Intuit Inc. (Nasdaq:INTU)
reaffirmed its financial guidance for the first quarter and full
fiscal year 2017. The company's fiscal year runs from Aug. 1 to
July 31.
Intuit reaffirmed its guidance in conjunction with Investor Day,
being held today at the company’s Mountain View, Calif.,
headquarters. Chairman and Chief Executive Officer Brad Smith and
company leaders will address the company’s priorities in support of
its strategy to be the operating system behind small business
success, and to do the nations’ taxes in the U.S. and Canada.
“With a strong finish to fiscal 2016, we have the wind at our
backs,” said Smith. “Our time is now - to capitalize on the
customer and technology trends we see in the market. We’re working
to take our offerings to the next level, moving mobile beyond touch
screens and adding voice recognition. Creating indispensable
connections across our platforms. Applying machine learning to
create personalized experience for our customers, while
continuously focusing on securing Intuit and our customers’
data.”
Reiterates First-quarter and Fiscal 2017 Guidance
Intuit reiterated the first-quarter and full-year fiscal 2017
guidance that was previously announced on Aug. 23. For the first
quarter, which ends Oct. 31, the company is reiterating the
guidance set and expects:
- Revenue of $740 million to $760
million, growth of 4 to 7 percent.
- GAAP operating loss of $65 million to
$75 million.
- Non-GAAP operating income of $10
million to $20 million.
- GAAP loss per share of $0.19 to
$0.21.
- Non-GAAP diluted earnings per share of
$0.01 to $0.03.
- QuickBooks Online subscribers of
approximately 1.6 million.
For fiscal year 2017, which ends July 31, the company is
reiterating the guidance set and expects:
- Revenue of $5 billion to $5.1 billion,
growth of 7 to 9 percent.
- GAAP operating income of $1.33 billion
to $1.38 billion, growth of 7 to 11 percent.
- Non-GAAP operating income of $1.675
billion to $1.725 billion, growth of 8 to 11 percent.
- GAAP diluted earnings per share of
$3.35 to $3.45, versus $3.69 in fiscal 2016. Fiscal 2016 earnings
per share includes $0.65 net income per share from discontinued
operations.
- Non-GAAP diluted earnings per share of
$4.30 to $4.40, growth of 14 to 16 percent.
- QuickBooks Online subscribers of 2.0
million to 2.2 million.
Investor Day: How to Participate
The event will be broadcast live from 8:00 a.m. to 11:30 a.m.
Pacific time and a webcast will be available on Intuit’s website at
http://investors.intuit.com/events/event-details/2016/Intuits-Annual-Investor-Day-Video-Broadcast-2016/default.aspx.
A replay of the video broadcast and webcast will be available on
Intuit’s website two hours after the meeting ends.
About Intuit
Intuit Inc. creates business and financial management solutions
that simplify the business of life for small businesses, consumers
and accounting professionals.
Its flagship products and services include QuickBooks® and
TurboTax®, which make it easier to manage small businesses
and tax preparation and filing. Mint.com provides a fresh,
easy and intelligent way for people to manage their money, while
Intuit's ProConnect brand portfolio includes ProConnect
Online, ProSeries® and Lacerte®, the company's leading
tax preparation offerings for professional accountants.
Founded in 1983, Intuit had revenue of $4.7 billion in its
fiscal year 2016. The company has approximately 7,900 employees
with major offices in the United States, Canada, the United
Kingdom, India, Australia and other locations. More information can
be found at www.intuit.com.
About Non-GAAP Financial Measures
This press release includes non-GAAP financial measures. For a
description of these non-GAAP financial measures, including the
reasons management uses each measure, and reconciliations of these
non-GAAP financial measures to the most directly comparable
financial measures prepared in accordance with Generally Accepted
Accounting Principles, please see the accompanying Table 1 and the
section titled "About Non-GAAP Financial Measures." A copy of the
press release issued by Intuit today can be found on the investor
relations page of Intuit's Web site.
Cautions About Forward-looking Statements
This press release contains forward-looking statements,
including forecasts of expected growth and future financial results
of Intuit and its reporting segments; Intuit’s prospects for the
business in fiscal 2017 and beyond; expectations regarding timing
and growth of revenue for each of Intuit’s reporting segments and
from current or future products and services; expectations
regarding customer growth; expectations regarding changes to our
products and their impact on Intuit’s business; expectations
regarding the impact of our strategic decisions on Intuit’s
business; and all of the statements under the heading
“Forward-looking Guidance.”
