Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion improved sharply from the prior quarter, with free cash flow margin rising as operating cash flow increased while capital expenditure declined. Compared to the same quarter last year, free cash flow and margin were higher, supported by stronger operating cash flow.
- Revenue was higher than both the prior quarter and the year-ago quarter. Operating cash flow increased substantially relative to the previous quarter and was also higher than the same quarter last year. Capital expenditure was lower than the prior quarter but higher than the year-ago quarter. Free cash flow and free cash flow margin improved compared to both periods.
- Compared to the immediately preceding quarter, free cash flow margin improved from a lower level to a higher level, driven by a larger increase in operating cash flow relative to the change in revenue. Versus the same quarter one year earlier, free cash flow margin was higher, with operating cash flow growth outpacing revenue growth.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$623.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$695.9M
Cash generated by operations before capital spending.
CapEx
$72.9M
Capital spending and related asset purchases.
FCF margin
11.7%
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 | $4.9B | $922.3M | $83.2M | $839.1M | 17.2% |
| 2023-12-31 | $4.4B | $934.8M | $83.5M | $851.3M | 19.2% |
| 2024-03-31 | $4.2B | $247.2M | $83.8M | $163.4M | 3.9% |
| 2024-06-30 | $5.3B | $695.9M | $72.9M | $623.0M | 11.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 82.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.4% | 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 Strength
Operating cash flow increased significantly from both the prior quarter and the year-ago quarter, while revenue also grew. This was the strongest observable driver of the improvement in free cash flow and margin.
Higher operating cash flow directly lifted free cash flow and margin without requiring a proportional increase in capital expenditure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than both the prior quarter and the year-ago quarter. Operating cash flow increased substantially relative to the previous quarter and was also higher than the same quarter last year. Capital expenditure was lower than the prior quarter but higher than the year-ago quarter. Free cash flow and free cash flow margin improved compared to both periods.
Compared to the immediately preceding quarter, free cash flow margin improved from a lower level to a higher level, driven by a larger increase in operating cash flow relative to the change in revenue. Versus the same quarter one year earlier, free cash flow margin was higher, with operating cash flow growth outpacing revenue growth.
Monitor whether capital expenditure remains at a level that supports the current free cash flow conversion rate.