Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the current quarter, operating cash flow exceeded capital expenditure, generating positive free cash flow with an improved margin compared to the prior quarter. However, relative to the same quarter last year, both free cash flow and margin were lower, as operating cash flow declined while capital expenditure increased.
- Revenue was slightly higher than the prior quarter, and operating cash flow improved, while capital expenditure stayed stable. This combination resulted in higher free cash flow and a stronger free cash flow margin.
- Compared to the immediately preceding quarter, free cash flow and margin improved as operating cash flow rose despite stable capital expenditure. Compared to the same quarter one year earlier, free cash flow and margin weakened, with operating cash flow lower and capital expenditure higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$623.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.4B
Cash generated by operations before capital spending.
CapEx
$1.8B
Capital spending and related asset purchases.
FCF margin
9.2%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $7.3B | $3.1B | $1.6B | $1.5B | 20.8% |
| 2023-12-31 | $2.2B | $3.2B | $970.0M | $2.3B | 101.2% |
| 2024-03-31 | $6.7B | $2.0B | $1.8B | $224.0M | 3.3% |
| 2024-06-30 | $6.8B | $2.4B | $1.8B | $623.0M | 9.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 53.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 26.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$17.1B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Sequential operating cash flow growth
Operating cash flow increased from the prior quarter while capital expenditure remained unchanged, leading to a substantial improvement in free cash flow and free cash flow margin.
This sequential improvement in operating cash flow was the primary driver of the higher 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 slightly higher than the prior quarter, and operating cash flow improved, while capital expenditure stayed stable. This combination resulted in higher free cash flow and a stronger free cash flow margin.
Compared to the immediately preceding quarter, free cash flow and margin improved as operating cash flow rose despite stable capital expenditure. Compared to the same quarter one year earlier, free cash flow and margin weakened, with operating cash flow lower and capital expenditure higher.
Monitor the trend of operating cash flow relative to capital expenditure, as the year-over-year decline in free cash flow was driven by both lower operating cash flow and higher capital spending.