Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was lower than the previous quarter and the same quarter last year, driven by decreased operating cash flow and increased capital expenditure. The free cash flow margin weakened significantly.
- Revenue was lower than the prior quarter but higher than a year ago. Operating cash flow as a percentage of revenue declined compared to both periods, resulting in a lower free cash flow margin.
- Compared to the preceding quarter, revenue, operating cash flow, and free cash flow were all lower, while capital expenditure was higher. Versus the same quarter last year, revenue was higher but operating cash flow, free cash flow, and margin were lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$5.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$441.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.5B
Cash generated by operations before capital spending.
CapEx
$2.1B
Capital spending and related asset purchases.
FCF margin
1.9%
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 | $16.9B | $2.4B | $1.7B | $621.0M | 3.7% |
| 2022-09-30 | $21.5B | $5.1B | $1.8B | $3.3B | 15.4% |
| 2022-12-31 | $24.3B | $3.3B | $1.9B | $1.4B | 5.8% |
| 2023-03-31 | $23.3B | $2.5B | $2.1B | $441.0M | 1.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 17.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 8.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | $15.2B | 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 from both the previous quarter and the same quarter last year, despite revenue being higher year-over-year. This was the primary factor behind the weaker free cash flow.
Lower operating cash flow, combined with higher capital expenditure, reduced free cash flow significantly.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than the prior quarter but higher than a year ago. Operating cash flow as a percentage of revenue declined compared to both periods, resulting in a lower free cash flow margin.
Compared to the preceding quarter, revenue, operating cash flow, and free cash flow were all lower, while capital expenditure was higher. Versus the same quarter last year, revenue was higher but operating cash flow, free cash flow, and margin were lower.
Monitor the relationship between operating cash flow and capital expenditure, as the gap widened this quarter.