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 higher than the same quarter last year. Operating cash flow and free cash flow improved compared to both the preceding quarter and the year-ago quarter, with the free cash flow margin strengthening.
- Operating cash flow as a share of revenue was higher than both the prior quarter and the year-ago quarter, while capital expenditure remained stable. This resulted in free cash flow and free cash flow margin that were improved relative to both comparison periods.
- Compared to the immediately preceding quarter, revenue was lower but operating cash flow, free cash flow, and free cash flow margin were all higher. Versus the same quarter one year earlier, revenue, operating cash flow, free cash flow, and free cash flow margin were all higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$600.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$636.0M
Cash generated by operations before capital spending.
CapEx
$36.0M
Capital spending and related asset purchases.
FCF margin
33.5%
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 |
|---|---|---|---|---|---|
| 2023-04-01 | $1.6B | $130.0M | $35.0M | $95.0M | 6.0% |
| 2023-07-01 | $1.7B | $406.0M | $36.0M | $370.0M | 21.2% |
| 2023-09-30 | $1.9B | $462.0M | $37.0M | $425.0M | 22.9% |
| 2023-12-30 | $1.8B | $636.0M | $36.0M | $600.0M | 33.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 157.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | n/a | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Stronger cash generation from operations
Operating cash flow increased substantially compared to both the prior quarter and the year-ago quarter, even as revenue declined sequentially. This improvement was the primary factor behind the higher free cash flow and margin.
The stronger operating cash flow drove free cash flow and margin higher without a corresponding increase in capital expenditure.
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 prior quarter and the year-ago quarter, while capital expenditure remained stable. This resulted in free cash flow and free cash flow margin that were improved relative to both comparison periods.
Compared to the immediately preceding quarter, revenue was lower but operating cash flow, free cash flow, and free cash flow margin were all higher. Versus the same quarter one year earlier, revenue, operating cash flow, free cash flow, and free cash flow margin were all higher.
Monitor the trend in trade accounts receivable, which decreased from the prior quarter end, as changes in collections can affect cash conversion.