Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was negative in the current quarter, driven by a large operating cash outflow that more than offset capital spending. Revenue was stable compared to a year ago, but the cash conversion weakened significantly from the prior quarter.
- Revenue was essentially unchanged from a year earlier, yet operating cash flow turned more negative, resulting in a wider free cash flow deficit and a lower free cash flow margin. The conversion from revenue to cash was poor this quarter.
- Compared to the prior quarter, operating cash flow swung from a large inflow to a large outflow, and free cash flow turned from positive to negative. Versus the same quarter last year, operating cash flow was more negative, and free cash flow was also lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$710.4M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$496.7M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$431.0M
Cash generated by operations before capital spending.
CapEx
$65.7M
Capital spending and related asset purchases.
FCF margin
-12.8%
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 |
|---|---|---|---|---|---|
| 2023-07-01 | $4.2B | $264.4M | $68.3M | $196.1M | 4.7% |
| 2023-09-30 | $4.0B | $443.9M | $79.9M | $364.0M | 9.2% |
| 2023-12-30 | $3.7B | $769.3M | $122.3M | $647.0M | 17.3% |
| 2024-03-30 | $3.9B | -$431.0M | $65.7M | -$496.7M | -12.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -2547.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.7% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$5.6B | 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
The most observable driver was the sharp decline in operating cash flow, which moved from a positive amount in the prior quarter to a negative amount in the current quarter. This change was the primary factor behind the negative free cash flow.
The negative operating cash flow directly caused free cash flow to be deeply 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 essentially unchanged from a year earlier, yet operating cash flow turned more negative, resulting in a wider free cash flow deficit and a lower free cash flow margin. The conversion from revenue to cash was poor this quarter.
Compared to the prior quarter, operating cash flow swung from a large inflow to a large outflow, and free cash flow turned from positive to negative. Versus the same quarter last year, operating cash flow was more negative, and free cash flow was also lower.
Monitor whether operating cash flow can return to positive levels in the coming quarter, given the large swing from the prior period.