Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned positive this quarter, driven by a significant improvement in operating cash flow despite a reduction in revenue. The free cash flow margin strengthened compared to the prior quarter but remained below the level from one year earlier.
- Revenue was stable compared to the prior quarter but lower than the same quarter last year. Operating cash flow increased substantially from the prior quarter, while capital expenditure decreased, resulting in positive free cash flow and an improved free cash flow margin.
- Compared to the immediately preceding quarter, free cash flow improved from negative to positive, with higher operating cash flow and lower capital expenditure. Versus the same quarter one year earlier, free cash flow and free cash flow margin were lower, driven by lower operating cash flow and higher capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$69.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$120.0M
Cash generated by operations before capital spending.
CapEx
$51.0M
Capital spending and related asset purchases.
FCF margin
3.2%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $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% |
| 2024-03-31 | $2.1B | $120.0M | $51.0M | $69.0M | 3.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 25.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.4% | 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 Recovery
Operating cash flow increased substantially from the prior quarter, reversing the negative free cash flow position. This improvement was the strongest observable driver of the quarter's cash conversion.
The higher operating cash flow directly enabled positive free cash flow and a higher free cash flow margin this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable compared to the prior quarter but lower than the same quarter last year. Operating cash flow increased substantially from the prior quarter, while capital expenditure decreased, resulting in positive free cash flow and an improved free cash flow margin.
Compared to the immediately preceding quarter, free cash flow improved from negative to positive, with higher operating cash flow and lower capital expenditure. Versus the same quarter one year earlier, free cash flow and free cash flow margin were lower, driven by lower operating cash flow and higher capital expenditure.
Monitor the trajectory of operating cash flow, as it was the primary factor behind the swing in free cash flow this quarter.