Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved substantially compared to both the prior quarter and the same quarter last year, driven by higher operating cash flow. The free cash flow margin strengthened to a level above both comparison periods.
- Revenue was unchanged from the prior quarter but operating cash flow rose, resulting in a higher free cash flow and margin. The conversion of revenue into cash improved markedly.
- Compared to the prior quarter, free cash flow increased as operating cash flow grew while revenue was stable. Versus the same quarter last year, free cash flow and margin were higher despite a modest increase in capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$977.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.0B
Cash generated by operations before capital spending.
CapEx
$36.0M
Capital spending and related asset purchases.
FCF margin
31.7%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $2.9B | $1.1B | $28.0M | $1.1B | 36.9% |
| 2023-03-31 | $3.2B | $594.0M | $28.0M | $566.0M | 17.9% |
| 2023-06-30 | $3.1B | $769.0M | $31.0M | $738.0M | 23.8% |
| 2023-09-30 | $3.1B | $1.0B | $36.0M | $977.0M | 31.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 131.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$9.8B | 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 from both the prior quarter and the year-ago quarter, while revenue was flat sequentially and higher year-over-year. This drove a significant improvement in free cash flow.
The improvement in operating cash flow was the primary factor behind the higher free cash flow and margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was unchanged from the prior quarter but operating cash flow rose, resulting in a higher free cash flow and margin. The conversion of revenue into cash improved markedly.
Compared to the prior quarter, free cash flow increased as operating cash flow grew while revenue was stable. Versus the same quarter last year, free cash flow and margin were higher despite a modest increase in capital expenditure.
Monitor the trajectory of capital expenditure, which was higher than both the prior quarter and the year-ago period.