Publish date:

Intuit Narrows Loss, Names New CEO

The tax software maker guides EPS in line for the coming quarter, but revenue is light.

Updated from 5:20 p.m. EDT

SAN FRANCISCO -- In its typically slow fourth quarter,


(INTU) - Get Intuit Inc. (INTU) Report

narrower net loss surprised analysts, but next-quarter revenue guidance came up short.

Additionally on Wednesday, the company announced a change of guard in the CEO post.

The Mountain View, Calif., developer of TurboTax and QuickBooks software reported a per-share loss of 4 cents, or $13.6 million, vs. a loss of $18.9 million in the same quarter last year.

The top line of $432.7 million was well ahead of Thomson Financial analysts' expectations of $415.7 million, and up 31% from the same period of 2006.

Excluding items, Intuit lost 2 cents, or $7.5 million, vs. a loss of $11.5 million in the year-ago period. Analysts forecast a loss of a nickel a share.

In recent after-hours trading, shares were down 44 cents, or 1.5%, to $28.50.

TheStreet Recommends

All ongoing product segments performed as expected, and most were at the high end of guidance for the year, CEO Stephen Bennett said in an interview. "They all performed well."

The company said growth was driven by the acquisition in February of Digital Insight, a $300 million business, and strong performance in sales to small businesses.

Intuit will soon expand Digital Insight's bill-pay capability by bringing out FinanceWorks for Small Business, a hosted, on-demand software suite sold through Digital Insight to financial institutions, which will make it available to their clients. FinanceWorks "will have small business functionality and integration with online banking that we think will be big in the marketplace," he said. "Time will tell if it's a killer app


Also in the on-demand software category, QuickBooks Online is growing 50% year over year, said Brad Smith, general manager of the small business division. The service now has 100,000 customers, up from 25,000 in 2005.

"We believe we have more online accounting customers than everyone else put together," Bennett said.

The software maker shows its strongest net earnings in the first half of the calendar year, after tax season winds down, with the first and fourth fiscal quarters typically the slowest.

Excluding items, for the first or coming quarter, Intuit sees revenue in the range of $426 million to $441 million, and an EPS loss of 12 cents to 14 cents, which was in line with consensus of an EPS loss of 13 cents. Revenue was shy of analysts' expectations of $450.5 million.

Intuit expects fiscal 2008 revenue in the range of $3 billion to $3.05 billion and full-year EPS, less items, of $1.59 to $1.61. Analysts had been expecting a top line of $3.04 billion and EPS of $1.60.

The company also named Smith to succeed Bennett as president and CEO, effective Jan. 1. Bennett, will remain on the board.

"The timing is right for Brad and for me," said Bennett. "We had eight solid seasons in a row. Brad is ready, and I'm ready to take some time off and explore" new opportunities.