Exhibit 99.01
| | | | | |
Contacts: | | Investors | | Media |
| | | Bob Lawson | | Holly Anderson |
| | | Intuit Inc. | | Intuit Inc. |
| | | (650) 944-6165 | | (650) 944-3992 |
| | | Robert_Lawson@intuit.com | | Holly_Anderson@intuit.com |
Intuit’s First-Quarter Revenue Grows 20 Percent
Company Raises Revenue and Earnings Guidance for Fiscal Year 2006
MOUNTAIN VIEW, Calif. — Nov. 16, 2005 —Intuit Inc. (Nasdaq: INTU) today announced its first-quarter 2006 revenue increased 20 percent over the year-ago quarter to $304.1 million. Growth was primarily driven by strong sales of its QuickBooks software and add-on solutions. The company’s first quarter ended on Oct. 31, 2005.
“Intuit delivered a terrific first quarter and we’ve raised our outlook for the fiscal year,” said Steve Bennett, Intuit’s president and chief executive officer. “With our strongest-ever QuickBooks® lineup now on the shelves and a great TurboTax® lineup launching next week, we’re excited about the balance of the fiscal year.”
First-Quarter 2006 Financial Highlights
Intuit posted a GAAP (Generally Accepted Accounting Principles) net loss of $45.8 million versus a net loss of $46.1 million in the first quarter of 2005. This represents a net loss of $0.26 per diluted share versus a net loss of $0.24 per diluted share in the year-ago quarter. First-quarter 2006 results included approximately $12 million after tax, or $0.07 per share, in expenses associated with employee stock options and purchases under Intuit’s employee stock purchase plan. Intuit’s first-quarter 2005 GAAP results did not include options expense. Intuit typically posts a seasonal loss in its first quarter when it has little revenue from its tax businesses.
Intuit posted a non-GAAP net loss of $45.8 million versus a net loss of $47.1 million in the first quarter of 2005. The first-quarter non-GAAP net loss was $0.26 per diluted share versus a net loss of $0.25 per diluted share in the first quarter of fiscal 2005. A lower share count caused the per share loss to widen year-over-year.
First-Quarter 2006 Business Segment Results
| • | | QuickBooks-Related revenue of $178.1 million was up 22 percent over the year-ago quarter. |
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| • | | Intuit-Branded Small Business revenue of $58.2 million was up 9 percent over the year-ago quarter. |
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| • | | Other Businesses revenue of $51.0 million was up 24 percent. |
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| • | | In a seasonally slow quarter, Consumer Tax revenue was $7.9 million and Professional Tax revenue was $8.9 million. |
Fiscal 2006 Guidance
Intuit has raised its revenue and earnings guidance for fiscal year 2006, which will end on July 31, 2006. The company now expects:
| • | | Revenue of $2.20 billion to $2.26 billion, which represents annual growth of 8 percent to 11 percent. Previous guidance was annual growth of 7 percent to 10 percent. |
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| • | | GAAP operating income of $506 million to $526 million, versus $524 million in fiscal 2005. 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 $600 million to $620 million, which represents annual growth of 9 percent to 13 percent. |
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| • | | GAAP diluted earnings per share, or EPS, of $1.99 to $2.07 versus $2.03 in fiscal 2005. Fiscal 2006 EPS will include expenses for employee stock options and a higher GAAP tax rate. On a non-GAAP basis, diluted EPS is expected to be $2.23 to $2.31, which represents annual growth of 12 percent to 16 percent. Previous guidance was for annual growth of 10 percent to 15 percent. |
Intuit has raised its 2006 guidance for QuickBooks revenue to annual growth of 7 percent to 12 percent, up from 5 percent to 10 percent. The company reaffirmed revenue
growth guidance for its other business segments. That information is provided on the accompanying fact sheet.
Second-Quarter 2006 Guidance
In a separate press release, Intuit today announced improvements to this season’s TurboTax offerings, including changes in products and pricing. A result of those changes is a change in the seasonal pattern of TurboTax revenue this season. Approximately $40 million in revenue and $0.13 in EPS will move up from Intuit’s third quarter to its second quarter. It has updated its quarterly guidance accordingly. Second-quarter guidance is now:
| • | | Revenue of $710 million to $750 million, or year-over-year growth of 10 percent to 16 percent. |
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| • | | GAAP operating income of $226 million to $241 million, or year-over-year growth of 3 percent to 10 percent. Non-GAAP operating income of $250 million to $265 million, or year-over-year growth of 11 percent to 18 percent. |
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| • | | GAAP diluted EPS of $0.80 to $0.90. Intuit expects non-GAAP diluted EPS of $0.88 to $0.98, or year-over-year growth of 11 percent to 24 percent. |
GAAP and non-GAAP revenue and EPS guidance for the third and fourth quarters of fiscal 2006 is provided on the accompanying fact sheet.
Webcast and Conference Call Information
A live audio webcast of Intuit’s first-quarter 2006 conference call is available at http://www.intuit.com/about_intuit/investors/
webcast_events.html. The call begins today at 1:30 p.m. PST. 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) 256-3815 in the United States and (703) 639-1212 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 802045.
Intuit, the Intuit logo, Quicken, QuickBooks and TurboTax, 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
This press release and the accompanying tables and sheet entitled “Intuit Facts” include non-GAAP financial measures. For a description of these non-GAAP financial measures and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles (GAAP), please see the section of the accompanying tables entitled “About Non-GAAP Financial Measures” as well as the related Table A2, Table B, Table E1 and Table E2 which follow it. A copy of the press release filed by Intuit on Nov. 16, 2005, can be found on the investor relations page of Intuit’s web site at www.intuit.com.
Cautions About Forward-Looking Statements
This press release contains forward-looking statements, including forecasts of our expected financial results. Other statements relating to the future are also forward-looking, including: our expectations regarding future market opportunities; our prospects for the business in fiscal 2006 and beyond; our expectations regarding future stock repurchases; all of the statements under the headings “Fiscal 2006 Guidance” and “Second Quarter 2006 Guidance;” our objectives regarding future revenue growth and EPS growth; our assessment of potential growth opportunities; and our expectations regarding the launch of new or improved products and services.
Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause our actual results to differ materially from the expectations expressed 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 released accounting software and associated services for small business customers, 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 effect our operating results and market position; current and future products and services, including the 2006 edition of QuickBooks, may not adequately address customer needs and may not achieve broad market acceptance, which could harm our operating results and financial condition; 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; we may not be able to successfully introduce new products and services to meet our growth and profitability objectives; our new product or service offerings may not attract customers or they may negatively impact our profitability if the business models for new offerings are not successful or if customers elect to purchase lower-priced alternatives; 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 2005 and in 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 November 16, 2005, and we do not undertake any duty to update any forward-looking statement or other information in this press release.
Table A1
INTUIT INC.
