Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue declined sharply from both the prior quarter and the year-ago quarter, while operating cash flow turned negative, resulting in a negative free cash flow margin that widened from the prior year. The company's cash conversion weakened significantly as operating cash flow swung from positive to negative.
- Revenue was lower than the prior quarter and the year-ago quarter, while operating cash flow shifted from positive to negative, leading to a negative free cash flow. Capital expenditure was slightly lower than the prior quarter and year-ago quarter, but the decline in operating cash flow was the primary factor behind the negative free cash flow margin.
- Compared to the prior quarter, revenue was lower, operating cash flow moved from positive to negative, and free cash flow turned from positive to negative. Compared to the same quarter last year, revenue was lower, operating cash flow was less negative, but free cash flow margin was more negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$227.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$216.0M
Cash generated by operations before capital spending.
CapEx
$11.0M
Capital spending and related asset purchases.
FCF margin
-23.2%
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 | $2.9B | $1.4B | $4.0M | $1.4B | 48.7% |
| 2023-03-31 | $3.1B | $2.2B | $8.0M | $2.2B | 69.0% |
| 2023-06-30 | $2.0B | $940.0M | $9.0M | $931.0M | 47.1% |
| 2023-09-30 | $980.0M | -$216.0M | $11.0M | -$227.0M | -23.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 214.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.1% | 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.
Revenue Decline
Revenue was significantly lower than both the prior quarter and the year-ago quarter, which contributed to a negative operating cash flow and a widened free cash flow margin deficit.
The lower revenue base constrained cash generation, making free cash flow negative despite reduced capital expenditure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than the prior quarter and the year-ago quarter, while operating cash flow shifted from positive to negative, leading to a negative free cash flow. Capital expenditure was slightly lower than the prior quarter and year-ago quarter, but the decline in operating cash flow was the primary factor behind the negative free cash flow margin.
Compared to the prior quarter, revenue was lower, operating cash flow moved from positive to negative, and free cash flow turned from positive to negative. Compared to the same quarter last year, revenue was lower, operating cash flow was less negative, but free cash flow margin was more negative.
Monitor the trajectory of revenue and operating cash flow in the upcoming quarter, given the company's acknowledgement of seasonal patterns in the residential real estate market.