Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was slightly higher than a year ago but lower than the prior quarter, with a margin that weakened sequentially while remaining above the year-ago level. Revenue was stable compared to the prior quarter and higher year over year, and capital expenditure decreased both sequentially and year over year.
- Cash conversion, measured as free cash flow relative to revenue, resulted in a margin that was lower than the prior quarter but higher than a year earlier. Operating cash flow was lower than both the previous quarter and the same quarter last year, while capital expenditure decreased compared to both periods.
- Compared to the immediately preceding quarter, free cash flow and margin were lower, driven by a decrease in operating cash flow that was not fully offset by a slight reduction in capital expenditure. Versus the same quarter one year earlier, free cash flow was slightly higher and the margin improved, supported by lower capital expenditure despite a modest decline in operating cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$706.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$892.9M
Cash generated by operations before capital spending.
CapEx
$186.4M
Capital spending and related asset purchases.
FCF margin
47.7%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $1.5B | $1.0B | $178.3M | $858.5M | 56.2% |
| 2024-03-31 | $1.4B | $773.1M | $163.0M | $610.1M | 42.3% |
| 2024-06-30 | $1.5B | $1.1B | $188.4M | $874.8M | 60.0% |
| 2024-09-30 | $1.5B | $892.9M | $186.4M | $706.5M | 47.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 129.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 12.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$23.2B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Lower capital expenditure supports cash flow
Capital expenditure decreased compared to both the prior quarter and the same quarter last year, which partially offset the decline in operating cash flow and helped keep free cash flow above the year-ago level.
The reduction in capital expenditure helped sustain a free cash flow margin that remained higher than the year-ago period.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion, measured as free cash flow relative to revenue, resulted in a margin that was lower than the prior quarter but higher than a year earlier. Operating cash flow was lower than both the previous quarter and the same quarter last year, while capital expenditure decreased compared to both periods.
Compared to the immediately preceding quarter, free cash flow and margin were lower, driven by a decrease in operating cash flow that was not fully offset by a slight reduction in capital expenditure. Versus the same quarter one year earlier, free cash flow was slightly higher and the margin improved, supported by lower capital expenditure despite a modest decline in operating cash flow.
Monitor operating cash flow trends, as its sequential decline was the primary factor behind the weaker free cash flow performance this quarter.