Intuit Reports Better-Than-Expected Earnings
May 24 2016 - 06:10PM
Dow Jones News
By Ezequiel Minaya
Intuit Inc., the maker of TurboTax software, on Tuesday reported
better-than-expected results for its third quarter, with adjusted
earnings easily beating expectations, as the company benefited from
the sale of several businesses.
The company also raised its annual guidance for revenue and
adjusted earnings per share.
For the fiscal year, Intuit now expects revenue in the range of
$4.66 billion to $4.68 billion with adjusted earnings between $3.63
a share and $3.65 a share. Previously, the company had projected
sales between $4.53 billion and $4.61 billion with earnings in the
range of $3.45 and $3.50.
For the current quarter, the company expects revenue between
$720 million and $740 million with adjusted per-share earnings
roughly break-even. Analysts, meanwhile, forecast $719 million of
revenue and an adjusted loss of a penny a share.
The company typically collects the bulk of its earnings during
tax season and posts losses in its off-tax-season quarters. It has
been looking to pare down and in March announced it has found a
buyer for its Quicken segment. The business was slated for sale to
private-equity firm HIG Capital.
The move came after Intuit said last summer that it would seek
to sell several business units, including collaboration platform
QuickBase and communications software business Demandforce in
addition to Quicken, in a move to focus on its core small-business
and tax-preparation businesses.
On Tuesday the company said that it had completed the sales of
Demandforce, QuickBase and Quicken businesses for $463 million in
cash. Intuit recorded a $354 million pretax gain on the divestures,
which translated into a net gain of $176 million during the
quarter. In contrast, the company posted a $155 million lost in the
same period a year earlier connected to discontinued
businesses.
Over all for the latest quarter, Intuit reported a profit of
$1.03 billion, or $3.94 a share, compared with a year-ago profit of
$501 million, or $1.78 a share.
Excluding certain items, profit was $3.43 a share, up from $2.85
a share a year earlier. Revenue climbed 8% to $2.3 billion.
The company had expected revenue between $2.21 billion to $2.26
billion with adjusted earnings between $3.15 a share and $3.20 a
share. Analysts surveyed by Thomson Reuters had projected adjusted
profit of $3.21 a share on $2.25 billion in revenue.
The small-business segment's revenue increased 12% while the
consumer and professional tax division posted a 7% increase.
Intuit also repurchased some $465 million of shares during the
quarter, cutting shares outstanding by about 20 million compared
with the same quarter a year ago. The company has $435 million left
on its current authorization.
Write to Ezequiel Minaya at ezequiel.minaya@wsj.com
(END) Dow Jones Newswires
May 24, 2016 17:55 ET (21:55 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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