GAAP CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
| | | | | | | | | |
| | | Three Months Ended | |
| | | October 31, | | | October 31, | |
| | | 2005 | | | 2004 | |
| Net revenue: | | | | | | | | |
| Product | | $ | 182,454 | | | $ | 154,003 | |
| Service | | | 104,620 | | | | 84,157 | |
| Other | | | 16,997 | | | | 14,616 | |
| | | | | | | |
| Total net revenue | | | 304,071 | | | | 252,776 | |
| | | | | | | |
| Costs and expenses: | | | | | | | | |
| Cost of revenue: | | | | | | | | |
| Cost of product revenue | | | 32,431 | | | | 29,844 | |
| Cost of service revenue | | | 53,396 | | | | 39,752 | |
| Cost of other revenue | | | 5,852 | | | | 5,797 | |
| Amortization of purchased intangible assets | | | 2,949 | | | | 2,541 | |
| Selling and marketing | | | 147,430 | | | | 128,546 | |
| Research and development | | | 97,280 | | | | 74,365 | |
| General and administrative | | | 63,595 | | | | 49,641 | |
| Acquisition-related charges | | | 3,759 | | | | 4,441 | |
| | | | | | | |
| Total costs and expenses | | | 406,692 | | | | 334,927 | |
| | | | | | | |
| Operating loss from continuing operations | | | (102,621 | ) | | | (82,151 | ) |
| Interest and other income | | | 6,304 | | | | 3,855 | |
| Gains on marketable equity securities and other investments, net | | | 4,267 | | | | 158 | |
| | | | | | | |
| Loss from continuing operations before income taxes | | | (92,050 | ) | | | (78,138 | ) |
| Income tax benefit [A] | | | (34,439 | ) | | | (32,641 | ) |
| | | | | | | |
| Net loss from continuing operations | | | (57,611 | ) | | | (45,497 | ) |
| Net income (loss) from discontinued operations [B] | | | 11,807 | | | | (639 | ) |
| | | | | | | |
| Net loss | | $ | (45,804 | ) | | $ | (46,136 | ) |
| | | | | | | |
| | | | | | | |
| | | | | | | | | |
| Basic and diluted net loss per share from continuing operations | | $ | (0.33 | ) | | $ | (0.24 | ) |
| Basic and diluted net income (loss) per share from discontinued operations | | | 0.07 | | | | — | |
| | | | | | | |
| Basic and diluted net loss per share | | $ | (0.26 | ) | | $ | (0.24 | ) |
| | | | | | | |
| | | | | | | |
| | | | | | | | | |
| Shares used in basic and diluted per share amounts | | | 177,406 | | | | 188,346 | |
| | | | | | | |
| | | | | | | |
| | | | | | | | | |
Share-based compensation expense for stock options and Employee Stock Purchase Plan recorded in accordance with SFAS 123(R) for continuing operations [C]: | | | | | | | | |
| Cost of product revenue | | $ | 288 | | | $ | — | |
| Cost of service revenue | | | 637 | | | | — | |
| Selling and marketing | | | 6,307 | | | | — | |
| Research and development | | | 5,610 | | | | — | |
| General and administrative | | | 6,257 | | | | — | |
| | | | | | | |
| Total | | $ | 19,099 | | | $ | — | |
| | | | | | | |
| | | | | | | |
See accompanying Notes.
INTUIT INC.
NOTES TO TABLE A1
| [A] | | Due to the seasonal nature of our business, we recorded income tax benefits on pre-tax losses in the three months ended October 31, 2005 and 2004. Our effective tax rate for the three months ended October 31, 2005 was 37% and differed from the federal statutory rate primarily due to state income taxes, which were partially offset by federal and state research and experimentation credits and tax exempt interest income. Our effective tax rate for the three months ended October 31, 2004 was 42% and differed from the federal statutory rate due in part to the retroactive extension of federal research and experimental credits and to the impact of recognizing these benefits in a quarter in which we had a net loss. We also benefited from federal research and experimental credits, tax exempt interest income and various state tax credits. These benefits were partially offset by state taxes. |
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| [B] | | In May 2005 our Board of Directors formally approved a plan to sell our Intuit Information Technology Solutions (ITS) business and in October 2005 we signed a definitive agreement to sell ITS, subject to closing conditions, for approximately $200 million in cash. In accordance with the provisions of Statement of Financial Accounting Standards (SFAS) No. 144, we determined that ITS became a long-lived asset held for sale in the fourth quarter of fiscal 2005. SFAS 144 provides that a long-lived asset classified as held for sale should be measured at the lower of its carrying amount or fair value less cost to sell. Since the carrying value of ITS at October 31, 2005 was less than the fair value less cost to sell, no adjustment to the carrying value of this long-lived asset was necessary during the first quarter of fiscal 2006. In accordance with SFAS 144, we discontinued the amortization of ITS intangible assets and the depreciation of ITS property and equipment in the fourth quarter of fiscal 2005. |
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| | | Also in accordance with the provisions of SFAS 144, we determined that ITS became a discontinued operation in the fourth quarter of fiscal 2005. Consequently, we have segregated the net assets, operating results and cash flows of ITS from continuing operations on our balance sheets, statements of operations and statements of cash flows for all periods presented. Revenue for ITS was $14.4 million and $13.2 million for the three months ended October 31, 2005 and 2004. Income before income taxes for ITS was $5.8 million and $4.9 million for the same periods. |
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| | | In December 2004 we sold our Intuit Public Sector Solutions (IPSS) business for approximately $11 million. In accordance with SFAS 144,“Accounting for the Impairment or Disposal of Long-lived Assets,”we determined that IPSS became a long-lived asset held for sale and a discontinued operation in the first quarter of fiscal 2005. Consequently, we have segregated the net assets, operating results and cash flows of IPSS from continuing operations on our balance sheets, statements of operations and statements of cash flows for all periods prior to the sale. Also in accordance with SFAS 144, we discontinued the amortization of IPSS purchased intangible assets in the first quarter of fiscal 2005. |
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| | | Revenue and loss before income taxes for IPSS were $2.8 million and $0.5 million for the three months ended October 31, 2004. The net loss from IPSS discontinued operations for the three months ended October 31, 2004 also included an income tax provision of $3.4 million for the estimated tax payable in connection with the expected tax gain on the sale of IPSS. |
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| [C] | | Prior to August 1, 2005, we accounted for our share-based employee compensation plans under the measurement and recognition provisions of Accounting Principles Board (APB) Opinion No. 25,“Accounting for Stock Issued to Employees.”In accordance with APB 25, we recorded no share-based compensation expense for stock options or purchases of common stock under our Employee Stock Purchase Plan in fiscal periods prior to that date. Effective August 1, 2005, we adopted the fair value recognition provisions of SFAS 123(R),“Share-Based Payment,”using the modified prospective transition method. Accordingly, we began recording compensation expense for stock options and purchases under our Employee Stock Purchase Plan on that date. Results for prior periods have not been restated. |
INTUIT INC.
ABOUT NON-GAAP FINANCIAL MEASURES
Table A2 contains non-GAAP financial measures. Table B reconciles the non-GAAP financial measures in Table A2 to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles (GAAP). Tables E1 and E2 reconcile the non-GAAP financial measures found in the accompanying document entitled “Intuit Facts” to the most directly comparable financial measures prepared in accordance with GAAP.
Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. These non-GAAP financial measures do not reflect a comprehensive system of accounting, differ from GAAP measures with the same captions and may differ from non-GAAP financial measures with the same or similar captions 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 related to Intuit’s core operating results and facilitate the comparison of results for current periods and guidance for future periods with results for past periods. The following items have been excluded from our non-GAAP financial measures.
| • | | Share-based compensation expenses. Our non-GAAP financial measures exclude share-based compensation expense for stock options and purchases of common stock under our Employee Stock Purchase Plan that Intuit began recording under SFAS 123(R) in the first quarter of fiscal 2006. We exclude these amounts from our non-GAAP financial measures in order to facilitate the comparison of guidance for future periods with results for past periods, which did not include these share-based compensation expenses. We also exclude these amounts from our non-GAAP financial measures because they are non-cash expenses. We deduct share-based compensation expense recorded in accordance with SFAS 123(R) from our GAAP cost of revenue, selling and marketing expense, research and development expense and general and administrative expense. We continue to include the compensation expense associated with restricted stock awards in both our GAAP and non-GAAP financial measures. SFAS 123(R) did not change the method of accounting for restricted stock. We compute weighted average dilutive shares using the method required by SFAS 123(R) for both GAAP and non-GAAP diluted net income per share. |
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| • | | Amortization of purchased intangible assets, acquisition-related charges, charges for purchased research and development, and loss on impairment of goodwill and purchased intangible assets. In accordance with GAAP, amortization of purchased intangible assets in cost of revenue includes amortization of software and other technology assets related to acquisitions and acquisition-related charges in operating expenses includes amortization of other purchased intangible assets such as customer lists and covenants not to compete. GAAP operating income or loss also includes charges for in-process research and development that we obtain in connection with acquisitions as well as losses on impairment of goodwill and other purchased intangible assets. We exclude these items from our non-GAAP operating income or loss because we believe that excluding these items facilitates comparisons to our historical core operating results and to the results of other companies in our industry, which have their own unique acquisition histories. |
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| • | | Gains and losses on marketable equity securities and other investments. We exclude these amounts from our non-GAAP net income or loss because they are unrelated to our core business operating results. |
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| • | | Income taxes. Our historical non-GAAP effective tax rates differ from our GAAP effective tax rates for those periods because non-GAAP income tax expense or benefit excludes certain GAAP discrete tax items, including the reversal of reserves related to potential income tax exposures that have been resolved. We exclude the impact of these discrete tax items from our non-GAAP income tax provision or benefit because they are not indicative of our ongoing business operations. |
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| • | | Operating results and gains and losses on the sale of discontinued operations. From time to time, we sell or otherwise dispose of selected operations as we adjust our portfolio of businesses to meet our strategic goals. In accordance with GAAP, we segregate the operating results of discontinued operations as well as gains and losses on the sale of these discontinued operations from continuing operations on our GAAP statements of operations but continue to include them in GAAP net income or loss and net income or loss per share. We exclude these amounts from our non-GAAP net income or loss and net income or loss per share because they are unrelated to our ongoing business operations. |
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. 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.
The reconciliations of the forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measures in Table E1 include all information reasonably available to Intuit at the date of this press release. These tables include adjustments that management can reasonably predict. Events that could cause the reconciliation to change include acquisitions and divestitures of businesses, goodwill and other asset impairments and sales of marketable equity securities.
Table A2
INTUIT INC.
NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS DATA
(In thousands, except per share amounts)
(Unaudited)
| | | | | | | | | |
| | | Three Months Ended | |
| | | October 31, | | | October 31, | |
| | | 2005 | | | 2004 | |
| Net revenue: | | | | | | | | |
| Product | | $ | 182,454 | | | $ | 154,003 | |
| Service | | | 104,620 | | | | 84,157 | |
| Other | | | 16,997 | | | | 14,616 | |
| | | | | | | |
| Total net revenue | | | 304,071 | | | | 252,776 | |
| | | | | | | |
| Costs and expenses: | | | | | | | | |
| Cost of revenue: | | | | | | | | |
| Cost of product revenue | | | 32,143 | | | | 29,844 | |
| Cost of service revenue | | | 52,759 | | | | 39,752 | |
| Cost of other revenue | | | 5,852 | | | | 5,797 | |
| Selling and marketing | | | 141,123 | | | | 128,546 | |
| Research and development | | | 91,670 | | | | 74,365 | |
| General and administrative | | | 57,338 | | | | 49,641 | |
| | | | | | | |
| Total costs and expenses | | | 380,885 | | | | 327,945 | |
| | | | | | | |
| Loss from operations | | | (76,814 | ) | | | (75,169 | ) |
| Interest and other income | | | 6,304 | | | | 3,855 | |
| | | | | | | |
| Loss before income taxes | | | (70,510 | ) | | | (71,314 | ) |
| Income tax benefit | | | (24,679 | ) | | | (24,247 | ) |
| | | | | | | |
| Net loss | | $ | (45,831 | ) | | $ | (47,067 | ) |
| | | | | | | |
| | | | | | | |
| | | | | | | | | |
| Basic and diluted net loss per share | | $ | (0.26 | ) | | $ | (0.25 | ) |
| | | | | | | |
| | | | | | | |
| Shares used in basic and diluted per share amounts | | | 177,406 | | | | 188,346 | |
| | | | | | | |
| | | | | | | |
Table B
INTUIT INC.
RECONCILIATION OF NON-GAAP STATEMENTS OF OPERATIONS DATA
TO GAAP CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | Three Months Ended | |
| | | October 31, 2005 | | | October 31, 2004 | |
| | | Non- | | | | | | | | | | | Non- | | | | | | | |
| | | GAAP | | | Adjmts | | | GAAP | | | GAAP | | | Adjmts | | | GAAP | |
| Net revenue: | | | | | | | | | | | | | | | | | | | | | | | | |
| Product | | $ | 182,454 | | | $ | — | | | $ | 182,454 | | | $ | 154,003 | | | $ | — | | | $ | 154,003 | |
| Service | | | 104,620 | | | | — | | | | 104,620 | | | | 84,157 | | | | — | | | | 84,157 | |
| Other | | | 16,997 | | | | — | | | | 16,997 | | | | 14,616 | | | | — | | | | 14,616 | |
| | | | | | | | | | | | | | | | | | | |
| Total net revenue | | | 304,071 | | | | — | | | | 304,071 | | | | 252,776 | | | | — | | | | 252,776 | |
