Intuit’s 2022 Tax Period: Solid Earnings


Hello and welcome to Protocol Fintech. This Wednesday: Intuit’s strong earnings, Adam Neumann’s second fintech act and hotel rooms as NFT.

out of the chain

Protocol Fintech keeps growing. Ryan Deffenbaugh has joined us as a New York-based reporter, where he’ll cover Wall Street, the city’s fintech startups and other news. He previously wrote about Adam Neumann’s new crypto career, a story included in today’s edition.

—Owen Thomas (E-mail | Twitter)

Maybe the scandal is how well Intuit is doing

Intuit’s biggest stories of late haven’t been good for its image – among consumers or employees. State Attorneys General colonized with Intuit on the fee it offered a free version of TurboTax, which Intuit advertised prominently but made difficult to find online. The company paid $141 million in a settlement to 4.4 million taxpayers while admitting no wrongdoing. And his acquisition of Mailchimp – which struck many as having a not clear strategic logic – was tainted by Mailchimp employees’ fury at being excluded of the windfall of 12 billion dollars. A series of wage increases in April would not have cheered up.

During yesterday’s earnings call, Intuit announced good news for another constituency: its investors. The company’s third fiscal quarter is tax season, always a good time for Intuit. Revenue of $5.6 billion was up 35% year over year (29% without Mailchimp), and at least $100 million on analysts’ expectations. Operating profit also increased by 25%.

  • Wall Street doesn’t seem to mind the crackdown on free deposit. There was virtually no mention of the free filing scandal or the risk of the IRS developing its own online filing tools.
  • GAAP earnings per share were $6.28, with the settlement expected to reduce current quarter earnings by 37 cents. “We are delighted to put this issue behind us,” said Chief Financial Officer Michelle Clatterbuck.
  • The Mailchimp acquisition has boosted the company’s small business services division, helping to diversify its tax-heavy revenue image.

Investors worried about what was to come. Uncertain markets dominated the Q&A session.

  • However, CEO Sasan Goodarzi seemed indifferent. “We are best positioned to serve consumers and small businesses in difficult times,” he said.
  • He’s right: Intuit appears to have a recession-proof business model. In 2008, the company outperformed the vast stock marketand Intuit has since branched out into the services customers need in good times and bad.
  • It raised its growth forecast for the current fiscal year, although an earlier tax return means its current quarter will see revenue fall.

The free deposit scandal still haunts the company. Despite state regulations, a FTC vs. Intuit case is still active.

  • Intuit said the FTC’s claims were “just not credible” and also argued that the 50-state settlement makes the FTC case unnecessary, as it has already agreed to change its practices.
  • In a technical move, Intuit requested that the matter be removed from arbitration, and the commission agreed. The relevant rule requires the commission to now consider whether further litigation is in the public interest.

The recession is probably a bigger concern. A growing number analysts and bankers are issuing catastrophic forecasts, but this is not a sure thing. Goodarzi told analysts on Tuesday that Intuit was “the best projector for the overall economy because of all the data we see.” If so, then perhaps Intuit’s bullish earnings can be seen as a rare moment of optimism for all of us.

— Veronica Irwin (E-mail | Twitter)


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on the money

On protocol: A new report from a16z sees technology valuations in general falling, with the fintech sector in particular being the hardest hit. Expert advice: “Reevaluate your valuation, understand your consumption multiples and develop scenarios.”

Coinbase has expanded its Travel Rule solution and membership internationally. Travel Rule universal solution technology, also known as TRUST, has now went to live in Canada and Singapore, with plans to expand into Europe. Trust member entities have also grown globally.

The CFPB is renewing its innovation cell. The Consumer Financial Protection Bureau created the Office of Innovation and Competition to replace its former Office of Innovation, which reportedly aims to promote innovation more broadly and identify the threats posed by big tech to small businesses.

Some hotels are converting excess rooms to NFT. Guests can book rooms by buy an NFT, but if they decide not to go, they can sell or exchange the reservation as an NFT instead of requesting a refund from the hotel. Which is a fancy Web3 way for the hotel not to refund you.

A WeWork founder finds his next act in fintech

Ousted WeWork founder Adam Neumann is getting into crypto.

Flowcarbon, which counts Neumann and his wife Rebekah as co-founders, said on Tuesday it raised a combined $70 million in venture funding, led by Andreessen Horowitz’s crypto fund and including a token sale. The startup hopes to sell tokenized carbon credits on the blockchain.

Companies use the credits to offset greenhouse gas emissions. A16z predicts that the market for these credits could reach $50 billion by end of the decadeciting data from McKinsey, but the voluntary markets used to track those credits are currently “fractured, opaque and closed,” wrote Arianna Simpson, the firm’s general partner.

Flowcarbon sees blockchain as the best way to connect credit buyers to project developers who create the offsets, with a focus on nature-based carbon removal efforts such as reforestation.

Read the full story on

—Ryan Defenbaugh (E-mail | Twitter)

Just one question to Matt Homer, Executive in Residence at Nyca Partners

Prior to joining Nyca Partners in 2021, Homer was the founding leader of the Research and Innovation Division of the New York State Department of Financial Services. He also led policy at Quovo, which was acquired by Plaid.

What new thing have you learned recently that has inspired you?

Lately I’ve been digging into the history of the Templars. There was this period after the fall of the Roman Empire where people had to figure out who was going to control the monetary system. The Templars were the people who fought the Crusades – that’s what they’re best known for. But they also controlled much of the trade routes and castles. They were basically the BNY Mellons of medieval times.


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Thanks for reading – see you tomorrow!


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