Intuit grows revenue for Q1, continues push into "connected services"

Intuit disappoints by missing earnings target but notes highlights as it transitions to a "connected services company."
Written by Sam Diaz, Inactive


Intuit, the maker of TurboTax and Quicken software, beat Wall Street's estimates for its first quarter, reporting a 2 percent growth in revenue for the period. The company reported a net loss of $32 million, or 10 cents per share, on revenue of $493 million, which is a 2 percent increase from the year-ago quarter. Wall Street had been expecting a net loss of 16 cents per share on revenue of $487.7 million. (Statement)

The company reported 11 cents worth of charges in the quarter. Adjusted for that, it reported a loss of $68 million, or 21 cents per share.

The company highlighted strong customer growth across core businesses and the repurchasing of $300 million shares of stock during the quarter, as well as as a board approval of a new repurchase program if $600 million. It ended the quarter with more then $1 billion cash and investment.

During the quarter, it also acquired Mint.com and reaffirmed its full-year 2010 guidance inclusive of the transaction. In a statement, Intuit president and CEO Brad Smith said:

Intuit’s solid revenue and operating results give us a good start to the fiscal year, with our most important quarters ahead of us... We continue to see growth in our core businesses and are making progress in building out adjacent businesses. At the same time, we are accelerating our transition to a connected services company, with the recent acquisitions of online payroll provider PayCycle and the fast-growing online personal finance service Mint.com. We’ll also continue to invest in our products and in innovations that position us well for future growth.

Intuit has been pushing the adjacent segments and emerging technologies that moves it closer to the connected services company it wants to be, by leveraging strengths, such as being a brand name that's trusted with details of our finances, and moving strategically and cautiously into the cloud.

Last month, the company enhanced its Quickbooks accounting software by unveiling an app store and opening its API so developers can help companies free their financial data into custom apps. What was interesting about that was the hybrid approach - a button embedded into the desktop software that takes users to an apps marketplace in the cloud.

Earlier this month, the company launched Customer manager, a new online and mobile app software that brings CRM tools to Quickbooks, largely targeted at the small business market.

Looking forward, guidance for the second quarter is non-GAAP EPS of 29-32 cents on revenue of $800 million to $835 million, representing growth of 1-6 percent.

Shares of Intuit were down slightly in regular trading, closing at $30.27. Shares dipped slightly - about 1.5 percent - in after hours trading.

Correction: An earlier version of this post inadvertently contained results based on the adjusted GAAP basis, instead of non-GAAP, and said the company missed Wall Street estimates when it actually beat. I extend my apologies for any confusion.

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