Intuit's View Too Dim

The QuickBooks maker's second-quarter outlook is below Wall Street's expectations.
Author:
Publish date:

Updated from 4:39 p.m. EST

Strong sales of the newest version of QuickBooks helped

Intuit

(INTU) - Get Report

boost first-quarter revenue by a stronger-than-expected 19%, but the company's second-quarter outlook was below Wall Street's expectations.

Intuit, best known for its tax-preparation software and small-business accounting packages, lost $58.9 million, or 17 cents a share, compared with a loss of $45.8 million, or 13 cents a share, in the October quarter of last year. Revenue grew to $362.1 million.

Because it derives little revenue from its tax programs in the first quarter, Intuit typically posts a loss in the period.

Excluding the cost of stock options, the Mountain View, Calif., company lost $42.5 million, or 12 cents a share.

Analysts polled by Thomson First Call were looking for a loss of 13 cents a share on revenue of $340.7 million.

Contributing to the wider loss was a 14% increase in operating expenses. Much of the increase, said CFO Kiran Patel, went to fund R&D, particularly a new software product aimed at helping consumers manage the cost of medical treatment. He expects it to launch within the year.

Intuit has released few details of the new product but did say it is being developed in conjunction with a number of large health care providers.

CEO Steve Bennett said the company expects to resume share repurchases, but he did not specify a time. Intuit's board has authorized the repurchase of more than $500 million worth of shares.

Bennett said that the company's stock has done quite well -- up 29% on the year -- without the support of a buyback.

QuickBooks revenue grew to $133.7 million during the first quarter, a year-over-year increase of 28%. Also growing strongly were payroll- and payments-related products, which were 21%.

Consumer-tax revenue grew 62% to $12.8 million.

Looking to the second quarter, the company expects revenue to range from $743 million to $760 million, or growth of up to 2%.

Non-GAAP EPS will range from 39 cents to 42 cents.

On the same basis, analysts were forecasting a profit of 45 cents a share on sales of $766.2 million.

GAAP earnings, the company said, will likely range from 34 cents a share to 37 cents a share.

In after-hours trading, shares were off 53 cents, or 1.5%, to $34.28.