Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow weakened sharply as operating cash flow declined while capital expenditure remained elevated. Revenue also decreased, contributing to a lower free cash flow margin.
- Revenue and operating cash flow both fell, but the conversion was further pressured by capital expenditure that stayed high relative to operating cash flow, resulting in a much lower free cash flow and margin.
- Compared with the prior quarter, revenue, operating cash flow, and free cash flow all decreased, while capital expenditure was slightly higher. Versus the same quarter a year earlier, revenue and operating cash flow were lower, capital expenditure was higher, and free cash flow and margin weakened substantially.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$178.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.2B
Cash generated by operations before capital spending.
CapEx
$982.0M
Capital spending and related asset purchases.
FCF margin
4.1%
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 | $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% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 10.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 22.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$5.6B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Capital Expenditure Pressure
Capital expenditure remained high compared with the prior quarter and was significantly higher than a year earlier, while operating cash flow declined. This combination drove a sharp reduction in free cash flow and margin.
The elevated capital expenditure relative to operating cash flow is the strongest observable factor behind the weakened free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue and operating cash flow both fell, but the conversion was further pressured by capital expenditure that stayed high relative to operating cash flow, resulting in a much lower free cash flow and margin.
Compared with the prior quarter, revenue, operating cash flow, and free cash flow all decreased, while capital expenditure was slightly higher. Versus the same quarter a year earlier, revenue and operating cash flow were lower, capital expenditure was higher, and free cash flow and margin weakened substantially.
Monitor the trajectory of capital expenditure relative to operating cash flow, as elevated spending continues to weigh on free cash flow conversion.