Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was negative this quarter, driven by a large operating cash outflow that more than offset capital spending. The margin weakened sharply from the prior quarter but improved compared with the same quarter last year.
- Revenue was stable, yet operating cash flow turned deeply negative, resulting in a negative free cash flow margin. Capital expenditure was lower than the prior quarter but higher than a year ago, but the swing in operating cash flow was the dominant factor in cash conversion.
- Compared with the prior quarter, operating cash flow shifted from a large positive to a large negative, and free cash flow turned from positive to negative. Versus the same quarter last year, operating cash flow and free cash flow were less negative, and the margin improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$1.1B
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$844.0M
Cash generated by operations before capital spending.
CapEx
$230.0M
Capital spending and related asset purchases.
FCF margin
-34.2%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $3.1B | -$852.0M | $170.0M | -$1.0B | -32.9% |
| 2023-09-30 | $2.7B | $222.0M | $135.0M | $87.0M | 3.2% |
| 2023-12-31 | $3.0B | $4.2B | $329.0M | $3.9B | 126.6% |
| 2024-03-31 | $3.1B | -$844.0M | $230.0M | -$1.1B | -34.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -232.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.3% | 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 Swing
Operating cash flow moved from a large positive in the prior quarter to a large negative this quarter, and was less negative than the year-ago quarter. This swing was the strongest observable driver of free cash flow.
The negative operating cash flow directly caused free cash flow to be negative despite lower capital expenditure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable, yet operating cash flow turned deeply negative, resulting in a negative free cash flow margin. Capital expenditure was lower than the prior quarter but higher than a year ago, but the swing in operating cash flow was the dominant factor in cash conversion.
Compared with the prior quarter, operating cash flow shifted from a large positive to a large negative, and free cash flow turned from positive to negative. Versus the same quarter last year, operating cash flow and free cash flow were less negative, and the margin improved.
Monitor whether operating cash flow returns to positive levels in the coming quarter, as it was the primary driver of the negative free cash flow.