Press Releases

Intuit Second-quarter Revenue Tops $1 Billion for First Time; Raises Fiscal Year Operating Income and EPS Guidance

Double-digit Revenue Growth Driven by Core Businesses

MOUNTAIN VIEW, Calif. – Feb. 21, 2012 – Intuit Inc. (Nasdaq: INTU) today announced financial results for its second fiscal quarter, which ended Jan. 31. Unless otherwise noted, all growth rates refer to the current period versus the comparable prior-year period.
 

Second-quarter Highlights:

• Increased total revenue by 16 percent, to $1.02 billion.
• Grew Small Business revenue 9 percent in the quarter and 11 percent for the first half of fiscal 2012. Growth has been driven by strong adoption of connected services and improving revenue per customer.
• Launched TurboTax 2011 and SnapTax to positive industry and user reviews. Grew total TurboTax federal units 10 percent season-to-date through Feb. 18. Reiterated full-year guidance for consumer tax revenue growth of 10 to 13 percent.
• Increased connected services total revenue to 60 percent of total revenue in the first half of fiscal 2012, up from 54 percent in the first half of last year.
• Reiterated fiscal year 2012 guidance for revenue and raised operating income and earnings per share guidance.

Snapshot of Second Quarter Results

 

GAAP				Non-GAAP
	Q2 FY12	Q2 FY11	Change	Q2 FY12	Q2 FY11	Change
Revenue	$1,019	$878	16%	$1,019	$878	16%
Operating Income	$192	$111	73%	$249	$164	52%
Diluted EPS	$0.39	$0.23	70%	$0.51	$0.32	59%

Dollars are in millions, except earnings per share (EPS). See “About Non-GAAP Financial Measures” below for more information regarding financial measures not prepared in accordance with Generally Accepted Accounting Principles (GAAP).
 

Company Perspective

“We had a strong second quarter and have built solid momentum through the first half of the fiscal year, with revenue growing double-digits, driven by our core businesses. We are on track to deliver the revenue guidance we set for the full year, and we raised our guidance for fiscal 2012 operating income and EPS,” said Brad Smith, Intuit’s president and chief executive officer.

“We are off to a great start in tax. Early indications are positive and we are pleased with how the business is performing so far. Third-party data and our unit sales through Feb. 18 give us confidence that the software category is growing and that we are executing well.

 “Longer term, our strategy remains the same, and our opportunity to grow customers and revenue by converting non-consumption across our businesses has never been stronger as customers continue to shift to digital solutions and mobile devices,” Smith said.
 

Quarterly Business Segment Results and Highlights

Total Small Business Group revenue grew 9 percent, led by strength in Employee Management Solutions and Payment Solutions.
 

• Financial Management Solutions revenue increased 6 percent, driven by QuickBooks Online and QuickBooks Enterprise combined revenue growth of 31 percent.
• Employee Management Solutions revenue was up 9 percent, led by growth in Intuit Online Payroll and Enhanced Payroll subscribers and improved adoption of direct deposit services. Online payroll subscribers grew 22 percent.
• Payment Solutions revenue increased 17 percent, with 11 percent growth in merchant customers.

Consumer Tax

• Consumer Tax revenue totaled $295 million, up 44 percent. The IRS was unable to accept certain returns until mid-February last season, which contributed to a year-over-year decline in Consumer Tax revenue in the second quarter of fiscal 2011.

Accounting Professionals

• Accounting Professionals segment revenue increased by 8 percent in the second quarter.

Financial Services

• Financial Services revenue grew 9 percent, driven by ongoing adoption of online and mobile banking capabilities, with mobile users nearly tripling over the last year to 1.6 million

Other Businesses

• Other Businesses revenue declined 5 percent due to a decrease in Quicken revenue. Intuit’s global business grew revenue 8 percent.

 

CFO Perspective

“The shift to online offerings is accelerating across the company,” said Neil Williams, chief financial officer.  “That shows up in the financial results we released today and demonstrates that our strategy is working. This secular shift to digital solutions is also good news for customer acquisition and continues to enrich our mix, as connected services generate recurring revenue streams and favorable lifetime value economics for Intuit.”
 

Quarterly Dividend

Intuit paid a quarterly cash dividend of $0.15 per share, or $44 million, in the second quarter of fiscal 2012. In February the board of directors approved a new quarterly cash dividend of $0.15 per share to be paid on April 18 to shareholders of record as of the close of business on April 10.
 

Share Repurchase Program

Intuit repurchased $331 million of its common stock in the second quarter, bringing repurchases to a total of $586 million for the first half of the fiscal year. At the end of the quarter the company had authorization from its board of directors to use up to an additional $2 billion in cash for stock repurchases through August 2014.
 

Forward-looking Guidance

Intuit reiterated its fiscal year 2012 guidance for revenue and raised operating income and EPS guidance. For the fiscal year ending July 31, the company now expects:

• Revenue of $4.185 billion to $4.285 billion, growth of 9 to 11 percent.
• GAAP operating income of $1.19 billion to $1.215 billion, growth of 18 to 21 percent.
• Non-GAAP operating income of $1.405 billion to $1.43 billion, growth of 12 to 14 percent.
• GAAP diluted EPS of $2.43 to $2.50, growth of 22 to 25 percent.
• Non-GAAP diluted EPS of $2.90 to $2.97, growth of 16 to 18 percent.

