By Tess Stynes
Intuit Inc.'s chief financial officer said Thursday that the
online tax-software company hasn't seen any indications that its
systems were breached in connection with a wave of fraudulent
tax-return filings this month.
The comments from finance chief Neil Williams came after the
company reported its revenue rose 3.3% in the January quarter,
helped by subscriber growth at its QuickBooks segment.
Earlier this month--after the quarter ended--TurboTax
temporarily halted electronic filing of all state returns for about
24 hours after more than a dozen states spotted criminal attempts
to obtain refunds through its systems.
Intuit said it continues to take measures to navigate a
heightened sense of concern about tax fraud, and Mr. Williams
reiterated that the company has been working with a number of
third-party consulting firms to get independent looks at its own
security systems.
Going forward, TurboTax also has implemented multi-factor
authentication to access its online tax services as an added
precaution. Mr. Williams added it is too early in the tax season to
determine whether there is an increase in tax refund fraud this
year, compared with past tax seasons.
It was already a tough tax season for Intuit ahead of the
fraudulent filings. The company angered some longtime users of its
software by making changes that would have required some customers
to upgrade to more expensive versions to file 2014 returns. But
after a furor, the company reversed the changes.
On Thursday's conference call, Chief Executive Brad Smith called
the upgrade plan a "self-inflicted wound" and acknowledged it has
been "an eventful few weeks at Intuit." He also insisted that cyber
fraud is an "industry-wide threat, not a company-specific
threat."
The company didn't disclose the financial impact from the
fraudulent filings or the rescinded upgrade plan.
Intuit shares edged up more than 3% after hours and have
increased 24% over the past 12 months through Thursday's close.
The company, however, gave a disappointing forecast for the
current quarter, guiding for per-share earnings of $2.70 to $2.75
and revenue of $2.075 billion to $2.15 billion. Analysts polled by
Thomson Reuters expected a per-share profit decline of 19% to $2.88
and a revenue decrease of 7% to $2.23 billion.
Intuit, also known for Quicken, has diversified through a
variety of acquisitions. In June, the company bought mobile payment
provider Check for about $360 million. Previously, it struck deals
for document service DocStoc and tax-return helper GoodApril.
For the period ended Jan. 31, Intuit reported a loss of $66
million, or 23 cents a share, compared with a year-earlier loss of
$37 million, or 13 cents a share. Excluding stock-based
compensation and other items, the per-share loss from continuing
operations was six cents, compared with a year-earlier earnings of
two cents. The company expected a loss excluding items of 11 cents
to 13 cents a share.
Revenue edged up to $808 million, exceeding the company's
expectations for $780 million to $800 million.
The company said it added more than 100,000 QuickBooks Online
subscribers versus the previous quarter, bringing total paying
subscribers worldwide to 841,000.
In the company's consumer segment, which includes TurboTax,
consumer revenue increased 54%, benefitting from an earlier start
to this year's tax season.
For the current tax season through Feb. 14, TurboTax Online
sales volume climbed 19% and overall TurboTax volume increased
11%.
Intuit also affirmed its guidance for the year ending in
July.
-Laura Saunders contributed to this article.
Write to Tess Stynes at tess.stynes@wsj.com
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