Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company's cash conversion improved markedly in the current quarter, with free cash flow and margin rising versus both the prior quarter and the year-ago quarter. Revenue was higher than both comparison periods, while capital expenditure was lower than the prior quarter but slightly higher than a year earlier.
- Revenue was higher than both the immediately preceding quarter and the same quarter one year earlier. Operating cash flow and free cash flow were substantially higher than the prior quarter and higher than the year-ago quarter. Capital expenditure was lower than the prior quarter but slightly higher than a year ago. The free cash flow margin improved significantly from the prior quarter and was slightly higher than a year ago.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow all increased, while capital expenditure decreased. Relative to the same quarter one year earlier, all revenue and cash flow metrics were higher, with a slightly improved free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$579.8M
Trailing twelve-month free cash flow.
Quarter free cash flow
$227.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$233.8M
Cash generated by operations before capital spending.
CapEx
$6.8M
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $993.6M | $142.4M | $12.6M | $129.8M | 13.1% |
| 2023-09-29 | $957.3M | $147.1M | $13.2M | $133.9M | 14.0% |
| 2023-12-29 | $932.4M | $98.9M | $9.8M | $89.1M | 9.6% |
| 2024-03-29 | $953.3M | $233.8M | $6.8M | $227.0M | 23.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 396.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.7% | 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 Growth
Operating cash flow rose sharply compared to the prior quarter. The filing notes that the increase was primarily driven by higher deferred revenue, an increase in accounts payable, and lower inventory purchases.
This improvement directly boosted free cash flow and the free cash flow margin to their highest levels relative to the comparison periods.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than both the immediately preceding quarter and the same quarter one year earlier. Operating cash flow and free cash flow were substantially higher than the prior quarter and higher than the year-ago quarter. Capital expenditure was lower than the prior quarter but slightly higher than a year ago. The free cash flow margin improved significantly from the prior quarter and was slightly higher than a year ago.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow all increased, while capital expenditure decreased. Relative to the same quarter one year earlier, all revenue and cash flow metrics were higher, with a slightly improved free cash flow margin.
Monitor the sustainability of the operating cash flow drivers, particularly deferred revenue and accounts payable, as cited in the filing.