Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned negative in the current quarter, driven by a sharp decline in operating cash flow relative to revenue. Capital expenditure increased compared to both the prior quarter and the same quarter last year.
- Revenue was slightly higher than the same quarter last year, but operating cash flow fell significantly, resulting in a negative free cash flow margin. Capital expenditure exceeded operating cash flow, further weakening cash conversion.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow all decreased substantially, with free cash flow margin turning from positive to negative. Versus the same quarter one year earlier, operating cash flow and free cash flow were lower, while capital expenditure was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$35.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$33.0M
Cash generated by operations before capital spending.
CapEx
$68.0M
Capital spending and related asset purchases.
FCF margin
-1.7%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $2.3B | $187.1M | $31.5M | $155.6M | 6.8% |
| 2023-06-30 | $2.2B | $281.7M | $41.6M | $240.1M | 10.7% |
| 2023-09-30 | $2.6B | $838.9M | $63.7M | $775.2M | 30.2% |
| 2023-12-31 | $2.1B | $33.0M | $68.0M | -$35.0M | -1.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -16.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$2.4B | 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 Decline
Operating cash flow dropped sharply from the prior quarter and was also lower than the same quarter last year, despite revenue being relatively stable. This was the strongest observable driver of the negative free cash flow.
The decline in operating cash flow directly caused free cash flow to turn negative, even as capital expenditure increased.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly higher than the same quarter last year, but operating cash flow fell significantly, resulting in a negative free cash flow margin. Capital expenditure exceeded operating cash flow, further weakening cash conversion.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow all decreased substantially, with free cash flow margin turning from positive to negative. Versus the same quarter one year earlier, operating cash flow and free cash flow were lower, while capital expenditure was higher.
Monitor the trajectory of operating cash flow, as its decline was the primary factor behind the negative free cash flow.