Small Business Online Ecosystem Revenue Powers Growth; TurboTax
Online Gains Share
MOUNTAIN VIEW, Calif.–(BUSINESS WIRE)–Intuit Inc. (Nasdaq: INTU)
announced financial results for the third quarter of fiscal 2019, which
ended April 30.
“This was a strong quarter across the company,” said Sasan
Goodarzi, Intuit’s CEO. “We are on-track to exceed the guidance we
provided at the beginning of the year.”
“We had a great tax season, growing the Do-It-Yourself (DIY) category
overall as well as our share within the category driven by our
innovation and significantly improved customer experience. We produced
our most robust free offering yet and made significant progress in our
effort to transform the assisted category.
“We continue to see momentum in our Small Business and Self-Employed
Group driven by Online Ecosystem revenue growth. We’re making progress
in solving key customer pain points and becoming the center of small
business growth around the globe,” said Goodarzi.
Financial Highlights
For the third quarter, Intuit:
- Grew total revenue to $3.3 billion, up 12 percent.
-
Increased TurboTax Online
share within the DIY category by an estimated half a point. -
Increased Small Business
Online Ecosystem revenue by 38 percent. - Grew Consumer Group revenue by 10 percent to $2.2 billion.
-
Grew Small Business and Self-Employed Group revenue 19 percent to $887
million.
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. Fiscal 2018
amounts have been restated for the adoption of the new accounting
standard on revenue accounting, ASC 606.
|
Snapshot of Third-quarter Results |
||||||||||||||||||
| GAAP | Non-GAAP | |||||||||||||||||
|
Q3 |
Q3 |
|
Change |
Q3 |
Q3 |
Change | ||||||||||||
| Revenue | $3,272 | $2,912 | 12% | $3,272 | $2,912 | 12% | ||||||||||||
| Operating Income | $1,784 | $1,601 | 11% | $1,888 | $1,700 | 11% | ||||||||||||
| Earnings Per Share | $5.22 | $4.53 | 15% | $5.55 | $4.78 | 16% | ||||||||||||
Dollars are in millions, except earnings per share. See “About Non-GAAP
Financial Measures” below for more information regarding financial
measures not prepared in accordance with Generally Accepted Accounting
Principles (GAAP).
Business Segment Results
Small Business and Self-Employed Group
Intuit is focused on becoming the center of small business growth by
helping customers get paid faster, pay their employees and contractors,
access capital and have total confidence that their books are done right.
-
QuickBooks Capital has funded $360 million in cumulative loans in the
last 18 months. At the end of Q3, the notes receivable balance was $96
million. -
QuickBooks Online subscribers grew 32 percent ending the quarter with
over 4.2 million subscribers. -
Growth remains strong across multiple geographies, with U.S.
subscribers up 25 percent to over 3.1 million and international
subscribers increasing 55 percent to over 1.1 million. -
Within QuickBooks Online, Self-Employed subscribers grew to
approximately 970,000, up from roughly 680,000 one year ago. -
Approximately 440,000 QuickBooks Self-Employed customers are from the
TurboTax Self-Employed offering, up from 330,000 last year.
Consumer and Strategic Partner Groups
Intuit is focused on expanding its share in DIY, transforming the
assisted tax preparation category and expanding beyond tax with a
consumer platform. This is in service to helping customers make ends
meet, get their largest tax refund and make smart decisions with their
money.
- TurboTax Online units grew 7 percent this season.
- Customers using TurboTax Live more than tripled year-over-year.
-
The Turbo platform has over 14 million registered users, up from 5
million last year. -
The Strategic Partner Group reported $235 million of professional tax
revenue for the third quarter, in line with expectations.
Capital Allocation Summary
In the third quarter the company:
-
Repurchased $135 million of shares, with $2.8 billion remaining on the
company’s authorization. -
Received Board approval for a quarterly dividend of $0.47 per share,
payable July 18, 2019. This represents a 21 percent increase compared
to last year.
