Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion improved markedly from the prior quarter, with free cash flow margin returning to the level of a year earlier. This was driven by a substantial increase in operating cash flow, while capital expenditure rose modestly.
- Revenue was stable sequentially and lower than a year ago. Operating cash flow was higher than the prior quarter but slightly lower than the same quarter last year. Capital expenditure increased from the prior quarter and was lower than the year-ago period. Free cash flow and its margin both improved sequentially and were comparable to the year-ago period.
- Sequentially, revenue was stable, operating cash flow and free cash flow were higher, and free cash flow margin improved. Year over year, revenue was lower, operating cash flow and free cash flow were slightly lower, and margin was stable.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$739.3M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$835.2M
Cash generated by operations before capital spending.
CapEx
$95.9M
Capital spending and related asset purchases.
FCF margin
18.8%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $3.9B | $189.0M | $153.7M | $35.3M | 0.9% |
| 2023-03-31 | $3.7B | $971.2M | $47.8M | $923.4M | 24.8% |
| 2023-06-30 | $3.9B | $525.1M | $67.8M | $457.3M | 11.7% |
| 2023-09-30 | $3.9B | $835.2M | $95.9M | $739.3M | 18.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | n/a | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$17.1B | 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 strength
Operating cash flow rose significantly from the previous quarter, providing the primary lift to free cash flow despite a moderate increase in capital spending.
This improvement in cash conversion was the key factor behind the sequential recovery in free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable sequentially and lower than a year ago. Operating cash flow was higher than the prior quarter but slightly lower than the same quarter last year. Capital expenditure increased from the prior quarter and was lower than the year-ago period. Free cash flow and its margin both improved sequentially and were comparable to the year-ago period.
Sequentially, revenue was stable, operating cash flow and free cash flow were higher, and free cash flow margin improved. Year over year, revenue was lower, operating cash flow and free cash flow were slightly lower, and margin was stable.
Capital expenditure levels, which increased from the prior quarter while remaining below the year-ago level, and their effect on free cash flow generation.