Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow narrowed sharply as capital expenditure rose significantly, despite a slight increase in revenue and operating cash flow. The free cash flow margin declined compared to both the prior quarter and the same quarter last year.
- Revenue increased modestly, and operating cash flow improved slightly, but a substantial rise in capital expenditure consumed most of the cash generated, resulting in a low free cash flow and a weakened margin.
- Compared to the prior quarter, free cash flow and margin were lower due to higher capital spending, while revenue and operating cash flow were slightly higher. Versus the same quarter last year, free cash flow and margin were also lower, with operating cash flow declining and capital expenditure increasing.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$660.9M
Trailing twelve-month free cash flow.
Quarter free cash flow
$33.3M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$278.3M
Cash generated by operations before capital spending.
CapEx
$245.0M
Capital spending and related asset purchases.
FCF margin
1.6%
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 | $1.9B | $339.5M | $89.8M | $249.7M | 12.9% |
| 2023-12-31 | $1.9B | $335.3M | $141.1M | $194.2M | 10.0% |
| 2024-03-31 | $2.0B | $260.4M | $76.7M | $183.7M | 9.3% |
| 2024-06-30 | $2.1B | $278.3M | $245.0M | $33.3M | 1.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 16.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 11.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$2.3B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Capital Expenditure Surge
Capital expenditure rose substantially from both the prior quarter and the same quarter last year, outpacing the growth in operating cash flow and causing free cash flow to contract.
The elevated capital spending was the strongest observable driver of the quarter's lower free cash flow and margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased modestly, and operating cash flow improved slightly, but a substantial rise in capital expenditure consumed most of the cash generated, resulting in a low free cash flow and a weakened margin.
Compared to the prior quarter, free cash flow and margin were lower due to higher capital spending, while revenue and operating cash flow were slightly higher. Versus the same quarter last year, free cash flow and margin were also lower, with operating cash flow declining and capital expenditure increasing.
Monitor the level of capital expenditure in upcoming quarters, as its significant increase was the primary factor behind the reduced free cash flow.