Intuit rebounds from challenging tax season with strong Q4 results

For the year, Intuit said combined QuickBooks Online and TurboTax Online platform revenue increased 22% to $4.8 billion.

Intuit rebounded from a rocky tax season with better-than-expected fourth quarter results. On Tuesday, the personal and small business financial software maker reported a net income of $445 million, or $1.68 per share. 

Non-GAAP earnings were $1.81 per share on revenue of $1.8 billion. Wall Street was expecting earnings of $1.05 per share with $1.57 billion in revenue.

For the fiscal year, Intuit reported revenue of $7.7 billion, up 13% from a year ago, with operating income of $2.18 billion.

In the fourth quarter, the Mountain View, California-based company said total consumer group revenue was up to $710 million. Within this group, Intuit said TurboTax Online and total TurboTax units both increased 11%, marking the strongest customer growth in four years.

The company also saw strength in its small business and self employed unit. Intuit said revenue from its small business and self-employed group increased 16% to $1 billion. Small business online ecosystem revenue was up 29%. 

Additional highlights from Intuit's fiscal year:

  • Combined QuickBooks Online and TurboTax Online platform revenue increased 22% to $4.8 billion.
  • Small Business and Self-Employed Group revenue increased by15% and Online Ecosystem revenue rose 31%. 
  • Consumer Group revenue climbed 13%. 

The third quarter is traditionally tax season and Intuit generally performs well above its average on sales of consumer tax software. But the due to COVID-19's impact on small business customers and the extension of the IRS tax filing deadline to mid July, Intuit's Consumer Group took a sales hit in Q3 and its overall revenue declined 8% year-over-year. The strong fourth quarter results help offset the third quarter turbulence.  

"After seeing an impact on small businesses from shelter-in-place during the third quarter, we saw trends across our business improve during the fourth quarter, highlighting the resiliency of our platform," said Sasan Goodarzi, Intuit's chief executive officer. "We had an outstanding tax season, growing the Do-It-Yourself (DIY) category overall as well as our share of total returns, while posting the strongest customer growth in four years. TurboTax Live had another great season, as we made significant progress in our effort to transform the assisted category."

Intuit didn't issue guidance for the current quarter. Wall Street is looking for revenue of $1.17 billion and earnings of 34 cents per share. Shares of Intuit were up over 5% after hours.