Stock Peaks
Read management/analysts’ comments on Intuit’s Q3 earnings
The government’s extensive stimulus program is a bright spot for small-and-medium companies that bore the maximum brunt of the COVID crisis. Intuit’s TurboTax, a do-it-yourself platform that allows individuals to do tax filing on their own without assistance, has a large customer base and remains intact despite the challenging market conditions. The growing adoption of the self-filing service and the shift to subscription-based model might set a new trend for the business in the coming months.
Strong Season
The third fiscal quarter is typically the busiest period for Intuit as it comes in the January-April tax season, generating significant revenues compared to the other three quarters. Since the tax season started in February this year, instead of January due to technical reasons, a complete picture would emerge only when the company reports fourth-quarter results. Meanwhile, the management remains bullish on future performance and has raised the full-year guidance above the consensus estimate.
From Intuit’s Q3 2021 earnings conference call:
“We made significant progress this season. Within the do-it-yourself category, we continued to double down on underpenetrated segments, including LatinX, Self-Employed, and investors. We saw a significant acceleration in investor customer growth this season and expect it to more than triple over last year. We expect the base of customers paying us nothing to grow 6% this season. Within transforming the assisted category, we continue to make progress connecting people to experts with TurboTax Live.”
Broad-based Growth
In the most recent quarter, adjusted earnings grew 35% to $6.07 per share on revenues of $4.17 billion, which was up 39% year-over-year. The positive outcome mainly reflects a double-digit growth in the core consumer group division, supported by strong performance by the other two segments. The numbers, meanwhile, came in below expectations, as they did in the previous quarter.
The company’s shares closed Wednesday’s regular session lower but stayed well above their 52-week average. For the stock, 2021 has been a volatile year so far though it grew 18% since the beginning of the year.