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| Intuit's Fiscal '05 Revenue Grows 13 Percent, Tops $2 Billion |
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| Fourth-Quarter Revenue Increases 17 Percent |
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MOUNTAIN VIEW, Calif., -
August
24,
2005 -
Intuit Inc. (Nasdaq: INTU) today announced strong revenue and profit growth for its fiscal year ended July 31, 2005.
"We're very pleased with our results for the year," said Steve Bennett, Intuit's president and chief executive officer. "Each of our business segments performed very well. Our two largest segments - QuickBooks-Related and Consumer Tax - had outstanding results, with strong revenue growth and a significant increase in new users."
Fiscal 2005 Financial Highlights
- Revenue of $2.04 billion increased 13 percent from fiscal 2004. Growth was driven by solid performance in Intuit's two largest business segments, QuickBooks-Related and Consumer Tax.
- Intuit had operating income of $524.1 million in accordance with GAAP, or Generally Accepted Accounting Principles, up 25 percent from fiscal 2004. Intuit had non-GAAP operating income of $550.9 million, up 22 percent from fiscal 2004.
- Intuit had net income of $381.6 million in accordance with GAAP, up 20 percent from fiscal 2004. This represents diluted earnings per share, or EPS, of $2.03, up 28 percent over fiscal 2004.
- Intuit's non-GAAP net income of $375.5 million increased 18 percent from fiscal 2004. Non-GAAP diluted EPS of $1.99 grew 25 percent over the year-ago period.
Fiscal 2005 Business Segment Revenue Growth
- QuickBooks-Related revenue grew 15 percent over fiscal 2004 to $753.0 million.
- Intuit-Branded Small Business revenue increased 11 percent over fiscal 2004 to $230.7 million. This segment includes outsourced payroll and Intuit's three vertical businesses.
- Consumer Tax revenue grew 16 percent over the prior-year period to $570.7 million.
- Professional Tax revenue increased 5 percent over fiscal 2004 to $265.0 million.
- Revenue from Other Businesses, which includes Quicken and Canada, was up 9 percent year-over-year to $218.3 million.
Fourth-Quarter 2005 Highlights
- Revenue of $301.8 million increased 17 percent from the year-ago quarter. Growth was primarily driven by strong performance in Intuit's QuickBooks-Related segment.
- On a GAAP basis, Intuit had an operating loss of $34.2 million. On a non-GAAP basis, Intuit had an operating loss of $27.6 million.
- On a GAAP basis, Intuit had a net loss of $20.0 million, narrower than a loss of $42.1 million in the year-ago quarter. This represents a loss of $0.11 per share versus a loss of $0.22 per share in the fourth quarter of fiscal 2004.
- Intuit had a non-GAAP net loss of $14.7 million, narrower than a non-GAAP net loss of $16.2 million in the year-ago quarter. Intuit typically posts a seasonal loss in its fourth quarter when it has little revenue from its tax businesses but expenses remain relatively constant. The fourth-quarter non-GAAP loss per share was $0.08 versus a loss of $0.09 in the fourth quarter of fiscal 2004.
Forward-Looking Guidance for Fiscal 2006
Intuit provided for the first time its financial guidance for fiscal 2006, which will end on July 31, 2006. The company expects:
- Revenue of $2.18 billion to $2.24 billion, or year-over-year growth of approximately 7 percent to 10 percent. Revenue guidance for each quarter of fiscal 2006 is provided on the accompanying fact sheet.
- GAAP operating income of $501 million to $523 million, versus $524.1 million in fiscal 2005. Beginning in fiscal 2006 GAAP operating income will include the expenses associated with employee stock options. On a non-GAAP basis, operating income is expected to be $595 million to $617 million, or growth of approximately 8 percent to 12 percent over fiscal 2005.
- GAAP diluted EPS of $1.86 to $1.96, down 3 percent to 8 percent year-over-year due to the expensing of employee stock options and a higher GAAP tax rate. On a non-GAAP basis, diluted EPS is expected to be $2.19 to $2.29, up approximately 10 percent to 15 percent from fiscal 2005. GAAP and non-GAAP EPS guidance for each quarter of fiscal 2006 is provided on the accompanying fact sheet.
Forward-Looking Guidance for First-Quarter 2006
Intuit's expected results for the first quarter of fiscal 2006, which will end Oct. 31, 2005, are:
- Revenue of $270 million to $285 million, or year-over-year growth of 7 percent to 13 percent.
- A GAAP operating loss of $111 million to $121 million and a non-GAAP operating loss of $85 million to $95 million. Intuit typically posts a seasonal loss in its first quarter when it has little revenue from its tax businesses but expenses remain relatively constant.
- A GAAP net loss of $0.38 to $0.43 per share and a non-GAAP net loss of $0.30 to $0.35 per share.
Conference Call Scripts, Webcast and Conference Call Information
A live audio webcast of Intuit's fourth-quarter and fiscal 2005 conference call is available at http://web.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) 261-7147 in the United States and (703) 639-1227 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 749152.
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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.
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About Non-GAAP Financial Measures
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This press release includes non-GAAP financial measures. These measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with generally accepted accounting principles ("GAAP"). These non-GAAP financial measures do not reflect a comprehensive system of accounting, differ from GAAP measures with the same names and may differ from non-GAAP financial measures with the same or similar names that are used by other companies. Intuit's management believes that these non-GAAP financial measures provide meaningful supplemental information regarding Intuit's operating results because they exclude amounts that are not necessarily related to Intuit's core operating results. In addition, the forward-looking guidance for non-GAAP income, loss, earnings per share and loss per share in fiscal 2006 excludes estimated expenses for stock-based compensation and associated taxes that Intuit will begin recording under SFAS 123(R) in the first quarter of fiscal 2006. These estimated stock-based compensation expenses and associated taxes are excluded from non-GAAP financial measures in order to facilitate the comparison of guidance for future periods with results for past periods, which did not include such stock-based compensation expenses. 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 amortization of purchased assets and acquisition-related charges. Non-GAAP net income and diluted earnings per share exclude gains and losses on marketable securities and other investments and the tax effects of these items as well as net income or loss from discontinued operations. In addition, the forward-looking guidance for non-GAAP income, loss, earnings per share and loss per share in fiscal 2006 excludes estimated expenses for stock-based compensation and associated taxes that Intuit will begin recording under SFAS 123(R) in the first quarter of fiscal 2006. The accompanying tables and sheet entitled "Intuit Facts" provide 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 the most directly comparable GAAP financial measures.
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Cautions About Forward-Looking Statements
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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 2006,"and "Forward-Looking Guidance for First-Quarter 2006"are forward-looking statements. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, without limitation, the following: product introductions and price competition from our competitors, including competition from Microsoft, which has announced its intention to target small business customers with accounting software and associated services, can have unpredictable negative effects on our revenue, profitability and market position; governmental encroachment in our tax businesses or other governmental activities regulating the filing of tax returns could negatively affect our operating results and market position; 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, and are continuing to upgrade, 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; 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; 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 our subsequent reports on Form 10-Q and other SEC filings. You can locate these reports through our website at http://www.intuit.com/about_intuit/investors. Forward-looking statements are based on information as of August 24, 2005, and we do not undertake any duty to update any forward-looking statement or other information in this press release except as otherwise required by law.
(Financial Statements and Fact Sheet follow)
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