Intuit Inc. (NASDAQ:INTU)

The analysis of the financial ratios over the reported periods reveals several notable trends in operational efficiency and working capital management.

Receivables Turnover

This ratio exhibits a variable yet cyclical pattern, fluctuating between lower values around 12-17 and peaks exceeding 30, with notable spikes approximately every third or fourth quarter. Initial periods start with unusually high turnover which quickly moderates. This indicates intermittent periods where receivables are collected more rapidly, improving liquidity temporarily. However, the pattern of repeated peaks followed by declines suggests seasonal or cyclical influences on collection efficiency.

Payables Turnover

The payables turnover shows a general gradual increase over time, rising from a lower base near 2.3 to values around 5.4 in some periods, with occasional slight decreases. This trend suggests improving efficiency in settling payables, although the ratio remains somewhat volatile. A higher payables turnover implies the company is paying suppliers more quickly, which may impact cash flow but could strengthen supplier relationships.

Working Capital Turnover

This ratio displays significant fluctuations with an overall upward trajectory. Early values are relatively low but spike dramatically in some quarters, reaching values above 15 and even exceeding 20 at one point. These high turnover values indicate periods when the company is generating substantial revenue relative to its working capital, denoting improved utilization. However, the inconsistency points to possible variability in either sales or working capital components.

Average Receivable Collection Period

The average collection period exhibits an inverse pattern compared to receivables turnover, with peaks aligning where turnover dips. Collection days oscillate typically between about 9 to over 22 days, with some periods extending up to 28 days. Shorter collection periods correspond to better cash flow, thus the observed fluctuations align with varying liquidity conditions over time, reinforcing noted seasonality or cyclical behavior.

Average Payables Payment Period

The payment period shows a declining trend after an initial peak in the early periods, where it started very high (over 150 days), moving toward more moderate durations between 67 to 105 days. The earlier higher payment days suggest initially more extended credit terms or delayed payments, while the subsequent reduction indicates a movement toward faster payment practices. The periods of reduction are interspersed with occasional rises, indicating some variability but an overall trend toward quicker supplier payments.

Overall, the company's working capital management exhibits cyclical patterns with tendencies toward improved turnover ratios and somewhat shorter payment and collection periods over time, albeit with distinct fluctuations suggestive of seasonality or operational cycles. These trends may impact liquidity management and supplier/customer relationships and warrant closer monitoring for cash flow planning.

The financial data reveals distinct seasonal and cyclical patterns across multiple key metrics. Net revenue exhibits notable fluctuations throughout the quarters, with strong peaks generally observed in the second and fourth quarters of each fiscal year. These peaks suggest a possible correlation with specific business cycles or market demand triggers that boost revenues periodically. While net revenue demonstrates an overall upward trajectory over the observed periods, the increases are not uniform, showing intermittent contractions in some quarters before rebounding.

Accounts receivable, net, follows a somewhat similar seasonal pattern but with more volatility and less consistent growth. There are substantial spikes in certain quarters, particularly evident at the beginning of some fiscal years. These abrupt increases may indicate delayed collections or extended payment terms during these periods. The variability of receivables contrasts with the comparatively smoother fluctuation seen in net revenue, suggesting changes in credit or collection policies or seasonal client payment behaviors impacting receivables management.

The receivables turnover ratio, which measures the efficiency of collection relative to credit sales, demonstrates significant quarter-to-quarter variability. This ratio tends to dip during quarters when accounts receivable are elevated, indicating slower collection periods. Conversely, it peaks in quarters corresponding with lower receivables balances, reflecting enhanced collection effectiveness. The data indicates a recurring pattern of lower turnover ratios primarily in the first quarter of each year, followed by improved turnover in subsequent quarters, pointing to a potential cyclical collection and credit management strategy aligned with the business revenue cycle.

Overall, the interplay between net revenue, accounts receivable, and receivables turnover suggests that the company experiences typical seasonal fluctuations impacting sales and collection cycles. Management of receivables appears to require close attention during quarters with high receivables balances to maintain liquidity and working capital efficiency. Given the recurring nature of these patterns, forecasting and working capital planning could benefit from incorporating these seasonal variations.

