Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased slightly while operating cash flow declined sharply, leading to a lower free cash flow and margin compared to the prior quarter. Versus the same quarter a year earlier, operating cash flow and free cash flow both improved, resulting in a higher free cash flow margin.
- Revenue rose modestly from the prior quarter, but operating cash flow fell significantly, resulting in a lower free cash flow despite a smaller increase in capital expenditure. The free cash flow margin weakened accordingly, as the conversion of revenue into operating cash dropped.
- Compared to the immediately preceding quarter, cash conversion weakened: revenue was slightly higher, but operating cash flow, free cash flow, and margin all declined. Relative to the same quarter one year earlier, cash conversion improved: revenue, operating cash flow, free cash flow, and margin were all higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$820.6M
Trailing twelve-month free cash flow.
Quarter free cash flow
$151.2M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$160.4M
Cash generated by operations before capital spending.
CapEx
$9.2M
Capital spending and related asset purchases.
FCF margin
39.1%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $376.3M | $245.3M | $28.6M | $216.7M | 57.6% |
| 2023-12-31 | $380.4M | $204.2M | $5.0M | $199.2M | 52.4% |
| 2024-03-31 | $384.3M | $257.3M | $3.8M | $253.5M | 66.0% |
| 2024-06-30 | $387.1M | $160.4M | $9.2M | $151.2M | 39.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 76.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.4% | 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 decline
Operating cash flow was substantially lower than the prior quarter, even as revenue edged higher. This decline was the primary factor behind the reduction in free cash flow and free cash flow margin.
The lower operating cash flow drove free cash flow margin down from the previous quarter, reversing the improving trend seen year-over-year.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue rose modestly from the prior quarter, but operating cash flow fell significantly, resulting in a lower free cash flow despite a smaller increase in capital expenditure. The free cash flow margin weakened accordingly, as the conversion of revenue into operating cash dropped.
Compared to the immediately preceding quarter, cash conversion weakened: revenue was slightly higher, but operating cash flow, free cash flow, and margin all declined. Relative to the same quarter one year earlier, cash conversion improved: revenue, operating cash flow, free cash flow, and margin were all higher.
Monitor share repurchase activity, which consumed a significant amount of cash and reduced the company's cash and marketable securities balance during the quarter.