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| Intuit's Third-Quarter Revenue Climbs 20 Percent |
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MOUNTAIN VIEW, Calif. -
May
18,
2005 -
Intuit Inc. (Nasdaq: INTU) today announced its third-quarter 2005 revenue increased 20 percent over the year-ago quarter to $849.5 million from $709.8 million.
"This was an outstanding quarter for Intuit," said Steve Bennett, Intuit's president and chief executive officer. "Revenue and profits were significantly higher than last year's third quarter — largely driven by an outstanding consumer tax season and another great quarter for QuickBooks."
Third-Quarter 2005 Financial Highlights
- GAAP (Generally Accepted Accounting Principles) net income was $300.5 million, up 14 percent from $264.0 million in the year-ago quarter. GAAP diluted earnings per share (EPS) was $1.61, up 21 percent from $1.33 in the year-ago quarter.
- Intuit had non-GAAP net income of $289.9 million, up 21 percent from $238.8 million in the year-earlier period. Non-GAAP diluted EPS was $1.55, up 29 percent from $1.20 in the year-earlier period.
Third-Quarter 2005 Business Portfolio and Segment Results
- Consumer Tax revenue was $419.0 million, up 22 percent from the year-ago quarter.
- QuickBooks-Related revenue was $196.6 million, up 16 percent from the year-ago quarter.
- Professional Tax revenue was $99.8 million, up 21 percent from the year-ago quarter.
- Intuit-Branded Small Business revenue was $71.0 million, up 9 percent from the year-ago quarter.
- Other Businesses revenue was $63.1 million, up 32 percent from the year-ago quarter. This segment includes Quicken and Canada.
Company Plans to Sell Information Technology Solutions Business
Intuit said it has decided to sell its Information Technology Solutions (ITS) business, which sells Track-It! software.
"The market for our ITS business has changed," said Bennett. "As a result, ITS would require much greater focus and additional investments to be accretive to Intuit's revenue growth rate in the future. We've identified better investment opportunities in our core businesses."
Intuit's ITS has contributed $42.3 million in revenue in the first three quarters of fiscal 2005 and $0.05 in GAAP fully diluted EPS and $0.06 in non-GAAP fully diluted EPS.
While ITS performance is included in the results Intuit reported today and will be included in its upcoming Form 10-Q, it will be treated as a discontinued business in future financial filings, as required. As a result, Intuit did not include past or future results from ITS when it developed non-GAAP fourth-quarter and fiscal year 2005 guidance, but has included it in GAAP EPS guidance in accordance with accounting rules.
Forward-Looking Guidance for Fiscal 2005
Intuit's guidance for fiscal 2005 is unchanged except for the exclusion of results from its ITS business:
- Revenue of $2.005 to $2.020 billion, or year-over-year growth of 11-12 percent.
- Non-GAAP operating income of $535 million to $545 million, or year-over-year growth of 18 percent to 20 percent. GAAP operating income of $508 million to $518 million.
- Non-GAAP diluted EPS of $1.96 to $1.99, or year-over-year growth of 23 percent to 25 percent. GAAP diluted EPS of $2.02 to $2.05.
Forward-Looking Guidance for Fourth-Quarter 2005
Except for the exclusion of ITS, fourth-quarter guidance remains the same:
- Revenue of $270 million to $285 million, or year-over-year growth of 5 percent to 10 percent.
- Non-GAAP operating loss of $35 million to $45 million. GAAP operating loss of $42 million to $52 million.
- Non-GAAP EPS of a loss of 9 cents to 12 cents. GAAP EPS loss of 9 cents to 12 cents.
Conference Call Scripts, Webcast and Conference Call Information
A live audio webcast of Intuit's third-quarter conference call is available at http://www.intuit.com/about_intuit/investors/webcast_events.html. The call begins today at 1:30 p.m. (PDT). The replay of the audio webcast will remain on Intuit's Web site for one week after the conference call. Intuit has posted to its Web site this press release, including the attached tables and non-GAAP to GAAP reconciliations. It will post the conference call script to the Web site shortly after the conference call concludes.
The conference call number is (866) 814-1914 in the United States and (703) 639-1358 from international locations. No reservation or access code is needed. A replay of the call will be available for one week by calling (888) 266-2081 in the United States and (703) 925-2533 from international locations. The access code is 702596.
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Intuit, the Intuit logo, Quicken and QuickBooks, 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
Intuit's management believes that the non-GAAP financial measures it uses provide meaningful supplemental information regarding Intuit's core operating results because they exclude amounts that are not necessarily related to Intuit's core operating results. Intuit's management refers to these non-GAAP financial measures in assessing the performance of Intuit's ongoing operations and for planning and forecasting in future periods. These non-GAAP financial measures also facilitate management's internal comparisons to Intuit's historical operating results. In addition, Intuit has historically reported similar non-GAAP financial measures and believes that the inclusion of comparative numbers provides consistency in its financial reporting. Intuit computes non-GAAP financial measures using the same consistent method from quarter to quarter and year to year.
Non-GAAP operating income excludes acquisition-related charges, such as amortization of intangibles and impairment charges, as well as amortization of purchased software and charges for purchased research and development. Non-GAAP net income and diluted earnings per share exclude discontinued operations, gains and losses on marketable securities and other investments, as well as the tax effects of these transactions. These non-GAAP financial measures are not prepared in accordance with generally accepted accounting principles and likely are different from non-GAAP financial measures used by other companies. The accompanying tables and fact sheet have more details on Intuit's historical performance and financial projections, the GAAP financial measures that are most directly comparable to Intuit's non-GAAP financial measures, and the reconciliation of non-GAAP financial measures to GAAP.
Cautions About Forward-Looking Statements
This press release contains forward-looking statements, including forecasts of our expected financial results. All of the statements under the headings "Forward-Looking Guidance for Fiscal 2005,"and "Forward-Looking Guidance for Fourth-Quarter 2005"are forward-looking statements. A number of risks and uncertainties may cause our actual results to differ materially from our expressed expectations. Some of the important factors that could cause our results to differ include the following: our revenue, profitability and market position can be negatively impacted in an unpredictable manner due to product introductions and price competition from our competitors, including competition from Microsoft, which recently announced its intention to target small business customers with accounting software and associated services, and governmental encroachment in our tax businesses; our participation in the Free File Alliance may result in lost revenue due to potential customers filing free federal returns and electing not to pay for state filing or other services and cannibalization of our traditional paid franchise; 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; predicting tax-related revenues is challenging due to the heavy concentration of activity in a short time period; revenue growth for some of our products is slowing and we must successfully introduce new products and services to meet our growth and profitability objectives; our new product offerings may not succeed or they may negatively impact our profitability if customers elect to purchase lower-priced simplified offerings instead of our higher priced offerings; we have implemented new information systems and any problems with these new systems could interfere with our ability to ship and deliver products and gather information to effectively manage our business; litigation involving intellectual property, antitrust, shareholder and other matters may increase our costs; and our failure to maintain reliable and responsive service levels for our offerings could cause us to lose customers and negatively impact our revenues and profitability. More details about these and other risks that may impact our business are included in our Form 10-K for fiscal 2004 and in subsequent Form 10-Q, and other SEC filings. You can locate these reports through our website at http://www.intuit.com/about_intuit/investors. We do not undertake any duty to update the information in this press release except as otherwise required by law.
(Financial Statements and Fact Sheet follow)
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