Intuit Inc. (NASDAQ:INTU)

Net Operating Profit After Taxes (NOPAT)

The net operating profit after taxes showed a general upward trend from 2020 through 2025, increasing from $1,795 million in 2020 to $3,531 million in 2025. There was a peak in 2022 at $2,300 million, followed by a decline in 2023 to $2,022 million, but the figure recovered strongly in the subsequent years, indicating an overall growth in operating profitability.

Cost of Capital

The cost of capital remained relatively stable over the years, fluctuating slightly between 16.27% and 16.95%. This suggests that the company's risk profile and financing costs did not experience significant changes during the period, maintaining a relatively consistent benchmark for evaluating investment returns.

Invested Capital

Invested capital more than doubled from $8,690 million in 2020 to a peak of approximately $24,948 million in 2024, before slightly decreasing to $24,521 million in 2025. The substantial increase through the years into 2022 reflects significant capital expenditure or asset accumulation, with a slight reduction towards the end possibly indicating asset divestitures or depreciation exceeding new investments.

Economic Profit

Economic profit showed a declining trend throughout the period, moving from positive values in 2020 ($355 million) and 2021 ($85 million) into large negative values from 2022 onwards, reaching a negative $572 million in 2025. This decline despite increasing NOPAT highlights that the returns generated were insufficient to cover the cost of the increased invested capital, indicating potential inefficiencies in capital utilization or investments that did not meet required thresholds.

Net income

The net income shows an overall upward trend from 2020 to 2025. Starting at 1,826 million USD in 2020, it increases steadily each year, reaching 3,869 million USD in 2025. The yearly increments indicate consistent growth, with a notable acceleration from 2023 to 2025 where the net income rises by approximately 577 million USD between 2023 and 2024, and by 906 million USD between 2024 and 2025.

Net operating profit after taxes (NOPAT)

NOPAT also follows an increasing trajectory over the period, starting at 1,795 million USD in 2020 and rising to 3,531 million USD in 2025. However, the trend is less smooth compared to net income. After an increase from 2020 to 2022, there is a dip in 2023 to 2,022 million USD. Following this dip, the figures recover and grow substantially in 2024 and 2025. The increase from 2023 to 2025 is significant, indicating enhanced operational efficiency or profitability after taxes during the later years.

Comparison and insights

Both net income and NOPAT demonstrate growth over the six-year period, with net income growing slightly more consistently. The dip in NOPAT in 2023 suggests possible operational challenges or non-recurring expenses that affected operating profits during that year. The recovery and strong growth in subsequent years for both metrics imply successful strategic adjustments or improved market conditions. Overall, the data suggests increasing profitability and operational effectiveness over time, with particularly strong momentum in the last two years.

Provision for income taxes

The provision for income taxes showed a fluctuating trend over the analyzed periods. Starting at 372 million US dollars in July 2020, it increased to 494 million in July 2021. This was followed by a slight decrease to 476 million in July 2022. Subsequently, the provision rose again to 605 million in July 2023, then decreased slightly to 587 million in July 2024. A significant increase was observed in July 2025, reaching 965 million. Overall, the provision demonstrated an upward trajectory with occasional declines, suggesting variability in taxable income or tax rates but a general rise in tax expenses over time.

Cash operating taxes

The cash operating taxes exhibited considerable volatility throughout the period. Beginning at 477 million US dollars in July 2020, it increased moderately to 545 million in July 2021. However, a sharp decline occurred in July 2022, with the value dropping to 398 million. This was followed by a dramatic increase in July 2023 to 1,320 million and a further slight decrease to 1,276 million in July 2024. The upward movement continued into July 2025, reaching 1,538 million. This pattern indicates significant fluctuations in actual cash tax payments, possibly driven by changes in profitability, tax planning strategies, or timing differences in tax payments.

The financial data presents a multi-year view of key financial metrics, namely total reported debt and leases, stockholders’ equity, and invested capital, spanning from fiscal years ending July 31, 2020 through July 31, 2025.

Total Reported Debt & Leases

This liability measure showed a decline from 3,636 million USD in 2020 to 2,480 million USD in 2021, indicating a reduction in debt obligations or lease liabilities during that period. However, it then rose sharply to 7,540 million USD by 2022, suggesting a significant incurrence of additional liabilities. After 2022, the value decreased slightly to 6,689 million USD in 2023 and then remained relatively stable, hovering around 6,500 to 6,600 million USD through the forecasted years 2024 and 2025. This pattern reveals an initial debt reduction, followed by a rapid increase and subsequent stabilization at a higher level than the starting point.

