This summary is based on the second quarter fiscal 2009 earnings call conducted by Intuit Inc. (INTU) on February 19, 2009.
Management:
President, CEO and Director: Brad D. Smith
SVP and CFO: R. Neil Williams
VP, IR and Treasurer: Jerry Natoli
Key Investor Issues:
- The company spent $35 million in the share repurchase program in Q2.
- Full year 2009 non-GAAP EPS are forecast to be in the range $1.78 to $1.89.
Second Quarter Highlights:
The Q2 non-GAAP operating income was $172.0 million.
- This was well above our expected range.
- The result was also in spite of about $58.0 million in operating income that shifted from Q2 to Q3 because of the change in revenue deferrals.
- The strong earnings figures are a direct result of the operational rigor used to run the company.
The management has also taken a number of specific actions to meet the environmental challenges.
- This includes slowing down on hiring.
- The management is evaluating the performance-based compensation program and adjusting expected payment levels to take the current environment into account.
- The company is monitoring marketing costs and adjusting programs to realize the lift in customer acquisition expected from investments.
Analysis of Segments:
Tax segments:
- Consumer tax second quarter revenue was $187.0 million, down 25% from a year ago.
- This includes a shift of about $70.0 million in revenue in Q2 to Q3.
- Without the revenue shift, growth would have been 4%.
- Customer growth is reportedly coming from the online version of the product.
Accounting Professionals:
- The second quarter revenue was $133.0 million, representing 14% growth.
- This includes about $12.0 million of revenue shifted in from the third quarter.
- Fewer services are bundled into the professional tax solutions this year.
- This implies more of the revenue is recognized up front.
Small Business segment:
- The second quarter revenue was $322.0 million, up 5% from a year ago.
- Adjusting for the acquisitions of Homestead and ECHO made in 2008, revenue would have been flat for Q2.
QuickBooks segment:
- Second quarter revenue was $164.0 million, 2% less than the same quarter last year.
- The growth rate would have been about 4 points lower without the acquisition of Homestead.
- The decrease in revenue is primarily due to fewer than expected paid new QuickBooks users.
- The management reported that upgrades remain on target and the online edition and enterprise products continue to add to their customer bases.
- Online edition customers increased by 9% and enterprise customers grew by 21%.
Payroll and Payment segment:
