QB ONLINE SUBSCRIBERS SURGE

posted in: Uncategorized | 0

Technically, Xero’s customer base has grown more rapidly than Intuit’s. Xero ended its year on March 31 with 475,000 subscribers, up 67 percent over a year earlier. Intuit ended its third quarter on April 30 with 965,000 QuickBooks Online subscribers, 54.6 percent higher than on the same date in 2014. Intuit is a far larger company than Xero and you would expect it not to grow nearly as fast. In the meantime, during this year’s webcast of earnings, Intuit CEO Brad Smith was asked for a figure I have not heard before—QBO retention. “The retention rates are in the mid to high 70-percent range,” Smith said.  Smith has previously said one in five desktop customers bails. Intuit had a more successful quarter than it appears on paper. Net income for the most recently period was $501 million, down 41 percent from $984 million a year ago. Revenue fell to $2.19 billion, down 8 percent from $2.34 billion last year. One reason was the decision to recognize software revenue ratably, which pushed the company’s ProTax down by 61 percent to $130 million. In this week’s earnings webcast, CFO Neil Williams said $150 million in revenue is moving to fiscal 2016 “due to changes in our desktop offerings”, which sounds different than the original explanation. Intuit also took a $263-million goodwill impairment charge. For its Consumer Ecosystem Group, where revenue trailed expectations. Intuit purchased Check last year for its bill pay channels but is shifting focus to integrating its bill pay system into Mint and Quicken.