Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue declined from both the prior quarter and the same quarter last year. Free cash flow margin improved sequentially but remained lower than the year-ago level.
- Operating cash flow was stable compared to the prior quarter but lower than a year ago. Capital expenditure decreased from the prior quarter, which helped free cash flow rise sequentially despite lower revenue.
- Compared to the prior quarter, revenue was lower while free cash flow was higher, resulting in an improved free cash flow margin. Versus the same quarter last year, both revenue and free cash flow were lower, and the margin weakened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$776.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.9B
Cash generated by operations before capital spending.
CapEx
$1.1B
Capital spending and related asset purchases.
FCF margin
19.0%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $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% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 56.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 28.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$8.3B | 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 Reduction
Capital expenditure decreased from the prior quarter, which directly supported a higher free cash flow despite lower revenue. The filing notes that capital expenditures are expected to remain above historical levels as part of long-term capacity planning.
The lower capital expenditure was the strongest observable driver of the sequential free cash flow improvement.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was stable compared to the prior quarter but lower than a year ago. Capital expenditure decreased from the prior quarter, which helped free cash flow rise sequentially despite lower revenue.
Compared to the prior quarter, revenue was lower while free cash flow was higher, resulting in an improved free cash flow margin. Versus the same quarter last year, both revenue and free cash flow were lower, and the margin weakened.
Monitor the trajectory of capital expenditure relative to operating cash flow, as the sequential reduction in capex was a key factor in the free cash flow improvement.