Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved sharply from the prior quarter and was higher than the same quarter last year, driven by a significant increase in operating cash flow. The free cash flow margin strengthened notably compared to both periods.
- Revenue was lower than both the prior quarter and the year-ago quarter, yet operating cash flow rose substantially, resulting in a higher free cash flow and an improved free cash flow margin. Capital expenditure was higher than a year ago but slightly lower than the prior quarter.
- Compared to the prior quarter, free cash flow and free cash flow margin were significantly higher, while revenue was lower. Versus the same quarter last year, free cash flow and margin were higher, despite lower revenue and higher capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$694.1M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.2B
Cash generated by operations before capital spending.
CapEx
$475.7M
Capital spending and related asset purchases.
FCF margin
18.3%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $5.8B | $635.5M | $215.1M | $420.4M | 7.2% |
| 2022-09-30 | $5.0B | $459.6M | $395.9M | $63.7M | 1.3% |
| 2022-12-31 | $4.1B | $537.5M | $518.9M | $18.6M | 0.5% |
| 2023-03-31 | $3.8B | $1.2B | $475.7M | $694.1M | 18.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 139.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 12.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$12.0B | 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 Surge
Operating cash flow was substantially higher than both the prior quarter and the year-ago quarter, despite lower revenue. This was the strongest observable driver of the improvement in free cash flow.
The surge in operating cash flow more than offset the higher capital expenditure relative to a year ago, driving free cash flow and margin higher.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than both the prior quarter and the year-ago quarter, yet operating cash flow rose substantially, resulting in a higher free cash flow and an improved free cash flow margin. Capital expenditure was higher than a year ago but slightly lower than the prior quarter.
Compared to the prior quarter, free cash flow and free cash flow margin were significantly higher, while revenue was lower. Versus the same quarter last year, free cash flow and margin were higher, despite lower revenue and higher capital expenditure.
Monitor whether the elevated operating cash flow level can be sustained given the lower revenue base.