For the third quarter of fiscal 2012, Intuit expects:

• Revenue of $1.95 billion to $1.99 billion.
• GAAP operating income of $1.095 billion to $1.125 billion.
• Non-GAAP operating income of $1.14 billion to $1.17 billion.
• GAAP diluted EPS of $2.36 to $2.40.
• Non-GAAP diluted EPS of $2.47 to $2.51.

Intuit also reiterated the EPS guidance ranges for the fourth quarter of fiscal 2012 which it provided last quarter. The company expects:

• GAAP basic and diluted loss per share of $0.02 to $0.04.
• Non-GAAP diluted EPS of $0.06 to $0.08.

Conference Call Information

Intuit executives will discuss the financial results on a conference call at 1:30 p.m. Pacific time on that date.  To hear the call, dial 866-731-8333 in the United States or 973-935-8686 from international locations. No reservation or access code is needed. The conference call can also be heard live via webcast at http://investors.intuit.com/events.cfm. Prepared remarks for the call will be available on Intuit’s website after the call ends.
 

Replay Information

A replay of the conference call will also be available for one week by calling 888-266-2081, or 703-925-2533 from international locations. The access code for this call is 1566449. The audio webcast will remain available on Intuit’s website for one week after the conference call.
 

About Intuit Inc.

Intuit Inc. is a leading provider of business and financial management solutions for small and medium-sized businesses; consumers, accounting professionals and financial institutions. Its flagship products and services, including QuickBooks®, TurboTax® and Quicken®, simplify small business management including payment and payroll processing, tax preparation and filing, and personal finance. Lacerte® and ProSeries® are Intuit's leading tax preparation offerings for professional accountants. Intuit Financial Services helps banks and credit unions grow by providing on-demand solutions and services that make it easier for consumers and businesses to manage their money.

Founded in 1983, Intuit had annual revenue of $3.9 billion in its fiscal year 2011. The company has approximately 8,000 employees with major offices in the United States, Canada, the United Kingdom, India and other locations. More information can be found at www.intuit.com.
 

Intuit and the Intuit logo, among others, are registered trademarks and/or registered service marks of Intuit Inc. in the United States and other countries.

About Non-GAAP Financial Measures

This press release and the accompanying tables include non-GAAP financial measures. For a description of these non-GAAP financial measures, including the reasons management uses each measure, and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles, please see the accompanying Table B and Table E as well as the section titled "About Non-GAAP Financial Measures." A copy of the press release issued by Intuit today can be found on the investor relations page of Intuit's Web site.
 

Cautions About Forward-looking Statements

This press release contains forward-looking statements, including forecasts of Intuit’s future expected financial results; expectations regarding growth from digital services and from current or future products and services; expectations regarding the amount and timing of any future dividends; its prospects for the business in fiscal 2012; and all of the statements under the heading “Forward-Looking Guidance.”

Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause our actual results to differ materially from the expectations expressed in the forward-looking statements. These factors include, without limitation, the following: inherent difficulty in predicting consumer behavior; difficulties in receiving, processing, or filing customer tax submissions; consumers may not respond as we expected to our advertising and promotional activities; product introductions and price competition from our competitors can have unpredictable negative effects on our revenue, profitability and market position; governmental encroachment in our tax businesses or other governmental activities or public policy affecting the preparation and filing of tax returns could negatively affect our operating results and market position; we may not be able to successfully innovate and introduce new offerings and business models to meet our growth and profitability objectives, and current and future offerings may not adequately address customer needs and may not achieve broad market acceptance, which could harm our operating results and financial condition; business interruption or failure of our information technology and communication systems may impair the availability of our products and services, which may damage our reputation and harm our future financial results; as we upgrade and consolidate our customer facing applications and supporting information technology infrastructure, any problems with these implementations could interfere with our ability to deliver our offerings; any failure to properly use and protect personal customer information and data could harm our revenue, earnings and reputation; if we are unable to develop, manage and maintain critical third party business relationships, our business may be adversely affected; increased government regulation of our businesses may harm our operating results; if we fail to process transactions effectively or fail to adequately protect against potential fraudulent activities, our revenue and earnings may be harmed; any significant offering quality problems or delays in our offerings could harm our revenue, earnings and reputation; our participation in the Free File Alliance may result in lost revenue opportunities and cannibalization of our traditional paid franchise; the continuing global economic downturn may continue to impact consumer and small business spending, financial institutions and tax filings, which could negatively affect our revenue and profitability; year-over-year changes in the total number of tax filings that are submitted to government agencies due to economic conditions or otherwise may result in lost revenue opportunities; our revenue and earnings are highly seasonal and the timing of our revenue between quarters is difficult to predict, which may cause significant quarterly fluctuations in our financial results; our financial position may not make repurchasing shares advisable or we may issue additional shares in an acquisition causing our number of outstanding shares to grow; our inability to adequately protect our intellectual property rights may weaken our competitive position and reduce our revenue and earnings; our acquisition and divestiture activities may disrupt our ongoing business, may involve increased expenses and may present risks not contemplated at the time of the transactions; our use of significant amounts of debt to finance acquisitions or other activities could harm our financial condition and results of operation; and litigation involving intellectual property, antitrust, shareholder and other matters may increase our costs. More details about these and other risks that may impact our business are included in our Form 10-K for fiscal 2011 and in our other SEC filings. You can locate these reports through our website at http://investors.intuit.com. Forward-looking statements are based on information as of February 21, 2012, and we do not undertake any duty to update any forward-looking statement or other information in these materials.
 

(Financial Statements follow)