Intuit Inc. (Nasdaq: INTU), maker of TurboTax, QuickBooks and
Mint, today updated its full fiscal year 2021 and second fiscal
quarter guidance to reflect the close of the Credit Karma
acquisition on Dec. 3. The completion of the acquisition allows
Intuit and Credit Karma to begin to transform personal finance by
making it simpler for consumers to find the right financial
products, put more money in their pockets, and access financial
expertise and advice.
For the full fiscal year 2021, the company expects:
- Revenue of $8.810 billion to $8.995 billion, growth of
approximately 15 to 17 percent.
- GAAP operating income of $1.920 billion to $1.990 billion, a
decline of approximately 9 to 12 percent.
- Non-GAAP operating income of $2.975 billion to $3.045 billion,
growth of approximately 12 to 14 percent.
- GAAP diluted earnings per share of $5.30 to $5.50, a decline of
approximately 21 to 23 percent.
- Non-GAAP diluted earnings per share of $8.20 to $8.40, growth
of approximately 4 to 7 percent.
This fiscal 2021 guidance includes Credit Karma beginning Dec.
3. The company expects Credit Karma revenue of $545 million to $580
million and segment operating income of $15 million to $35 million
in fiscal 2021. Fiscal 2021 GAAP operating income for Intuit
includes $343 million for stock-based compensation expense and $174
million for amortization expense associated with the acquisition of
Credit Karma.
The company updated segment revenue guidance to include Credit
Karma for fiscal year 2021:
- Small Business and Self-Employed Group: growth of approximately
8 to 10 percent.
- Consumer Group: growth of approximately 9 to 10 percent.
- ProConnect Group: growth approximately of 0 to 1 percent.
- Credit Karma: revenue of $545 million to $580 million.
For the second quarter of fiscal year 2021, which ends Jan. 31,
the company expects:
- Revenue of $1.935 billion to $1.965 billion, growth of
approximately 14 to 16 percent.
- GAAP operating income of $171 million to $191 million.
- Non-GAAP operating income of $455 million to $475 million.
- GAAP diluted earnings per share of $0.43 to $0.49.
- Non-GAAP diluted earnings per share of $1.25 to $1.31.
This second quarter guidance includes Credit Karma beginning
Dec. 3.
Intuit plans to operate Credit Karma as a separate reporting
segment, and segment operating income includes all direct expenses.
Therefore, Credit Karma segment operating income is not comparable
to those of Intuit’s other reporting segments. Share-based
compensation expense and amortization of acquired technology and
other intangible assets related to the Credit Karma acquisition are
included in unallocated corporate expenses. For other segments,
expenses such as corporate selling and marketing, product
development, general and administrative and share-based
compensation are not allocated to specific segments and are
included in unallocated corporate expenses. In addition,
amortization of acquired technology, amortization of other acquired
intangible assets, and goodwill and intangible asset impairment
charges are also included in unallocated corporate expenses.
Guidance Update Conference Call Details
Intuit executives will host a conference call to discuss updated
guidance to include Credit Karma for the second quarter and full
year of fiscal 2021 at 1:30 p.m. Pacific time on December 7. To
participate in the call, dial 866-417-5279 in the United States or
409-937-8904 from international locations. No reservation or access
code is needed. The conference call can also be heard live at
http://investors.intuit.com/Events/default.aspx. Prepared remarks
for the call will be available on Intuit’s website after the call
ends.
Replay Information
A replay of this conference call will be available for one week
by calling 855-859-2056, or 404-537-3406 from international
locations. The access code for this call is 1335808. The audio
webcast will remain available on Intuit’s website for one week
after the conference call.
About Intuit
Intuit’s mission is to power prosperity around the world. We are
a mission-driven, global financial platform company with products
including TurboTax, QuickBooks, and Mint, designed to empower
consumers, self-employed and small businesses to improve their
financial lives. Our platform and products help customers get more
money with the least amount of work, while giving them complete
confidence in their actions and decisions. Our innovative ecosystem
of financial management solutions serves more than 50 million
customers worldwide. Please visit us for the latest news and
in-depth information about Intuit and its brands and find us on
social.
About Non-GAAP Financial Measures
This press release and the accompanying table include 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 section of
the accompanying table 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 website.
Cautions About Forward-looking Statements
This press release contain forward-looking statements within the
meaning of applicable securities laws, including forecasts of
expected growth and future financial results of Intuit and its
reporting segments, including Credit Karma; Intuit’s prospects for
the business in fiscal 2021 and beyond; expectations regarding
timing and growth of revenue for each of Intuit’s reporting
segments; expectations regarding the impact of our strategic
decisions on Intuit’s business; expectations regarding the impact
of the Credit Karma acquisition; and all of the statements relating
to second fiscal quarter and full fiscal year 2021 guidance.
Forward-looking statements and information usually relate to future
events and anticipated revenues, earnings, cash flows or other
aspects of our operations or operating results. Forward-looking
statements are often identified by the words “believe,” “expect,”
“anticipate,” “plan,” “intend,” “foresee,” “should,” “would,”
“could,” “may,” “will,” “estimate,” “outlook” and similar
expressions, including the negative thereof. The absence of these
words, however, does not mean that the statements are not
forward-looking.
