Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin weakened versus both the prior quarter and the same quarter last year, as operating cash flow was lower while revenue was higher. Capital expenditure increased from the prior quarter, contributing to the decline in free cash flow.
- Revenue was higher than both the prior quarter and the year-ago quarter, but operating cash flow was lower than the year-ago quarter and stable versus the prior quarter. The resulting free cash flow and free cash flow margin were lower in both comparisons, reflecting a weaker conversion of revenue into cash.
- Compared to the prior quarter, revenue was higher, operating cash flow was stable, capital expenditure was higher, and free cash flow and free cash flow margin were lower. Compared to the same quarter one year earlier, revenue was higher, operating cash flow was lower, capital expenditure was slightly higher, and free cash flow and free cash flow margin were lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.8B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.4B
Cash generated by operations before capital spending.
CapEx
$609.0M
Capital spending and related asset purchases.
FCF margin
19.2%
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 |
|---|---|---|---|---|---|
| 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% |
| 2024-09-30 | $9.2B | $2.4B | $460.0M | $2.0B | 21.7% |
| 2024-12-31 | $9.3B | $2.4B | $609.0M | $1.8B | 19.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 162.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 6.6% | 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 Weakening
Operating cash flow was stable versus the prior quarter but lower than the same quarter last year, while revenue was higher in both comparisons. This divergence is the strongest observable driver of the decline in free cash flow and free cash flow margin.
The lower operating cash flow relative to revenue reduced the cash available for capital expenditure and free cash flow generation.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than both the prior quarter and the year-ago quarter, but operating cash flow was lower than the year-ago quarter and stable versus the prior quarter. The resulting free cash flow and free cash flow margin were lower in both comparisons, reflecting a weaker conversion of revenue into cash.
Compared to the prior quarter, revenue was higher, operating cash flow was stable, capital expenditure was higher, and free cash flow and free cash flow margin were lower. Compared to the same quarter one year earlier, revenue was higher, operating cash flow was lower, capital expenditure was slightly higher, and free cash flow and free cash flow margin were lower.
Monitor the trend in operating cash flow relative to revenue, as it declined year-over-year despite higher revenue.