As a paying subscriber, this is an example of what you’ll get bi-monthly.
Intuit (creator of TurboTax, Quickbooks, etc.), unsurprisingly, makes all of its profit in a 3-month window.
Guess which three months?
We'll start with revenue.
You can see that Q2 and Q3 are the biggest revenue quarters, with Q3, being the real driver.
Here is how much Q3 is responsible for annual sales.
Is this higher or lower than you would have guessed? I would have guessed even higher probably.
But here's where it gets interesting.
Here are EBIT margins. In Q3, EBIT margins are Mastercard-like!
And Visa-like for free cash flow.
Here is how much Q3 is responsible for EBIT. Just about 100% of profit comes from a 3-month window.
This proportion is even a little higher with free cash flow.
Intuit is a pretty interesting business as it has done a good job of shifting from desktop downloads to a SaaS model. And the brand is second to none.
TurboTax and Quickbooks have become synonymous with tax/accounting software.
One thing that was kind of surprising was how much of its earnings the company returns to shareholders.
For 2019, it spent about 50% of its EBIT on buybacks and dividends.
For 9 months of the year, Intuit just about breaks even. Then it adds almost $2 billion in profit in a span of 90 days.
Talk about seasonality!