Forward-looking Guidance
“With strong performance and momentum across the company, we are raising
our revenue, operating income and earnings per share guidance for fiscal
year 2019,” said Michelle
Clatterbuck, Intuit’s chief financial officer. “We will continue to
execute against our strategy of becoming an A.I.-driven expert platform
that focuses on our customers’ common set of needs as we pursue our
mission to power prosperity around the world.”
Intuit announced guidance for the fourth quarter of fiscal year 2019,
which ends July 31. The company expects:
- Revenue growth of 10 to 12 percent,
- GAAP loss per share of $0.35 to $0.33, and
- Non-GAAP diluted loss per share of $0.16 to $0.14.
Intuit raised guidance for full fiscal year 2019. The company now
expects:
- Revenue of $6.738 billion to $6.758 billion, growth of 12 percent.
-
GAAP operating income of $1.827 billion to $1.837 billion, growth of
17 to 18 percent. -
Non-GAAP operating income of $2.258 billion to $2.268 billion, growth
of 10 to 11 percent. -
GAAP diluted earnings per share of $5.72 to $5.74, growth of 12 to 13
percent. -
Non-GAAP diluted earnings per share of $6.67 to $6.69, growth of 15 to
16 percent.
The company also updated segment revenue results. For fiscal year 2019,
the company now expects:
- Small Business and Self-Employed Group: growth of 15 percent.
- Consumer Group: growth of 10 percent.
- Strategic Partner Group: growth of 4 percent.
Conference Call Details
Intuit executives will discuss the financial results on a conference
call at 1:30 p.m. Pacific time on May 23. To hear the call, dial
844-246-4601 in the United States or 703-639-1172 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 855-859-2056, or 404-537-3406 from international locations. The
access code for this call is 8488901.
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. Our global
products and platforms, including TurboTax, QuickBooks, Mint and Turbo, are
designed to empower consumers, self-employed and small
businesses to improve their financial lives, finding them 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 approximately 50 million customers
worldwide, unleashing the power of many for the prosperity of
one. 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 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 B1, Table B2, and Table E. 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 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
2019 and beyond; expectations regarding timing and growth of revenue for
each of Intuit’s reportable 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 amount and timing of any future dividends or
share repurchases; expectations regarding Intuit’s corporate tax rate;
expectations regarding availability of our offerings; 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: our ability to compete successfully; our participation in
the Free File Alliance; governmental encroachment in our tax businesses,
our ability to adapt to technological change; our ability to predict
consumer behavior; our ability to protect our intellectual property
rights; our reliance on third party intellectual property; any harm to
our reputation; risks associated with acquisitions and divestitures;
issue of additional shares as consideration or incurring 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; failure to process transactions effectively; interruption
or failure of our information technology; ability to maintain critical
third party business relationships; our ability to attract and retain
talent; deficiency in quality, accuracy or timely launch of products;
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; seasonal nature of our tax business; changes in tax rates and
tax reform legislation; global economic changes; exposure to credit risk
of the businesses we provide capital to; amortization of acquired
intangible assets and impairment charges; our ability to repay
outstanding debt; our ability to repurchase shares or distribute
dividends; volatility of our stock price; and our ability to
successfully market our offerings. More details about these and other
risks that may impact our business are included in our Form 10-K for
fiscal 2018 and in our other SEC filings. You can locate these reports
through our website at http://investors.intuit.com.
