Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow weakened significantly versus both the preceding quarter and the same quarter a year earlier, as operating cash flow declined while capital expenditure increased. Revenue was stable across all three periods.
- Operating cash flow of the quarter fell relative to both the preceding quarter and the year-ago quarter, and capital expenditure rose, resulting in a lower free cash flow and a narrower free cash flow margin.
- Compared with the preceding quarter, free cash flow and operating cash flow were lower, while capital expenditure was higher. Versus the same quarter a year earlier, operating cash flow and free cash flow were also lower, and capital expenditure was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$721.2M
Trailing twelve-month free cash flow.
Quarter free cash flow
$124.2M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$164.4M
Cash generated by operations before capital spending.
CapEx
$40.2M
Capital spending and related asset purchases.
FCF margin
8.7%
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 |
|---|---|---|---|---|---|
| 2023-04-02 | $1.4B | $203.0M | $24.4M | $178.6M | 12.9% |
| 2023-07-02 | $1.4B | $190.5M | $27.3M | $163.2M | 11.5% |
| 2023-10-01 | $1.4B | $278.2M | $23.0M | $255.2M | 18.2% |
| 2023-12-31 | $1.4B | $164.4M | $40.2M | $124.2M | 8.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 38.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$2.6B | 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 decline
The quarter's operating cash flow decreased markedly from both the preceding quarter and the year-ago quarter, while capital expenditure increased. This combination drove a substantial reduction in free cash flow and margin.
The free cash flow margin weakened sharply, falling below the levels of both prior periods.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow of the quarter fell relative to both the preceding quarter and the year-ago quarter, and capital expenditure rose, resulting in a lower free cash flow and a narrower free cash flow margin.
Compared with the preceding quarter, free cash flow and operating cash flow were lower, while capital expenditure was higher. Versus the same quarter a year earlier, operating cash flow and free cash flow were also lower, and capital expenditure was higher.
Monitor the capital expenditure trend, as it was higher in the current quarter than in both comparative periods.