% |
| 2023-12-31 | $3.4B | $1.1B | $175.0M | $962.0M | 28.1% |
| 2024-03-31 | $3.1B | $851.0M | $226.0M | $625.0M | 20.0% |
| 2024-06-30 | $3.1B | $761.0M | $185.0M | $576.0M | 18.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 88.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.9% | 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.
Operating cash flow decline
Operating cash flow decreased from the prior quarter despite stable revenue, which was the primary factor behind the sequential drop in free cash flow.
If operating cash flow continues to decline, free cash flow sustainability may be affected.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was unchanged from the prior quarter, while operating cash flow contracted. Capital expenditure was reduced, but free cash flow and free cash flow margin weakened sequentially. Relative to the same quarter last year, revenue was lower, but operating cash flow improved slightly and capital expenditure was lower, leading to higher free cash flow and margin.
Compared to the immediately preceding quarter, free cash flow and margin decreased. Versus the same quarter one year earlier, free cash flow and margin increased.
Monitor the cash balance and the effect of debt repayments on liquidity, as the company used cash to retire notes during the quarter.