Shares of financial software and services company
were off nearly 9% Monday, as news of a top executive's departure reached investors.
Dan Nye, the man responsible for the company's
small-business accounting software, is leaving the company after six years for personal reasons, the company said in a written statement. His resignation particularly concerns investors because Intuit has pinned much of its future-growth prospects on the small-business market, which comprises 35% to 40% of Intuit's revenue.
The former vice president of Intuit's small-business division may be taking the fall for the company's recently announced revenue shortfall, according to an analyst's note. Intuit surprised analysts last month when it unexpectedly announced at its annual analyst day that it would bring in revenue of $425 million to $450 million instead of meeting revenue expectations of $455 million to $470 million for the third quarter ending April 30. In turn, the company lowered its sales estimates for the full year to $1.26 billion to $1.30 billion from $1.32 billion to $1.34 billion.
Intuit blamed the effects of a Y2K QuickBooks giveaway for the warning. The company gave out 350,000 free copies of its QuickBooks software so customers would be Y2K compliant. The lucky recipients then decided not to upgrade in 2001 at the 20% to 30% rate expected, which pinches the small-business segment.
"Investors can 'connect the dots,' but it certainly appears that Nye is the fall guy -- and maybe appropriately so --
for Intuit's recently lowered revenue guidance," according to a
note this morning.
Steve Bennett, Intuit CEO, will oversee the small-business division during the search for a replacement, the company said. "We believe that the potential exists for further negative revisions to Intuit's third- and fourth-quarter guidance," the note said.
In recent trading, Intuit was down $2.44, or 8.8%, to $25.31.