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Accounting Software, Cloud Computing, Web/Tech             November 7, 2019November 7, 2019          Updated Cloud Accounting Adoption Statistics.
I’ve updated my statistics on cloud accounting adoption from the sources to which I have access.  There have also been some significant announcements since I last posted these statistics.  The key takeaway here is that QBO is dominant in the US, and Xero is the leader outside the US, especially in Australia/NZ/UK.
Key changes in the small business cloud accounting space in the last year or so include the following:  Wave Accounting has been acquired by H&R Block, who is now offering bookkeeping services to Wave Accounting users.

Intuit is in the process of implementing QuickBooks Online Select

a new service to help QBO end users with first time setup of QBO.
Xero discontinued its payroll offerings, and now recommends that people use Gusto for payroll.
Sage acquired Auto Entry, a company which uses AI and OCR to extract data from invoices, receipts, bank statements, credit card statements, and other sources.  We expect that Auto Entry will turn into another Sage connected service which will connect to Sage Business Cloud.
I also track the ratio of Intuit’s desktop/online ecosystems, and for the first time ever, .

The QBO ecosystem had more revenue than the desktop ecosystem

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Filed under: Cloud Accounting, FreshBooks, QBO, QuickBooks, Sage, Wave, Xero                                       Accounting Software, Cloud Computing, Computer Applications, Web/Tech             May 28, 2018June 6, 2018          CPATechBlog.com Cloud Accounting Dashboard as of 5/24/2018.
I’ve updated the CPATechBlog Cloud Accounting Dashboard for the latest statistics on cloud accounting adoption for the most recent earnings and public company disclosures from Sage, Intuit, and Xero.
Highlights from the most recent updates include the following:  Intuit continued to dominate the cloud accounting space, with 1.82 million companies on QBO as of 4/30/2018, as compared to 132,000 in North America for Xero.  The other competitors in this space do not break out North American adoption stats or are private and do not have to disclose adoption stats to the public.
In addition to the 1.82 million companies on QBO in the US.

Intuit reported another 720K QBO companies outside the US

as well as 680K users of QBO Self Employed.  The 720K QBO companies outside the US compares unfavorably to the 1.25 million companies on Xero at 3/31/2018, but both performed favorably against the 431,000 reported on Sage Business Cloud Accounting (the product formerly known as Sage One) at 3/31/2018.
Intuit disclosed that 330,000 of the 680,000 total QBOSE users bundled the product with TurboTax, which may make some of you practitioners nervous about recommending that product – don’t forget that there’s a way to connect QBO for Accountants to your client’s QBOSE, and Intuit says that they won’t try to sell TurboTax to your QBO self-employed clients – if you need details, drop me a line – Brian at bftcpa dot com.
I still estimate that the ratio of QB Desktop users to QBO companies is 1.30:1 as of the most recent earnings release.  What’s more important for you, the gentle reader of this blog to know is two things:  While the ratio of QBD users/QBO companies is 1.18:1, the ratio of the desktop QB ecosystem revenues to the QBO ecosystem revenues was 1.42:1 – so desktop versions of QuickBooks are still essential to the QuickBooks business for Intuit.
The really bad news for users of desktop versions of QuickBooks is the forward looking information about desktop versions of QuickBooks – and I’m quoting directly from their Q3 Earnings Call Script here.  “Desktop Ecosystem revenue grew 3 percent in the quarter and is up 7 percent year-todate.
For fiscal 2018, we expect QuickBooks desktop units to decline mid to high teens and Desktop Ecosystem revenue to be up mid-single digits.”  While we’ve known for some time that Intuit passed on a price increase to QuickBooks desktop users, it tells me that we should probably expect prices on desktop software to continue to climb as Intuit continues to try to make it financially advantageous for users to switch to QBO, where they have more control over the ecosystem, as opposed to QB Pro/Premier/Enterprise.
While Intuit has a lead in US cloud accounting, if the much vaunted machine learning and artificial intelligence capabilities which the cloud brings us in the next few years ever actually happen, accounting software may become something that people used to use – like buggy whips.  Truthfully, if the technology winds shift quickly – it’s still anybody’s race.
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Filed under: Cloud Accounting, FreshBooks, QBO, Sage Business Cloud Accounting, Sage Intacct, Xero                                Search for:              Subscribe to Newsletter.
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Recent Posts.
Launch of the 7th Annual Accounting Firm Operations and Technology Survey.
Updated Cloud Accounting Adoption Statistics.
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The @CPATechBlog Cloud Accounting Dashboard December 2018 Update.
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Cloud Accounting Adoption Grows, But Desktop Solutions Still Pay the Bills.
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2018 Sales Tax Holidays.
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