Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased compared to both the prior quarter and the same quarter last year. Free cash flow margin improved from the prior quarter but was lower than the year-ago quarter.
- Operating cash flow was lower than the prior quarter but slightly below the year-ago quarter. Capital expenditure decreased from the prior quarter but increased from the year-ago quarter, resulting in free cash flow that was higher than the prior quarter but lower than the year-ago quarter. The free cash flow margin improved sequentially but weakened year-over-year.
- Compared to the prior quarter, revenue was higher and free cash flow was higher, with an improved margin. Compared to the same quarter last year, revenue was higher but free cash flow was lower, with a weakened margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$309.1M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$687.7M
Cash generated by operations before capital spending.
CapEx
$378.6M
Capital spending and related asset purchases.
FCF margin
8.6%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $3.4B | $857.6M | $313.6M | $544.0M | 15.9% |
| 2022-09-30 | $3.6B | $816.8M | $277.5M | $539.3M | 15.0% |
| 2022-12-31 | $3.5B | $810.0M | $529.2M | $280.8M | 8.0% |
| 2023-03-31 | $3.6B | $687.7M | $378.6M | $309.1M | 8.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 80.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 10.6% | 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.
Capital Expenditure Increase
Capital expenditure was higher than the year-ago quarter, which contributed to the lower free cash flow despite higher revenue. The sequential decrease in capital expenditure from the prior quarter helped free cash flow improve.
The higher capital expenditure year-over-year was the strongest observable driver of the weakened free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was lower than the prior quarter but slightly below the year-ago quarter. Capital expenditure decreased from the prior quarter but increased from the year-ago quarter, resulting in free cash flow that was higher than the prior quarter but lower than the year-ago quarter. The free cash flow margin improved sequentially but weakened year-over-year.
Compared to the prior quarter, revenue was higher and free cash flow was higher, with an improved margin. Compared to the same quarter last year, revenue was higher but free cash flow was lower, with a weakened margin.
Monitor the trend in capital expenditure relative to operating cash flow, as it has increased year-over-year while operating cash flow has not kept pace.