Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin weakened from both the prior quarter and the same quarter last year, as revenue declined while operating cash flow fell more sharply. Capital expenditure increased relative to both periods, contributing to the lower conversion.
- Revenue was lower than both the previous quarter and the year-ago quarter, while operating cash flow declined more steeply, compressing free cash flow. The free cash flow margin fell as a result, despite a modest increase in capital expenditure as a share of operating cash flow.
- Compared to the immediately preceding quarter, free cash flow margin weakened as both operating cash flow and revenue were lower and capital expenditure was higher. Versus the same quarter one year ago, free cash flow margin also weakened, driven by lower operating cash flow and revenue, though capital expenditure was slightly higher.
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
$370.9M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$616.9M
Cash generated by operations before capital spending.
CapEx
$246.0M
Capital spending and related asset purchases.
FCF margin
16.7%
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 |
|---|---|---|---|---|---|
| 2025-02-28 | $2.2B | $594.7M | $282.6M | $312.1M | 14.4% |
| 2025-05-31 | $2.5B | $637.2M | $192.8M | $444.4M | 17.7% |
| 2025-08-31 | $2.5B | $852.1M | $217.3M | $634.8M | 25.6% |
| 2025-11-30 | $2.2B | $616.9M | $246.0M | $370.9M | 16.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 73.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 11.1% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$10.1B | 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 Pressure
Operating cash flow declined more than revenue both sequentially and year-over-year, exerting downward pressure on free cash flow. This relationship was the strongest observable driver of the margin weakness.
The lower operating cash flow relative to revenue directly reduced free cash flow and margin, making it the primary factor to track.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than both the previous quarter and the year-ago quarter, while operating cash flow declined more steeply, compressing free cash flow. The free cash flow margin fell as a result, despite a modest increase in capital expenditure as a share of operating cash flow.
Compared to the immediately preceding quarter, free cash flow margin weakened as both operating cash flow and revenue were lower and capital expenditure was higher. Versus the same quarter one year ago, free cash flow margin also weakened, driven by lower operating cash flow and revenue, though capital expenditure was slightly higher.
Monitor the trend in operating cash flow relative to revenue, as its sharper decline was the main factor behind the reduced free cash flow margin.