Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was lower than the prior quarter but operating cash flow and free cash flow improved, resulting in a higher free cash flow margin. Compared to the same quarter last year, revenue declined while cash generation strengthened significantly.
- Operating cash flow rose relative to revenue, and capital expenditure was lower than both the prior quarter and the year-ago quarter, supporting a higher free cash flow margin. The conversion from revenue to free cash flow improved sequentially and year over year.
- Compared to the immediately preceding quarter, revenue was higher while operating cash flow and free cash flow were lower, leading to a weakened free cash flow margin. Versus the same quarter one year earlier, revenue was lower but operating cash flow and free cash flow were higher, resulting in an improved margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$295.4M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$365.5M
Cash generated by operations before capital spending.
CapEx
$70.1M
Capital spending and related asset purchases.
FCF margin
24.2%
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 |
|---|---|---|---|---|---|
| 2022-12-30 | $1.3B | $773.4M | $63.5M | $709.9M | 53.4% |
| 2023-03-31 | $1.2B | $411.7M | $45.4M | $366.3M | 31.8% |
| 2023-06-30 | $1.1B | $305.8M | $31.3M | $274.5M | 25.6% |
| 2023-09-29 | $1.2B | $365.5M | $70.1M | $295.4M | 24.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 120.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$274.1M | 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 Strength
Operating cash flow increased compared to both the prior quarter and the year-ago quarter, despite revenue being lower than the year-ago period. The filing notes favorable changes in working capital, including a decrease in accounts receivable and inventory, as a contributing factor.
Higher operating cash flow was the primary factor behind the improvement in free cash flow and margin this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow rose relative to revenue, and capital expenditure was lower than both the prior quarter and the year-ago quarter, supporting a higher free cash flow margin. The conversion from revenue to free cash flow improved sequentially and year over year.
Compared to the immediately preceding quarter, revenue was higher while operating cash flow and free cash flow were lower, leading to a weakened free cash flow margin. Versus the same quarter one year earlier, revenue was lower but operating cash flow and free cash flow were higher, resulting in an improved margin.
Monitor the trend in capital expenditure, which decreased sharply from the year-ago quarter and was lower than the prior quarter.