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 declined versus the prior quarter and the year-ago quarter. Free cash flow turned more negative as capital expenditure fell less sharply than operating cash flow.
- Operating cash flow turned negative from a small positive in the prior quarter and a larger positive a year ago. Free cash flow margin worsened sequentially and year over year, reflecting weaker cash generation relative to revenue.
- Compared with the immediately preceding quarter, revenue decreased and operating cash flow fell from a positive to a negative figure; free cash flow deficit widened. Versus the same quarter one year earlier, all metrics were lower and free cash flow turned from positive to negative.
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
-$505.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$381.0M
Cash generated by operations before capital spending.
CapEx
$124.0M
Capital spending and related asset purchases.
FCF margin
-18.0%
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 |
|---|---|---|---|---|---|
| 2022-07-01 | $4.5B | $295.0M | $280.0M | $15.0M | 0.3% |
| 2022-09-30 | $3.7B | $6.0M | $320.0M | -$314.0M | -8.4% |
| 2022-12-30 | $3.1B | $35.0M | $258.0M | -$223.0M | -7.2% |
| 2023-03-31 | $2.8B | -$381.0M | $124.0M | -$505.0M | -18.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 88.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$4.9B | 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 Decline
Operating cash flow moved from a positive amount in both comparison periods to a negative amount in the current quarter. This decline was the primary observable driver behind the larger free cash flow deficit.
The shift to negative operating cash flow directly expanded the free cash flow shortfall, absent a proportionate reduction in capital expenditure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow turned negative from a small positive in the prior quarter and a larger positive a year ago. Free cash flow margin worsened sequentially and year over year, reflecting weaker cash generation relative to revenue.
Compared with the immediately preceding quarter, revenue decreased and operating cash flow fell from a positive to a negative figure; free cash flow deficit widened. Versus the same quarter one year earlier, all metrics were lower and free cash flow turned from positive to negative.
Monitor the trajectory of operating cash flow, which shifted from positive to negative and is a key input to free cash flow.