Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow was lower than the prior year, while capital spending stayed stable, resulting in a weaker free cash flow compared to the same quarter last year. Sequentially, free cash flow improved as operating cash flow rose and capital spending increased moderately.
- Revenue was broadly stable versus the prior year, but operating cash flow and free cash flow contracted, causing the free cash flow margin to narrow from the year-ago quarter. Cash conversion weakened sequentially, as the increase in operating cash flow outpaced the rise in capital spending, leading to an improved free cash flow margin compared to the immediately preceding quarter.
- Compared to the immediately preceding quarter, all cash flow metrics improved, with free cash flow margin increasing. Relative to the same quarter one year earlier, operating cash flow and free cash flow were lower, while revenue was steady and capital spending remained comparable.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$614.9M
Trailing twelve-month free cash flow.
Quarter free cash flow
$367.3M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$559.9M
Cash generated by operations before capital spending.
CapEx
$192.6M
Capital spending and related asset purchases.
FCF margin
8.6%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $3.4B | $155.6M | $177.1M | -$21.5M | -0.6% |
| 2023-12-30 | $3.7B | $396.1M | $227.2M | $168.9M | 4.6% |
| 2024-03-30 | $3.4B | $257.4M | $157.2M | $100.2M | 3.0% |
| 2024-06-29 | $4.2B | $559.9M | $192.6M | $367.3M | 8.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 86.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.5% | 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 Decline
Operating cash flow decreased substantially relative to the same quarter last year, despite revenue being nearly unchanged. This decline was the primary factor behind the reduced free cash flow and margin.
If operating cash flow remains suppressed, free cash flow generation could continue to lag historical levels.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was broadly stable versus the prior year, but operating cash flow and free cash flow contracted, causing the free cash flow margin to narrow from the year-ago quarter. Cash conversion weakened sequentially, as the increase in operating cash flow outpaced the rise in capital spending, leading to an improved free cash flow margin compared to the immediately preceding quarter.
Compared to the immediately preceding quarter, all cash flow metrics improved, with free cash flow margin increasing. Relative to the same quarter one year earlier, operating cash flow and free cash flow were lower, while revenue was steady and capital spending remained comparable.
Monitor whether operating cash flow can recover to prior-year levels, as it is the primary source of free cash flow.