Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was negative in the quarter, driven by capital expenditure exceeding operating cash flow. Revenue and operating cash flow were lower than the prior quarter but higher than the same quarter last year.
- Operating cash flow was higher than the year-ago quarter but lower than the prior quarter. Capital expenditure increased compared to both periods, resulting in a negative free cash flow margin that improved from the year-ago quarter but weakened from the prior quarter.
- Compared to the prior quarter, revenue and operating cash flow were lower, while capital expenditure was higher, turning free cash flow from positive to negative. Versus the year-ago quarter, revenue and operating cash flow were higher, and capital expenditure also increased, but free cash flow improved from a larger negative to a smaller negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$4.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$695.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.8B
Cash generated by operations before capital spending.
CapEx
$2.5B
Capital spending and related asset purchases.
FCF margin
-24.0%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $3.1B | -$909.0M | $1.2B | -$2.1B | -67.2% |
| 2022-12-31 | $3.9B | -$313.0M | $1.8B | -$2.1B | -54.7% |
| 2023-03-31 | $5.9B | $2.0B | $1.8B | $150.0M | 2.5% |
| 2023-06-30 | $2.9B | $1.8B | $2.5B | -$695.0M | -24.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -113.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 84.8% | 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.
Capital Expenditure Increase
Capital expenditure rose compared to both the prior quarter and the year-ago quarter, outpacing operating cash flow growth and driving free cash flow negative.
Higher capital expenditure was the primary observable factor behind the negative free cash flow in the quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was higher than the year-ago quarter but lower than the prior quarter. Capital expenditure increased compared to both periods, resulting in a negative free cash flow margin that improved from the year-ago quarter but weakened from the prior quarter.
Compared to the prior quarter, revenue and operating cash flow were lower, while capital expenditure was higher, turning free cash flow from positive to negative. Versus the year-ago quarter, revenue and operating cash flow were higher, and capital expenditure also increased, but free cash flow improved from a larger negative to a smaller negative.
Monitor the trend in capital expenditure relative to operating cash flow, as the gap widened in the current quarter.