Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved markedly from the prior quarter, driven by a strong increase in operating cash flow, though it remained slightly below the level of the same quarter a year earlier. Revenue rose compared with both the prior period and the year-ago period, while capital expenditure also increased.
- Revenue grew, operating cash flow rose sharply, and capital expenditure increased, resulting in a free cash flow margin that was substantially higher than the prior quarter but slightly lower than the year-ago margin.
- Compared with the immediately preceding quarter, free cash flow and margin improved dramatically due to a much higher operating cash flow. Versus the same quarter one year earlier, free cash flow was slightly lower and margin modestly weaker, despite higher revenue.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$19.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$8.8B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$13.6B
Cash generated by operations before capital spending.
CapEx
$4.8B
Capital spending and related asset purchases.
FCF margin
5.5%
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 |
|---|---|---|---|---|---|
| 2022-10-31 | $151.5B | $6.5B | $4.6B | $1.9B | 1.2% |
| 2023-01-31 | $162.7B | $13.1B | $4.8B | $8.3B | 5.1% |
| 2023-04-30 | $151.0B | $4.6B | $4.4B | $204.0M | 0.1% |
| 2023-07-31 | $160.3B | $13.6B | $4.8B | $8.8B | 5.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 114.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$25.8B | 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 Recovery
Operating cash flow increased substantially from the prior quarter, while capital expenditure grew at a slower pace, enabling a large improvement in free cash flow.
The quarter's free cash flow margin rebounded from the prior quarter's low level, reflecting stronger cash generation from operations.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue grew, operating cash flow rose sharply, and capital expenditure increased, resulting in a free cash flow margin that was substantially higher than the prior quarter but slightly lower than the year-ago margin.
Compared with the immediately preceding quarter, free cash flow and margin improved dramatically due to a much higher operating cash flow. Versus the same quarter one year earlier, free cash flow was slightly lower and margin modestly weaker, despite higher revenue.
The increase in capital expenditure, combined with the filing's observation that higher property and equipment purchases contributed to a decline in return on assets, warrants monitoring of capital spending efficiency.