Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue, operating cash flow, and free cash flow all improved compared to both the prior quarter and the same quarter last year. The free cash flow margin strengthened sequentially and year-over-year.
- Operating cash flow as a share of revenue was higher than both the preceding quarter and the year-ago quarter, while capital expenditure remained relatively stable. This combination drove free cash flow and the free cash flow margin higher.
- Compared to the immediately preceding quarter, revenue, operating cash flow, free cash flow, and free cash flow margin were all higher. Versus the same quarter one year earlier, all four metrics were also higher, with capital expenditure lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.4B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.5B
Cash generated by operations before capital spending.
CapEx
$145.0M
Capital spending and related asset purchases.
FCF margin
23.8%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $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% |
| 2023-12-31 | $5.8B | $1.5B | $145.0M | $1.4B | 23.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 121.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$10.0B | 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 Growth
Operating cash flow increased from both the prior quarter and the year-ago quarter, while capital expenditure was lower year-over-year and nearly flat sequentially. This was the strongest observable driver of the free cash flow improvement.
Higher operating cash flow, combined with stable capital expenditure, directly lifted free cash flow and 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 as a share of revenue was higher than both the preceding quarter and the year-ago quarter, while capital expenditure remained relatively stable. This combination drove free cash flow and the free cash flow margin higher.
Compared to the immediately preceding quarter, revenue, operating cash flow, free cash flow, and free cash flow margin were all higher. Versus the same quarter one year earlier, all four metrics were also higher, with capital expenditure lower.
Monitor whether operating cash flow can sustain its improved level relative to revenue in future quarters.