Intuit Raises Earnings Guidance

Software developer Intuit Inc. (INTU) Monday raised its quarterly earnings and revenue guidance, citing a shift to direct sales and strong demand for its small-business accounting and consumer tax-preparation software.

The forecast sent Intuit shares up $1.87, or 5 percent, to $39.17 in midday trade on the Nasdaq stock market.

Intuit's improved outlook was in contrast to a spate of earnings warnings from other big software players last week, including PeopleSoft Inc., i2 Technologies Inc. , E.piphany Inc. and Compuware Corp.

"Intuit isn't so exposed to IT (information technology) spending as other companies ... a big chunk of its revenue comes from tax software," said UBS Warburg analyst Michael Wallace.

Wallace also said Intuit is cushioned by its 85 percent share of the small-business accounting software market.

Intuit's QuickBooks software is a small-business accounting system. Its TurboTax product, which sees increased demand during the tax season, is software used by consumers for calculating tax returns.

The company's business is pegged to the U.S. tax season. The company historically posts profits in its fiscal second and third quarters -- November through April -- and losses in the first and fourth quarters.

"The QuickBooks 2002 offerings have been well received by customers. And continuing the trend we saw in the second quarter, we are seeing a shift from the retail channel to direct sales, which provide higher profits," said Intuit President and Chief Executive Steve Bennett.

Mountain View, California-based Intuit said it was increasing its forecast for fiscal third-quarter earnings, excluding one-time items, by $15 million, or 5 cents a share to between $225 million and $232 million. It said it expects revenues to come in at the higher end of its forecast range of $520 million to $544 million.

Analysts polled by Thomson Financial/First Call expected earnings per share of 67 cents for the third quarter, ending April 31.

Intuit said it did not change its fourth-quarter guidance. Reflecting the higher third-quarter forecast, though, it boosted its guidance for full-year earnings, excluding one-time items, to between $315 million to $325 million from prior estimates of $300 million to $310 million.

The company said its full year revenue would come in at the higher end of its forecast range of $1.47 billion to $1.5 billion.