On New Relic’s FCF
This is another interesting observation I just made. Looking at the slide for TTM Free Cash Flow in the new slide deck that just came out, it shows 3% Free Cash Flow for fiscal 2018 (12 months ending in March), and 11% Free Cash Flow for the last 12 months.
Not much of a big deal, huh? Wow! It’s a very big deal! An enormous deal!
For fiscal 2018 (the four quarters ending in March) they had $355 million revenue. Now, 3% of that going into Free Cash Flow comes to $10.7 million in FCF spread out over the whole four quarters.
Now, at the end of June, they have $383 million in 12 month trailing revenue.
But 11% of $383 million as Free Cash Flow is $42.1 million, just one quarter later. That means that after having only $10.7 million in four quarters combined, their Free Cash Flow rose $31.4 million in this last quarter, in one quarter alone, to $42.1 million. That sounds like a big deal to me.