Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow and free cash flow margin improved compared to both the prior quarter and the same quarter last year. Cash generation strengthened as operating cash flow outpaced capital expenditure changes.
- Revenue and operating cash flow were higher sequentially and year-over-year, while capital expenditure decreased from the prior quarter but was slightly higher than the year-ago period. This combination resulted in free cash flow and margin both strengthening.
- Compared to the prior quarter, free cash flow and margin improved as operating cash flow rose and capital expenditure fell. Versus the same quarter last year, free cash flow and margin also improved, driven by higher operating cash flow despite a modest increase in capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$858.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.0B
Cash generated by operations before capital spending.
CapEx
$178.3M
Capital spending and related asset purchases.
FCF margin
56.2%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $1.4B | $828.7M | $166.1M | $662.6M | 49.1% |
| 2023-06-30 | $1.4B | $1.1B | $221.2M | $908.3M | 66.3% |
| 2023-09-30 | $1.4B | $935.9M | $227.7M | $708.2M | 50.2% |
| 2023-12-31 | $1.5B | $1.0B | $178.3M | $858.5M | 56.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 99.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 11.7% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$24.9B | 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, providing the primary support for higher free cash flow. This improvement, combined with relatively stable capital expenditure, lifted the free cash flow margin.
Stronger operating cash flow was the dominant factor behind the quarter's improved free cash generation.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue and operating cash flow were higher sequentially and year-over-year, while capital expenditure decreased from the prior quarter but was slightly higher than the year-ago period. This combination resulted in free cash flow and margin both strengthening.
Compared to the prior quarter, free cash flow and margin improved as operating cash flow rose and capital expenditure fell. Versus the same quarter last year, free cash flow and margin also improved, driven by higher operating cash flow despite a modest increase in capital expenditure.
Capital expenditure levels should be monitored for their influence on free cash flow consistency.