Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned positive and the margin improved compared to both the prior quarter and the same quarter a year ago. Operating cash flow was the main contributor to the strong cash generation.
- Revenue, operating cash flow, and free cash flow all increased relative to the prior quarter. The free cash flow margin moved from negative to positive, indicating a substantial improvement in cash conversion.
- Compared to the immediately preceding quarter, free cash flow shifted from negative to positive and the margin improved significantly. Compared to the same quarter one year earlier, both free cash flow and margin were higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$994.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.1B
Cash generated by operations before capital spending.
CapEx
$124.2M
Capital spending and related asset purchases.
FCF margin
28.0%
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 |
|---|---|---|---|---|---|
| 2023-04-29 | $2.6B | $304.9M | $109.8M | $195.1M | 7.4% |
| 2023-07-29 | $2.5B | $123.9M | $95.0M | $28.9M | 1.1% |
| 2023-10-28 | $2.5B | -$70.8M | $106.3M | -$177.1M | -7.1% |
| 2024-02-03 | $3.6B | $1.1B | $124.2M | $994.0M | 28.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 252.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.5% | 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 Recovery
Operating cash flow swung from negative in the prior quarter to positive in the current quarter, while capital expenditure remained relatively stable. This shift was the primary factor behind the free cash flow turning positive.
The recovery in operating cash flow enabled the company to generate substantial free cash flow in the quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue, operating cash flow, and free cash flow all increased relative to the prior quarter. The free cash flow margin moved from negative to positive, indicating a substantial improvement in cash conversion.
Compared to the immediately preceding quarter, free cash flow shifted from negative to positive and the margin improved significantly. Compared to the same quarter one year earlier, both free cash flow and margin were higher.
Monitor capital expenditure levels, as the filing notes that store expansion and supply chain improvements are primary cash needs.