Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned strongly positive this quarter, driven by a large swing in operating cash flow. Revenue was slightly lower than the prior quarter but higher than a year ago.
- Operating cash flow of one hundred seventy-seven million dollars and capital expenditure of six million dollars produced free cash flow of one hundred seventy-one million dollars, yielding a free cash flow margin of thirty-four point six percent.
- Compared to the prior quarter, operating cash flow improved from negative to positive, and free cash flow margin strengthened from negative to positive. Versus the same quarter last year, both operating cash flow and free cash flow were higher, and the free cash flow margin improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$337.3M
Trailing twelve-month free cash flow.
Quarter free cash flow
$171.4M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$177.5M
Cash generated by operations before capital spending.
CapEx
$6.1M
Capital spending and related asset purchases.
FCF margin
34.6%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $452.2M | $121.9M | $5.1M | $116.8M | 25.8% |
| 2023-03-31 | $471.9M | $74.7M | $2.0M | $72.7M | 15.4% |
| 2023-06-30 | $504.3M | -$19.2M | $4.3M | -$23.5M | -4.7% |
| 2023-09-30 | $494.7M | $177.5M | $6.1M | $171.4M | 34.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 364.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$603.7M | 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 Reversal
Operating cash flow swung from negative nineteen million dollars in the prior quarter to positive one hundred seventy-seven million dollars this quarter, the strongest observable driver of free cash flow improvement.
This reversal was the primary factor behind free cash flow turning from negative to positive and the margin rising from negative to positive.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow of one hundred seventy-seven million dollars and capital expenditure of six million dollars produced free cash flow of one hundred seventy-one million dollars, yielding a free cash flow margin of thirty-four point six percent.
Compared to the prior quarter, operating cash flow improved from negative to positive, and free cash flow margin strengthened from negative to positive. Versus the same quarter last year, both operating cash flow and free cash flow were higher, and the free cash flow margin improved.
Monitor whether operating cash flow can sustain its positive level in the coming quarter.