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 compared to the prior quarter and the same quarter last year, leading to a higher free cash flow margin. The quarter showed a strong cash conversion profile with operating cash flow significantly exceeding capital expenditure.
- Operating cash flow was substantially higher than capital expenditure, resulting in a free cash flow margin that improved from both the prior quarter and the year-ago quarter. The conversion of revenue into free cash flow strengthened notably.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all higher, and the free cash flow margin improved. Versus the same quarter one year earlier, revenue was slightly higher, while operating cash flow and free cash flow were also higher, with an improved margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$776.2M
Trailing twelve-month free cash flow.
Quarter free cash flow
$562.6M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$605.1M
Cash generated by operations before capital spending.
CapEx
$42.5M
Capital spending and related asset purchases.
FCF margin
29.1%
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 |
|---|---|---|---|---|---|
| 2023-04-01 | $1.5B | $14.0M | $61.6M | -$47.6M | -3.1% |
| 2023-07-01 | $1.5B | $270.7M | $39.6M | $231.1M | 15.4% |
| 2023-09-30 | $1.6B | $72.9M | $42.8M | $30.1M | 1.8% |
| 2023-12-30 | $1.9B | $605.1M | $42.5M | $562.6M | 29.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 203.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.2% | 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 Strength
Operating cash flow was the strongest observable driver, increasing substantially from both the prior quarter and the year-ago quarter. This supported a significant rise in free cash flow and margin.
The higher operating cash flow directly drove the improvement in free cash flow and margin for the quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was substantially higher than capital expenditure, resulting in a free cash flow margin that improved from both the prior quarter and the year-ago quarter. The conversion of revenue into free cash flow strengthened notably.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all higher, and the free cash flow margin improved. Versus the same quarter one year earlier, revenue was slightly higher, while operating cash flow and free cash flow were also higher, with an improved margin.
Monitor the level of capital expenditure relative to operating cash flow in future quarters to assess sustainability of free cash flow generation.