Intuit Q1 tops expectations with steady growth in small business ecosystem

Intuit reported better-than-expected first quarter financial results on Thursday, showing solid growth in its small business and self employed unit. The personal and small business financial software maker reported a net income of $198 million, or 75 cents per share. Non-GAAP earnings were 94 cents per share on revenue of $1.3 billion. Wall Street was expecting earnings of 37 cents per share with $1.21 billion in revenue.

In its small business and self employed unit, Intuit said revenue increased 13% to $1.2 billion. Small business online ecosystem revenue was up 24%. 

QuickBooks said online accounting revenue increased 28% in the quarter and online services revenue rose 17%, driven by strength in the QuickBooks payments and online payroll products.

Meanwhile, the company said its consumer group revenue increased 19% to $119 million and that professional services revenue was $23 million in the first quarter.

For fiscal 2021, the company projected annual revenue of $8.265 billion to $8.415 billion, up 8% to 10% from the previous year. Non-GAAP earnings per share are expected to be between $8.40 to $8.55. Wall Street is expecting Intuit to deliver fiscal year revenue of $8.29 billion with earnings of $8.43 per share.

For the current quarter, Intuit expects revenue growth of 8% to 9% with per share of $1.31 to $1.34.

Intuit also touched upon its $7.1 billion purchase of Credit Karma. 

Intuit said Credit Karma's business "was negatively impacted over the last 7 months as lenders tightened access to credit due to economic uncertainty related to the pandemic. The company has seen continued recovery after reaching a low point in June, with the October revenue run-rate nearly back to pre-COVID levels. Therefore, Intuit expects the acquisition to be modestly dilutive to non-GAAP earnings per share in fiscal 2021, and neutral to modestly dilutive to non-GAAP earnings per share in the first full fiscal year after close in fiscal 2022."

Shares of Intuit were down slightly after hours. 

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