Intuit Raising 2016 Guidance After Strong Tax Season Results

Intuit Inc. (NASDAQ: INTU) has released its earnings for the third quarter of its fiscal year 2016. As this company is so dependent upon tax filing software sales and services around TurboTax, this quarter ending on April 30 is effectively its Christmas quarter if you were to make a retail comparison.

Intuit reported revenue of $2.304 billion, up 8 percent from a  year ago. The company also grew TurboTax Online units by 15 percent for the tax season, and it further said that the total TurboTax units grew 12 percent.

Another boost was that Intuit added some 140,000 QuickBooks Online subscribers in the quarter. This brings the total to 1,397,000 paid subscribers worldwide at the end of April.

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Perhaps the big news is that Intuit went on to raise revenue, operating income and earnings per share guidance for the fiscal year. Annual guidance is as follows:

• Revenue of $4.660 billion to $4.680 billion, growth of 11 to 12 percent.
• Non-GAAP diluted EPS of $3.63 to $3.65, growth of 40 to 41 percent.
• Non-GAAP operating income of $1.490 billion to $1.510 billion, growth of 31 to 32 percent.

Brad Smith, Intuit’s chairman and chief executive officer, said:

This was simply a great season for TurboTax. We delivered an awesome product experience and we remain committed to continuing to invest and build on our competitive advantage to drive share gains for our product and the category.

This was a strong quarter for small business as well, led by robust new-user growth in our QuickBooks Online ecosystem. As a result of the strong year we’ve delivered through three quarters, we’ve raised our revenue, operating income and earnings per share guidance for the year.

Intuit shares were up 2.6% at $107.38 at the close, and the after-hours earnings reaction had shares up 2.7% at $110.25. Intuit’s consensus analyst price target was $106.06 going into earnings, versus a 52-week range of $79.63 to $108.20.