Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was deeply negative in the quarter, driven by a large operating cash outflow. Revenue declined from both the prior quarter and the same quarter last year.
- Revenue of eight hundred seventy million dollars converted into negative operating cash flow of five hundred forty-two million dollars, resulting in a free cash flow margin of negative sixty-three point three percent after capital expenditure of nine million dollars.
- Compared to the prior quarter, free cash flow weakened from negative two hundred twenty-seven million dollars to negative five hundred fifty-one million dollars, and the margin declined from negative twenty-three point two percent. Versus the same quarter one year earlier, free cash flow shifted from positive one point four billion dollars to deeply negative, and the margin dropped from positive forty-eight point seven percent.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$551.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$542.0M
Cash generated by operations before capital spending.
CapEx
$9.0M
Capital spending and related asset purchases.
FCF margin
-63.3%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $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% |
| 2023-12-31 | $870.0M | -$542.0M | $9.0M | -$551.0M | -63.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 605.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.0% | 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 outflow
The most observable driver of the quarter's free cash flow was the large negative operating cash flow of five hundred forty-two million dollars, which far exceeded the prior quarter's outflow and reversed the positive cash flow from the year-ago period.
This operating cash outflow was the primary factor behind the quarter's negative free cash flow and margin decline.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue of eight hundred seventy million dollars converted into negative operating cash flow of five hundred forty-two million dollars, resulting in a free cash flow margin of negative sixty-three point three percent after capital expenditure of nine million dollars.
Compared to the prior quarter, free cash flow weakened from negative two hundred twenty-seven million dollars to negative five hundred fifty-one million dollars, and the margin declined from negative twenty-three point two percent. Versus the same quarter one year earlier, free cash flow shifted from positive one point four billion dollars to deeply negative, and the margin dropped from positive forty-eight point seven percent.
Monitor whether operating cash flow can narrow its negative gap relative to revenue in upcoming quarters.