Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and free cash flow margin improved compared to both the prior quarter and the same quarter last year. Operating cash flow rose year over year but declined sequentially, while capital expenditure decreased on both comparisons.
- Revenue increased while operating cash flow was lower than the prior quarter but higher than a year ago, resulting in a free cash flow margin that improved from the prior quarter and turned positive from a negative level a year earlier. Capital expenditure decreased on both comparisons, supporting the free cash flow improvement.
- Compared to the immediately preceding quarter, revenue was higher but operating cash flow was lower, leading to a lower free cash flow despite lower capital expenditure. Compared to the same quarter one year earlier, revenue, operating cash flow, and free cash flow were all higher, and free cash flow margin turned positive from negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$844.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.5B
Cash generated by operations before capital spending.
CapEx
$676.0M
Capital spending and related asset purchases.
FCF margin
17.5%
The share of revenue converted into free cash flow.
TTM FCF yield
1.4%
TTM FCF divided by market capitalization.
FCF reconciliation
Free cash flow is not a GAAP line item; it should be bridged from the cash flow statement.
| Operating cash flow | $1.5B | Cash generated by operations before capital spending. |
| Capital expenditures | $676.0M | Capital spending used to bridge CFO to FCF. |
| Free cash flow | $844.0M | Operating cash flow less capital spending. |
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 | $5.2B | $1.8B | $597.0M | $1.2B | 22.5% |
| 2022-09-30 | $5.2B | $2.8B | $790.0M | $2.0B | 37.7% |
| 2022-12-31 | $4.7B | $2.0B | $967.0M | $1.1B | 23.0% |
| 2023-03-31 | $4.4B | $1.2B | $982.0M | $178.0M | 4.1% |
| 2023-06-30 | $4.5B | $1.4B | $1.4B | -$47.0M | -1.0% |
| 2023-09-30 | $4.5B | $1.9B | $1.5B | $442.0M | 9.8% |
| 2023-12-31 | $4.1B | $1.9B | $1.1B | $776.0M | 19.0% |
| 2024-03-31 | $3.7B | $1.0B | $1.2B | -$231.0M | -6.3% |
| 2024-06-30 | $3.8B | $1.6B | $1.1B | $507.0M | 13.3% |
| 2024-09-30 | $4.2B | $1.7B | $1.3B | $416.0M | 10.0% |
| 2024-12-31 | $4.0B | $2.0B | $1.2B | $806.0M | 20.1% |
| 2025-03-31 | $4.1B | $849.0M | $1.1B | -$274.0M | -6.7% |
| 2025-06-30 | $4.4B | $1.9B | $1.3B | $555.0M | 12.5% |
| 2025-09-30 | $4.7B | $2.2B | $1.2B | $993.0M | 20.9% |
| 2025-12-31 | $4.4B | $2.3B | $925.0M | $1.3B | 30.0% |
| 2026-03-31 | $4.8B | $1.5B | $676.0M | $844.0M | 17.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 54.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 14.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$10.5B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Free Cash Flow Margin Recovery
The free cash flow margin improved from the prior quarter and turned positive from a negative level a year ago, driven by higher revenue and lower capital expenditure. Operating cash flow increased year over year, supporting the margin expansion.
The improvement in free cash flow margin reflects a stronger cash conversion efficiency compared to both the prior quarter and the same quarter last year.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased while operating cash flow was lower than the prior quarter but higher than a year ago, resulting in a free cash flow margin that improved from the prior quarter and turned positive from a negative level a year earlier. Capital expenditure decreased on both comparisons, supporting the free cash flow improvement.
Compared to the immediately preceding quarter, revenue was higher but operating cash flow was lower, leading to a lower free cash flow despite lower capital expenditure. Compared to the same quarter one year earlier, revenue, operating cash flow, and free cash flow were all higher, and free cash flow margin turned positive from negative.
Monitor the trend in operating cash flow relative to revenue, as it declined sequentially despite higher revenue.
Valuation context
A cash-flow page should show how much investors are paying for the cash stream, without turning into a full DCF.
| Market capitalization | $274.1B | Used as the denominator for FCF yield. |
| TTM FCF yield | 1.4% | TTM free cash flow divided by market capitalization. |
| EV / TTM FCF | 76.5x | A quick valuation bridge, not a full DCF. |
Peer context
Free cash flow quality is easier to read against related public companies.
Risks and tripwires
Observable signals that would weaken the free cash flow thesis.
| Risk | Tripwire | Why it matters |
|---|---|---|
| FCF margin compression | FCF margin falls for two consecutive quarters. | Cash conversion may be weakening before earnings show it. |
| Capital intensity rises | CapEx/revenue moves materially above the recent run rate. | More operating cash flow would be consumed before becoming FCF. |
| Working capital drag | Inventory or receivables grow faster than revenue. | Reported growth may not translate into cash. |