Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was higher than the prior quarter and the same quarter one year earlier, but the operating cash outflow widened, resulting in a more negative free cash flow margin. The company continues to rely on external financing to fund its operations, as highlighted in the filing.
- Revenue increased compared to both the prior quarter and the year-ago quarter, yet the operating cash deficit deepened, and capital expenditure remained minimal. Consequently, free cash flow was more negative, and the free cash flow margin weakened, reflecting poor conversion of revenue into cash.
- Sequentially, revenue was higher but operating cash flow and free cash flow were more negative, and the margin deteriorated. Year-over-year, revenue also rose while cash outflows increased, leading to a wider free cash flow deficit and a more negative margin compared to the same quarter one year earlier.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$53.1M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$15.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$15.5M
Cash generated by operations before capital spending.
CapEx
$15000
Capital spending and related asset purchases.
FCF margin
-907.1%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $1.7M | -$12.8M | $74000 | -$12.9M | -761.9% |
| 2022-12-31 | $2.4M | -$10.9M | $174000 | -$11.1M | -461.8% |
| 2023-03-31 | $1.6M | -$13.6M | $64000 | -$13.6M | -861.5% |
| 2023-06-30 | $1.7M | -$15.5M | $15000 | -$15.5M | -907.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 59.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.9% | 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.
Growing Operating Cash Outflow
The operating cash outflow increased relative to the prior quarter and the year-ago quarter, despite a rise in revenue. This widening deficit was the primary factor behind the more negative free cash flow and margin.
Continued cash consumption without a corresponding improvement in cash generation heightens the need for external capital, as noted in the filing.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased compared to both the prior quarter and the year-ago quarter, yet the operating cash deficit deepened, and capital expenditure remained minimal. Consequently, free cash flow was more negative, and the free cash flow margin weakened, reflecting poor conversion of revenue into cash.
Sequentially, revenue was higher but operating cash flow and free cash flow were more negative, and the margin deteriorated. Year-over-year, revenue also rose while cash outflows increased, leading to a wider free cash flow deficit and a more negative margin compared to the same quarter one year earlier.
The company's ability to secure additional financing, as it states it will need to fund operations for the next twelve months.