Intuit Inc. (INTU”>INTU) reported a fourth quarter 2011 adjusted loss of 11 cents per share, wider than the Zacks Consensus Estimate for a loss of 10 cents.
Revenue
Intuit reported revenues of $593 million in the reported quarter, up 10.4% from $537 million in the prior-year quarter. Reported revenues surpassed management’s guidance range of $567.0 million to $587.0 million.
Product revenues increased 5.4% year over year to $233.0 million, while Services and Other revenues surged 13.9% from the prior-year quarter to $360 million.
Consumer Tax witnessed strong growth in the reported quarter, up 13.0% year over year with a unit growth of 12.0%. Tax software growth accelerated in fiscal 2010, and the company grabbed a major share within the category.
Small Business Group revenue surged 10% year over year, driven by double-digit revenue growth in Financial Management Solutions, Employee Management Solutions and Payment Solutions.
Financial Services revenue grew 12.0% on a year-over-year basis, driven by increased QuickBooks Online subscriptions. Employee Management Solutions (formerly referred to as Payroll) was up 5% year over year aided by customer growth.
Payment Solutions posted a 12% year over year growth in the quarter. Transaction volumes per merchant grew marginally from the prior-year quarter.
Operating Results
The GAAP operating loss was $61.0 million compared with $64.0 million in the year-earlier quarter. Excluding special items, non-GAAP operating income was $25.0 million compared with a loss of $9.0 million in the year-earlier quarter.
GAAP net loss in the quarter was $57.0 million or 19 cents per share, compared with $48.0 million or 15 cents per share in the year-ago quarter. The adjusted net loss in the quarter stood at $35.0 million or 11 cents per share, compared with a loss of $51.0 million or 16 cents per share in the year-ago quarter.
Balance Sheet & Cash Flow
Intuit ended the quarter with cash, equivalents and investments of $1.42 million, up from $1.83 billion in the previous quarter. Accounts receivables were $171.0 million, compared with $266.0 million in the previous quarter. As of July 31, 2011, long-term debt remained flat at $499.0 million.
Intuit used $172 million of operating cash in the fourth quarter, versus $1.14 billion million in the prior quarter. During the quarter, Intuit repurchased shares worth $250 million.
Outlook
For the first quarter of fiscal 2012, the company expects revenues of $575.0 million to $585.0 million, up 8.0% to 10.0%. GAAP operating loss is expected in the range of $95.0 million to $105.0 million, compared with a loss of $104.0 million in the year-ago quarter. Non-GAAP operating loss is projected between $40.0 million and $50.0 million, compared with a loss of $53.0 million in the year-ago quarter. GAAP net loss per share is estimated in the range of 24 cents to 26 cents, compared with a loss of 22 cents in the year-ago quarter. Non-GAAP net loss per share is expected in the 11 cent to 13 cent range, compared with a loss of 12 cents in the year-ago quarter.
Our Take
Intuit is a leading provider of business and financial management solutions to small and medium-sized businesses, consumers, accounting professionals and financial institutions. Management is confident about gaining market share in its Small Business group and Consumer Tax business, aided by accelerating customer growth and improving revenue per customer. However, stiff competition from H&R Block Inc. (HRB”>HRB) is a concern.
Currently, Intuit has a Zacks #3 Rank, which translates into a short-term Hold rating.
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