Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue rose compared to the prior quarter, while operating cash flow and free cash flow each declined. Compared to the same quarter one year earlier, revenue and free cash flow were both higher, though free cash flow margin was slightly lower.
- Cash conversion weakened sequentially: higher revenue yielded lower operating cash flow and a larger decline in free cash flow, leading to a lower free cash flow margin. Compared with the year-ago quarter, revenue and free cash flow were both higher, making the cash conversion rate stable.
- Compared to the immediately preceding quarter, revenue improved but operating cash flow, free cash flow, and margin all weakened. Compared to the same quarter one year earlier, revenue and free cash flow were higher, while operating cash flow was lower and margin was slightly lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$9.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.7B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.9B
Cash generated by operations before capital spending.
CapEx
$214.0M
Capital spending and related asset purchases.
FCF margin
27.5%
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 |
|---|---|---|---|---|---|
| 2023-03-26 | $9.3B | $1.5B | $453.0M | $1.0B | 10.8% |
| 2023-06-25 | $8.5B | $2.7B | $306.0M | $2.4B | 27.8% |
| 2023-09-24 | $8.6B | $4.1B | $293.0M | $3.8B | 44.0% |
| 2023-12-24 | $9.9B | $2.9B | $214.0M | $2.7B | 27.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 98.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$6.4B | 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 Weakening
Revenue increased from the prior quarter, yet operating cash flow fell substantially, resulting in a lower free cash flow margin. This divergence between revenue growth and cash generation is the strongest observable driver of the quarter's cash flow performance.
If operating cash flow continues to lag revenue growth, free cash flow margin may remain under pressure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion weakened sequentially: higher revenue yielded lower operating cash flow and a larger decline in free cash flow, leading to a lower free cash flow margin. Compared with the year-ago quarter, revenue and free cash flow were both higher, making the cash conversion rate stable.
Compared to the immediately preceding quarter, revenue improved but operating cash flow, free cash flow, and margin all weakened. Compared to the same quarter one year earlier, revenue and free cash flow were higher, while operating cash flow was lower and margin was slightly lower.
Monitor the trajectory of operating cash flow, which declined both sequentially and year-over-year despite higher revenue.