Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin improved markedly from the prior quarter but was slightly below the year-ago level. Operating cash flow rose sharply sequentially, while revenue also increased.
- Revenue expansion combined with stable operating cash flow conversion and lower capital expenditure resulted in free cash flow increasing relative to the preceding quarter. The free cash flow margin reflected a higher proportion of operating cash flow retained after capital spending.
- Compared to the prior quarter, free cash flow and operating cash flow were both higher, while capital expenditure was slightly lower. Versus the same quarter a year ago, free cash flow was stable but the free cash flow margin was lower as revenue grew at a faster pace.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$6.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.4B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.4B
Cash generated by operations before capital spending.
CapEx
$43.2M
Capital spending and related asset purchases.
FCF margin
16.8%
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 | $11.5B | $1.4B | $63.7M | $1.3B | 11.5% |
| 2022-09-30 | $12.8B | $2.0B | $108.3M | $1.9B | 15.0% |
| 2022-12-31 | $13.5B | $929.8M | $47.0M | $882.8M | 6.6% |
| 2023-03-31 | $14.3B | $2.4B | $43.2M | $2.4B | 16.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 537.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.3% | 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.
Strong Operating Cash Flow
Operating cash flow increased substantially from the preceding quarter, supporting a rise in free cash flow despite slightly lower year-over-year comparison. The company's insurance operations generated positive cash flows, as noted in the filing context.
The elevated cash generation provides flexibility for capital allocation and reduces reliance on external funding.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue expansion combined with stable operating cash flow conversion and lower capital expenditure resulted in free cash flow increasing relative to the preceding quarter. The free cash flow margin reflected a higher proportion of operating cash flow retained after capital spending.
Compared to the prior quarter, free cash flow and operating cash flow were both higher, while capital expenditure was slightly lower. Versus the same quarter a year ago, free cash flow was stable but the free cash flow margin was lower as revenue grew at a faster pace.
Monitor capital expenditure trends given the lower spending this quarter relative to both prior periods.