Because these forward-looking statements involve risks and
uncertainties, there are important factors that could cause our
actual results to differ materially from the expectations expressed
in the forward-looking statements. These factors include, without
limitation, the following: inherent difficulty in predicting
consumer behavior; difficulties in receiving, processing, or filing
customer tax submissions; consumers may not respond as we expected
to our advertising and promotional activities; product
introductions and price competition from our competitors can have
unpredictable negative effects on our revenue, profitability and
market position; governmental encroachment in our tax businesses or
other governmental activities or public policy affecting the
preparation and filing of tax returns could negatively affect our
operating results and market position; we may not be able to
successfully innovate and introduce new offerings and business
models to meet our growth and profitability objectives, and current
and future offerings may not adequately address customer needs and
may not achieve broad market acceptance, which could harm our
operating results and financial condition; business interruption or
failure of our information technology and communication systems may
impair the availability of our products and services, which may
damage our reputation and harm our future financial results; as we
upgrade and consolidate our customer facing applications and
supporting information technology infrastructure, any problems with
these implementations could interfere with our ability to deliver
our offerings; any failure to properly use and protect personal
customer information and data could harm our revenue, earnings and
reputation; if we are unable to develop, manage and maintain
critical third party business relationships, our business may be
adversely affected; increased government regulation of our
businesses may harm our operating results; if we fail to process
transactions effectively or fail to adequately protect against
potential fraudulent activities, our revenue and earnings may be
harmed; related publicity regarding such fraudulent activity could
cause customers to lose confidence in using our software and
adversely impact our results; any significant offering quality
problems or delays in our offerings could harm our revenue,
earnings and reputation; our participation in the Free File
Alliance may result in lost revenue opportunities and
cannibalization of our traditional paid franchise; the continuing
global economic downturn may continue to impact consumer and small
business spending, financial institutions and tax filings, which
could negatively affect our revenue and profitability;
year-over-year changes in the total number of tax filings that are
submitted to government agencies due to economic conditions or
otherwise may result in lost revenue opportunities; our revenue and
earnings are highly seasonal and the timing of our revenue between
quarters is difficult to predict, which may cause significant
quarterly fluctuations in our financial results; our financial
position may not make repurchasing shares advisable or we may issue
additional shares in an acquisition causing our number of
outstanding shares to grow; our inability to adequately protect our
intellectual property rights may weaken our competitive position
and reduce our revenue and earnings; our acquisition and
divestiture activities may disrupt our ongoing business, may
involve increased expenses and may present risks not contemplated
at the time of the transactions; our use of significant amounts of
debt to finance acquisitions or other activities could harm our
financial condition and results of operation; and litigation
involving intellectual property, antitrust, shareholder and other
matters may increase our costs. More details about the risks that
may impact our business are included in our Form 10-K for fiscal
2016 and in our other SEC filings. You can locate these reports
through our website at http://investors.intuit.com. Forward-looking
statements are based on information as of September 21, 2016 and we
do not undertake any duty to update any forward-looking statement
or other information in these materials.
TABLE 1 INTUIT
INC. RECONCILIATIONS OF FORWARD-LOOKING GUIDANCE FOR
NON-GAAP FINANCIAL MEASURES TO PROJECTED GAAP REVENUE,
OPERATING INCOME (LOSS) AND EPS (In millions, except per
share amounts) Forward-Looking Guidance
GAAP Non-GAAP Range of Estimate Range of
Estimate From To Adjustments
From To Three Months Ending
October 31, 2016 Revenue $ 740 $ 760 $ - $ 740 $ 760
Operating income (loss) $ (75 ) $ (65 ) $ 85 [a] $ 10 $ 20 Diluted
net income (loss) per share $ (0.21 ) $ (0.19 ) $ 0.22 [b] $ 0.01 $
0.03
Twelve Months Ending July 31, 2017
Revenue $ 5,000 $ 5,100 $ - $ 5,000 $ 5,100 Operating income $
1,330 $ 1,380 $ 345 [c] $ 1,675 $ 1,725 Diluted earnings per share
$ 3.35 $ 3.45 $ 0.95 [d] $ 4.30 $ 4.40
See "About Non-GAAP Financial Measures" immediately following
this Table 1 for information on these measures, the items excluded
from the most directly comparable GAAP measures in arriving at
non-GAAP financial measures, and the reasons management uses each
measure and excludes the specified amounts in arriving at each
non-GAAP financial measure.
[a]
Reflects estimated adjustments for
share-based compensation expense of approximately $81 million,
amortization of acquired technology of approximately $3 million,
and amortization of other acquired intangible assets of
approximately $1 million.
[b]
Reflects the estimated adjustments in item
[a], income taxes related to these adjustments, and other income
tax effects related to the use of the long-term non-GAAP tax
rate.
[c]
Reflects estimated adjustments for
share-based compensation expense of approximately $332 million,
amortization of acquired technology of approximately $12 million,
and amortization of other acquired intangible assets of
approximately $1 million.
[d]
Reflects the estimated adjustments in item
[c], income taxes related to these adjustments, and other income
tax effects related to the use of the long-term non-GAAP tax
rate.
INTUIT INC.
ABOUT NON-GAAP FINANCIAL MEASURES
The accompanying press release dated September 21, 2016 contains
non-GAAP financial measures. Table 1 reconciles the non-GAAP
financial measures in that press release to the most directly
comparable financial measures prepared in accordance with Generally
Accepted Accounting Principles (GAAP). These non-GAAP financial
measures include non-GAAP operating income (loss), non-GAAP net
income (loss), and non-GAAP net income (loss) per share.
