Intuit (INTU -1.18%), the software company known for QuickBooks and TurboTax, released its earnings for Q4 and the fiscal 2024 on Aug. 22. The company reported solid revenue growth and exceeded non-GAAP EPS expectations although GAAP operating income fell short due to a restructuring charge. For Q4, Intuit beat its revenue guidance, reporting $3.184 billion compared to the expected range of $3.063 billion to $3.099 billion. Overall, it was a strong quarter for the company as it met or exceeded most targets.
Understanding Intuit
Intuit is a leading software company providing financial and business management solutions through products like QuickBooks and TurboTax. The company has increasingly focused on integrating artificial intelligence (AI), resulting in innovative customer experiences.
Recently, Intuit has placed strong emphasis on AI and technological innovation, the Small Business and Self-Employed segment, the Consumer segment (TurboTax), and Credit Karma as key growth drivers.
Quarterly Highlights
Intuit reported robust growth in the fourth quarter of its fiscal 2024. The Small Business and Self-Employed segment, renamed the Global Business Solutions Group, showcased 20% revenue growth to $2.6 billion -- and 19% growth for the year. QuickBooks Online revenue rose 17% for the quarter and 19% for the year, driven by customer growth and higher prices. Online services, including payroll and Mailchimp, increased 19% for the quarter and 21% for the year.
The Consumer segment's TurboTax revenue saw mixed results. While full-year revenue was up by 7% to $4.4 billion, TurboTax Live revenue increased strongly by 17%. However, total TurboTax units in the U.S. declined by 1%, mainly due to competition and a strategy focusing on higher revenue per customer. Credit Karma reported modest growth, with Q4 revenue increasing by 14% to $485 million, and annual revenue growing 5% to $1.7 billion.
Impressive strides were made in artificial intelligence. The AI-driven expert platform, including Intuit Assist, was utilized by over 24 million customers during the tax season. Credit Karma also enhanced its offerings with AI features that aided nearly half of its 40 million active users.
One-time restructuring charges led to a GAAP operating loss of $151 million in Q4. Despite this, non-GAAP diluted EPS of $16.94 exceeded expectations of $16.79 to $16.84. Intuit repurchased $2 billion in shares during fiscal 2024 and announced a dividend of $1.04 per share, payable on Oct. 18.
Looking Ahead
For fiscal 2025, Intuit projects revenue between $18.160 billion to $18.347 billion, reflecting 12-13% growth. GAAP operating income is expected to range from $4.649 billion to $4.724 billion, with non-GAAP operating income between $7.241 billion to $7.316 billion. The company anticipates significant revenue growth across all segments, particularly 16-17% for the Small Business and Self-Employed Group and 7-8% for the Consumer Group.
Investors should monitor Intuit’s ongoing investments in AI, as these are pivotal for long-term growth. Observing changes in the competitive landscape, particularly for TurboTax and Credit Karma, will also be crucial. The company plans to accelerate its mid-market initiatives and expand its international footprint, so tracking these developments could provide additional insights into its future performance.