Fiscal 2019 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 A |
||||||||||||||||||||
|
INTUIT INC. |
||||||||||||||||||||
|
GAAP CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||||||||||
|
(In millions, except per share amounts) |
||||||||||||||||||||
|
(Unaudited) |
||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||
|
April 30, |
April 30, |
April 30, |
|
April 30, |
||||||||||||||||
| *As Adjusted | *As Adjusted | |||||||||||||||||||
| Net revenue: | ||||||||||||||||||||
| Product | $ | 498 | $ | 479 | $ | 1,378 | $ | 1,378 | ||||||||||||
| Service and other | 2,774 | 2,433 | 4,412 | 3,783 | ||||||||||||||||
| Total net revenue | 3,272 | 2,912 | 5,790 | 5,161 | ||||||||||||||||
| Costs and expenses: | ||||||||||||||||||||
| Cost of revenue: | ||||||||||||||||||||
| Cost of product revenue | 19 | 20 | 60 | 65 | ||||||||||||||||
| Cost of service and other revenue | 330 | 280 | 811 | 674 | ||||||||||||||||
| Amortization of acquired technology | 5 | 5 | 15 | 10 | ||||||||||||||||
| Selling and marketing | 652 | 549 | 1,546 | 1,326 | ||||||||||||||||
| Research and development | 311 | 296 | 900 | 875 | ||||||||||||||||
| General and administrative | 170 | 159 | 447 | 447 | ||||||||||||||||
| Amortization of other acquired intangible assets | 1 | 2 | 4 | 4 | ||||||||||||||||
| Total costs and expenses [A] | 1,488 | 1,311 | 3,783 | 3,401 | ||||||||||||||||
| Operating income | 1,784 | 1,601 | 2,007 | 1,760 | ||||||||||||||||
| Interest expense | (4 | ) | (5 | ) | (12 | ) | (16 | ) | ||||||||||||
| Interest and other income, net | 17 | 7 | 23 | 15 | ||||||||||||||||
| Income before income taxes | 1,797 | 1,603 | 2,018 | 1,759 | ||||||||||||||||
| Income tax provision [B] | 419 | 417 | 417 | 392 | ||||||||||||||||
| Net income | $ | 1,378 | $ | 1,186 | $ | 1,601 | $ | 1,367 | ||||||||||||
| Basic net income per share | $ | 5.30 | $ | 4.62 | $ | 6.16 | $ | 5.34 | ||||||||||||
| Shares used in basic per share calculations | 260 | 257 | 260 | 256 | ||||||||||||||||
| Diluted net income per share | $ | 5.22 | $ | 4.53 | $ | 6.06 | $ | 5.25 | ||||||||||||
| Shares used in diluted per share calculations | 264 | 262 | 264 | 260 | ||||||||||||||||
| Cash dividends declared per common share | $ | 0.47 | $ | 0.39 | $ | 1.41 | $ | 1.17 | ||||||||||||
|
* Prior-period information has been restated for the adoption of ASU 2014-09, Revenue from Contracts with Customers (Topic 606), which we adopted on August 1, 2018. |
| See accompanying Notes. |
|
INTUIT INC. |
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|
NOTES TO TABLE A |
|||||||||||||||||||
|
[A] The following table summarizes the total share-based |
|||||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||
| (in millions) |
April 30, |
April 30, |
April 30, |
April 30, |
|||||||||||||||
| Cost of revenue | $ | 15 | $ | 14 | $ | 44 | $ | 30 | |||||||||||
| Selling and marketing | 23 | 25 | 78 | 75 | |||||||||||||||
| Research and development | 32 | 30 | 101 | 99 | |||||||||||||||
| General and administrative | 28 | 23 | 80 | 79 | |||||||||||||||
| Total share-based compensation expense | $ | 98 | $ | 92 | $ | 303 | $ | 283 | |||||||||||
| [B] |
We compute our provision for or benefit from income taxes by applying the estimated annual effective tax rate to income or loss from recurring operations and adding the effects of any discrete income tax items specific to the period. |
||
|
Our effective tax rates for the three and nine months ended April 30, 2018 have been restated to reflect the full retrospective application of ASU 2014-09, “Revenue from Contracts with Customers (Topic 606).” |
|||
|
The Tax Cuts and Jobs Act (2017 Tax Act) was enacted on December 22, 2017 and reduced the U.S. statutory federal corporate tax rate from 35% to 21%. The effective date of the tax rate change was January 1, 2018. The change resulted in a blended lower U.S. statutory federal rate of 26.9% for fiscal 2018. In fiscal 2019, we fully benefit from the enacted lower tax rate of 21%. |
|||
|