Net Revenue

Displays a cyclical pattern with peaks mainly in the second and fourth quarters, accompanied by a general upward trend over time.

Accounts Receivable, Net

Exhibits volatility with pronounced quarterly spikes, particularly at fiscal year starts, indicating fluctuating collection dynamics.

Receivables Turnover Ratio

Varies inversely with accounts receivable levels, showing lower turnover in quarters with higher receivables and higher turnover when receivables decrease, reflecting fluctuations in collection efficiency.

Seasonal and Operational Insights

Repeating seasonal cycles influence revenue and collections, with implications for working capital management and forecasting accuracy.

Cost of Revenue

The cost of revenue displays significant variability over the periods analyzed, with an overall upward trend from October 2020 to July 2025. Initial values start at 256 million USD in October 2020, rising to 595 million by April 2021. This is followed by some fluctuations, with notable peaks at April 2023 (981 million USD), April 2024 (1067 million USD), and October 2025 (1194 million USD). These fluctuations indicate periods of increased expenditure on generating revenue, suggesting either growth activities or cost pressures at certain intervals.

Accounts Payable

Accounts payable exhibit considerable fluctuations with no consistent linear trend. Starting at 256 million USD in October 2020, the value peaks early at 900 million USD in April 2022, then declines and fluctuates again through the subsequent periods. Notable observations include highs such as 1038 million USD in January 2025 and lows like 630 million USD in April 2023. The irregular pattern suggests variability in the company’s short-term liabilities management or changes in vendor payment terms.

Payables Turnover Ratio

The payables turnover ratio displays oscillatory behavior throughout the observed time frame. The ratio begins at 5.25 in October 2020, decreases to a low of 2.31 in January 2022, then generally trends upward with intermittent fluctuations. Peaks are observed at 5.41 in January 2025 and 5.12 in October 2023, while lower values such as 2.31 and 2.52 indicate slower turnover periods. The ratio’s variability signals changes in how effectively the company is managing its accounts payable, alternating between faster and slower payment cycles.

Overall Insights

The combined analysis of the cost of revenue, accounts payable, and payables turnover ratio suggests a dynamic operating environment. The increase in cost of revenue over time may be linked with growth initiatives or inflationary pressures, while variability in accounts payable points to changing supplier or operating conditions. The payables turnover ratio fluctuations indicate adjustments in payment practices, reflecting potential strategic cash flow management efforts. These trends highlight the importance of monitoring cost control and working capital optimization continuously.

Working Capital

Working capital values exhibit significant fluctuations across the observed quarters. Initial values around 4,499 million US$ at the end of October 2020 sharply decline to approximately 1,417 million US$ by January 2021. Following this dip, there is a pattern of variability, with working capital generally remaining between approximately 500 million and 3,000 million US$ through most periods.

Notably, a marked increase appears mid-2024, with working capital rising above 4,000 million US$ in April 2025, indicating a potential improvement in short-term liquidity or asset management. However, between quarters, values often fluctuate, reflecting possible seasonal impacts, changes in current assets and liabilities management, or operational adjustments.

Net Revenue

Net revenue trends demonstrate considerable variability with periodic spikes occurring roughly annually, suggesting seasonal influences in sales cycles. Revenues begin around 1,323 million US$ in October 2020 and generally increase over time, interspersed with pronounced jumps, such as 6,737 million US$ in April 2024 and 7,754 million US$ in April 2025.

These large inflections imply peak revenue periods likely associated with specific quarters, possibly tied to product launches, market demand cycles, or promotional activities. Between the spikes, revenue tends to stabilize in the 2,000 to 4,000 million US$ range, indicating a baseline of consistent business performance.

Working Capital Turnover

The working capital turnover ratio reveals a highly variable pattern, with substantial peaks and valleys across the quarters. Early values start at 1.74 and increase dramatically to over 21.87 by January 2022, indicating a period where the company generated significantly higher revenue relative to working capital.

