Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and free cash flow both increased compared to the prior quarter and the same quarter last year. The free cash flow margin improved significantly from negative to positive versus the prior quarter and was higher than a year ago.
- Operating cash flow rose sharply relative to revenue, while capital expenditure increased modestly, resulting in a strong free cash flow and a higher free cash flow margin.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow all improved, with free cash flow turning from negative to positive. Versus the same quarter one year earlier, all metrics were higher, and the free cash flow margin was stronger.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$508.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$299.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$373.0M
Cash generated by operations before capital spending.
CapEx
$74.0M
Capital spending and related asset purchases.
FCF margin
14.4%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $1.5B | $362.0M | $60.0M | $302.0M | 20.1% |
| 2023-03-31 | $1.4B | -$19.0M | $49.0M | -$68.0M | -4.7% |
| 2023-06-30 | $1.7B | $28.0M | $53.0M | -$25.0M | -1.5% |
| 2023-09-30 | $2.1B | $373.0M | $74.0M | $299.0M | 14.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 196.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$1.6B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Strong free cash flow conversion
Operating cash flow increased substantially, while capital expenditure rose only moderately, leading to a much higher free cash flow and margin.
This quarter's cash conversion performance was notably stronger than both the prior quarter and the same quarter a year ago.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow rose sharply relative to revenue, while capital expenditure increased modestly, resulting in a strong free cash flow and a higher free cash flow margin.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow all improved, with free cash flow turning from negative to positive. Versus the same quarter one year earlier, all metrics were higher, and the free cash flow margin was stronger.
The company's operating cash flow was supported by a reduction in inventory investment, which should be monitored for sustainability.