Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was lower than the prior quarter but higher than the same quarter last year. Free cash flow margin weakened compared to both the prior quarter and the year-ago quarter.
- Operating cash flow was lower than the prior quarter and stable compared to the year-ago quarter. Capital expenditure was higher than the prior quarter but lower than the year-ago quarter, resulting in free cash flow that was lower than the prior quarter and stable versus the year-ago quarter.
- Compared to the prior quarter, revenue, operating cash flow, free cash flow, and free cash flow margin were all lower, while capital expenditure was higher. Compared to the same quarter last year, revenue was higher, operating cash flow and free cash flow were stable, capital expenditure was lower, and free cash flow margin was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$5.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.0B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.2B
Cash generated by operations before capital spending.
CapEx
$170.0M
Capital spending and related asset purchases.
FCF margin
14.2%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $6.8B | $1.3B | $175.0M | $1.1B | 15.8% |
| 2022-09-30 | $6.8B | $1.8B | $182.0M | $1.6B | 23.0% |
| 2022-12-31 | $7.4B | $1.6B | $158.0M | $1.4B | 19.4% |
| 2023-03-31 | $7.0B | $1.2B | $170.0M | $1.0B | 14.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 125.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.4% | 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.
Free Cash Flow Margin Weakening
The free cash flow margin declined from the prior quarter and from the year-ago quarter, driven by a combination of lower operating cash flow relative to revenue and higher capital expenditure relative to the prior quarter.
The weakening margin indicates that cash generation efficiency has declined compared to both the prior quarter and the same quarter last year.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was lower than the prior quarter and stable compared to the year-ago quarter. Capital expenditure was higher than the prior quarter but lower than the year-ago quarter, resulting in free cash flow that was lower than the prior quarter and stable versus the year-ago quarter.
Compared to the prior quarter, revenue, operating cash flow, free cash flow, and free cash flow margin were all lower, while capital expenditure was higher. Compared to the same quarter last year, revenue was higher, operating cash flow and free cash flow were stable, capital expenditure was lower, and free cash flow margin was lower.
Monitor the trend in free cash flow margin, which weakened sequentially and year-over-year.