EPS of $8.41 increased by 14.8% from previous year
Gross margin of 82.4%
Net income of 2.39B
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Intuit Inc (0JCT.L) QQ3 2024 Earnings Review – Robust Q3 2024 Performance Across SMB, Consumer, and Tax Platforms with Strong Free Cash Flow and Balance Sheet Resilience
Executive Summary
Intuit reported a solid QQ3 2024 with substantial sequential momentum and healthy profitability across its four segments. Revenue reached $6.737 billion, up 11.95% year-over-year and surging about 99% quarter-over-quarter, underscoring stronger seasonality and scale in its core platforms (Small Business/ Self-Employed, Consumer/TurboTax, and Credit Karma). Gross margin remained high at approximately 82.4%, and operating margin about 46.1%, supporting an operating income of $3.105 billion and net income of $2.389 billion for the quarter. Diluted earnings per share were $8.41, with reported EPS of $8.53, reflecting roughly $0.15 of quarterly variance versus the diluted figure. The company generated robust operating cash flow of $3.951 billion and free cash flow of $3.89 billion, leaving a strong liquidity position (cash at period-end of $6.481 billion) and a still-discipline-driven capital allocation framework (net debt of $2.283 billion, $572 million in share repurchases, and $257 million in dividends). These dynamics reinforce Intuit’s ability to reinvest in its ecosystem while returning capital to shareholders. Management commentary (as far as can be inferred from the release and typical guidance patterns) emphasizes continued investment in scaleable platforms (QuickBooks Online, TurboTax, Credit Karma) and operating discipline to sustain margin strength amid a favorable but potentially choppy macro environment.
- Revenue: $6.737 billion; YoY +11.95%; QoQ +98.97%
- Gross Profit: $5.55 billion; Gross Margin ~82.38%
- Operating Income: $3.105 billion; Operating Margin ~46.09%
- Net Income: $2.389 billion; Net Margin ~35.46%
- EPS (diluted): $8.41; Reported EPS: $8.53; YoY EPS growth ~14.80% ; QoQ ~576.98%
- EBITDA: $3.303 billion; EBITDA Margin ~49.03% (EBITDA / Revenue)
- Cash Flow: Operating Cash Flow $3.951 billion; Free Cash Flow $3.89 billion; Cash at End of Period $6.481 billion
- Balance Sheet: Total Assets $31.56B; Total Liabilities $12.803B; Total Stockholders’ Equity $18.758B; Net Debt ~$2.283B
- Cash Conversion & Returns: FCF yield high vs market cap (as implied by FCF per share ~$13.89); ROE ~12.7%; ROA ~7.6%
- Valuation Signals: P/E ~18.5x; P/FCF ~45x; P/S ~26x; Cash rich with strong visibility in recurring revenue streams
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
6.74B
11.95%
98.97%
Gross Profit
5.55B
10.18%
119.28%
Operating Income
3.11B
11.77%
741.46%
Net Income
2.39B
14.47%
576.77%
EPS
8.53
14.80%
576.98%
Key Financial Ratios
currentRatio
1.5
grossProfitMargin
82.4%
operatingProfitMargin
46.1%
netProfitMargin
35.5%
returnOnAssets
7.57%
returnOnEquity
12.7%
debtEquityRatio
0.35
operatingCashFlowPerShare
$14.11
freeCashFlowPerShare
$13.89
dividendPayoutRatio
10.8%
priceToBookRatio
9.41
priceEarningsRatio
18.48
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Transcript data not included in the provided dataset. Consequently, no verbatim management quotes are available within this extraction. The analysis instead relies on the disclosed quarterly metrics and typical strategic themes associated with Intuit’s business model: (1) continued scale and monetization of QuickBooks Online and the broader SMB ecosystem, (2) Tax/Consumer platform optimization through TurboTax and Credit Karma, and (3) disciplined capital allocation (share repurchases and dividends) alongside strong cash generation. Without the transcript, investors should monitor upcoming calls for explicit guidance and management commentary on growth mix, retention metrics, and any margin- or investment-related guidance.
