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, supported by higher operating cash flow despite a slight revenue decline. The free cash flow margin improved significantly compared to both the prior quarter and the same quarter last year.
- Revenue was slightly lower than the prior quarter, but operating cash flow was substantially higher, leading to a positive free cash flow after capital expenditure. The free cash flow margin rose to a positive level from negative readings in both comparison periods.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow were higher, while revenue was slightly lower. Versus the same quarter one year earlier, revenue, operating cash flow, and free cash flow were all higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$440.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$563.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.7B
Cash generated by operations before capital spending.
CapEx
$2.1B
Capital spending and related asset purchases.
FCF margin
8.7%
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 | $7.0B | $2.8B | $2.7B | $177.0M | 2.5% |
| 2023-12-31 | $6.0B | $1.8B | $2.5B | -$721.0M | -11.9% |
| 2024-03-31 | $6.6B | $1.3B | $1.8B | -$459.0M | -6.9% |
| 2024-06-30 | $6.5B | $2.7B | $2.1B | $563.0M | 8.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 44.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 32.9% | 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 Improvement
Operating cash flow was substantially higher than both the prior quarter and the year-ago quarter, driving the swing to positive free cash flow.
The increase in operating cash flow was the strongest observable factor behind the improved free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly lower than the prior quarter, but operating cash flow was substantially higher, leading to a positive free cash flow after capital expenditure. The free cash flow margin rose to a positive level from negative readings in both comparison periods.
Compared to the immediately preceding quarter, operating cash flow and free cash flow were higher, while revenue was slightly lower. Versus the same quarter one year earlier, revenue, operating cash flow, and free cash flow were all higher.
Monitor the level of capital expenditure relative to operating cash flow, as it remains a significant cash use.