Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow both improved compared to the prior quarter, while free cash flow margin strengthened slightly. Versus the same quarter last year, revenue was higher but free cash flow margin was lower.
- Operating cash flow exceeded capital expenditure, resulting in positive free cash flow. The free cash flow margin improved sequentially but declined from the year-ago quarter, reflecting a mixed conversion efficiency.
- Compared to the prior quarter, revenue, operating cash flow, and free cash flow were all higher, and the free cash flow margin improved. Compared to the same quarter last year, revenue and operating cash flow were higher, but free cash flow was stable and the free cash flow margin was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.7B
Cash generated by operations before capital spending.
CapEx
$464.0M
Capital spending and related asset purchases.
FCF margin
14.6%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $7.9B | $1.6B | $572.0M | $1.0B | 13.2% |
| 2023-03-31 | $7.7B | $330.0M | $410.0M | -$80.0M | -1.0% |
| 2023-06-30 | $8.1B | $1.6B | $471.0M | $1.1B | 14.0% |
| 2023-09-30 | $8.3B | $1.7B | $464.0M | $1.2B | 14.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 108.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.6% | 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.
Operating cash flow growth
Operating cash flow increased both sequentially and year-over-year, supporting higher free cash flow compared to the prior quarter. This was the strongest observable driver of the quarter's cash generation.
Higher operating cash flow directly contributed to the sequential improvement in free cash flow and margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow exceeded capital expenditure, resulting in positive free cash flow. The free cash flow margin improved sequentially but declined from the year-ago quarter, reflecting a mixed conversion efficiency.
Compared to the prior quarter, revenue, operating cash flow, and free cash flow were all higher, and the free cash flow margin improved. Compared to the same quarter last year, revenue and operating cash flow were higher, but free cash flow was stable and the free cash flow margin was lower.
Monitor the trend in capital expenditure relative to operating cash flow, as it increased from the year-ago quarter while free cash flow remained stable.