Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion remained negative but improved markedly versus both the prior quarter and the same quarter last year, driven by a smaller operating cash outflow. Free cash flow margin strengthened accordingly.
- Revenue was stable, while operating cash flow was a net outflow that was substantially lower than in the preceding quarter and the year-ago period. Capital expenditure was slightly lower than prior periods, resulting in a free cash flow deficit that narrowed considerably.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow both improved, and the free cash flow margin was less negative. Versus the same quarter one year earlier, all cash flow metrics showed improvement.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$7.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$1.0B
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$852.0M
Cash generated by operations before capital spending.
CapEx
$170.0M
Capital spending and related asset purchases.
FCF margin
-32.9%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $3.0B | $4.5B | $210.0M | $4.3B | 143.9% |
| 2022-12-31 | $3.2B | $7.0B | $204.0M | $6.8B | 216.5% |
| 2023-03-31 | $3.1B | -$2.9B | $182.0M | -$3.0B | -98.2% |
| 2023-06-30 | $3.1B | -$852.0M | $170.0M | -$1.0B | -32.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -133.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.5% | 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.
Operating Cash Flow Improvement
Operating cash flow, while still negative, was significantly less negative than in the prior quarter and the year-ago quarter, indicating a stronger cash conversion from revenue.
This improvement was the primary factor behind the narrower free cash flow deficit and the higher free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable, while operating cash flow was a net outflow that was substantially lower than in the preceding quarter and the year-ago period. Capital expenditure was slightly lower than prior periods, resulting in a free cash flow deficit that narrowed considerably.
Compared to the immediately preceding quarter, operating cash flow and free cash flow both improved, and the free cash flow margin was less negative. Versus the same quarter one year earlier, all cash flow metrics showed improvement.
Monitor the trajectory of operating cash flow, as it remains negative despite the improvement.