Intuit reported a 13 percent jump in revenue to $1.6 billion for its fiscal third quarter, which ended April 30, largely on the strength of tax season.

The revenue growth exceeded the company’s guidance range. On a GAAP basis, operating income grew 16 percent to $888 million. Non-GAAP operating income grew 12 percent to $938 million. GAAP diluted earnings per share were $1.78, up 21 percent over the third quarter of last year. Non-GAAP diluted earnings per share were $1.89, up 13 percent.

Intuit’s Consumer Tax Group generated revenue of $871 million in the third quarter, growing 12 percent over the previous year.

The company raised fiscal year guidance based on strong results across the board. For fiscal year 2010, which ends July 31, Intuit expects revenue to grow 10 percent from $3.410 billion to $3.425 billion.

“We delivered another quarter of strong results, with revenue and earnings per share exceeding the top end of our guidance,” said Intuit president and CEO Brad Smith in a statement. “We saw across-the-board strength, fueled by a great tax season, a return to double-digit revenue growth in small business, and continued strong performance from our financial institutions segment. With these strong results, we are once again raising our revenue and earnings outlook for the year.”

Small business total revenue grew 13 percent for the third quarter, driven by strong performance in Financial Management Solutions and Employee Management Solutions at the company.

Revenue on the Financial Management Solutions side increased 16 percent compared to the third quarter of 2009, led by outstanding growth in QuickBooks for the desktop, QuickBooks Online and Intuit Websites. The online customer base grew 32 percent compared to the year-ago quarter. Intuit Websites continued to make strong progress, with customers increasing 80 percent over last year, to more than 300,000.

Employee Management Solutions revenue grew 13 percent, powered by Intuit Online Payroll. Revenue grew 8 percent in Payment Solutions for the company, driven by a 16 percent increase in merchants. Charge volume grew 1 percent year over year, the first increase since the third quarter of fiscal 2008.

For Intuit’s Consumer Tax Group, revenue increased 12 percent, with an increase in share in both the desktop and online categories. Total units were up 11 percent for the season, with Web units up 18 percent. Intuit believes Consumer Tax revenue will grow 12 to 13 percent in fiscal 2010.

Online tax units represented more than 70 percent of total TurboTax units this season, as more customers continued to choose the online product.

Accounting Professionals revenue grew 15 percent over last year, capping off a solid tax season for the segment. Excluding a $9 million revenue shift deferred from the second to the third quarter, Accounting Professionals revenue grew 10 percent.

Financial Services revenue grew 21 percent and bill pay users grew 16 percent. This tax season, more than 1,100 financial institutions offered TurboTax for Online Banking. Revenue grew 9 percent, excluding TurboTax for Online Banking. Approximately 450 financial institutions are signed up to offer FinanceWorks, with a growing number of banks adopting Intuit's online bill payment and mobile banking solutions.

Intuit’s recently acquired personal finance site,, saw accelerated growth. New registered users for the third quarter were more than 2.5 times greater than for the same quarter last year.

Intuit noted that it has also signed an agreement to acquire Medfusion, a patient-to-provider communications provider. This transaction will provide Intuit with a Software-as-a-Service offering currently used by more than 30,000 health care providers, the vast majority of whom are essentially small businesses.

Intuit increased its guidance range for the full 2010 fiscal year, which ends July 31, and expects revenue to grow 10 percent from $3.410 billion to $3.425 billion, along with growth of 15 to 16 percent in GAAP operating income from $840 million to $850 million, and non-GAAP operating income from $1.065 billion to $1.075 billion.
GAAP diluted earnings per share are expected to grow 25 to 27 percent from $1.69 to $1.72. Non-GAAP diluted EPS are expected to grow 12 to 13 percent from $2.03 to $2.06.

Intuit also updated its previous fiscal year revenue guidance for the Consumer Tax segment, which is now expected to grow 12 to 13 percent. All other segment revenue guidance remained unchanged.

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access