Subsequent quarters maintain generally elevated turnover ratios, ranging mostly between 4 and 15, with spikes reaching nearly 15.31 and 13.92 in late 2022 and early 2024 respectively. These fluctuations suggest changing efficiency in utilizing working capital to generate sales, where higher ratios indicate improved efficiency. Conversely, lower turnover ratios may indicate either increased working capital levels or decreased sales for the period.

Overall Analysis

The data indicates that the company faces cyclical patterns in both net revenue and working capital metrics. The sizable increases in net revenue during certain quarters coincide with relative changes in working capital turnover, reflecting efficient management of working capital during peak business activities.

However, the working capital levels show irregular volatility, possibly due to timing differences in current assets and liabilities or strategic decisions impacting liquidity. The combination of these trends points toward a business with seasonal or campaign-driven revenue cycles, requiring active management of capital to optimize financial performance across quarters.

Improved working capital turnover ratios during revenue peaks suggest successful leveraging of resources to maximize sales, whereas periods with lower turnover highlight opportunities for working capital optimization. The substantial revenue growth over multiple years signals overall expansion, despite the evident quarter-to-quarter variability.

Receivables Turnover

The receivables turnover ratio exhibits a cyclical pattern over the reported periods, fluctuating between lower values near 12.84 and higher peaks approaching 79.16. This pattern indicates periods of both accelerated and slowed collection pace. Periods with elevated turnover ratios suggest efficient collection from customers, while lower values imply a potential slowdown in receivables management or increased credit sales relative to collections.

Average Receivable Collection Period

The average receivable collection period moves inversely to the receivables turnover ratio, ranging from as low as 5 days to as high as 28 days. The fluctuations denote varying efficiency in cash collection practices, with shorter collection periods indicating faster cash inflows and longer periods pointing toward slower collections. The collection period often contracts following quarters with high turnover ratios and extends when turnover declines.

Trend Analysis and Insights

Over multiple years, there is a recurring pattern of sharp increases in receivables turnover followed by gradual decreases, mirrored by opposite trends in the collection period. These cycles may reflect seasonal business activity or the impact of fiscal quarter-end cash management strategies. The data suggests the company undergoes phases of improved liquidity management, periodically returning to more extended collection periods.

Overall Financial Implication

The alternating shifts between higher and lower turnover ratios and collection days imply a dynamic approach to receivables. While periods of efficient receivables turnover enhance cash flow and liquidity, the recurring increases in collection period highlight areas where receivables management might be optimized to maintain consistent cash generation. Maintaining a balance is crucial to support operational needs without extending credit terms excessively.

Payables Turnover Ratio Trends

The payables turnover ratio exhibits considerable variability throughout the periods analyzed. Initially, the ratio declines sharply from 5.25 to a low of 2.31 within the first six quarters, indicating a slower rate of payable settlements initially. Subsequently, the ratio demonstrates some recovery and oscillation, with values rising to around 5.41 before falling back again. This pattern suggests fluctuating management of payables, with periods of accelerated payments alternating with periods of slower turnover.

Average Payables Payment Period Trends

The average payables payment period, expressed in number of days, shows an inverse trend relative to the payables turnover. Starting at 70 days, the payment period lengthens significantly to a peak of 158 days early on, reflecting delayed payments or extended credit terms. This is followed by a general decline with intermittent increases, settling closer to the initial levels by the end of the timeframe. The oscillations in payment period correspond to the fluctuations observed in the payables turnover ratio.

Relationship Between Metrics

There is a clear inverse relationship between the payables turnover ratio and the average payment period as theoretically expected. Periods with lower turnover ratios coincide with longer average payment periods, indicating a slowdown in the settlement of payables. Conversely, higher turnover ratios coincide with shorter payment periods, indicating faster payments. This dynamic suggests that the company experiences alternating cycles of cash flow management strategies or varying supplier payment terms over the quarters.

Overall Insights

The analysis reveals that the company does not maintain a consistent payables turnover pattern, hinting at potential seasonality or strategic adjustments in managing payables. The notable fluctuations may impact supplier relationships and cash flow stability. The recurring shifts between rapid and delayed payments suggest periodic reviews or changes in credit policies or operational cash requirements. Monitoring and managing this volatility may help optimize working capital efficiency.