Photo Credit: James Broad

Intuit Inc. (INTU) Information Technology – Software | Reports May 24, After Market Closes

Key Takeaways

Software company, Intuit, is prepared to announce fiscal third quarter earnings this Tuesday, after the market closes. Intuit is best known for its portfolio of financial software such as TurboTax and QuickBooks. The company generates a majority of its sales during the quarter which includes tax season and the turn of most fiscal calendars. It’s often the case that 50% of revenue comes during Q3, so clearly these results are important. In its Q2 analyst call, Intuit guided revenue growth in the range of 4%-6% on earnings per share between $3.15 and $3.20. The Estimize consensus believes results will come in on the higher end of guidance, calling for earnings per share of $3.20 on $2.25 billion in revenue. The company has been on a nice winning streak the last 2 quarters and given that it beats 70% of the time, it won’t be surprising to see another strong report. 

Intuit’s recent string of success has been driven by increasing demand and subscriptions for its cloud based software. Intuit has successfully transitioned away from its licensed based service towards cloud-focused services. This quarter, Intuit is guiding QuickBooks online subscribers to increase 43% from a year earlier. Full year projections have online users growing between 37 and 40%. Currently, Quickbooks desktop and online services account for a majority of Intuit’s revenue followed by consumer tax and pro tax products. Regardless, each major reporting segment continues to see gains compared to the year prior. Meanwhile, Intuit has successfully leveraged it software to develop new financial services products for small business. The company introduced Quickbooks Financing, similar to Square Capital, a few years ago as a conduit to connect borrowers and lenders.