Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved significantly from the same quarter a year earlier, driven by a much higher operating cash flow. Sequentially, free cash flow declined as operating cash flow weakened and capital expenditure increased.
- The company converted a portion of revenue into operating cash flow, which after deducting capital expenditure yielded free cash flow. The free cash flow margin was lower than the prior quarter but higher than the year-ago quarter.
- Compared to the immediately preceding quarter, revenue was slightly lower, operating cash flow and free cash flow were lower, capital expenditure was higher, and the free cash flow margin weakened. Versus the same quarter one year earlier, revenue was similar, operating cash flow and free cash flow were higher, capital expenditure was slightly higher, and the margin improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$403.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$568.5M
Cash generated by operations before capital spending.
CapEx
$165.5M
Capital spending and related asset purchases.
FCF margin
10.5%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $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% |
| 2023-12-31 | $3.8B | $568.5M | $165.5M | $403.0M | 10.5% |
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 | 4.3% | 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
Operating cash flow decreased sequentially but increased significantly year-over-year, directly impacting free cash flow. This metric was the primary factor behind the quarter's free cash flow performance.
Free cash flow moved in line with operating cash flow, making it the strongest observable driver for the quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
The company converted a portion of revenue into operating cash flow, which after deducting capital expenditure yielded free cash flow. The free cash flow margin was lower than the prior quarter but higher than the year-ago quarter.
Compared to the immediately preceding quarter, revenue was slightly lower, operating cash flow and free cash flow were lower, capital expenditure was higher, and the free cash flow margin weakened. Versus the same quarter one year earlier, revenue was similar, operating cash flow and free cash flow were higher, capital expenditure was slightly higher, and the margin improved.
Monitor operating cash flow trends, given the sequential decline and the filing's indication of a decrease in full-year operating cash flow.