Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the first quarter of fiscal 2024, free cash flow remained negative as capital expenditure exceeded operating cash flow. The free cash flow deficit narrowed compared to the same quarter last year but widened from the prior quarter.
- Operating cash flow as a percentage of revenue improved from the year-ago quarter but declined slightly from the previous quarter. The gap between operating cash flow and capital expenditure resulted in a negative free cash flow margin.
- Compared to the prior quarter, revenue and operating cash flow were lower, while capital expenditure was slightly lower, leading to a more negative free cash flow and a weakened margin. Relative to the same quarter last year, revenue and operating cash flow were higher, capital expenditure was higher, but free cash flow improved (less negative) and margin strengthened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$575.5M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$170.4M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$347.4M
Cash generated by operations before capital spending.
CapEx
$517.8M
Capital spending and related asset purchases.
FCF margin
-17.9%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $1.1B | $226.0M | $473.0M | -$247.0M | -22.0% |
| 2023-09-30 | $1.6B | $396.3M | $396.3M | -$48000 | -0.0% |
| 2023-12-31 | $991.6M | $373.8M | $531.8M | -$158.0M | -15.9% |
| 2024-03-31 | $951.7M | $347.4M | $517.8M | -$170.4M | -17.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -805.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 54.4% | 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.
Year-over-Year Operating Cash Flow Improvement
Operating cash flow increased significantly compared to the same quarter last year, which helped reduce the free cash flow deficit despite higher capital expenditure.
The stronger operating cash flow was the primary factor narrowing the free cash flow gap year over year.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a percentage of revenue improved from the year-ago quarter but declined slightly from the previous quarter. The gap between operating cash flow and capital expenditure resulted in a negative free cash flow margin.
Compared to the prior quarter, revenue and operating cash flow were lower, while capital expenditure was slightly lower, leading to a more negative free cash flow and a weakened margin. Relative to the same quarter last year, revenue and operating cash flow were higher, capital expenditure was higher, but free cash flow improved (less negative) and margin strengthened.
Monitor the trajectory of capital expenditure relative to operating cash flow, as the sustained investment outlay continues to pressure free cash flow.