Intuit shares drop slightly as Q4 earnings, revenue miss targets

UPDATED: QuickBooks subscriber numbers up are up -- especially outside of the United States.
Written by Rachel King, Contributor on

Intuit didn't close the fiscal year out like it might have hoped -- or at least how analysts and investors might have expected.

For the fiscal fourth quarter, the personal finance software provider reported a net loss of $16 million, or five cents per share (statement).

Non-GAAP earnings were flat at zero cents per share on a revenue of $634 million.

Wall Street was looking for earnings of three cents per share with revenue of $658.05 million.

Shares were down by approximately three percent in after-hours trading.

For fiscal 2013, revenue grew 10 percent to $4.2 billion with non-GAAP earnings of $3.20 per share.

CEO Brad Smith reflected shortcomings and reorganization during the quarter in prepared remarks:

In anticipation of the next chapter of growth, we updated our connected services strategy and reorganized our business units and functional groups. These organizational changes have transformed Intuit from a portfolio of businesses into an ecosystem of small businesses, consumers, and accountants, who build durable competitive advantage by working together.

Looking to fiscal year 2014, our momentum is rising with a robust global strategy, new product launches, and one of the most exciting marketing campaigns we have ever launched in our small business segment. In tax, our teams are thinking big and looking for ways to redefine the franchise. We are excited about our potential as we go after a global opportunity to transform the financial lives of small businesses and consumers, and the trusted accountants who serve them.

For the first quarter, Wall Street is expecting revenue of $649.64 million with a non-GAAP loss of two cents per share.

Intuit's Q1 revenue guidance range slipped in below that with projected revenue of $595 million to $605 million with a non-GAAP net loss per share between 10 and 11 cents.

For fiscal 2014, Intuit expects revenue to grow by six to eight percent to $4.440 billion to $4.525 billion, with non-GAAP earnings between $3.52 to $3.60 per share.

Here's a closer look at Intuit's fourth quarter earnings report, by the numbers:

  • Small Business Group revenue grew 13 percent for the quarter and 16 percent for the year
  • Financial Management Solutions revenue increased 18 percent for the quarter and 20 percent for the year
  • Employee Management Solutions revenue grew 12 percent for the quarter and 12 percent for the year
  • Payment Solutions revenue grew 7 percent for the quarter and 14 percent for the year
  • Other Businesses revenue was up 8 percent for the quarter and 6 percent for the year
  • QuickBooks Online subscriber base grew 28 percent to 487,000. Subscribers outside the U.S. grew even more so by 80 percent to 32,000.

Clarification: Analyst estimates changed over the last 24 hours. The latest Q4 estimates were updated to $622.95 million in revenue with EPS of zero cents.

Q1 guidance from analysts is still higher than what Intuit provided, but the two are closer in line now that expectations shifted downward to $619.01 million in revenue with a loss of three cents per share.

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