Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was slightly lower than the prior quarter. However, operating cash flow turned sharply negative, causing free cash flow to also be deeply negative and the free cash flow margin to weaken substantially.
- Revenue declined modestly, but operating cash flow shifted from positive in both the prior quarter and year-ago quarter to a large negative figure. Capital expenditure was essentially stable, so the entire swing in free cash flow was driven by the operating cash flow change, resulting in a deeply negative free cash flow margin.
- Compared to the preceding quarter, revenue was slightly lower and free cash flow turned from strongly positive to a large negative. Versus the same quarter one year earlier, revenue was modestly higher, but free cash flow weakened from positive to heavily negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$1.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$3.8B
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$3.8B
Cash generated by operations before capital spending.
CapEx
$69.0M
Capital spending and related asset purchases.
FCF margin
-144.5%
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 | $2.5B | $1.3B | $40.6M | $1.2B | 49.4% |
| 2023-12-31 | $2.5B | $234.6M | $58.1M | $176.5M | 7.0% |
| 2024-03-31 | $2.7B | $1.3B | $68.4M | $1.2B | 46.0% |
| 2024-06-30 | $2.6B | -$3.8B | $69.0M | -$3.8B | -144.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 106.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.6% | 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 Swing
Operating cash flow fell from a positive amount in both comparable quarters to a large negative figure. The filing context notes that cash used in operating activities was primarily due to cash consideration paid to acquire Alpine, though no further causal breakdown is provided.
This shift caused free cash flow to turn deeply negative and the free cash flow margin to decline sharply from positive levels.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue declined modestly, but operating cash flow shifted from positive in both the prior quarter and year-ago quarter to a large negative figure. Capital expenditure was essentially stable, so the entire swing in free cash flow was driven by the operating cash flow change, resulting in a deeply negative free cash flow margin.
Compared to the preceding quarter, revenue was slightly lower and free cash flow turned from strongly positive to a large negative. Versus the same quarter one year earlier, revenue was modestly higher, but free cash flow weakened from positive to heavily negative.
Monitor the trajectory of operating cash flow, as its substantial negative swing was the sole factor behind the free cash flow deficit.