Intuit Inc. (Nasdaq: INTU) today announced financial results for the first quarter of the 2014 fiscal year, which ended Oct. 31, and confirmed guidance for the remainder of the year.

“We are out of the gate strong in the first quarter, led by the rapid adoption of QuickBooks Online, which is accelerating our transition to the cloud and driving value for Intuit,” said Brad Smith, Intuit’s president and chief executive officer. “Cloud-based offerings provide superior benefits for small businesses, so we are making it as easy as possible for our QuickBooks customers, accountants and developers to move to the cloud.

“We’re also gearing up for tax season and looking forward to getting our new offerings out to market in the coming weeks,” Smith said.

Financial Highlights

Unless otherwise noted, all growth rates refer to the current period versus the comparable prior-year period, and the business metrics and associated growth rates refer to worldwide business metrics.

• Increased revenue 11 percent, to $622 million.
• Reiterated guidance for second-quarter revenue, with a range of $890 million to $910 million, and full fiscal year revenue guidance of $4.440 billion to $4.525 billion, with growth of 6 to 8 percent.
• Completed three talent and technology acquisitions for a total of approximately $65 million. These acquisitions are expected to add value across Intuit’s businesses.
• Entered into an accelerated share repurchase agreement to buy back $1.4 billion in shares.

Business Segment Highlights

Intuit also provided details of business segment performance, reflecting the internal reorganization announced in July.

Small Business

• Delivered 11 percent higher revenue in the Small Business segment, driven by increased adoption of cloud solutions.
• Reached 516,000 QuickBooks Online subscribers, growth of 29 percent, with subscribers outside the U.S. up more than 80 percent to over 37,000.
• Grew Small Business Management Solutions, or SBMS, revenue by 15 percent. Within SBMS, Demandforce grew subscriptions by 36 percent and online payroll grew customers 18 percent.

Consumer

• Grew Consumer Tax revenue by 11 percent in a seasonally light quarter.

Professional Tax

• Increased Professional Tax segment revenue by 16 percent.

Dollars are in millions, except earnings per share (EPS). See “About Non-GAAP Financial Measures” below for more information regarding financial measures not prepared in accordance with Generally Accepted Accounting Principles (GAAP). All figures in the table above have been reclassified to reflect Intuit Websites, Intuit Financial Services, and Intuit Health as discontinued operations and to exclude their results from non-GAAP EPS.

CFO Remarks

Intuit Chief Financial Officer Neil Williams commented on Intuit’s results for the quarter in prepared remarks for investors.

“We continue to take a disciplined approach to capital management,” he said. “In the first quarter we made three acquisitions adding valuable technology and talented scientists and engineers to the teams.”

Capital Allocation Summary

The company continued to return value to shareholders through its stock repurchase program and quarterly dividend.

• Entered into an accelerated share repurchase agreement to buy back $1.4 billion in shares; $2 billion remains on the current authorization, which Intuit’s board of directors approved in August.
• In October, Intuit’s board of directors approved a new quarterly cash dividend of $0.19 per share, payable on Jan. 21 to shareholders of record on Jan. 10, 2014.

Forward-looking Guidance

Intuit reiterated guidance for full fiscal year 2014, which ends July 31, and for the remaining quarters of fiscal 2014.

For the full fiscal year 2014 Intuit expects:

• Revenue of $4.440 billion to $4.525 billion, growth of 6 to 8 percent.
• GAAP operating income of $1.347 billion to $1.377 billion, growth of 9 to 12 percent.
• Non-GAAP operating income of $1.58 billion to $1.61 billion, growth of 7 to 10 percent.
• GAAP diluted earnings per share of $3.11 to $3.19, growth of 10 to 13 percent.
• Non-GAAP diluted EPS of $3.52 to $3.60, growth of 10 to 13 percent.

For the second quarter of fiscal 2014 Intuit expects:

• Revenue of $890 million to $910 million.
• GAAP operating income of $50 million to $60 million.
• Non-GAAP operating income of $110 million to $120 million.
• GAAP diluted EPS of $0.12 to $0.14.
• Non-GAAP diluted EPS of $0.25 to $0.27.

For the third quarter of fiscal 2014, Intuit expects:

• Revenue of $2.245 billion to $2.290 billion.
• GAAP diluted EPS of $3.12 to $3.17.
• Non-GAAP diluted EPS of $3.25 to $3.30.

For the fourth quarter of fiscal 2014, Intuit expects:

• Revenue of $710 million to $720 million.
• GAAP loss per share of $0.02 to $0.04.
• Non-GAAP diluted EPS of $0.11 to $0.13.

Conference Call Information

Intuit executives will discuss the financial results on a conference call at 1:30 p.m. Pacific time on Nov. 21. To hear the call, dial 866-875-5291 in the United States or 973-935-8702 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 the conference call will be available for one week by calling 888-266-2081, or 703-925-2533 from international locations. The access code for this call is 1626582.

The audio webcast will remain available on Intuit’s website for one week after the conference call.

About Intuit Inc.

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®, Quicken® and TurboTax®, which make it easier to manage small businesses and payroll processing, personal finance, and tax preparation and filing. Mint.com provides a fresh, easy and intelligent way for people to manage their money, while Demandforce® offers marketing and communication tools for small businesses. ProSeries® and Lacerte® are Intuit's leading tax preparation offerings for professional accountants.

Founded in 1983, Intuit had revenue of $4.2 billion in its fiscal year 2013. The company has approximately 8,000 employees with major offices in the United States, Canada, the United Kingdom, India and other locations. More information can be found at www.intuit.com.

Intuit and the Intuit logo, among others, are registered trademarks and/or registered service marks of Intuit Inc. in the United States and other countries.

About Non-GAAP Financial Measures

This press release and the accompanying tables 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 tables titled "About Non-GAAP Financial Measures" as well as the related Table B and Table E. 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 Intuit’s future expected financial results; expectations regarding growth from digital services and from current or future products and services; expectations regarding the impact of acquisitions on Intuit’s business; expectations regarding Intuit’s global strategy, product launches and marketing campaigns and their impacts on Intuit’s business; expectations regarding the amount and timing of any future dividends and share repurchases; Intuit’s prospects for the business in fiscal 2014; 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; 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 these and other risks that may impact our business are included in our Form 10-K for fiscal 2013 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 November 21, 2013, and we do not undertake any duty to update any forward-looking statement or other information in these materials.

INTUIT INC.
NOTES TO TABLE A

See “About Non-GAAP Financial Measures” immediately following Table E 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.

See “About Non-GAAP Financial Measures” immediately following this Table E 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.

INTUIT INC.
ABOUT NON-GAAP FINANCIAL MEASURES

The accompanying press release dated November 21, 2013 contains non-GAAP financial measures. Table B and Table E reconcile 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 of excluded items and discrete tax items
• 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 of excluded items and certain discrete tax items. We exclude from our non-GAAP financial measures the income tax effects of the items described above, as well as income tax effects related to business combinations. In addition, the effects of one-time income tax adjustments recorded in a specific quarter for GAAP purposes are reflected on a forecasted basis in our non-GAAP financial measures. This is consistent with how we plan, forecast and evaluate our operating results.

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 E include all information reasonably available to Intuit at the date of this press release. 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.