| | | | | | | | | | | | | | | | | | | |
| Costs and expenses: | | | | | | | | | | | | | | | | | | | | | | | | |
| Cost of revenue: | | | | | | | | | | | | | | | | | | | | | | | | |
| Cost of product revenue | | | 32,143 | | | | 288 | | [a] | | 32,431 | | | | 29,844 | | | | — | | | | 29,844 | |
| Cost of service revenue | | | 52,759 | | | | 637 | | [a] | | 53,396 | | | | 39,752 | | | | — | | | | 39,752 | |
| Cost of other revenue | | | 5,852 | | | | — | | | | 5,852 | | | | 5,797 | | | | — | | | | 5,797 | |
| Amortization of purchased intangible assets | | | — | | | | 2,949 | | [b] | | 2,949 | | | | — | | | | 2,541 | | [b] | | 2,541 | |
| Selling and marketing | | | 141,123 | | | | 6,307 | | [a] | | 147,430 | | | | 128,546 | | | | — | | | | 128,546 | |
| Research and development | | | 91,670 | | | | 5,610 | | [a] | | 97,280 | | | | 74,365 | | | | — | | | | 74,365 | |
| General and administrative | | | 57,338 | | | | 6,257 | | [a] | | 63,595 | | | | 49,641 | | | | — | | | | 49,641 | |
| Acquisition-related charges | | | — | | | | 3,759 | | [c] | | 3,759 | | | | — | | | | 4,441 | | [c] | | 4,441 | |
| | | | | | | | | | | | | | | | | | | |
| Total costs and expenses | | | 380,885 | | | | 25,807 | | | | 406,692 | | | | 327,945 | | | | 6,982 | | | | 334,927 | |
| | | | | | | | | | | | | | | | | | | |
| Operating loss from continuing operations | | | (76,814 | ) | | | (25,807 | ) | | | (102,621 | ) | | | (75,169 | ) | | | (6,982 | ) | | | (82,151 | ) |
| Interest and other income | | | 6,304 | | | | — | | | | 6,304 | | | | 3,855 | | | | — | | | | 3,855 | |
| Gains on marketable equity securities and other investments, net | | | — | | | | 4,267 | | [d] | | 4,267 | | | | — | | | | 158 | | [d] | | 158 | |
| | | | | | | | | | | | | | | | | | | |
| Loss from continuing operations before income taxes | | | (70,510 | ) | | | (21,540 | ) | | | (92,050 | ) | | | (71,314 | ) | | | (6,824 | ) | | | (78,138 | ) |
| Income tax benefit | | | (24,679 | ) | | | (9,760 | ) | [e] | | (34,439 | ) | | | (24,247 | ) | | | (8,394 | ) | [e] | | (32,641 | ) |
| | | | | | | | | | | | | | | | | | | |
| Net loss from continuing operations | | | (45,831 | ) | | | (11,780 | ) | | | (57,611 | ) | | | (47,067 | ) | | | 1,570 | | | | (45,497 | ) |
| Net income (loss) from discontinued operations | | | — | | | | 11,807 | | [f] | | 11,807 | | | | — | | | | (639 | ) | [f] | | (639 | ) |
| | | | | | | | | | | | | | | | | | | |
| Net loss | | $ | (45,831 | ) | | $ | 27 | | | $ | (45,804 | ) | | $ | (47,067 | ) | | $ | 931 | | | $ | (46,136 | ) |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Basic and diluted net loss per share from continuing operations | | $ | (0.26 | ) | | | | | | $ | (0.33 | ) | | $ | (0.25 | ) | | | | | | $ | (0.24 | ) |
| Basic and diluted net income (loss) per share from discontinued operations | | | — | | | | | | | | 0.07 | | | | — | | | | | | | | — | |
| | | | | | | | | | | | | | | | | | | |
| Basic and diluted net loss per share | | $ | (0.26 | ) | | | | | | $ | (0.26 | ) | | $ | (0.25 | ) | | | | | | $ | (0.24 | ) |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| Shares used in basic and diluted per share amounts | | | 177,406 | | | | | | | | 177,406 | | | | 188,346 | | | | | | | | 188,346 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | |
| See “About Non-GAAP Financial Measures” immediately preceding Table A2 for more information on these non-GAAP adjustments. | | |
| |
| [a] | | Adjustment to exclude share-based compensation expense for stock options and purchases under our Employee Stock Purchase Plan that we began recording under SFAS 123(R) in the first quarter of fiscal 2006 from non-GAAP financial measures. |
| |
| [b] | | Adjustment to exclude amortization of purchased intangible assets from non-GAAP financial measures. |
| |
| [c] | | Adjustment to exclude acquisition-related charges from non-GAAP financial measures. |
| |
| [d] | | Adjustment to exclude net gains on marketable equity securities and other investments from non-GAAP financial measures. |
| |
| [e] | | Adjustment to reflect the tax effects of items [a] through [d] and to exclude certain GAAP discrete tax items. |
| |
| [f] | | Adjustment to exclude net income or loss from discontinued operations from non-GAAP financial measures. |
Table C
INTUIT INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
| | | | | | | | | |
| | | October 31, | | | July 31, | |
| | | 2005 | | | 2005 | |
| ASSETS | | | | | | | | |
| Current assets: | | | | | | | | |
| Cash and cash equivalents | | $ | 74,974 | | | $ | 83,842 | |
| Investments | | | 622,330 | | | | 910,416 | |
| Accounts receivable, net | | | 73,226 | | | | 86,125 | |
| Income taxes receivable | | | 71,520 | | | | 38,665 | |
| Deferred income taxes | | | 61,460 | | | | 54,854 | |
| Prepaid expenses and other current assets | | | 72,078 | | | | 60,610 | |
| Current assets of discontinued operations | | | 20,716 | | | | 21,989 | |
| | | | | | | |
| Current assets before funds held for payroll customers | | | 996,304 | | | | 1,256,501 | |
| Funds held for payroll customers | | | 345,432 | | | | 357,838 | |
| | | | | | | |
| Total current assets | | | 1,341,736 | | | | 1,614,339 | |
| | | | | | | | | |
| Property and equipment, net | | | 210,974 | | | | 208,548 | |
| Goodwill, net | | | 509,884 | | | | 509,499 | |
| Purchased intangible assets, net | | | 71,611 | | | | 69,678 | |
| Long-term deferred income taxes | | | 109,347 | | | | 118,475 | |
| Loans to executive officers and other employees | | | 9,245 | | | | 9,245 | |
| Other assets | | | 32,889 | | | | 30,078 | |
| Long-term assets of discontinued operations | | | 156,680 | | | | 156,589 | |
| | | | | | | |
| Total assets | | $ | 2,442,366 | | | $ | 2,716,451 | |
| | | | | | | |
| | | | | | | |
| | | | | | | | | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | | |
| Current liabilities: | | | | | | | | |
| Accounts payable | | $ | 96,928 | | | $ | 65,812 | |
| Accrued compensation and related liabilities | | | 80,536 | | | | 144,823 | |
| Deferred revenue | | | 274,315 | | | | 279,382 | |
| Income taxes payable | | | 13,707 | | | | 30,423 | |
| Other current liabilities | | | 94,072 | | | | 103,131 | |
| Current liabilities of discontinued operations | | | 19,839 | | | | 21,995 | |
| | | | | | | |
| Current liabilities before payroll customer fund deposits | | | 579,397 | | | | 645,566 | |
| Payroll customer fund deposits | | | 345,432 | | | | 357,838 | |
| | | | | | | |
| Total current liabilities | | | 924,829 | | | | 1,003,404 | |
| | | | | | | | | |
| Long-term obligations | | | 16,693 | | | | 17,308 | |
| Long-term obligations of discontinued operations | | | 221 | | | | 240 | |
| Stockholders’ equity | | | 1,500,623 | | | | 1,695,499 | |
| | | | | | | |
| Total liabilities and stockholders’ equity | | $ | 2,442,366 | | | $ | 2,716,451 | |
| | | | | | | |
| | | | | | | |
Table D
INTUIT INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| | | | | | | | | |
| | | Three Months Ended | |
| | | October 31, | | | October 31, | |
| | | 2005 | | | 2004 | |
| Cash flows from operating activities: | | | | | | | | |
| Net loss | | $ | (45,804 | ) | | $ | (46,136 | ) |
| Net (income) loss from discontinued operations | | | (11,807 | ) | | | 639 | |
| | | | | | | |
Net loss from continuing operations | | | (57,611 | ) | | | (45,497 | ) |
| Adjustments to reconcile net loss from continuing operations to net cash used in operating activities: | | | | | | | | |
