Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased from the prior quarter but was lower than the same quarter last year. Free cash flow remained negative, though the margin improved compared to a year ago.
- Operating cash flow was positive and higher than the year-ago quarter, but capital expenditure exceeded operating cash flow, resulting in negative free cash flow and a negative margin.
- Compared to the prior quarter, revenue was higher while operating cash flow was lower, and capital expenditure increased, leading to a larger free cash flow deficit and a weakened margin. Versus the same quarter last year, revenue was lower but operating cash flow improved significantly, and despite higher capital expenditure, the free cash flow deficit narrowed and the margin improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$2.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$1.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.1B
Cash generated by operations before capital spending.
CapEx
$2.3B
Capital spending and related asset purchases.
FCF margin
-38.9%
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 | $5.9B | $2.0B | $1.8B | $150.0M | 2.5% |
| 2023-06-30 | $2.9B | $1.8B | $2.5B | -$695.0M | -24.0% |
| 2023-09-30 | $2.9B | $1.4B | $1.8B | -$400.0M | -13.8% |
| 2023-12-31 | $3.2B | $1.1B | $2.3B | -$1.2B | -38.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -165.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 73.2% | 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 outpacing operating cash flow
Capital expenditure was higher than both the prior quarter and the year-ago quarter, while operating cash flow, though improved year-over-year, was lower than the prior quarter. This imbalance drove the negative free cash flow.
The elevated capital expenditure relative to operating cash flow is the strongest observable driver of the quarter's negative free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was positive and higher than the year-ago quarter, but capital expenditure exceeded operating cash flow, resulting in negative free cash flow and a negative margin.
Compared to the prior quarter, revenue was higher while operating cash flow was lower, and capital expenditure increased, leading to a larger free cash flow deficit and a weakened margin. Versus the same quarter last year, revenue was lower but operating cash flow improved significantly, and despite higher capital expenditure, the free cash flow deficit narrowed and the margin improved.
Monitor the level of capital expenditure relative to operating cash flow, as it remains the primary factor behind the negative free cash flow.