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 sequentially, driving a swing from negative to positive free cash flow. Compared to the same quarter last year, free cash flow and margin were lower despite higher revenue.
- Operating cash flow as a share of revenue strengthened from the prior quarter, and capital expenditure rose modestly, resulting in a positive free cash flow margin. The conversion from revenue to free cash flow improved markedly versus the preceding quarter.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow all increased, with free cash flow turning positive from negative. Versus the same quarter one year earlier, revenue was higher but operating cash flow, free cash flow, and free cash flow margin were all lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$973.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.4B
Cash generated by operations before capital spending.
CapEx
$463.0M
Capital spending and related asset purchases.
FCF margin
10.6%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $8.3B | $1.7B | $464.0M | $1.2B | 14.6% |
| 2023-12-31 | $9.0B | $3.0B | $594.0M | $2.4B | 27.0% |
| 2024-03-31 | $8.7B | $327.0M | $399.0M | -$72.0M | -0.8% |
| 2024-06-30 | $9.1B | $1.4B | $463.0M | $973.0M | 10.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 87.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.1% | 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 substantially from the prior quarter, reversing a weak cash generation period. This was the strongest observable driver of the swing to positive free cash flow.
The improvement in operating cash flow was the primary factor enabling positive free cash flow this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a share of revenue strengthened from the prior quarter, and capital expenditure rose modestly, resulting in a positive free cash flow margin. The conversion from revenue to free cash flow improved markedly versus the preceding quarter.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow all increased, with free cash flow turning positive from negative. Versus the same quarter one year earlier, revenue was higher but operating cash flow, free cash flow, and free cash flow margin were all lower.
Monitor the trajectory of operating cash flow relative to revenue, as it declined year-over-year despite higher revenue.