| Depreciation | | | 23,145 | | | | 21,410 | |
| Acquisition-related charges | | | 3,759 | | | | 4,441 | |
| Amortization of purchased assets | | | 2,949 | | | | 2,541 | |
| Amortization of other purchased intangible assets | | | 2,031 | | | | 1,883 | |
| Share-based compensation — restricted stock | | | 1,325 | | | | 1,625 | |
| Share-based compensation — all other | | | 19,099 | | | | — | |
| (Gain) loss on disposal of property and equipment | | | 34 | | | | (126 | ) |
| Amortization of premiums and discounts on available-for-sale debt securities | | | 1,094 | | | | 3,466 | |
| Net realized loss on sales of available-for-sale debt securities | | | 380 | | | | 1,297 | |
| Net gains on marketable equity securities and other investments | | | (4,267 | ) | | | (158 | ) |
| Deferred income taxes | | | 2,520 | | | | (10,920 | ) |
| Tax benefit from employee stock options | | | 1,583 | | | | 5,153 | |
| Gain on foreign exchange transactions | | | (15 | ) | | | (327 | ) |
| | | | | | | |
| Subtotal | | | (3,974 | ) | | | (15,212 | ) |
| | | | | | | |
| Changes in operating assets and liabilities: | | | | | | | | |
| Accounts receivable | | | 12,921 | | | | 21,513 | |
| Prepaid expenses, taxes, and other current assets | | | (38,494 | ) | | | (96,389 | ) |
| Accounts payable | | | 30,665 | | | | 13,665 | |
| Accrued compensation and related liabilities | | | (64,399 | ) | | | (60,254 | ) |
| Deferred revenue | | | (5,237 | ) | | | (2,037 | ) |
| Income taxes payable | | | (16,771 | ) | | | 48,700 | |
| Other current liabilities | | | (9,471 | ) | | | (2,218 | ) |
| | | | | | | |
| Total changes in operating assets and liabilities | | | (90,786 | ) | | | (77,020 | ) |
| | | | | | | |
Net cash used in operating activities of continuing operations | | | (94,760 | ) | | | (92,232 | ) |
| Net cash provided by operating activities of discontinued operations | | | 10,981 | | | | 4,846 | |
| | | | | | | |
Net cash used in operating activities | | | (83,779 | ) | | | (87,386 | ) |
| | | | | | | |
| | | | | | | | | |
| Cash flows from investing activities: | | | | | | | | |
| Purchases of available-for-sale debt securities | | | (289,119 | ) | | | (667,184 | ) |
| Liquidation and maturity of available-for-sale debt securities | | | 575,844 | | | | 948,003 | |
| Net change in funds held for payroll customers’ money market funds and other cash equivalents | | | 12,406 | | | | (10,057 | ) |
| Purchases of property and equipment | | | (25,057 | ) | | | (24,397 | ) |
| Change in other assets | | | (4,454 | ) | | | (4,886 | ) |
| Net change in payroll customer funds deposits | | | (12,406 | ) | | | 10,057 | |
| Acquisitions of intangible assets | | | (10,148 | ) | | | — | |
| | | | | | | |
Net cash provided by investing activities | | | 247,066 | | | | 251,536 | |
| | | | | | | |
| | | | | | | | | |
| Cash flows from financing activities: | | | | | | | | |
| Change in long-term obligations | | | (634 | ) | | | (624 | ) |
| Net proceeds from issuance of common stock under stock plans | | | 21,468 | | | | 30,958 | |
| Purchase of treasury stock | | | (194,800 | ) | | | (170,562 | ) |
| Excess tax benefit from employee stock options | | | 939 | | | | — | |
| | | | | | | |
Net cash used in financing activities | | | (173,027 | ) | | | (140,228 | ) |
| | | | | | | |
| | | | | | | | | |
| Effect of exchange rates on cash and cash equivalents | | | 872 | | | | 877 | |
| | | | | | | |
Net increase (decrease) in cash and cash equivalents | | | (8,868 | ) | | | 24,799 | |
| Cash and cash equivalents at beginning of period | | | 83,842 | | | | 25,992 | |
| | | | | | | |
Cash and cash equivalents at end of period | | $ | 74,974 | | | $ | 50,791 | |
| | | | | | | |
| | | | | | | |
Table E1
INTUIT INC.
RECONCILIATION OF FORWARD-LOOKING GUIDANCE FOR NON-GAAP FINANCIAL MEASURES
TO PROJECTED GAAP REVENUE, OPERATING INCOME, AND EPS
(All Figures Except GAAP EPS Exclude Intuit Information Technology Solutions)
(In thousands, except per share amounts)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | |
| | | Forward-Looking Guidance | |
| | | Non-GAAP | | | | | | | GAAP | |
| | | Range of Estimate | | | | | | | Range of Estimate | |
| | | From | | | To | | | Adjustments | | | From | | | To | |
Three Months Ending January 31, 2006 | | | | | | | | | | | | | | | | | | | | |
| Revenue | | $ | 710,000 | | | $ | 750,000 | | | $ | — | | | $ | 710,000 | | | $ | 750,000 | |
| Operating income | | | 250,000 | | | | 265,000 | | | | (24,500 | ) | [a] | | 225,500 | | | | 240,500 | |
| Diluted earnings per share | | $ | 0.88 | | | $ | 0.98 | | | $ | (0.08 | ) | [b] | $ | 0.80 | | | $ | 0.90 | |
| Shares | | | 181,000 | | | | 182,000 | | | | — | | | | 181,000 | | | | 182,000 | |
| | | | | | | | | | | | | | | | | | | | | |
Three Months Ending April 30, 2006 | | | | | | | | | | | | | | | | | | | | |
| Revenue | | $ | 850,000 | | | $ | 910,000 | | | $ | — | | | $ | 850,000 | | | $ | 910,000 | |
| Diluted earnings per share | | $ | 1.62 | | | $ | 1.87 | | | $ | (0.08 | ) | [c] | $ | 1.54 | | | $ | 1.79 | |
| | | | | | | | | | | | | | | | | | | | | |
Three Months Ending July 31, 2006 | | | | | | | | | | | | | | | | | | | | |
| Revenue | | $ | 300,000 | | | $ | 330,000 | | | $ | — | | | $ | 300,000 | | | $ | 330,000 | |
| Diluted loss per share | | $ | (0.15 | ) | | $ | (0.10 | ) | | $ | (0.08 | ) | [d] | $ | (0.23 | ) | | $ | (0.18 | ) |
| | | | | | | | | | | | | | | | | | | | | |
Twelve Months Ending July 31, 2006 | | | | | | | | | | | | | | | | | | | | |
| Revenue | | $ | 2,200,000 | | | $ | 2,260,000 | | | $ | — | | | $ | 2,200,000 | | | $ | 2,260,000 | |
| Operating income | | | 600,000 | | | | 620,000 | | | | (94,200 | ) | [e] | | 505,800 | | | | 525,800 | |
| Diluted earnings per share | | $ | 2.23 | | | $ | 2.31 | | | $ | (0.24 | ) | [f] | $ | 1.99 | | | $ | 2.07 | |
| Shares | | | 180,000 | | | | 182,000 | | | | — | | | | 180,000 | | | | 182,000 | |
| | |
| [a] | | Reflects estimated adjustments for amortization of purchased intangible assets of approximately $2.4 million, acquisition-related charges of approximately $3.8 million and share-based compensation expense of approximately $18.3 million. |
| |
| [b] | | Reflects the adjustments in item [a], the income tax benefit related to these adjustments and estimated net income from discontinued operations of $1.2 million. |
| |
| [c] | | Reflects estimated adjustments for amortization of purchased intangible assets of approximately $1.9 million, acquisition-related charges of approximately $3.5 million, share-based compensation expense of approximately $16.8 million and the income tax benefit related to these adjustments. |
| |
| [d] | | Reflects estimated adjustments for amortization of purchased intangible assets of approximately $1.9 million, acquisition-related charges of approximately $3.0 million, share-based compensation expense of approximately $16.8 million and the income tax benefit related to these adjustments. |
| |
| [e] | | Reflects estimated adjustments for amortization of purchased intangible assets of approximately $9.2 million, acquisition-related charges of approximately $14.1 million and share-based compensation expense of approximately $70.9 million. |
| |
| [f] | | Reflects the adjustments in item [e], the income tax benefit related to these adjustments and estimated net income from discontinued operations of $13.0 million. |
TABLE E2
INTUIT INC.