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 risks and uncertainties
may be amplified by the COVID-19 pandemic, which has caused
significant global economic instability and uncertainty. Given
these risks and uncertainties, persons reading this communication
are cautioned not to place any undue reliance on such
forward-looking statements. These factors include, without
limitation, the following: our ability to compete successfully; our
participation in the Free File Alliance; potential governmental
encroachment in our tax businesses; our ability to adapt to
technological change; our ability to predict consumer behavior; our
reliance on third-party intellectual property; our ability to
protect our intellectual property rights; any harm to our
reputation; risks associated with acquisition and divestiture
activity; the issuance of equity or incurrence of debt to fund an
acquisition; our cybersecurity incidents (including those affecting
the third parties we rely on); customer concerns about privacy and
cybersecurity incidents; fraudulent activities by third parties
using our offerings; our failure to process transactions
effectively; interruption or failure of our information technology;
our ability to maintain critical third-party business
relationships; our ability to attract and retain talent; any
deficiency in the quality or accuracy of our products (including
the advice given by experts on our platform); any delays in product
launches; difficulties in processing or filing customer tax
submissions; risks associated with international operations;
changes to public policy, laws or regulations affecting our
businesses; litigation in which we are involved; the seasonal
nature of our tax business; changes in tax rates and tax reform
legislation; global economic changes; exposure to credit,
counterparty or other risks in providing capital to businesses;
amortization of acquired intangible assets and impairment charges;
our ability to repay or otherwise comply with the terms of our
outstanding debt; our ability to repurchase shares or distribute
dividends; volatility of our stock price; our ability to
successfully market our offerings; risks associated with tax
liabilities or changes in U.S. federal tax laws or interpretations
to which the transaction with Credit Karma or parties thereto are
subject; failure to successfully integrate any new business,
including Credit Karma; failure to realize anticipated benefits and
synergies of combined operations with Credit Karma; unanticipated
costs, expenses or difficulties of integrating Credit Karma; the
risk that the conditions imposed in connection with the regulatory
approval for the combined business, including the divestiture of
the Credit Karma Tax business, could adversely affect us and/or the
expected benefits of the combined business; potential impact of
consummation of the acquisition on relationships with third
parties, including employees, customers, partners and competitors;
inability to retain key personnel; changes in legislation or
government regulations affecting the acquisition or the parties;
economic and/or political conditions that could adversely affect
the parties; the impact of the COVID-19 pandemic; and risks
associated with assumptions the parties make in connection with the
parties’ critical accounting estimates and legal proceedings.
More details about these and other risks that may impact our
business are included in our Form 10-K for fiscal 2020 and in our
other SEC filings. You can locate these reports through our website
at http://investors.intuit.com. Second quarter and full year fiscal
2021 guidance speaks only as of the date it was publicly issued by
Intuit. Other forward-looking statements represent the judgment of
the management of Intuit as of the date of this presentation. We do
not undertake any duty to update any forward-looking statement or
other information in this presentation.
TABLE 1
INTUIT INC.
RECONCILIATION OF FORWARD-LOOKING
GUIDANCE FOR NON-GAAP FINANCIAL MEASURES TO PROJECTED GAAP REVENUE,
OPERATING INCOME, AND EPS
(In millions, except per share
amounts)
(Unaudited)
Forward-Looking
Guidance
GAAP Range of
Estimate
Non-GAAP Range of
Estimate
From
To
Adjmts
From
To
Three Months Ending January 31,
2021
Revenue
$
1,935
$
1,965
$
—
$
1,935
$
1,965
Operating income
$
171
$
191
$
284
[a]
$
455
$
475
Diluted earnings per share
$
0.43
$
0.49
$
0.82
[b]
$
1.25
$
1.31
Twelve Months Ending July 31,
2021
Revenue
$
8,810
$
8,995
$
—
$
8,810
$
8,995
Operating income
$
1,920
$
1,990
$
1,055
[c]
$
2,975
$
3,045
Diluted earnings per share
$
5.30
$
5.50
$
2.90
[d]
$
8.20
$
8.40
See “About Non-GAAP Financial Measures”
immediately following 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 $198 million,
which includes approximately $85 million related to Credit Karma;
professional fees for business combinations of approximately $34
million; amortization of acquired technology of approximately $14
million, which includes approximately $7 million related to Credit
Karma; and amortization of other acquired intangible assets of
approximately $38 million, which includes $37 million related to
Credit Karma.
[b]
Reflects estimated adjustments in item
[a], income taxes related to these adjustments, and other income
tax effects related to the use of the non-GAAP tax rate.
[c]
Reflects estimated adjustments for
share-based compensation expense of approximately $813 million,
which includes approximately $343 million related to Credit Karma;
professional fees for business combinations of approximately $39
million; amortization of acquired technology of approximately $51
million, which includes approximately $27 million related to Credit
Karma; and amortization of other acquired intangible assets of
approximately $152 million, which includes $147 million related to
Credit Karma.
[d]
Reflects estimated adjustments in item
[c], income taxes related to these adjustments, and other income
tax effects related to the use of the non-GAAP tax rate.
INTUIT INC. ABOUT NON-GAAP FINANCIAL
MEASURES
The accompanying press release dated December 7, 2020 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
- Gains and losses on disposals of businesses and long-lived
assets
- 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 and equity securities and other
investments
- Income tax effects and adjustments
- Discontinued operations
We believe 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 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 a business in a
business combination, we are required by GAAP to record the fair
values of the intangible assets of the business 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 businesses. 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.
Gains and losses on disposals of businesses and long-lived
assets. We exclude from our non-GAAP financial measures gains and
losses on disposals of businesses and long-lived assets because
they are unrelated to our ongoing business operating results.
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 and equity securities and other
investments. We exclude from our non-GAAP financial measures gains
and losses that we record when we impair available-for-sale debt
and equity 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, 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 23% for fiscal 2020 and 24% for
fiscal 2021. 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. 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 rate.
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.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201207005899/en/
Investors Kim Watkins Intuit Inc. 650-944-3324
kim_watkins@intuit.com
Media Karen Nolan Intuit Inc. 650-944-6619
karen_nolan@intuit.com
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