Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and free cash flow both improved from the prior quarter and the year-ago quarter. The increase in free cash flow was driven by higher operating cash flow, while capital expenditure remained relatively stable year over year.
- Operating cash flow of the current quarter was lower than the prior quarter but higher than the year-ago quarter. Capital expenditure dropped significantly from the prior quarter and was nearly flat from a year ago, resulting in free cash flow that was higher in both comparisons and a free cash flow margin that improved from the preceding quarter and the year-ago quarter.
- Compared to the immediately preceding quarter, revenue increased, operating cash flow decreased, capital expenditure decreased substantially, free cash flow increased, and free cash flow margin improved. Compared to the same quarter one year earlier, revenue increased, operating cash flow increased, capital expenditure was stable, free cash flow increased, and free cash flow margin improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
$546.1M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$684.8M
Cash generated by operations before capital spending.
CapEx
$138.7M
Capital spending and related asset purchases.
FCF margin
6.4%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $7.2B | $638.2M | $128.5M | $509.7M | 7.1% |
| 2022-09-30 | $7.1B | $680.7M | $126.8M | $553.9M | 7.8% |
| 2022-12-31 | $8.1B | $1.2B | $976.8M | $272.0M | 3.3% |
| 2023-03-31 | $8.5B | $684.8M | $138.7M | $546.1M | 6.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 74.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.6% | 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.
Free Cash Flow Growth
The strongest observable driver was the increase in free cash flow relative to both the prior quarter and the year-ago quarter. This occurred as operating cash flow rose year over year and capital expenditure fell from the prior quarter.
Free cash flow and its margin improved compared to both the prior quarter and the year-ago quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow of the current quarter was lower than the prior quarter but higher than the year-ago quarter. Capital expenditure dropped significantly from the prior quarter and was nearly flat from a year ago, resulting in free cash flow that was higher in both comparisons and a free cash flow margin that improved from the preceding quarter and the year-ago quarter.
Compared to the immediately preceding quarter, revenue increased, operating cash flow decreased, capital expenditure decreased substantially, free cash flow increased, and free cash flow margin improved. Compared to the same quarter one year earlier, revenue increased, operating cash flow increased, capital expenditure was stable, free cash flow increased, and free cash flow margin improved.
Monitor the trajectory of operating cash flow, as it decreased from the prior quarter despite higher revenue.