RECONCILIATION OF SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES
TO MOST DIRECTLY COMPARABLE GAAP FINANCIAL MEASURES
(In thousands, except per share amounts)
(Unaudited)
| | | | | | | | | | | | | |
| | | Non- | | | | | | | |
| | | GAAP | | | Adjustments | | | GAAP | |
Three months ended October 31, 2004 | | | | | | | | | | | | |
| Operating loss | | $ | (75,169 | ) | | $ | (6,982 | ) | [a] | $ | (82,151 | ) |
| Diluted loss per share | | $ | (0.25 | ) | | $ | 0.01 | | [b] | $ | (0.24 | ) |
| | | | | | | | | | | | | |
Three months ended January 31, 2005 | | | | | | | | | | | | |
| Operating income | | $ | 224,983 | | | $ | (6,795 | ) | [c] | $ | 218,188 | |
| Diluted earnings per share | | $ | 0.79 | | | $ | (0.02 | ) | [d] | $ | 0.77 | |
| | | | | | | | | | | | | |
Three months ended April 30, 2005 | | | | | | | | | | | | |
| Operating income | | $ | 428,722 | | | $ | (6,508 | ) | [e] | $ | 422,214 | |
| Diluted earnings per share | | $ | 1.53 | | | $ | 0.08 | | [f] | $ | 1.61 | |
| | | | | | | | | | | | | |
Three months ended July 31, 2005 | | | | | | | | | | | | |
| Operating loss | | $ | (27,642 | ) | | $ | (6,511 | ) | [g] | $ | (34,153 | ) |
| Diluted loss per share | | $ | (0.08 | ) | | $ | (0.03 | ) | [h] | $ | (0.11 | ) |
| | | | | | | | | | | | | |
Twelve months ended July 31, 2005 | | | | | | | | | | | | |
| Operating income | | $ | 550,894 | | | $ | (26,796 | ) | [i] | $ | 524,098 | |
| Diluted earnings per share | | $ | 1.99 | | | $ | 0.04 | | [j] | $ | 2.03 | |
| | | | | | | | | | | | | |
Three months ended October 31, 2005 | | | | | | | | | | | | |
| Operating loss | | $ | (76,814 | ) | | $ | (25,807 | ) | [k] | $ | (102,621 | ) |
| Diluted loss per share | | $ | (0.26 | ) | | $ | — | | [l] | $ | (0.26 | ) |
| | |
| [a] | | Reflects adjustments to exclude amortization of purchased intangible assets of $2.6 million and acquisition-related charges of $4.4 million. |
| |
| [b] | | Reflects the adjustments in item [a], an adjustment for net gains on marketable securities of $0.2 million and income taxes related to these adjustments. Also reflects an adjustment to exclude certain GAAP tax benefits as well as net loss from discontinued operations of $0.6 million. |
| |
| [c] | | Reflects adjustments to exclude amortization of purchased intangible assets of $2.6 million and acquisition-related charges of $4.2 million. |
| |
| [d] | | Reflects the adjustments in item [c], an adjustment for net gains on marketable securities of $0.1 million and income taxes related to these adjustments as well as net income from discontinued operations of $2.3 million. |
| |
| [e] | | Reflects adjustments to exclude amortization of purchased intangible assets of $2.5 million and acquisition-related charges of $4.0 million. |
| |
| [f] | | Reflects the adjustments in item [e], an adjustment for net gains on marketable securities of $0.1 million and income taxes related to these adjustments. Also reflects adjustments to exclude certain tax benefits as well as net income from discontinued operations of $2.4 million. |
| |
| [g] | | Reflects adjustments to exclude amortization of purchased intangible assets of $2.5 million and acquisition-related charges of $4.0 million. |
| |
| [h] | | Reflects the adjustments in item [g], an adjustment for net gains on marketable securities of $4.9 million and income taxes related to these adjustments as well as net income from discontinued operations of $2.6 million. |
| |
| [i] | | Reflects adjustments to exclude amortization of purchased intangible assets of $10.3 million and acquisition-related charges of $16.5 million. |
| |
| [j] | | Reflects the adjustments in item [i], an adjustment for net gains on marketable securities of $5.2 million and income taxes related to these adjustments. Also reflects adjustments to exclude certain tax benefits as well as net income from discontinued operations of $6.6 million. |
| |
| [k] | | Reflects adjustments to exclude share-based compensation expense for stock options and purchases under our Employee Stock Purchase Plan recorded in accordance with SFAS 123(R) of $19.1 million, amortization of purchased intangible assets of $2.9 million and acquisition-related charges of $3.8 million. |
| |
| [l] | | Reflects the adjustments in item [k], an adjustment for net gains on marketable securities of $4.3 million and income taxes related to these adjustments. Also reflects an adjustment to exclude net income from discontinued operations of $11.8 million. |
| | |
| Intuit Facts | | Intuit Inc. |
| | | |
| Q1 FY06 | | Investor Relations (650) 944-6165 |
| | | |
| | | NASDAQ: INTU |
Financial Summary
($ millions)
| | | | | | | | | | | | | |
| | | Q1 FY05 | | Q2 FY05 | | Q3 FY05 | | Q4 FY05 | | FY05 | | Q1 FY06 |
| | | |
Revenue: | | | | | | | | | | | | |
Small & Medium Business | | | | | | | | | | | | |
QuickBooks Related | | $145.6 | | $222.3 | | $196.6 | | $188.4 | | $753.0 | | $178.1 |
| % change YOY | | 12% | | 10% | | 16% | | 23% | | 15% | | 22% |
Intuit-Branded Small Business | | $53.5 | | $60.7 | | $56.4 | | $60.2 | | $230.7 | | $58.2 |
| % change YOY | | 14% | | 9% | | 9% | | 14% | | 11% | | 9% |
| | | | | | | | | | | | | |
Tax | | | | | | | | | | | | |
Consumer Tax | | $5.0 | | $141.1 | | $419.0 | | $5.6 | | $570.7 | | $7.9 |
| % change YOY | | -3% | | 9% | | 22% | | -45% | | 16% | | 57% |
Professional Tax | | $7.4 | | $150.6 | | $99.8 | | $7.2 | | $265.0 | | $8.9 |
| % change YOY | | 7% | | -4% | | 21% | | 27% | | 5% | | 20% |
| | | | | | | | | | | | | |
Other Businesses | | $41.2 | | $73.5 | | $63.1 | | $40.5 | | $218.3 | | $51.0 |
| % change YOY | | 8% | | -4% | | 32% | | 10% | | 9% | | 24% |
| | | |
| | | | | | | | | | | | | |
Total Revenue | | $252.8 | | $648.2 | | $834.9 | | $301.8 | | $2,037.7 | | $304.1 |
% change YOY | | 11% | | 4% | | 20% | | 17% | | 13% | | 20% |
| | | | | | | | | | | | | |
| GAAP Operating Income (Loss) | | ($82.2) | | $218.2 | | $422.2 | | ($34.2) | | $524.1 | | ($102.6) |
Non-GAAP Operating Income (Loss)[A] | | ($75.2) | | $225.0 | | $428.7 | | ($27.6) | | $550.9 | | ($76.8) |
Non-GAAP Operating Margin %[A] | | NA | | 35% | | 51% | | NA | | 27% | | NA |
Interest and Other Income[B] | | $3.9 | | $3.0 | | $5.7 | | $14.2 | | $26.7 | | $6.3 |
