Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow improved significantly from the prior quarter and turned positive versus a year ago, driving a substantial increase in free cash flow. The free cash flow margin strengthened compared to both the preceding quarter and the same quarter last year.
- Revenue was slightly lower than the prior quarter and the year-ago quarter, but operating cash flow rose sharply, leading to a higher free cash flow and an improved free cash flow margin. Capital expenditure was lower than a year earlier but slightly higher than the previous quarter.
- Compared to the immediately preceding quarter, free cash flow and free cash flow margin both improved, driven by higher operating cash flow. Versus the same quarter one year earlier, free cash flow turned positive from negative, and the margin strengthened significantly.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$726.2M
Trailing twelve-month free cash flow.
Quarter free cash flow
$364.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$443.9M
Cash generated by operations before capital spending.
CapEx
$79.9M
Capital spending and related asset purchases.
FCF margin
9.2%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $4.0B | $651.1M | $130.5M | $520.6M | 13.1% |
| 2023-04-01 | $3.9B | -$286.3M | $68.2M | -$354.5M | -9.0% |
| 2023-07-01 | $4.2B | $264.4M | $68.3M | $196.1M | 4.7% |
| 2023-09-30 | $4.0B | $443.9M | $79.9M | $364.0M | 9.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 7744.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$5.8B | 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 Recovery
Operating cash flow rose substantially from the prior quarter and turned positive from a negative level a year ago, providing the primary lift to free cash flow. This improvement occurred even as revenue was slightly lower than both comparison periods.
The stronger operating cash flow directly improved free cash flow and margin, reversing the prior year's negative cash conversion.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly lower than the prior quarter and the year-ago quarter, but operating cash flow rose sharply, leading to a higher free cash flow and an improved free cash flow margin. Capital expenditure was lower than a year earlier but slightly higher than the previous quarter.
Compared to the immediately preceding quarter, free cash flow and free cash flow margin both improved, driven by higher operating cash flow. Versus the same quarter one year earlier, free cash flow turned positive from negative, and the margin strengthened significantly.
Monitor the trend in capital expenditure relative to operating cash flow, as it increased sequentially while revenue declined.