Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue turned negative this quarter, while operating cash flow remained positive but declined from the prior quarter. Free cash flow fell sharply compared to both the previous quarter and the same quarter last year, despite a very high free cash flow margin.
- Operating cash flow was significantly higher than revenue, indicating strong cash conversion from operations. However, capital expenditure increased substantially, consuming most of the operating cash flow and resulting in a relatively low free cash flow.
- Compared to the prior quarter, revenue shifted from positive to negative, operating cash flow decreased, and capital expenditure rose sharply, causing free cash flow to drop. Versus the same quarter last year, revenue was lower, operating cash flow was slightly lower, capital expenditure was much higher, and free cash flow was significantly lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$916.3M
Trailing twelve-month free cash flow.
Quarter free cash flow
$32.4M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$304.7M
Cash generated by operations before capital spending.
CapEx
$272.3M
Capital spending and related asset purchases.
FCF margin
77.2%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $675.0M | $432.6M | $99.8M | $332.8M | 49.3% |
| 2024-03-31 | $657.9M | $294.5M | $77.3M | $217.2M | 33.0% |
| 2024-06-30 | -$594.3M | $425.6M | $91.6M | $334.0M | -56.2% |
| 2024-09-30 | $41.9M | $304.7M | $272.3M | $32.4M | 77.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 12.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 649.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$12.1B | 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 Surge
Capital expenditure rose sharply from the prior quarter and from the same quarter last year, far outpacing the change in operating cash flow. This was the strongest observable driver of the decline in free cash flow.
The elevated capital expenditure consumed a larger portion of operating cash flow, leading to a lower free cash flow despite positive operating cash generation.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was significantly higher than revenue, indicating strong cash conversion from operations. However, capital expenditure increased substantially, consuming most of the operating cash flow and resulting in a relatively low free cash flow.
Compared to the prior quarter, revenue shifted from positive to negative, operating cash flow decreased, and capital expenditure rose sharply, causing free cash flow to drop. Versus the same quarter last year, revenue was lower, operating cash flow was slightly lower, capital expenditure was much higher, and free cash flow was significantly lower.
Monitor the trajectory of capital expenditure, as its substantial increase this quarter was the primary factor compressing free cash flow.