Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin weakened from both the prior quarter and the same quarter a year ago, driven by a lower operating cash flow despite reduced capital expenditure. Revenue was slightly lower than the prior quarter but higher than the prior year.
- Revenue and operating cash flow both decreased compared with the prior quarter, while capital expenditure also declined, resulting in a lower free cash flow and a narrower free cash flow margin. Relative to the same quarter a year earlier, revenue was higher but operating cash flow was lower, and the lower capital expenditure only partially offset the decline, leading to a weaker free cash flow margin.
- Compared with the prior quarter, free cash flow margin declined sharply as operating cash flow more than halved despite a smaller drop in revenue. Versus the year-ago quarter, the margin also weakened, with operating cash flow lower and capital expenditure moderately lower, resulting in a smaller free cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$291.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$401.0M
Cash generated by operations before capital spending.
CapEx
$110.0M
Capital spending and related asset purchases.
FCF margin
12.9%
The share of revenue converted into free cash flow.
TTM FCF yield
7.2%
TTM FCF divided by market capitalization.
FCF reconciliation
Free cash flow is not a GAAP line item; it should be bridged from the cash flow statement.
| Operating cash flow | $401.0M | Cash generated by operations before capital spending. |
| Capital expenditures | $110.0M | Capital spending used to bridge CFO to FCF. |
| Free cash flow | $291.0M | Operating cash flow less capital spending. |
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $2.1B | $336.0M | $146.0M | $190.0M | 9.3% |
| 2022-09-30 | $2.0B | $526.0M | $154.0M | $372.0M | 18.6% |
| 2022-12-31 | $2.0B | $741.0M | $171.0M | $570.0M | 27.9% |
| 2023-03-31 | $2.0B | $549.0M | $223.0M | $326.0M | 16.3% |
| 2023-06-30 | $2.2B | $183.0M | $166.0M | $17.0M | 0.8% |
| 2023-09-30 | $2.2B | $724.0M | $145.0M | $579.0M | 26.9% |
| 2023-12-31 | $2.2B | $897.0M | $198.0M | $699.0M | 31.6% |
| 2024-03-31 | $2.2B | $595.0M | $140.0M | $455.0M | 20.8% |
| 2024-06-30 | $2.4B | $502.0M | $132.0M | $370.0M | 15.7% |
| 2024-09-30 | $2.4B | $951.0M | $167.0M | $784.0M | 32.8% |
| 2024-12-31 | $2.3B | $905.0M | $216.0M | $689.0M | 29.7% |
| 2025-03-31 | $2.2B | $515.0M | $178.0M | $337.0M | 15.3% |
| 2025-06-30 | $2.5B | $558.0M | $149.0M | $409.0M | 16.6% |
| 2025-09-30 | $2.4B | $938.0M | $133.0M | $805.0M | 33.5% |
| 2025-12-31 | $2.4B | $893.0M | $161.0M | $732.0M | 30.7% |
| 2026-03-31 | $2.3B | $401.0M | $110.0M | $291.0M | 12.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 48.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.9% | 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.
Lower operating cash flow
Operating cash flow decreased substantially from the prior quarter and also fell from the year-ago quarter, while revenue only declined slightly from the prior quarter and increased from the prior year. This decline had the most significant observable impact on free cash flow and margin.
The lower operating cash flow was the primary factor behind the weakened free cash flow margin in the current quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue and operating cash flow both decreased compared with the prior quarter, while capital expenditure also declined, resulting in a lower free cash flow and a narrower free cash flow margin. Relative to the same quarter a year earlier, revenue was higher but operating cash flow was lower, and the lower capital expenditure only partially offset the decline, leading to a weaker free cash flow margin.
Compared with the prior quarter, free cash flow margin declined sharply as operating cash flow more than halved despite a smaller drop in revenue. Versus the year-ago quarter, the margin also weakened, with operating cash flow lower and capital expenditure moderately lower, resulting in a smaller free cash flow.
Monitor accounts receivable trends, as the filing notes that the increase was driven by the timing of net sales and customer payments, which may influence future cash conversion.
Valuation context
A cash-flow page should show how much investors are paying for the cash stream, without turning into a full DCF.
| Market capitalization | $31.2B | Used as the denominator for FCF yield. |
| TTM FCF yield | 7.2% | TTM free cash flow divided by market capitalization. |
| EV / TTM FCF | n/a | A quick valuation bridge, not a full DCF. |
Peer context
Free cash flow quality is easier to read against related public companies.
Risks and tripwires
Observable signals that would weaken the free cash flow thesis.
| Risk | Tripwire | Why it matters |
|---|---|---|
| FCF margin compression | FCF margin falls for two consecutive quarters. | Cash conversion may be weakening before earnings show it. |
| Capital intensity rises | CapEx/revenue moves materially above the recent run rate. | More operating cash flow would be consumed before becoming FCF. |
| Working capital drag | Inventory or receivables grow faster than revenue. | Reported growth may not translate into cash. |