Intuit Inc. (NASDAQ:INTU)

The analysis of the quarterly financial ratios indicates distinct trends in the company's profitability and leverage from 2020 onwards.

Return on Assets (ROA)

The ROA data begins from the quarter ending July 31, 2020, showing an initial value of 16.7%. This ratio peaked shortly after at 20.26% in the quarter ending October 31, 2020, but then exhibited a declining trend through the next several periods, reaching a low of 6.93% by the quarter ending October 31, 2022. Following this trough, there was a gradual recovery, with ROA increasing steadily to 10.47% by the quarter ending July 31, 2025. The overall pattern suggests a period of contraction in asset returns followed by a slow and consistent improvement.

Financial Leverage

The financial leverage ratio shows some volatility yet remains within a relatively narrow range throughout the observed quarters. The ratio fluctuated between 1.53 and 2.14, with no clear upward or downward long-term trend. Initially, it started at 1.7 in October 2019, peaked at 2.14 in July 2020, and then mostly oscillated around levels between 1.6 and 1.8 in subsequent periods. Toward the most recent quarters, leverage has slightly increased, reaching 1.88 by July 2025. The moderate leverage levels imply consistent use of debt relative to equity without significant shifts.

Return on Equity (ROE)

ROE is reported starting from July 2020, initially at 35.76%, with a peak of 37.5% in October 2020. Similar to ROA, ROE then declined considerably, falling below 12% between October 2022 and January 2023. After hitting this lower range, ROE exhibited a steady upward trajectory, ultimately reaching 19.63% by the quarter ending July 2025. This trend mirrors the ROA movements but reflects a higher sensitivity and volatility, influenced by the financial leverage and operational performance.

In summary, both return measures (ROA and ROE) demonstrate a strong initial performance in 2020, followed by a decline that spans approximately two years before a gradual and sustained recovery phase. The financial leverage ratio remained stable without significant shifts, suggesting that variations in returns were primarily driven by operational factors rather than changes in capital structure.

The analyzed data reveals important trends in profitability, efficiency, and financial structure over the reported periods.

Net Profit Margin

The net profit margin exhibits a generally declining trend from the earlier periods, starting around 23.78%, then decreasing to a low near 14.1% in early 2022. Subsequently, a gradual recovery is visible, rising to approximately 20.55% by early 2025. This pattern suggests a phase of reduced profitability followed by stabilization and improvement.

Asset Turnover

Asset turnover fluctuates over time, initially around 0.7 to 0.81 in late 2019 and early 2020, then dropping to lows near 0.43 in mid-2022. A modest recovery follows, with ratios nearing 0.54 by early 2025. These variations indicate changes in the efficiency with which assets generate revenue, with a dip in efficiency during the mid-periods and partial recovery afterward.

Financial Leverage

The financial leverage ratio shows moderate variation, starting near 1.7 to 1.8 in late 2019 and early 2020, dipping slightly to below 1.6 in mid-2021, then gradually increasing again towards around 1.88 by early 2025. This trend reflects fluctuations in the use of debt or other liabilities relative to equity, with a tendency toward increased leverage in later periods.

Return on Equity (ROE)

ROE mirrors the net profit margin pattern with some amplification. It is high around 35.76% to 37.5% in early 2020, followed by a sharp decline to approximately 11.69% to 12.57% in early to mid-2022. A steady improvement occurs thereafter, reaching about 19.63% by early 2025. This suggests that shareholder returns were significantly pressured in the middle periods but have been recovering more recently.

Overall, the patterns indicate that the company experienced a period of reduced profitability and operational efficiency around 2021–2022, possibly reflecting external challenges or internal adjustments. Both profitability measures and asset utilization metrics show recovery trends from 2023 onward. Financial leverage increases modestly in the later periods, potentially supporting the improved performance and growth initiatives.

Tax Burden

The tax burden ratio demonstrates moderate fluctuations over the observed periods, remaining primarily within a range of 0.77 to 0.84. Early measured values around 0.83 gradually decline to approximately 0.77 during mid-periods before slightly recovering closer to 0.83 towards the later dates. This indicates a somewhat stable but slightly decreasing portion of earnings retained after taxes over time.

Interest Burden

The interest burden ratio shows a clear, gradual downward trend from approximately 0.99 in the mid-2020 period to a low near 0.92 around early 2022, suggesting a small increase in interest expense relative to operating income during this timeframe. Following this dip, the ratio modestly recovers to about 0.95 in the most recent periods, indicating improvement in managing interest expenses or reduced debt costs.

EBIT Margin

The EBIT margin exhibits notable volatility throughout the timeline. Initial values close to 28.81% peak near 30.7% before experiencing a steady decline reaching a minimum near 18.47%. From this trough, the margin shows a gradual recovery to approximately 26.98% by the latest period. This pattern reflects periods of contraction in operating profitability followed by a recovery, which could be attributable to changes in operational efficiency or cost management.

Asset Turnover

Asset turnover ratios display irregular variation, starting from a higher value of 0.81 and declining significantly to lows around 0.43 to 0.45 in mid-periods. After bottoming out, the metric stabilizes around the 0.50 to 0.52 range in recent quarters. These fluctuations suggest changes in the effectiveness of asset utilization to generate sales, with intermittent inefficiencies observed during the mid-periods.

Financial Leverage

Financial leverage shows some variability but generally remains within a range of roughly 1.5 to 2.1. After an initial increase to 2.14, the ratio decreases and stabilizes around 1.6 to 1.7, before gradually rising again to values near 1.88 towards the end. This indicates periods of both deleveraging and modest increases in leverage, reflecting adjustments in the use of debt in the capital structure.

