Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the current quarter, free cash flow turned positive and the margin improved compared to both the prior quarter and the same quarter last year. Revenue was lower than a year ago but higher than the previous quarter.
- Operating cash flow increased significantly from the prior quarter, and capital expenditure decreased slightly, resulting in a strong free cash flow and a positive margin. Compared to a year ago, operating cash flow was higher despite lower revenue, and capital expenditure was lower.
- Compared to the immediately preceding quarter, free cash flow improved from negative to positive, driven by a substantial increase in operating cash flow. Versus the same quarter one year earlier, free cash flow and margin were higher, even though revenue was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$462.9M
Trailing twelve-month free cash flow.
Quarter free cash flow
$103.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$142.8M
Cash generated by operations before capital spending.
CapEx
$39.3M
Capital spending and related asset purchases.
FCF margin
15.1%
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 |
|---|---|---|---|---|---|
| 2022-10-02 | $827.1M | $271.6M | $38.9M | $232.7M | 28.1% |
| 2022-12-31 | $731.8M | $183.4M | $34.6M | $148.8M | 20.3% |
| 2023-04-02 | $617.5M | $19.3M | $41.4M | -$22.1M | -3.6% |
| 2023-07-02 | $684.4M | $142.8M | $39.3M | $103.5M | 15.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 86.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.7% | 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.
Operating cash flow recovery
Operating cash flow increased markedly from the prior quarter, more than offsetting a slight reduction in capital expenditure and leading to positive free cash flow.
This improvement was the primary factor behind the swing from negative to positive free cash flow and the expansion of 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 increased significantly from the prior quarter, and capital expenditure decreased slightly, resulting in a strong free cash flow and a positive margin. Compared to a year ago, operating cash flow was higher despite lower revenue, and capital expenditure was lower.
Compared to the immediately preceding quarter, free cash flow improved from negative to positive, driven by a substantial increase in operating cash flow. Versus the same quarter one year earlier, free cash flow and margin were higher, even though revenue was lower.
Monitor changes in operating assets and liabilities, particularly prepayments to contract manufacturers and inventory levels, as these used cash in the first half of the fiscal year.