Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue declined compared to the preceding quarter and the same quarter a year ago, but free cash flow rose and the margin improved, supported by stronger operating cash flow and lower capital expenditure. The company's filing highlights its liquidity sources, including increased cash and marketable securities from the prior year-end.
- Revenue was lower, but operating cash flow increased from the prior quarter and was only slightly below the year-ago level. With capital expenditure reduced, free cash flow and its margin both improved.
- Relative to the prior quarter, free cash flow and margin improved substantially. Versus the same quarter last year, free cash flow was higher despite lower revenue, and the margin also improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$6.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.4B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.7B
Cash generated by operations before capital spending.
CapEx
$306.0M
Capital spending and related asset purchases.
FCF margin
27.8%
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 |
|---|---|---|---|---|---|
| 2022-09-25 | $11.4B | $1.4B | $634.0M | $812.0M | 7.1% |
| 2022-12-25 | $9.5B | $3.1B | $398.0M | $2.7B | 28.5% |
| 2023-03-26 | $9.3B | $1.5B | $453.0M | $1.0B | 10.8% |
| 2023-06-25 | $8.5B | $2.7B | $306.0M | $2.4B | 27.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 130.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$8.4B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Operating Cash Flow Improvement
Operating cash flow rose sequentially, and capital expenditure decreased, resulting in a higher free cash flow margin. The filing notes that operating cash flow is a key liquidity source.
The improved free cash flow margin strengthens the company's liquidity position.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower, but operating cash flow increased from the prior quarter and was only slightly below the year-ago level. With capital expenditure reduced, free cash flow and its margin both improved.
Relative to the prior quarter, free cash flow and margin improved substantially. Versus the same quarter last year, free cash flow was higher despite lower revenue, and the margin also improved.
Monitor the sustainability of operating cash flow generation as revenue continues to decline.