Return on Equity (ROE)

Return on equity evidences significant volatility, with an initial high near 37.5% followed by a sharp drop to approximately 11.69%. Subsequently, the ROE bears a slow but steady recovery reaching close to 19.63% in recent quarters. This trend is consistent with the EBIT margin and financial leverage movements, suggesting that fluctuations in profitability and leverage considerably impacted shareholder returns over time.

Net Profit Margin Trends

The net profit margin initially showed an increasing trend, reaching a peak around 25.1% in January 2020. Subsequently, there was a general decline, dropping to a low point near 14.1% by January 2023. After this trough, the margin gradually improved, climbing steadily to approximately 20.55% by October 2025. This pattern suggests a period of contraction in profitability followed by a recovery phase.

Asset Turnover Analysis

Asset turnover fluctuated notably during the observed periods. It started near 0.7 in October 2020, increased to a high of 0.81 in January 2021, then declined sharply to around 0.43 in April 2022. Subsequently, it oscillated between 0.45 and 0.54 without a clear upward or downward trend, ending close to 0.51 in July 2025. These fluctuations may indicate changes in operational efficiency or asset utilization over time, with no consistent improvement or deterioration.

Return on Assets (ROA) Evaluation

ROA showed a strong performance early on, peaking at 20.26% in January 2020, followed by a pronounced decline to a low of 6.93% by October 2022. Starting from this low point, ROA exhibited a gradual recovery, steadily rising to about 10.47% by July 2025. This movement reflects a correlation with net profit margin patterns, indicating that after a phase of reduced asset profitability, the company improved its ability to generate returns from its asset base.

Overall Financial Performance Implications

The analyzed financial ratios reveal a cycle of initial strength, subsequent weakening, and eventual recovery in profitability and asset returns. The net profit margin and ROA both exhibit this pattern, signaling shifts in operational effectiveness, cost control, or market conditions impacting profit generation. Asset turnover's volatility suggests periodic variations in asset use efficiency without a definitive long-term trend. Collectively, these observations point to a dynamic financial performance environment with phases of challenge and improvement.

Tax Burden

The tax burden ratio remained relatively stable over the observed periods, fluctuating narrowly between 0.77 and 0.84. Initially, it was around 0.83 in mid-2020, slightly declining towards 0.77 by early 2023, followed by a modest recovery to 0.83 by late 2023 and a slight decline thereafter. This indicates consistent tax expense management relative to pre-tax income.

Interest Burden

The interest burden ratio showed a gradual but steady decreasing trend from 0.99 in mid-2020 to a low of 0.92 in late 2021 and early 2022, suggesting an increased interest expense impact. However, from early 2022 onwards, this ratio improved marginally, rising back to approximately 0.95 by mid-2025, indicating a reduction in interest expense impact over recent quarters.

EBIT Margin

The EBIT margin exhibited notable volatility across the periods. It peaked around 30.7% in early 2020, then showed a declining trend reaching a low of approximately 18.47% in early 2022. After this trough, there was a gradual recovery to levels near 27% by mid-2025. This suggests that operational profitability experienced pressures followed by a steady improvement over time.

Asset Turnover

Asset turnover ratio experienced considerable fluctuations without a consistent trend, ranging from a high of 0.81 in early 2020 to lows around 0.43-0.45 in 2021. Post-2021, the ratio stabilized moderately around 0.5 to 0.54, reflecting somewhat stable efficiency in generating revenues from assets but with some volatility indicating shifts in asset utilization or revenue generation effectiveness.

Return on Assets (ROA)

Return on Assets showed a general pattern corresponding with the movements in EBIT margin and asset turnover. It peaked at 20.26% in early 2020 but dropped sharply to lows near 6.93% to 7.15% from mid-2021 to early 2022. Since then, ROA has gradually improved, reaching approximately 10.47% by mid-2025, indicating a recovery in profit generation relative to asset base, albeit not to previous peak levels.

The financial data reveals several notable trends across the periods analyzed. The Tax Burden ratio remained relatively stable, fluctuating narrowly around 0.80 to 0.83, indicating consistent tax expenses relative to earnings before tax. This stability suggests that the company maintained a steady tax environment without significant changes impacting its tax expense as a proportion of pre-tax earnings.

The Interest Burden ratio also exhibited a slight downward trend, moving from approximately 0.99 to around 0.92 by mid-periods before gradually recovering to about 0.95 towards the latest quarters. This decline followed by a modest recovery indicates a period during which interest expenses increased slightly in relation to EBIT but then stabilized, showing some variation in financial leverage or interest expense management over time.

The EBIT Margin percentage showed a general declining trend starting from roughly 28.81% and dipping to a low around 18.47%, followed by a gradual recovery back to approximately 26.98%. This pattern suggests that operating profitability experienced pressure during certain quarters but improved later on, reflecting possible operational challenges or increased costs that were subsequently addressed or offset by revenue growth.

Similarly, the Net Profit Margin followed a comparable pattern. Starting at 23.78%, it decreased steadily to a low of approximately 14.10% before recovering to around 20.55% in the most recent quarter. The fluctuation mirrors the EBIT Margin trend, indicating that the company's bottom-line profitability faced challenges but showed resilience and improvement, reflecting effective cost controls or revenue enhancement in later periods.

Tax Burden

Stable with minor fluctuations around 0.80 to 0.83, signaling consistent tax expenses relative to pre-tax earnings.

Interest Burden

Declined from near unity to approximately 0.92, then recovered to about 0.95, suggesting changes in interest expense management or financial leverage.

EBIT Margin

Experienced a notable dip from nearly 29% to under 19%, followed by recovery to nearly 27%, indicating variability in operating profitability with later improvement.

Net Profit Margin

Declined from around 24% to near 14%, recovering to just above 20%, mirroring EBIT Margin trends and reflecting overall profitability challenges and subsequent recovery.