Intuit
posted better-than-expected results for its October quarter while repeating its financial guidance for the July 2024 fiscal year.
For the fiscal first quarter, the provider of tax and accounting software reported revenue of $3 billion, up 15% from a year earlier, well above the growth of 10% to 11% that management had predicted. The consensus among Wall Street analysts tracked by
FactSet
had called for revenue of $2.88 billion.
The stock was little changed in late trading Tuesday.
On an adjusted basis, Intuit earned $2.47 a share in the quarter, well above both the guidance range of $1.94 to $2 a share and the Street consensus of $1.98. Under generally accepted accounting principles, Intuit earned 85 cents a share.
Intuit said revenue in its “small business and self-employed” group was $2.3 billion, up 18%. Consumer-segment revenue was $187 million, up 25%, while revenue at Credit Karma slipped 5% to $405 million.
Intuit bought back $603 million of common stock in the quarter, leaving $3.2 billion remaining on its current share-repurchase authorization.
CEO Sasan Goodarzi said in an interview with Barron’s that Intuit’s push to add generative AI features to its software is going well, although he notes the company isn’t including any contribution from that effort in its guidance for the rest of the year. He says AI should be a large contributor to revenue growth in subsequent years.
Goodarzi notes the company has begun to roll out AI features into some of its products, including in MailChimp, with AI-driven capabilities around creation of images and email text.
A new feature in the company’s consumer tax software, which will be included in the coming tax season, will provide AI generated analysis of returns with insights on why filers are—or aren’t—getting refunds.
Also coming soon is a new feature in the company’s QuickBooks accounting software that levers AI to create business summaries and to ask more questions about business performance.
It appears that some revenue that the Street had expected in the January quarter shifted to the October quarter. For the January quarter, Intuit sees revenue growth of 11% to 12%, with adjusted profits of $2.25 to $2.31 a share, while the Street consensus had called for 12% revenue growth and a profit of $2.57 a share.
Intuit affirmed that for the full year it sees revenue of $15.89 billion to $16.105 billion, up 11% to 12%, with adjusted profits of $16.17 to $16.47 a share. That includes growth of 16% to 17% in the small business and self-employed group, and 7% to 8% in consumer. The company expects the change in Credit Karma’s top line to range from a 3% decline to 3% growth.
Intuit shares were 0.5% higher at $568 in late trading. The stock is about 45% higher for the year to date.
Write to Eric J. Savitz at eric.savitz@barrons.com
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