Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved sharply versus both the prior quarter and the same quarter last year, driven by a higher operating cash flow. The free cash flow margin widened significantly compared with both periods.
- Revenue was slightly lower than the prior quarter but higher than a year ago. Operating cash flow rose substantially versus both periods, while capital expenditure increased from the prior quarter but was similar to the year-ago level. The combination produced a much higher free cash flow and a stronger free cash flow margin.
- Compared with the prior quarter, revenue was lower but operating cash flow, free cash flow, and free cash flow margin were all higher. Versus the same quarter last year, all metrics were higher, with operating cash flow and free cash flow showing the largest improvements.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$609.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$686.0M
Cash generated by operations before capital spending.
CapEx
$77.0M
Capital spending and related asset purchases.
FCF margin
24.1%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $2.2B | -$25.0M | $32.0M | -$57.0M | -2.6% |
| 2023-06-30 | $2.4B | $115.0M | $38.0M | $77.0M | 3.2% |
| 2023-09-30 | $2.5B | $425.0M | $39.0M | $386.0M | 15.1% |
| 2023-12-31 | $2.5B | $686.0M | $77.0M | $609.0M | 24.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 283.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.0% | 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 Strength
Operating cash flow was substantially higher than both the prior quarter and the year-ago quarter, driving the improvement in free cash flow and margin. The filing notes that operating cash flow for the year was primarily supported by net income, partially offset by working capital changes.
The higher operating cash flow was the strongest observable driver of the quarter's free cash flow improvement.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly lower than the prior quarter but higher than a year ago. Operating cash flow rose substantially versus both periods, while capital expenditure increased from the prior quarter but was similar to the year-ago level. The combination produced a much higher free cash flow and a stronger free cash flow margin.
Compared with the prior quarter, revenue was lower but operating cash flow, free cash flow, and free cash flow margin were all higher. Versus the same quarter last year, all metrics were higher, with operating cash flow and free cash flow showing the largest improvements.
Monitor the trend in capital expenditure, which increased from the prior quarter and may affect future free cash flow conversion.