| | | | | | | | | | | | | |
| GAAP Stock Option and ESPP Expense | | | | | | | | | | | | $19.1 |
| GAAP EPS Stock Option/ESPP Expense Impact | | | | | | | | | | | | ($0.07) |
| | | | | | | | | | | | | |
GAAP Diluted EPS | | ($0.24) | | $0.77 | | $1.61 | | ($0.11) | | $2.03 | | ($0.26) |
Non-GAAP Diluted EPS[A] | | ($0.25) | | $0.79 | | $1.53 | | ($0.08) | | $1.99 | | ($0.26) |
| | | | | | | | | | | | | |
| Basic Share Count | | 188.3 | | 186.3 | | 183.4 | | 180.3 | | 184.6 | | 177.4 |
| | | | | | | | | | | | | |
| Diluted Share Count | | 188.3 | | 190.1 | | 186.9 | | 180.3 | | 188.4 | | 177.4 |
| | | | | | | | | | | | | |
| GAAP Tax Rate | | 42% | | 34% | | 30% | | NA | | 33% | | 37% |
Non-GAAP Tax Rate[A] | | 34% | | 34% | | 34% | | NA | | 35% | | 35% |
Corporate Metrics
| | | | | | | |
| | | Q1/05 | | FYE/05 | | Q1/06 |
| | | | | | | |
| Capital Expenditure | | $24.4M | | $69.5M | | $25.1M |
| | | | | | | |
| Depreciation | | $21.4M | | $100.0M | | $23.1M |
| | | | | | | |
| Common Stock Outst. | | 187.2M | | 179.3M | | 175.6M |
| | | | | | | |
| Full Time Employees | | 7,033 | | 6,915 | | 7,444 |
Portfolio and Segment Composition
| | | | | |
Small & Medium Business | | | | |
QuickBooks Related | | | | |
| QuickBooks Software | | | | |
| QuickBooks Standard Payroll | | | | |
| QuickBooks Enhanced Payroll | | | | |
| QuickBooks Enhanced Payroll Plus | | | | |
| Financial Supplies | | | | |
| Innovative Merchant Solutions | | | | |
| QuickBooks Support Programs | | | | |
| QuickBooks Point of Sale | | | | |
| | | | | |
Intuit-Branded Small Business | | | | |
| Complete Payroll | | | | |
| QuickBooks Assisted Payroll | | | | |
| Premier Payroll | | | | |
| Intuit Real Estate Solutions (MRI) | | | | |
| Intuit Distribution Management Solutions (Eclipse) | | | | |
| Intuit Construction Business Solutions | | | | |
| | | | | |
Tax | | | | |
| | | | | |
Consumer Tax | | | | |
| TurboTax | | | | |
| | | | | |
Professional Tax | | | | |
| ProSeries | | | | |
| Lacerte | | | | |
| | | | | |
Other | | | | |
Other Businesses | | | | |
| Quicken | | | | |
| Canada/UK | | | | |
| | |
| Note: All amounts except GAAP EPS exclude information related to Intuit Information Technology Solutions, which we expect to divest in the second quarter of fiscal 2006. |
| |
| [A] | | These are non-GAAP financial measures. See tables B, E1 and E2 of the accompanying press release for reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures. |
| |
| [B] | | Interest and other income includes $7.5 million in variable royalty income from the purchaser of our former Quicken Loans business in Q4 FY05. |
Page 1
| | |
| Intuit Facts | | Intuit Inc. |
| | | |
| | | Investor Relations (650) 944-6165 |
| | | NASDAQ: INTU |
Business Metrics
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Units in thousands, except where noted | | Q1/FY04 | | Q2/FY04 | | Q3/FY04 | | Q4/FY04 | | | FY04 | | | Q1/FY05 | | Q2/FY05 | | Q3/FY05 | | Q4/FY05 | | | FY05 | | | Q1/FY06 |
| | | | | | | | | | | | | | | |
QuickBooks Related[D] | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Simple Start, Basic and Pro | | 163 | | 262 | | 312 | | 205 | | | 942 | | | 152 | | 318 | | 325 | | 223 | | | 1,018 | | | 203 |
| Premier units | | 26 | | 62 | | 60 | | 44 | | | 192 | | | 32 | | 67 | | 53 | | 39 | | | 191 | | | 31 |
| Enterprise units | | 1 | | 1 | | 1 | | 2 | | | 5 | | | 2 | | 3 | | 3 | | 2 | | | 10 | | | 3 |
| | | | | | | | | | | | | | | |
| Total QuickBooks software units sold | | 190 | | 325 | | 373 | | 251 | | | 1,139 | | | 186 | | 388 | | 381 | | 264 | | | 1,219 | | | 237 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net increase in Quickbooks software subscriptions[E] | | 1 | | 3 | | 4 | | 2 | | | 10 | | | 5 | | 54 | | 45 | | 33 | | | 137 | | | 22 |
| | | | | | | | | | | | | | | |
Total Quickbooks software units and increase in subscriptions[E] | | 191 | | 328 | | 377 | | 253 | | | 1,149 | | | 191 | | 442 | | 426 | | 297 | | | 1,356 | | | 259 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total Quickbooks software subscription customers[E] | | 12 | | 15 | | 19 | | 21 | | | 21 | | | 26 | | 80 | | 125 | | 158 | | | 158 | | | 180 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Sell Thru Channel Mix[F] | | | | | | | | | | | | | | | | | | | | | | | | | | |
| % of dollars at retail | | 59% | | 49% | | 48% | | 53% | | | 51% | | | 62% | | 47% | | 49% | | 50% | | | 51% | | | 55% |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
QuickBooks Retail Share[G] | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Unit share FYTD | | 78% | | 82% | | 83% | | 83% | | | 83% | | | 83% | | 86% | | 88% | | 88% | | | 88% | | | 88% |
| Dollar share FYTD | | 85% | | 89% | �� | 90% | | 91% | | | 91% | | | 89% | | 90% | | 92% | | 91% | | | 91% | | | 91% |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| QuickBooks do-it-yourself payroll (customers) | | 753 | | 776 | | 806 | | 807 | | | 807 | | | 816 | | 837 | | 844 | | 837 | | | 837 | | | 853 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Intuit-Branded Small Business (selected) | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Outsourced Payroll Customers | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Premier | | 24 | | 23 | | 22 | | 21 | | | 21 | | | 20 | | 19 | | 17 | | 15 | | | 15 | | | 15 |
| Branded Outsourced (Assisted & Complete) | | 45 | | 48 | | 50 | | 51 | | | 51 | | | 51 | | 53 | | 54 | | 54 | | | 54 | | | 55 |
| | | | | | | | | | | | | | | |
| Total Outsourced Payroll Customers | | 69 | | 71 | | 72 | | 72 | | | 72 | | | 71 | | 72 | | 71 | | 69 | | | 69 | | | 70 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer Tax[D] | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Federal TurboTax (millions) | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Desktop units retail | | NM | | 2.4 | | 2.3 | | NM | | | 4.7 | | | NM | | 2.6 | | 2.7 | | NM | | | 5.3 | | | NM |
| Desktop units direct | | NM | | 1.2 | | 0.5 | | NM | | | 1.7 | | | NM | | 1.1 | | 0.6 | | NM | | | 1.7 | | | NM |
| Web units paid | | NM | | 0.4 | | 2.4 | | NM | | | 2.8 | | | NM | | 0.6 | | 2.7 | | NM | | | 3.4 | | | NM |
| Free File Alliance | | NM | | 0.1 | | 0.6 | | NM | | | 0.7 | | | NM | | 0.4 | | 1.8 | | NM | | | 2.2 | | | NM |
