Intuit

Intuit, the global technology platform that makes TurboTax, QuickBooks, Credit Karma and Mailchimp, announced financial results for Q2 2023.
Total revenue for the year was $3 billion, up 14% and $130 million ahead of consensus. Adjusted operating profit increased 40% to $856 million with the operating margin increasing to 28% from 23% in Q2 2022. Adjusted EPS grew 42% to $2.20 per share, which was $0.76 above consensus. Intuit received Board approval for a quarterly dividend of $0.78 per share, representing a 15% increase versus last year.
Small Business and Self-Employed Group revenue rose 20% Y/Y to $1.9B, while Online Ecosystem revenue increased 24%. ProTax Group revenue rose 7% to $253M.
Disappointingly the company’s fintech app Credit Karma revenue declined by 16% to $375 million due to softness in personal loans, home loans, auto insurance and auto loans.
Guiding for 2023, Intuit management expects revenue between $14.04 billion and $14.25 billion, or growth of 10% to 12%. This was in-line with previous guidance given in Q1. The adjusted EPS share forecast of $13.59 to $13.89, represents growth of 15% to 17%, also unchanged.
Intuit is a high-quality business consistently generating operating margins of close to 25% and returns on invested capital of more than 20%. At $410, relative to guided full year EPS, Intuit trades at a PE of approximately 30x. Although the stock is expensive, we currently hold a small position in the Cratos Worldwide Flexible Fund.