Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow both improved, leading to higher free cash flow and a stable free cash flow margin compared to the same quarter last year. Sequentially, free cash flow rose sharply as capital expenditure fell, while the margin expanded significantly from the prior quarter.
- Revenue increased, and operating cash flow rose at a faster pace, while capital expenditure was moderately higher than a year ago but much lower than the prior quarter. Free cash flow improved both sequentially and year over year, with the free cash flow margin unchanged from the year-ago quarter and substantially higher than the preceding quarter.
- Compared to the prior quarter, revenue and operating cash flow were both higher, and capital expenditure was substantially lower, resulting in a much larger free cash flow and a significantly improved margin. Versus the same quarter one year earlier, revenue and operating cash flow were higher, capital expenditure was slightly higher, and free cash flow was higher with the margin remaining at the same level.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.3B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.8B
Cash generated by operations before capital spending.
CapEx
$500.0M
Capital spending and related asset purchases.
FCF margin
30.0%
The share of revenue converted into free cash flow.
TTM FCF yield
1.7%
TTM FCF divided by market capitalization.
FCF reconciliation
Free cash flow is not a GAAP line item; it should be bridged from the cash flow statement.
| Operating cash flow | $1.8B | Cash generated by operations before capital spending. |
| Capital expenditures | $500.0M | Capital spending used to bridge CFO to FCF. |
| Free cash flow | $1.3B | Operating cash flow less capital spending. |
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 | $2.2B | $478.6M | $954.7M | -$476.0M | -21.8% |
| 2022-09-30 | $3.0B | -$44.5M | $225.5M | -$270.1M | -9.0% |
| 2022-12-31 | $2.6B | $575.7M | $166.7M | $409.0M | 15.7% |
| 2023-03-31 | $2.9B | $1.3B | $252.0M | $1.1B | 36.7% |
| 2023-06-30 | $3.5B | $1.4B | $796.0M | $596.0M | 16.9% |
| 2023-09-30 | $4.2B | $659.0M | $281.0M | $378.0M | 9.1% |
| 2023-12-31 | $3.3B | $1.1B | $2.6B | -$1.5B | -43.6% |
| 2024-03-31 | $3.7B | $1.3B | $242.0M | $1.1B | 29.1% |
| 2024-06-30 | $4.1B | $1.6B | $2.1B | -$567.0M | -13.8% |
| 2024-09-30 | $4.9B | $897.0M | $334.0M | $563.0M | 11.5% |
| 2024-12-31 | $3.8B | $1.5B | $552.0M | $915.0M | 24.3% |
| 2025-03-31 | $4.0B | $1.6B | $428.0M | $1.2B | 30.0% |
| 2025-06-30 | $4.5B | $1.7B | $836.0M | $910.0M | 20.1% |
| 2025-09-30 | $5.1B | $1.5B | $2.5B | -$989.0M | -19.2% |
| 2025-12-31 | $4.3B | $1.6B | $1.5B | $116.0M | 2.7% |
| 2026-03-31 | $4.5B | $1.8B | $500.0M | $1.3B | 30.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 141.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 11.2% | 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.
Operating Cash Flow Growth
Operating cash flow increased compared to both the prior quarter and the year-ago quarter, supporting higher free cash flow despite a modest rise in capital expenditure relative to last year.
The improvement in operating cash flow underpinned the strong free cash flow margin and enabled the company to generate more cash after investments.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased, and operating cash flow rose at a faster pace, while capital expenditure was moderately higher than a year ago but much lower than the prior quarter. Free cash flow improved both sequentially and year over year, with the free cash flow margin unchanged from the year-ago quarter and substantially higher than the preceding quarter.
Compared to the prior quarter, revenue and operating cash flow were both higher, and capital expenditure was substantially lower, resulting in a much larger free cash flow and a significantly improved margin. Versus the same quarter one year earlier, revenue and operating cash flow were higher, capital expenditure was slightly higher, and free cash flow was higher with the margin remaining at the same level.
Monitor capital expenditure trends, as the current quarter's level was lower than the prior quarter but slightly higher than the year-ago period.
Valuation context
A cash-flow page should show how much investors are paying for the cash stream, without turning into a full DCF.
| Market capitalization | $78.4B | Used as the denominator for FCF yield. |
| TTM FCF yield | 1.7% | TTM free cash flow divided by market capitalization. |
| EV / TTM FCF | n/a | A quick valuation bridge, not a full DCF. |
Peer context
Free cash flow quality is easier to read against related public companies.
Risks and tripwires
Observable signals that would weaken the free cash flow thesis.
| Risk | Tripwire | Why it matters |
|---|---|---|
| FCF margin compression | FCF margin falls for two consecutive quarters. | Cash conversion may be weakening before earnings show it. |
| Capital intensity rises | CapEx/revenue moves materially above the recent run rate. | More operating cash flow would be consumed before becoming FCF. |
| Working capital drag | Inventory or receivables grow faster than revenue. | Reported growth may not translate into cash. |