Business and financial management solutions provider Intuit Inc. (INTU) on Wednesday reaffirmed its financial guidance for the fiscal 2010 first quarter and the full fiscal year 2010. The company originally issued earnings and revenue forecast for the periods while reporting fourth quarter and full year 2009 financial results on August 20.
Historically, the first quarter of the fiscal year is viewed as a weak one in comparison with the second and third quarters, when small businesses resort to buying new packages for their accounting and will be busy preparing the tax statements. Intuit usually reports a loss during the first quarter of the fiscal year.
Mountain View, California-based Intuit said it continues to expect a GAAP net loss in a range of $0.28 to $0.24 per share for the first quarter of 2010. Non-GAAP net loss for the quarter is still expected to be in the range of $0.19 to $0.15 per share.
On average, fifteen analysts polled by Thomson Reuters expects the company to report a loss of $0.16 per share for the first quarter. Analysts' estimates typically exclude special items.
Intuit said it continues to expect first-quarter revenues in the range of $479 million to $493 million, representing flat to 2% growth over the year-ago quarter. Fourteen Wall Street analysts have a consensus revenue estimate of $487.69 million for the quarter.
Intuit also continues to anticipate GAAP operating loss for the first quarter to be between $126 million to $107 million and non-GAAP operating loss in the range of $79 million to $60 million. Intuit typically posts a seasonal loss in its first quarter when it has little revenue from its tax businesses, while expenses remain relatively constant.
Looking ahead to fiscal 2010, Intuit also reaffirmed its GAAP earnings outlook in a range of $1.49 to $1.56 per share, and non-GAAP earnings for the year is still expected to be in the range of $1.89 per share to $1.96 per share.
The Street is looking for Intuit to report earnings of $1.94 per share for fiscal 2010.
Intuit also continues to see fiscal 2009 revenues in the range of $3.30 billion to $3.43 billion, representing a 4% to 8% year-over-year growth. Analysts are looking for full year 2010 revenues of $3.37 billion.
The company said it also continues to expect full-year GAAP operating income between $785 million and $825 million, representing a growth of 15% to 21%, and non-GAAP operating income in the range of $985 million to $1.025 billion, representing a growth of 6% to 10%. Non-GAAP operating margin is seen to be between 29% and 30%.
For fiscal 2010, on a segment basis, Intuit continues to expect annual revenues from its small business group to rise 4% to 8% to a range of $1.28 billion to $1.33 billion, and consumer tax revenue is still anticipated to grow 5% to 9% to between $1.045 billion and $1.085 billion.
Revenue for the accounting professionals segment continues to be seen to grow 3% to 7% to a range of $363 million to $375 million, and financial institutions revenues are expected to grow 6%-10% over the prior-year levels to between $330 million and $341 million. Revenues from other businesses are still seen to grow 6% to 10% to a range of $305 million to $318 million.
In mid-September, Intuit agreed to acquire privately-held provider of online personal finance services Mint.com for about $170 million in cash. The transaction, which is subject to regulatory review and other customary closing conditions, is expected to close during the fourth quarter of calendar year 2009. Mint.com will become part of Intuit's Consumer Group, which includes both Quicken and TurboTax products, upon closure of the deal.
Mint.com, based in Mountain View, California has successfully used its advanced technology to provide consumers with an easy and intelligent way to manage their money. Mint.com's innovative capabilities can be applied broadly to millions of Intuit consumer and small business customers.
Pursuant to the closure of the deal, Intuit expects to cut non-GAAP earnings outlook for the fiscal year 2010 by about $0.02 per share, and GAAP earnings by about $0.03 per share. However, Intuit does not anticipate the acquisition to have any material effect on fiscal 2011 earnings.
Last month, Intuit reported a wider net loss of $70.7 million or $0.22 per share for the fourth quarter from $61.9 million or $0.19 per share, as revenue remained nearly flat but costs and expenses rose. Intuit typically posts a seasonal loss in its fourth quarter when there is little revenue from its tax businesses but expenses remain relatively constant. Quarterly net revenues edged down to $475.77 million from $478.15 million in the same quarter last year.
On August 21, Credit Suisse downgraded Intuit shares to 'Neutral' from 'Outperform' and lowered its price target to '$30' from '$33'. The brokerage also reduced its 2010 EPS estimate to '$1.96' from '$1.97', while establishing its 2011 estimate of $2.26.
Intuit's peer, Kansas City, Missouri-based H&R Block, Inc. (HRB) also reported earlier in the month a wider net loss for the first quarter, daunted by the charges related to Southwest franchise acquisition and other expenses. However, loss per share for the period narrowed on higher share count. H&R Block also reaffirmed its outlook for earnings from continuing operations in a range of $1.60 to $1.80 per share. Further, H&R Block continues to expect the Tax Services segment to deliver improved margins totaling 100 basis points over the next two fiscal years.
Another peer, Parsippany, New Jersey-based Jackson Hewitt Tax Service, Inc. (JTX), on September 3, posted a wider first-quarter loss, reflecting the impact of termination charges incurred in July, despite revenue growth. Net loss widened to $21.84 million or $0.76 per share from $20.54 million or $0.72 per share a year ago. Quarterly revenues increased to $5.05 million from $4.29 million in the same quarter last year.
In Wednesday's regular trading session, INTU is currently trading at $27.83, down $0.04 or 0.14% on a volume of 0.94 million shares. In the past 52-week period, the stock has been trading in a range of $20.18 to $32.00.
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