Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow and margin improved markedly compared to both the prior quarter and the same quarter last year, as operating cash flow increased while revenue declined. The stronger cash generation was the primary observable factor in the quarter.
- Revenue was lower than the prior quarter and the year-ago quarter, but operating cash flow was higher, resulting in higher free cash flow. Capital expenditure increased slightly, yet the improvement in operating cash flow more than offset that, leading to an improved free cash flow margin.
- Compared to the immediately preceding quarter, free cash flow and margin improved as operating cash flow rose while revenue fell. Compared to the same quarter one year earlier, both free cash flow and margin were also higher, with operating cash flow increasing despite a slight decline in revenue.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$814.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$935.0M
Cash generated by operations before capital spending.
CapEx
$121.0M
Capital spending and related asset purchases.
FCF margin
17.2%
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 |
|---|---|---|---|---|---|
| 2024-03-31 | $5.1B | $795.1M | $79.2M | $715.9M | 14.1% |
| 2024-06-30 | $5.2B | $1.2B | $116.7M | $1.1B | 21.6% |
| 2024-09-30 | $4.9B | $744.0M | $95.0M | $649.0M | 13.2% |
| 2024-12-31 | $4.7B | $935.0M | $121.0M | $814.0M | 17.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 85.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.6% | 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.
Strong operating cash flow
Operating cash flow increased compared to both the prior quarter and the year-ago quarter, despite lower revenue. This drove a significant improvement in free cash flow and margin.
The higher operating cash flow allowed free cash flow to rise even as capital expenditure modestly increased.
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, but operating cash flow was higher, resulting in higher free cash flow. Capital expenditure increased slightly, yet the improvement in operating cash flow more than offset that, leading to an improved free cash flow margin.
Compared to the immediately preceding quarter, free cash flow and margin improved as operating cash flow rose while revenue fell. Compared to the same quarter one year earlier, both free cash flow and margin were also higher, with operating cash flow increasing despite a slight decline in revenue.
Monitor the trend in the Diversified Industrial segment sales, which the filing noted declined in the quarter.