Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved from the same quarter last year but weakened from the prior quarter. Revenue was stable compared to the prior quarter and lower than the year-ago quarter.
- Operating cash flow was lower than the prior quarter, while capital expenditure was higher, resulting in a lower free cash flow and free cash flow margin. Despite stable revenue, the cash conversion from operations weakened sequentially.
- Compared to the prior quarter, operating cash flow, free cash flow, and free cash flow margin were all lower. Compared to the same quarter last year, operating cash flow, free cash flow, and free cash flow margin were higher, while revenue was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$535.4M
Trailing twelve-month free cash flow.
Quarter free cash flow
$62.8M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$146.1M
Cash generated by operations before capital spending.
CapEx
$83.3M
Capital spending and related asset purchases.
FCF margin
5.1%
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 | $1.2B | $205.6M | $91.8M | $113.8M | 9.4% |
| 2023-03-31 | $1.3B | $215.8M | $71.4M | $144.3M | 11.3% |
| 2023-06-30 | $1.2B | $281.1M | $66.6M | $214.5M | 18.1% |
| 2023-09-30 | $1.2B | $146.1M | $83.3M | $62.8M | 5.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 54.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 6.7% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$3.2B | 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 Decline
Operating cash flow decreased from the prior quarter, which was the primary factor behind the lower free cash flow and margin, even though revenue remained stable.
The reduction in operating cash flow weakened the company's cash conversion and free cash flow generation relative to the prior quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was lower than the prior quarter, while capital expenditure was higher, resulting in a lower free cash flow and free cash flow margin. Despite stable revenue, the cash conversion from operations weakened sequentially.
Compared to the prior quarter, operating cash flow, free cash flow, and free cash flow margin were all lower. Compared to the same quarter last year, operating cash flow, free cash flow, and free cash flow margin were higher, while revenue was lower.
Monitor the trend in inventory investment, as the filing notes continued investment in inventory to reduce lead times and meet customer demand.