Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion improved sharply from the prior quarter, driven by a large increase in operating cash flow. Free cash flow margin strengthened versus the preceding quarter but was lower than the same quarter one year earlier.
- Revenue was stable compared to the prior quarter and the year-ago quarter. Operating cash flow rose significantly from the prior quarter, leading to a higher free cash flow and an improved free cash flow margin. Capital expenditure was slightly higher than both comparison periods.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow were substantially higher, and the free cash flow margin strengthened. Versus the same quarter one year earlier, operating cash flow and free cash flow were lower, and the free cash flow margin weakened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$655.1M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$702.9M
Cash generated by operations before capital spending.
CapEx
$47.9M
Capital spending and related asset purchases.
FCF margin
51.9%
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 |
|---|---|---|---|---|---|
| 2022-07-31 | $1.2B | $439.7M | $35.6M | $404.1M | 32.4% |
| 2022-10-31 | $818.5M | $393.5M | $33.7M | $359.9M | 44.0% |
| 2023-01-31 | $1.4B | $114.8M | $43.5M | $71.3M | 5.2% |
| 2023-04-30 | $1.3B | $702.9M | $47.9M | $655.1M | 51.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 240.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.8% | 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, driving a significant improvement in free cash flow and margin. This was the strongest observable driver of the quarter's cash conversion.
The higher operating cash flow directly lifted free cash flow and margin compared to the preceding quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable compared to the prior quarter and the year-ago quarter. Operating cash flow rose significantly from the prior quarter, leading to a higher free cash flow and an improved free cash flow margin. Capital expenditure was slightly higher than both comparison periods.
Compared to the immediately preceding quarter, operating cash flow and free cash flow were substantially higher, and the free cash flow margin strengthened. Versus the same quarter one year earlier, operating cash flow and free cash flow were lower, and the free cash flow margin weakened.
Monitor the level of capital expenditure relative to the prior quarter and year-ago period, as it was higher in both comparisons.