Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved from the prior year but weakened from the prior quarter. Revenue rose sequentially while operating cash flow fell, resulting in a lower free cash flow margin compared to the preceding period.
- Cash conversion weakened sequentially as operating cash flow declined despite higher revenue, producing a lower free cash flow margin. Compared to the same quarter last year, cash conversion improved with both higher revenue and higher operating cash flow.
- Relative to the prior quarter, free cash flow and margin were lower, while capital expenditure was slightly lower. Versus the same quarter a year ago, all metrics were higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
$460.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$510.0M
Cash generated by operations before capital spending.
CapEx
$50.0M
Capital spending and related asset purchases.
FCF margin
11.5%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $3.5B | $543.0M | $50.0M | $493.0M | 14.0% |
| 2024-03-31 | $3.6B | $391.0M | $49.0M | $342.0M | 9.4% |
| 2024-06-30 | $3.8B | $711.0M | $56.0M | $655.0M | 17.4% |
| 2024-09-30 | $4.0B | $510.0M | $50.0M | $460.0M | 11.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 76.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.2% | 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 Decline
The sequential drop in operating cash flow was the most significant factor behind the weaker free cash flow and margin. Despite higher revenue, cash from operations contracted noticeably.
The lower operating cash flow directly reduced the free cash flow available and compressed the margin compared to the prior quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion weakened sequentially as operating cash flow declined despite higher revenue, producing a lower free cash flow margin. Compared to the same quarter last year, cash conversion improved with both higher revenue and higher operating cash flow.
Relative to the prior quarter, free cash flow and margin were lower, while capital expenditure was slightly lower. Versus the same quarter a year ago, all metrics were higher.
Monitor the sustainability of operating cash flow given the regulatory capital constraints described in the filing that may affect distributions and liquidity.