Net revenue for the current quarter ended April 30, 1997 was $136.3 million, up 3% over net revenue of $132.1 million for the same quarter a year ago. During the quarter, Intuit completed the acquisition of Nihon Micom, a Japan-based small business accounting software firm and recorded a one-time pre-tax charge for purchased research and development of $6.1 million as a result. The Company reported net income for the quarter of $0.5 million, or $0.01 per share versus a loss of $0.3 million, or $ (0.01) per share for the same quarter a year ago. Excluding acquisition and discontinued operations related charges, the Company would have reported net income of $7.6 million or $0.16 per share, approximately flat with the same quarter a year ago.

For the nine months ended April 30, 1997, net revenue was $504.8 million, reflecting an 11% increase over the same period a year ago, in which the Company reported net revenue of $453.3 million. Net income was $88.1 million, or $1.86 per share, for the nine months ended April 30, 1997, and included a gain of $71.2 million, net of tax, on the sale of Intuit Services Corporation (ISC) to Checkfree Corporation which occurred in the second fiscal quarter. Excluding acquisition related charges and the impact of the ISC disposition, net income for the nine months would have been $45.9 million versus $39.5 million for the same period a year ago. Earnings per share for the nine months ended April 30, 1997 would have been $0.97, representing an increase of 17% over $0.83 for the same period a year ago.

As previously reported, Intuit’s revenue and profitability are typically highest in the January quarter, reflecting the highly seasonal nature of the Company’s tax return preparation products. Significantly lower levels of revenue are generated in the April, July and October quarters, although operating expenses to develop new products and services and updated versions of existing products continue during these periods. As a result, the Company typically produces more than 100% of its annual profits in the January quarter.

Scott D. Cook, Chairman of the Board, commented, "We are focused on delivering bottom line performance in the face of slower overall growth. Better product quality and operating improvements yielded improved gross margin and curtailed the increases in technical support costs. While most of the Company’s product areas experienced growth in the quarter, the overall growth for the Company was moderated by softness in the consumer software business."

Nine-month net revenue for tax preparation software, Intuit’s largest business, increased 13% from the same period a year ago and profits grew at an even faster rate than revenue. Higher levels of product quality and operational execution resulted in lower product and support costs for tax products. In addition, the number of returns filed electronically using the Company’s TurboTax® software increased almost 80% and the number of tax products downloaded from the Quicken® Financial Network on the Internet grew by three times.

Another growth area for the Company has been small business accounting. QuickBooks® 5.0 released in December, helped the business achieve a 27% revenue increase on a year-to-date basis. In addition, QuickBooks strengthened its leadership position achieving approximately 80% share of retail sales. The new version, QuickBooks 5.0, has won all nine out of nine major industry awards for accounting software.

Revenue in International experienced solid growth. New products launched in the second quarter, including QuickBooks in Canada and tax software in Germany and Canada, produced rapid revenue gains. In addition, late in the third quarter, the Company introduced new versions of Quicken in the UK, Germany and France. During the quarter, the Company completed the purchase of Nihon Micom, making Intuit now the largest PC accounting software company in the fast-growing Japanese market. Third quarter results for fiscal 1997 included revenues from Nihon Micom from the date of acquisition, March 14, 1997.

Quicken continues to maintain its strong market position in a declining market, which has led to declining Quicken revenue. The Company is accelerating the transition of its consumer financial services business to the Internet. The Company is consolidating the operations of its Pennsylvania-based Galt Technologies Internet subsidiary with the Company’s main Internet operations and is relocating 15 key Galt engineers to its Mountain View, California headquarters. During the quarter, Quicken Financial Network (www.qfn.com) added Debt Reduction Planner, which gained a Webmaster award for quality plus a "Hot Site" selection by USA Today online. While the Internet presents many opportunities, the Company expects that the timing and amount of Internet-related revenue may be difficult to predict.

The Company also announced today, in a separate release, that it has signed a letter of intent to sell its consumer software and direct marketing subsidiary, Parsons Technology, to Broderbund Software, Inc. Intuit will retain the Parsons line of tax products. The transaction is subject to the approval of the Broderbund and Intuit Board of Directors and government approvals and the satisfaction of other terms and conditions. "As our strategic focus increasingly shifts to providing the most comprehensive array of financial products, services and information via the Internet, we felt we were unable to provide Parsons with the breadth of product they need to support their direct marketing efforts. We feel that this is an outstanding combination of Broderbund’s substantial array of consumer titles and Parsons’ direct marketing capabilities," stated Bill Campbell, President and CEO of Intuit.