Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow both increased from the prior quarter, while free cash flow rose. Compared to the same quarter last year, revenue and free cash flow were lower despite a higher operating cash flow.
- Operating cash flow as a proportion of revenue improved from the prior quarter, contributing to a higher free cash flow margin. Capital expenditure increased in absolute terms, partially offsetting the cash conversion gain.
- Compared to the prior quarter, revenue, operating cash flow, and free cash flow were all higher, and the free cash flow margin improved. Versus the same quarter last year, revenue and free cash flow were lower, while operating cash flow was higher and capital expenditure increased.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.0B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.7B
Cash generated by operations before capital spending.
CapEx
$685.0M
Capital spending and related asset purchases.
FCF margin
23.4%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $2.9B | $881.0M | $414.0M | $467.0M | 16.2% |
| 2024-03-31 | $3.2B | $312.0M | $465.0M | -$153.0M | -4.8% |
| 2024-06-30 | $3.6B | $1.2B | $498.0M | $698.0M | 19.4% |
| 2024-09-30 | $4.3B | $1.7B | $685.0M | $1.0B | 23.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 53.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 15.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$13.8B | 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 growth
Operating cash flow increased from both the prior quarter and the same quarter last year, providing the primary support for free cash flow. This improvement occurred even as revenue declined year over year.
The higher operating cash flow drove a sequential improvement in free cash flow and margin, despite a larger capital expenditure outlay.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a proportion of revenue improved from the prior quarter, contributing to a higher free cash flow margin. Capital expenditure increased in absolute terms, partially offsetting the cash conversion gain.
Compared to the prior quarter, revenue, operating cash flow, and free cash flow were all higher, and the free cash flow margin improved. Versus the same quarter last year, revenue and free cash flow were lower, while operating cash flow was higher and capital expenditure increased.
Monitor the trend in capital expenditure relative to operating cash flow, as its increase this quarter outpaced the growth in operating cash flow compared to the prior year.