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 after a negative prior quarter, driven by a substantial increase in operating cash flow. Revenue was slightly lower than the same quarter last year, but free cash flow margin improved significantly from the prior quarter.
- Operating cash flow was higher than capital expenditure, resulting in positive free cash flow. The free cash flow margin improved compared to the prior quarter, reflecting a stronger conversion of revenue into free cash flow.
- Compared to the prior quarter, operating cash flow and free cash flow were both higher, while revenue was also higher. Versus the same quarter one year earlier, operating cash flow and free cash flow were lower, and revenue was slightly lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$945.8M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.7B
Cash generated by operations before capital spending.
CapEx
$724.3M
Capital spending and related asset purchases.
FCF margin
10.4%
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 |
|---|---|---|---|---|---|
| 2023-10-01 | $9.4B | $1.9B | $699.5M | $1.2B | 13.3% |
| 2023-12-31 | $9.4B | $2.4B | $595.9M | $1.8B | 19.0% |
| 2024-03-31 | $8.6B | $506.0M | $659.1M | -$153.1M | -1.8% |
| 2024-06-30 | $9.1B | $1.7B | $724.3M | $945.8M | 10.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 89.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.9% | 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 Recovery
Operating cash flow increased sharply from the prior quarter, which was the primary factor behind the swing from negative to positive free cash flow. This improvement occurred even as revenue was only modestly higher.
The higher operating cash flow directly enabled positive free cash flow and a stronger margin this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was higher than capital expenditure, resulting in positive free cash flow. The free cash flow margin improved compared to the prior quarter, reflecting a stronger conversion of revenue into free cash flow.
Compared to the prior quarter, operating cash flow and free cash flow were both higher, while revenue was also higher. Versus the same quarter one year earlier, operating cash flow and free cash flow were lower, and revenue was slightly lower.
Monitor whether operating cash flow can sustain its current level relative to capital expenditure in upcoming quarters.