Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased compared to both the prior quarter and the same quarter last year, yet operating cash flow and free cash flow declined. The free cash flow margin weakened, reflecting lower cash conversion from revenue.
- Cash conversion weakened as operating cash flow was lower despite higher revenue. Capital expenditure was reduced, but the decline in operating cash flow outweighed the CapEx reduction, leading to lower free cash flow and margin.
- Compared to the prior quarter, free cash flow and margin declined due to lower operating cash flow, partially offset by reduced capital spending. Versus the same quarter last year, both operating cash flow and free cash flow were significantly lower, with margin contracting substantially.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$11.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.4B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.6B
Cash generated by operations before capital spending.
CapEx
$256.0M
Capital spending and related asset purchases.
FCF margin
23.3%
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 |
|---|---|---|---|---|---|
| 2023-12-24 | $9.9B | $2.9B | $214.0M | $2.7B | 27.5% |
| 2024-03-24 | $9.4B | $3.6B | $184.0M | $3.4B | 35.9% |
| 2024-06-23 | $9.4B | $3.1B | $387.0M | $2.7B | 28.4% |
| 2024-09-29 | $10.2B | $2.6B | $256.0M | $2.4B | 23.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 81.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$5.4B | 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 Performance
Operating cash flow decreased from both the prior quarter and the same period last year, despite higher revenue. This suggests a weaker conversion of revenue into cash, which directly impacted free cash flow and margin.
The decline in operating cash flow is the primary factor behind the weaker free cash flow and margin this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion weakened as operating cash flow was lower despite higher revenue. Capital expenditure was reduced, but the decline in operating cash flow outweighed the CapEx reduction, leading to lower free cash flow and margin.
Compared to the prior quarter, free cash flow and margin declined due to lower operating cash flow, partially offset by reduced capital spending. Versus the same quarter last year, both operating cash flow and free cash flow were significantly lower, with margin contracting substantially.
Monitor whether operating cash flow can improve in the coming quarters as revenue continues to grow.