Non-GAAP financial measures should not be considered as a
substitute for, or superior to, measures of financial performance
prepared in accordance with GAAP. These non-GAAP financial measures
do not reflect a comprehensive system of accounting, differ from
GAAP measures with the same names, and may differ from non-GAAP
financial measures with the same or similar names that are used by
other companies.
We compute non-GAAP financial measures using the same consistent
method from quarter to quarter and year to year. We may consider
whether other significant items that arise in the future should be
excluded from our non-GAAP financial measures.
We exclude the following items from all of our non-GAAP
financial measures:
- Share-based compensation expense
- Amortization of acquired
technology
- Amortization of other acquired
intangible assets
- Goodwill and intangible asset
impairment charges
- Professional fees for business
combinations
We also exclude the following items from non-GAAP net income
(loss) and diluted net income (loss) per share:
- Gains and losses on debt securities and
other investments
- Income tax effects and adjustments
- Discontinued operations
We believe that these non-GAAP financial measures provide
meaningful supplemental information regarding Intuit’s operating
results primarily because they exclude amounts that we do not
consider part of ongoing operating results when planning and
forecasting and when assessing the performance of the organization,
our individual operating segments or our senior management. Segment
managers are not held accountable for share-based compensation
expense, amortization, or the other excluded items and,
accordingly, we exclude these amounts from our measures of segment
performance. We believe that our non-GAAP financial measures also
facilitate the comparison by management and investors of results
for current periods and guidance for future periods with results
for past periods.
The following are descriptions of the items we exclude from our
non-GAAP financial measures.
Share-based compensation expenses. These consist of non-cash
expenses for stock options, restricted stock units and our Employee
Stock Purchase Plan. When considering the impact of equity awards,
we place greater emphasis on overall shareholder dilution rather
than the accounting charges associated with those awards.
Amortization of acquired technology and amortization of other
acquired intangible assets. When we acquire an entity, we are
required by GAAP to record the fair values of the intangible assets
of the entity and amortize them over their useful lives.
Amortization of acquired technology in cost of revenue includes
amortization of software and other technology assets of acquired
entities. Amortization of other acquired intangible assets in
operating expenses includes amortization of assets such as customer
lists, covenants not to compete and trade names.
Goodwill and intangible asset impairment charges. We exclude
from our non-GAAP financial measures non-cash charges to adjust the
carrying values of goodwill and other acquired intangible assets to
their estimated fair values.
Professional fees for business combinations. We exclude from our
non-GAAP financial measures the professional fees we incur to
complete business combinations. These include investment banking,
legal and accounting fees.
Gains and losses on debt securities and other investments. We
exclude from our non-GAAP financial measures gains and losses that
we record when we sell or impair available-for-sale debt securities
and other investments.
Income tax effects and adjustments. We use a long-term non-GAAP
tax rate for evaluating operating results and for planning,
forecasting, and analyzing future periods. This long-term
non-GAAP tax rate excludes the income tax effects of the non-GAAP
pre-tax adjustments described above, assumes the federal research
and experimentation credit is continuously in effect, and
eliminates the effects of non-recurring and period specific items
which can vary in size and frequency. Based on our current
long-term projections, we are using a long-term non-GAAP tax rate
of 33% for fiscal 2017. These rates are consistent with the average
of our normalized fiscal year tax rate over a four year period that
includes the past three fiscal years plus the current fiscal year
forecast. We will evaluate this long-term non-GAAP tax rate on an
annual basis and whenever any significant events occur which may
materially affect this long-term rate. This long-term non-GAAP tax
rate could be subject to change for various reasons including
significant changes in our geographic earnings mix or fundamental
tax law changes in major jurisdictions in which we operate.
Operating results and gains and losses on the sale of
discontinued operations. From time to time, we sell or otherwise
dispose of selected operations as we adjust our portfolio of
businesses to meet our strategic goals. In accordance with GAAP, we
segregate the operating results of discontinued operations as well
as gains and losses on the sale of these discontinued operations
from continuing operations on our GAAP statements of operations but
continue to include them in GAAP net income or loss and net income
or loss per share. We exclude these amounts from our non-GAAP
financial measures.
The reconciliations of the forward-looking non-GAAP financial
measures to the most directly comparable GAAP financial measures in
Table 1 include all information reasonably available to Intuit at
the date of this presentation. These tables include adjustments
that we can reasonably predict. Events that could cause the
reconciliation to change include acquisitions and divestitures of
businesses, goodwill and other asset impairments, and sales of
available-for-sale debt securities and other investments.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160921005440/en/
InvestorsIntuit Inc.Jerry Natoli,
650-944-6181jerry_natoli@intuit.comorMediaIntuit Inc.Diane
Carlini, 650-944-6251diane_carlini@intuit.com
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