| | | | | | | | | | | | | | | |
| Total TurboTax federal units | | NM | | 4.1 | | 5.8 | | NM | | | 9.9 | | | NM | | 4.7 | | 7.8 | | NM | | | 12.6 | | | NM |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| TurboTax Efile returns (millions) | | NM | | 1.3 | | 11.6 | | 0.2 | | | 13.1 | | | NM | | 1.8 | | 14.4 | | 0.1 | | | 16.3 | | | NM |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Sell-Thru Channel Mix[F] | | | | | | | | | | | | | | | | | | | | | | | | | | |
| % of dollars at retail | | NM | | 51% | | 30% | | NM | | | 36% | | | NM | | 55% | | 26% | | NM | | | 34% | | | NM |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Federal TurboTax retail share[H] | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Unit share FYTD | | NM | | 71% | | 72% | | 72% | | | 72% | | | NM | | 75% | | 79% | | 79% | | | 79% | | | NM |
| Dollar share FYTD | | NM | | 81% | | 82% | | 82% | | | 82% | | | NM | | 81% | | 85% | | 85% | | | 85% | | | NM |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Professional Tax | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Professional Tax units | | NM | | 90 | | 7 | | NM | | | 97 | | | NM | | 94 | | 12 | | NM | | | 106 | | | NM |
| Efile returns (millions) | | 0.2 | | 0.6 | | 12.7 | | 0.4 | | | 13.9 | | | 0.7 | | 0.7 | | 15.6 | | 0.6 | | | 17.6 | | | 1.0 |
| | | | | | | | | | | | | | | |
| | |
| [D] | | Sales to end users (sell-through) by Intuit and via retailers and distributors for which Intuit relies on reports from these merchants. These numbers include estimates, including estimates of sales by merchants who do not report sales to Intuit. |
| |
| [E] | | Includes QuickBooks Online Edition, QuickBooks Pro and QuickBooks Premier from Enhanced Payroll Plus subscription units. |
| |
| [F] | | Estimate based on subset of retailers reporting. |
| |
| [G] | | Sources: NPD Group Monthly Retail Software Report through Sept 2005. |
| |
| [H] | | Sources: NPD Group Monthly Retail Software Report through April 2005. |
Page 2
| | |
| Intuit Facts | | Intuit Inc. |
| | | |
| FY06 Financial Outlook[I], [J] | | Investor Relations (650) 944-6165 |
| | | |
| | | NASDAQ: INTU |
Guidance
($ millions)
| | | | | | | | | | | |
| | | Guidance | | Guidance | | Guidance | | Guidance | | Historical |
| | | Q2 FY06 | | Q3 FY06 | | Q4 FY06 | | FY06 | | FY05 |
| | | |
Revenue: | | | | | | | | | | |
Small & Medium Business | | | | | | | | | | |
QuickBooks Related | | | | | | | | $806-$843 | | $753.0 |
| % change YOY | | | | | | | | 7%-12% | | 15% |
Intuit-Branded Small Business | | | | | | | | $242-$254 | | $230.7 |
| % change YOY | | | | | | | | 5%-10% | | 11% |
| | | | | | | | | | | |
Tax | | | | | | | | | | |
Consumer Tax | | | | | | | | $628-$656 | | $570.7 |
| % change YOY | | | | | | | | 10%-15% | | 16% |
Professional Tax | | | | | | | | $265-$278 | | $265.0 |
| % change YOY | | | | | | | | 0%-5% | | 5% |
| | | | | | | | | | | |
Other Businesses | | | | | | | | $229-$240 | | $218.3 |
| % change YOY | | | | | | | | 5%-10% | | 9% |
| | | |
| | | | | | | | | | | |
Total Revenue[L] | | $710-$750 | | $850-$910 | | $300-$330 | | $2,200-$2,260 | | $2,037.7 |
% change YOY | | 10%-16% | | 2%-9% | | (1%)-9% | | 8%-11% | | 13% |
| | | | | | | | | | | |
| GAAP Operating Income (Loss) | | $226-$241 | | | | | | $506-$526 | | $524.1 |
Non-GAAP Operating Income (Loss)[A] | | $250-$265 | | | | | | $600-$620 | | $550.9 |
Non-GAAP Operating Margin %[A] | | 35% | | | | | | 27%-28% | | 27% |
| | | | | | | | | | | |
GAAP Diluted EPS[K] [L] | | $0.80-$0.90 | | $1.54-$1.79 | | ($0.23)-($0.18) | | $1.99-$2.07 | | $2.03 |
Non-GAAP Diluted EPS[A] [L] | | $0.88-$0.98 | | $1.62-$1.87 | | ($0.15)-($0.10) | | $2.23 - $2.31 | | $1.99 |
| | | | | | | | | | | |
| Basic Share Count | | 181-182 | | | | | | 174-176 | | 184.6 |
| | | | | | | | | | | |
| Diluted Share Count | | 181-182 | | | | | | 180-182 | | 188.4 |
| | | | | | | | | | | |
GAAP Tax Rate[K] | | 35% | | | | | | 35% | | 33% |
Non-GAAP Tax Rate[A] | | 35% | | | | | | 35% | | 35% |
Portfolio and Segment Composition
| | | | | |
Small & Medium Business | | | | |
QuickBooks Related | | | | |
| QuickBooks Software | | | | |
| QuickBooks Standard Payroll | | | | |
| QuickBooks Enhanced Payroll | | | | |
| QuickBooks Enhanced Payroll Plus | | | | |
| Financial Supplies | | | | |
| Innovative Merchant Solutions | | | | |
| QuickBooks Support Programs | | | | |
| QuickBooks Point of Sale | | | | |
| | | | | |
Intuit-Branded Small Business | | | | |
| Complete Payroll | | | | |
| QuickBooks Assisted Payroll | | | | |
| Premier Payroll | | | | |
| Intuit Real Estate Solutions (MRI) | | | | |
| Intuit Distribution Management Solutions (Eclipse) | | | | |
| Intuit Construction Business Solutions | | | | |
| | | | | |
Tax | | | | |
Consumer Tax | | | | |
| TurboTax | | | | |
| | | | | |
Professional Tax | | | | |
| ProSeries | | | | |
| Lacerte | | | | |
| | | | | |
Other | | | | |
Other Businesses | | | | |
| Quicken | | | | |
| Canada/UK | | | | |
| | |
| [I] | | All of the numbers provided in the table entitled “Guidance,” other than those in the Historical FY05 column, are forward-looking statements.
Please see “Cautions About Forward-Looking Statements” in the pages accompanying this fact sheet for important information to assess when evaluating these statements. Actual future results may differ materially due to a number of risks and uncertainties. |
| |
| [J] | | Excludes results of Intuit Information Technology Solutions (ITS). The figures in the Historical FY05 column exclude $57.0 million in ITS revenue, $23.2 million in ITS non-GAAP operating income, $20.8 million in ITS GAAP operating income and $0.08 in ITS non-GAAP EPS. |
| |
| [K] | | In accordance with GAAP, EPS includes ITS results for all periods presented. The GAAP tax rate and GAAP EPS for fiscal 2005 also include the reversal of reserves related to potential income tax exposures that have been resolved. The non-GAAP tax rate and Non-GAAP EPS do not reflect the benefit of those reserve reversals. |
| [L] | | Compared to the Q4 FY05 fact sheet issued on 8/24/05, these guidance ranges reflect a shift of $40 million of revenue and $0.13 of EPS from Q3 FY06 to Q2 FY06. |
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