Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved compared to the same quarter last year, driven by higher operating cash flow. However, it weakened slightly from the prior quarter as revenue and operating cash flow declined.
- Revenue was lower than both the prior quarter and the year-ago quarter. Operating cash flow increased year-over-year but decreased sequentially. Capital expenditure was lower than the prior quarter but slightly higher than a year ago. Consequently, free cash flow and free cash flow margin were higher than the same quarter last year but lower than the immediate preceding quarter.
- Compared to the immediately preceding quarter, revenue, operating cash flow, capital expenditure, free cash flow, and free cash flow margin all declined. Compared to the same quarter one year earlier, operating cash flow, free cash flow, and free cash flow margin improved, while revenue was slightly lower and capital expenditure marginally higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$5.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.3B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.1B
Cash generated by operations before capital spending.
CapEx
$797.0M
Capital spending and related asset purchases.
FCF margin
22.0%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $6.0B | $2.0B | $835.0M | $1.2B | 19.8% |
| 2023-09-30 | $5.9B | $2.1B | $975.0M | $1.2B | 19.4% |
| 2023-12-31 | $6.2B | $2.4B | $1.0B | $1.4B | 22.3% |
| 2024-03-31 | $6.0B | $2.1B | $797.0M | $1.3B | 22.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 80.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 13.2% | 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.
Year-over-Year Operating Cash Flow Improvement
Operating cash flow increased compared to the same quarter last year, which the filing attributes to higher net income and prior year labor payments. This drove higher free cash flow despite a slight increase in capital expenditure.
The stronger cash generation provided a solid base for the quarter's free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than both the prior quarter and the year-ago quarter. Operating cash flow increased year-over-year but decreased sequentially. Capital expenditure was lower than the prior quarter but slightly higher than a year ago. Consequently, free cash flow and free cash flow margin were higher than the same quarter last year but lower than the immediate preceding quarter.
Compared to the immediately preceding quarter, revenue, operating cash flow, capital expenditure, free cash flow, and free cash flow margin all declined. Compared to the same quarter one year earlier, operating cash flow, free cash flow, and free cash flow margin improved, while revenue was slightly lower and capital expenditure marginally higher.
Monitor the sustainability of operating cash flow, as the filing notes that the year-over-year increase was partly due to prior year labor agreement payments that may not recur.