Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned positive this quarter after a negative prior quarter, driven by lower capital expenditure. Revenue rose slightly, but free cash flow was lower compared with the same quarter last year due to higher operating cash outflows relative to revenue.
- Revenue increased compared with both the prior quarter and the year-ago quarter. Operating cash flow decreased relative to revenue compared with the year-ago quarter but improved sharply compared with the prior quarter, while capital expenditure was substantially lower than the prior quarter. As a result, free cash flow margin improved from negative in the prior quarter to positive, though it weakened from the year-ago period.
- Compared with the prior quarter, free cash flow improved from negative to positive, driven by a large reduction in capital expenditure. Compared with the same quarter last year, free cash flow was lower, as operating cash flow decreased while capital expenditure was stable.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$690.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.2B
Cash generated by operations before capital spending.
CapEx
$544.0M
Capital spending and related asset purchases.
FCF margin
20.7%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $2.8B | $1.4B | $610.0M | $767.0M | 27.4% |
| 2023-09-30 | $3.1B | $1.2B | $690.0M | $544.0M | 17.8% |
| 2023-12-31 | $3.0B | $1.8B | $2.5B | -$655.0M | -21.7% |
| 2024-03-31 | $3.3B | $1.2B | $544.0M | $690.0M | 20.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 109.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 16.3% | 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.
Capital Expenditure Reduction
Capital expenditure in the current quarter was lower than the prior quarter, allowing free cash flow to turn positive despite a reduction in operating cash flow from the year-ago quarter.
Lower capital expenditure was the primary factor enabling the shift from negative to positive free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased compared with both the prior quarter and the year-ago quarter. Operating cash flow decreased relative to revenue compared with the year-ago quarter but improved sharply compared with the prior quarter, while capital expenditure was substantially lower than the prior quarter. As a result, free cash flow margin improved from negative in the prior quarter to positive, though it weakened from the year-ago period.
Compared with the prior quarter, free cash flow improved from negative to positive, driven by a large reduction in capital expenditure. Compared with the same quarter last year, free cash flow was lower, as operating cash flow decreased while capital expenditure was stable.
Monitor whether capital expenditure remains at the current lower level or reverts toward prior-quarter levels in future periods.