Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
This quarter's free cash flow turned positive from negative in the previous quarter, driven by higher operating cash flow. However, compared to the same quarter a year ago, free cash flow and margin were significantly lower.
- Revenue was stable quarter over quarter, while operating cash flow improved, leading to a positive free cash flow margin. Capital expenditure was similar to the prior quarter, so the improvement in cash conversion came from operations.
- Sequentially, free cash flow and margin improved from negative to positive. Year over year, free cash flow and margin weakened substantially, as operating cash flow was lower while capital expenditure was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$539.5M
Trailing twelve-month free cash flow.
Quarter free cash flow
$133.6M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$566.6M
Cash generated by operations before capital spending.
CapEx
$433.0M
Capital spending and related asset purchases.
FCF margin
6.1%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $2.1B | $731.3M | $373.0M | $358.3M | 17.0% |
| 2023-03-31 | $2.0B | $408.9M | $321.5M | $87.4M | 4.5% |
| 2023-06-30 | $2.1B | $390.8M | $430.6M | -$39.8M | -1.9% |
| 2023-09-29 | $2.2B | $566.6M | $433.0M | $133.6M | 6.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 22.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 19.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$820.3M | 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 recovery
Operating cash flow increased sequentially, turning free cash flow positive despite similar capital spending.
This sequential improvement in cash conversion strengthened the company's liquidity position.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable quarter over quarter, while operating cash flow improved, leading to a positive free cash flow margin. Capital expenditure was similar to the prior quarter, so the improvement in cash conversion came from operations.
Sequentially, free cash flow and margin improved from negative to positive. Year over year, free cash flow and margin weakened substantially, as operating cash flow was lower while capital expenditure was higher.
Monitor capital expenditure, as the filing notes it is directed toward manufacturing equipment and can materially influence available cash.