Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow weakened sharply compared to both the prior quarter and the same quarter last year, as lower operating cash flow and higher capital expenditure reduced cash conversion. The company noted that despite current liabilities exceeding current assets, it believes liquidity is adequate.
- The free cash flow margin declined to 1.2% from 14.7% in the prior quarter and 19.4% a year ago, reflecting the combined effect of reduced operating cash flow and increased capital spending.
- Compared to the previous quarter, revenue was lower, operating cash flow decreased, capital expenditure increased, and free cash flow fell significantly. Compared to the same quarter last year, revenue was higher, but operating cash flow was lower, capital expenditure was higher, and free cash flow was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
n/a
Trailing twelve-month free cash flow.
Quarter free cash flow
$23.9M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$853.3M
Cash generated by operations before capital spending.
CapEx
$829.4M
Capital spending and related asset purchases.
FCF margin
1.2%
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 |
|---|---|---|---|---|---|
| 2024-09-30 | $1.9B | $729.0M | $796.3M | -$67.3M | -3.6% |
| 2024-12-31 | $2.3B | $581.8M | n/a | n/a | n/a |
| 2025-03-31 | $3.1B | $1.2B | $701.1M | $461.5M | 14.7% |
| 2025-06-30 | $2.0B | $853.3M | $829.4M | $23.9M | 1.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 9.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 41.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$19.3B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Capital Expenditure Uptick and Operating Cash Flow Decline
The primary driver of the weakened free cash flow was the substantial increase in capital expenditure paired with a decline in operating cash flow, leading to a significantly lower free cash flow margin.
This combination compressed free cash flow to a minimal margin of 1.2%.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
The free cash flow margin declined to 1.2% from 14.7% in the prior quarter and 19.4% a year ago, reflecting the combined effect of reduced operating cash flow and increased capital spending.
Compared to the previous quarter, revenue was lower, operating cash flow decreased, capital expenditure increased, and free cash flow fell significantly. Compared to the same quarter last year, revenue was higher, but operating cash flow was lower, capital expenditure was higher, and free cash flow was lower.
Monitor the trajectory of capital expenditure relative to operating cash flow, as elevated capex levels could continue to pressure free cash flow.