Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company generated positive free cash flow this quarter, driven by operating cash flow that exceeded capital expenditure. Free cash flow margin turned positive from the prior quarter's negative level.
- Revenue was higher than the prior quarter, while operating cash flow rose substantially, more than covering a lower capital expenditure. This resulted in free cash flow turning positive and a material improvement in free cash flow margin.
- Compared with the prior quarter, free cash flow improved from negative to positive and margin strengthened. Versus the same quarter one year earlier, revenue was slightly higher, operating cash flow and free cash flow were both higher, and free cash flow margin was also higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.3B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$3.6B
Cash generated by operations before capital spending.
CapEx
$2.3B
Capital spending and related asset purchases.
FCF margin
5.3%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $23.4B | $3.3B | $2.5B | $848.0M | 3.6% |
| 2023-12-31 | $25.2B | $4.4B | $2.3B | $2.1B | 8.2% |
| 2024-03-31 | $21.3B | $242.0M | $2.8B | -$2.5B | -11.9% |
| 2024-06-30 | $25.5B | $3.6B | $2.3B | $1.3B | 5.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 95.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 8.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | $9.3B | 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 strength
Operating cash flow rose to a level that significantly exceeded capital expenditure, reversing the prior quarter's deficit. This was the strongest observable driver of the free cash flow improvement.
The improvement in operating cash flow turned free cash flow positive and lifted the margin above zero.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than the prior quarter, while operating cash flow rose substantially, more than covering a lower capital expenditure. This resulted in free cash flow turning positive and a material improvement in free cash flow margin.
Compared with the prior quarter, free cash flow improved from negative to positive and margin strengthened. Versus the same quarter one year earlier, revenue was slightly higher, operating cash flow and free cash flow were both higher, and free cash flow margin was also higher.
Monitor whether operating cash flow can sustain its current level relative to capital expenditure in coming quarters.