Stockholders’ Equity

Stockholders’ equity exhibited a consistent and significant upward trajectory throughout the period. Starting from 5,106 million USD in 2020, equity nearly doubled to 9,869 million USD by 2021, then continued to increase sharply to 16,441 million USD in 2022. The growth persisted through 2023 and into the projections for 2024 and 2025, reaching a forecasted 19,710 million USD. This steady increase reflects improvements in net assets attributable to shareholders, potentially driven by retained earnings growth, capital infusion, or favorable market valuations.

Invested Capital

Invested capital rose from 8,690 million USD in 2020 to 12,248 million USD in 2021, aligning with the growth trend seen in equity. A pronounced jump occurred in 2022 to 24,726 million USD, more than doubling the prior year, which parallels the spike in total reported debt and leases, indicating significant new capital investment potentially funded by increased liabilities. There was a marginal decline to 23,712 million USD in 2023, followed by a moderate increase to 24,948 million USD in 2024, before a slight reduction to 24,521 million USD in the final forecast year. Overall, invested capital has more than doubled from the start to the end of the period, reflecting substantial asset base growth likely supporting operational expansion or strategic acquisitions.

In summary, the data points to a period marked by substantial balance sheet expansion, with stockholders’ equity and invested capital growing robustly. The pattern of debt indicates strategic leveraging after an initial reduction, stabilizing at higher levels consistent with increased invested capital. Together, these trends suggest an aggressive growth phase involving capital acquisition and financing moves to support organizational objectives.

The financial data over the examined periods reveal significant variations in key financial performance indicators. The analysis focuses on economic profit, invested capital, and the economic spread ratio, which provide insight into the company's value creation and capital efficiency.

Economic Profit

The economic profit shows a downward trend from 2020 through 2025. Initially, the figure was positive at 355 million USD in 2020, but sharply declined to 85 million USD in 2021. From 2022 onwards, economic profit turned negative, worsening to -1,722 million USD in 2022 and reaching its lowest point of -1,911 million USD in 2023. Although negative values persisted in 2024 and 2025, there is a visible improvement with the loss narrowing to -1,499 million USD and further to -572 million USD, indicating some recovery in the later years.

Invested Capital

Invested capital has generally increased over the period. Starting at 8,690 million USD in 2020, it rose substantially to 12,248 million USD in 2021. This growth continued more sharply in 2022, reaching 24,726 million USD. The invested capital saw a slight reduction in 2023 to 23,712 million USD, followed by another increase peaking at 24,948 million USD in 2024 and a minor decline to 24,521 million USD in 2025. The overall trend signifies expansion in invested resources, although the variations towards the end suggest attempts at managing or optimizing capital deployment.

Economic Spread Ratio

The economic spread ratio mirrors the profitability trend and reflects the return on invested capital relative to its cost. In 2020, this ratio was positive at 4.08%, indicating returns above capital costs. However, it dropped significantly to 0.7% in 2021 and turned negative from 2022 onwards, reaching -6.96% in 2022 and dropping further to -8.06% in 2023. The ratio shows a gradual improvement in 2024 and 2025, improving to -6.01% and -2.33%, respectively. This pattern suggests that the company struggled to generate adequate returns on invested capital during the middle years but has been working toward mitigating losses more recently.

In summary, the data reveal a period of financial stress characterized by declining economic profit and negative returns on invested capital, despite an increase in invested capital itself. The financial indicators suggest challenges in generating value and efficient use of capital during 2022 and 2023, with early signs of recovery by 2024 and 2025. These trends highlight areas requiring strategic focus to enhance profitability and capital efficiency going forward.

The financial data presents several notable trends over the six-year period under review. Adjusted net revenue exhibits a consistent and substantial upward trajectory, increasing from 7,721 million US dollars in 2020 to 18,978 million US dollars projected for 2025. This reflects robust growth in revenue generation capabilities.

In contrast, economic profit demonstrates a significant decline throughout the same period. Beginning with a positive 355 million US dollars in 2020, economic profit sharply decreases to 85 million in 2021, before turning negative in 2022 at -1,722 million. The negative trend continues through the projections for 2023 to 2025, albeit with a gradual reduction in losses, ending at -572 million US dollars in 2025. This shift indicates challenges in generating profit above the cost of capital, despite increasing revenues.

The economic profit margin further illustrates this deterioration in profitability. Starting at a positive margin of 4.59% in 2020, it plunges to a negligible 0.88% in 2021 before entering a sustained negative zone. From 2022 onward, the margin remains negative, with values ranging between -13.4% and -3.01%, reflecting that economic profit is consistently below zero relative to the adjusted net revenue.

Overall, while the company shows strong revenue growth trends, this has not translated into improved economic profitability. The persistent negative economic profit and declining margin suggest increasing costs or capital charges that offset revenue gains. Although the losses appear to moderate towards the latter years, economic profitability remains a critical concern that needs addressing to align revenue growth with sustainable value creation.