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Forward Guidance
The QQ3 2024 results did not include explicit forward-looking guidance in the provided data. Inference based on reported metrics and historical patterns suggests a continued focus on scaling the QuickBooks Online/SaaS ecosystem, expanding the ProConnect and Credit Karma platforms, and maintaining operating discipline to sustain the high gross and operating margins. Key factors for investors to monitor include: (a) trajectory of SMB online services adoption and add-on modules within QuickBooks Online, (b) stability of TurboTax consumer tax seasonality and any policy/regulatory shifts affecting tax software volumes, (c) mix impact of Credit Karma on revenue growth and profitability, and (d) macroeconomic conditions impacting small business spend and consumer discretionary behavior. If management reinforces a target mid-to-high single-digit revenue growth with margin expansion, that would support the current earnings profile; conversely, any meaningful pullback in tax season demand or competitive pricing pressure could temper margins.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
0JCT.L Focus
82.38%
46.10%
12.70%
18.48%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Intuit demonstrates a robust QQ3 2024 performance characterized by strong margin resilience, cash generation, and a disciplined balance sheet. The business benefits from a high-quality, recurring revenue base across core platforms (QuickBooks Online, TurboTax, Credit Karma, ProConnect) and a formidable capital allocation framework. The key question for investors is the durability of revenue growth and margin trends as the company grows its ecosystem and faces potential tax-year volatility. Relative to peers, Intuit trades at a mid-high multiple on earnings and free cash flow, reflecting the quality of its subscription model and EBITDA margin. Given the clear cash generation, low net debt, and ongoing share repurchases, the investment thesis remains constructive with a bias toward modest appreciation over the medium term, provided management sustains top-line momentum, margin discipline, and meaningful progress on international expansion and cross-sell opportunities. Monitor: tax policy/regulatory developments, competitive dynamics in tax software and SMB tooling, and the velocity of Credit Karma's growth within the broader financial services ecosystem.
Key Investment Factors
Growth Potential
Strong recurring revenue through SaaS subscriptions (QuickBooks Online) and an expanding ecosystem (ProConnect, Credit Karma). Potential cross-sell opportunities across the SMB and consumer platforms and ongoing product enhancements should sustain high retention and moderate long-term growth.
Profitability Risk
Key risks include reliance on the U.S. tax cycle and regulatory changes, competitive pressure from alternative financial software, cybersecurity/privacy risks, and macroeconomic downturns impacting SMB investment and consumer spending. High goodwill/intangible asset base raises impairment risk in adverse scenarios.
Financial Position
Liquidity is robust with cash and cash equivalents of $4.215B and total cash/short-term investments of $4.678B, plus total debt of $6.499B and net debt of $2.283B. Leverage metrics are conservative relative to cash generation (Debt/Capital ~25.7%, Debt/Equity ~34.6%). Strong FCF generation ($3.89B free cash flow) supports capital return policies (dividends and buybacks) and ongoing ecosystem investments.
SWOT Analysis
Strengths
Leading market position in small business accounting and tax software (QuickBooks Online, TurboTax) with strong brand recognition.
High gross margin (~82%) and sticky, recurring revenue model across SMB and consumer platforms.
Robust free cash flow generation and strong balance sheet with substantial cash reserves.
Significant capital return program (share repurchases and dividends) supports shareholder value.
Weaknesses
Concentration risk in U.S. tax season dynamics and regulatory environment.
Intangible asset base (goodwill/intangibles) may expose to impairment risk in downside scenarios.
Dependence on lifecycle transitions across the tax and accounting software ecosystems.
Opportunities
Continued growth through QuickBooks Online ecosystem and cross-sell across ProConnect and consumer products (Credit Karma).
Expansion of cloud-based offerings and new features to increase wallet share within SMBs.
Potential upside from international expansion and cross-border tax software adoption.
Threats
Regulatory changes affecting tax software and financial services.
Intense competition in the software and fintech space (e.g., alternative tax platforms, fintech disruptors).
Macro pressures on SMBs and consumer spend could impact software-adoption cycles and retention.