Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow and margin improved versus both the prior quarter and the same quarter a year earlier, supported by stronger operating cash flow conversion relative to revenue. Capital expenditure remained broadly stable across the periods.
- Operating cash flow rose while revenue declined slightly from the prior quarter, resulting in a higher free cash flow margin. Capital expenditure was relatively unchanged, so the improvement in cash conversion was driven primarily by operating cash flow.
- Sequentially, revenue was lower but operating cash flow and free cash flow were higher, leading to a stronger margin. Year-over-year, all metrics were higher, with the margin improving notably.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$902.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.1B
Cash generated by operations before capital spending.
CapEx
$148.0M
Capital spending and related asset purchases.
FCF margin
18.4%
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 | $5.2B | $1.0B | $188.0M | $815.0M | 15.7% |
| 2023-03-31 | $4.8B | $445.0M | $130.0M | $315.0M | 6.6% |
| 2023-06-30 | $5.0B | $688.0M | $152.0M | $536.0M | 10.7% |
| 2023-09-30 | $4.9B | $1.1B | $148.0M | $902.0M | 18.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 130.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$10.8B | 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 Strength
Operating cash flow increased significantly compared to both the prior quarter and the same quarter last year, outpacing the change in revenue. This improvement was the primary factor behind the higher free cash flow and margin.
The stronger operating cash flow directly boosted free cash flow and expanded the free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow rose while revenue declined slightly from the prior quarter, resulting in a higher free cash flow margin. Capital expenditure was relatively unchanged, so the improvement in cash conversion was driven primarily by operating cash flow.
Sequentially, revenue was lower but operating cash flow and free cash flow were higher, leading to a stronger margin. Year-over-year, all metrics were higher, with the margin improving notably.
Monitor whether operating cash flow can sustain its elevated level relative to revenue in the coming quarters.