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Analyzing Intuit’s Revenue Drivers

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Key revenue drivers

Intuit’s (INTU) aggressive strategy to attract customers is paying rich dividends. The company’s strong product offerings suiting different needs, healthy mix of paying customers, and increasing Quickbooks online subscribers continue to act as strong catalysts.

The launch of TurboTax Live and rising TurboTax e-filed returns may further boost the company’s top-line growth. Intuit is also benefiting from increased sales of premium products, driving the company’s average revenue per return. Growth across all segments has driven the company’s revenue.

The graph above shows Intuit’s revenue growth over the last five quarters. Its revenue growth has followed an upward trend, growing at a compound annual rate of 3%.

In fiscal 2Q18, the company’s total revenue rose 15% YoY to ~$1.2 billion. Its business was slightly affected by tax season being shifted this year.

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Analysts’ estimates and guidance

Of the 22 analysts covering Intuit stock, six have recommended “strong buy,” three have recommended “buy,” 11 have recommended “hold,” and two have rated it as “underperform.”

The company projects fiscal 3Q18 revenue of $2.78 billion–$2.83 billion, marking a rise of 10%–12%. Similarly, in fiscal 2018, revenue is expected to expand 9%–11% to $5.64 billion–$5.74 billion. In comparison, major information technology peers Microsoft (MSFT) and IBM (IBM) saw 11% revenue growth YoY in fiscal 2Q18 and 1% growth YoY in fiscal 4Q17 on a constant-currency basis.

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