We recorded a provisional benefit of $37 million in the second quarter of fiscal 2018 related to the re-measurement of certain deferred tax balances. During the three months ended April 30, 2018, we recorded a provisional charge of $10 million related to the re-measurement of certain deferred tax balances, resulting in a net tax benefit of $27 million for the nine months ended April 30, 2018. In the second quarter of fiscal 2019, we completed our accounting for the income tax effects of the 2017 Tax Act, and there have been no material adjustments during the fiscal 2019 period. |
|||
|
For the three and nine months ended April 30, 2019, we recognized excess tax benefits on share-based compensation of $20 million and $69 million, respectively, in our provision for income taxes. For the three and nine months ended April 30, 2018, we recognized excess tax benefits on share-based compensation of $8 million and $41 million, respectively, in our provision for income taxes. |
|||
|
Our effective tax rates for the three and nine months ended April 30, 2019 were approximately 23% and 21%, respectively. Excluding discrete tax items, primarily related to share-based compensation tax benefits mentioned above, our effective tax rate for both periods was 23% and did not differ significantly from the federal statutory rate of 21%. |
|||
|
Our effective tax rate for the three months ended April 30, 2018 was approximately 26% and did not differ significantly from the federal statutory rate of 26.9%. Our effective tax rate for the nine months ended April 30, 2018 was 22%. Excluding discrete tax items, primarily related to the re-measurement of certain deferred tax balances and the share-based compensation tax benefits mentioned above, our effective tax rate for that period was 27% and did not differ significantly from the federal statutory rate of 26.9%. |
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|
TABLE B1 |
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|
INTUIT INC. |
|||||||||||||||||||||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|||||||||||||||||||||||||
|
TO MOST DIRECTLY COMPARABLE GAAP FINANCIAL MEASURES |
|||||||||||||||||||||||||
|
(In millions, except per share amounts) |
|||||||||||||||||||||||||
|
(Unaudited) |
|||||||||||||||||||||||||
| Fiscal 2019 | |||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Year to Date | |||||||||||||||||||||
| GAAP operating income (loss) | $ | (10 | ) | $ | 233 | $ | 1,784 | $ | — | $ | 2,007 | ||||||||||||||
| Amortization of acquired technology | 5 | 5 | 5 | — | 15 | ||||||||||||||||||||
| Amortization of other acquired intangible assets | 2 | 1 | 1 | — | 4 | ||||||||||||||||||||
| Share-based compensation expense | 105 | 100 | 98 | — | 303 | ||||||||||||||||||||
| Non-GAAP operating income (loss) | $ | 102 | $ | 339 | $ | 1,888 | $ | — | $ | 2,329 | |||||||||||||||
| GAAP net income (loss) | $ | 34 | $ | 189 | $ | 1,378 | $ | — | $ | 1,601 | |||||||||||||||
| Amortization of acquired technology | 5 | 5 | 5 | — | 15 | ||||||||||||||||||||
| Amortization of other acquired intangible assets | 2 | 1 | 1 | — | 4 | ||||||||||||||||||||
| Share-based compensation expense | 105 | 100 | 98 | — | 303 | ||||||||||||||||||||
| Net (gain) loss on debt securities and other investments | 1 | 2 | 2 | — | 5 | ||||||||||||||||||||
| Other income tax effects and adjustments [A] | (71 | ) | (33 | ) | (19 | ) | — | (123 | ) | ||||||||||||||||
| Non-GAAP net income (loss) | $ | 76 | $ | 264 | $ | 1,465 | $ | — | $ | 1,805 | |||||||||||||||
| GAAP diluted net income (loss) per share | $ | 0.13 | $ | 0.72 | $ | 5.22 | $ | — | $ | 6.06 | |||||||||||||||
| Amortization of acquired technology | 0.02 | 0.02 | 0.02 | — | 0.06 | ||||||||||||||||||||
| Amortization of other acquired intangible assets | 0.01 | — | — | — | 0.02 | ||||||||||||||||||||
| Share-based compensation expense | 0.40 | 0.38 | 0.38 | — | 1.15 | ||||||||||||||||||||
| Net (gain) loss on debt securities and other investments | — | 0.01 | 0.01 | — | 0.02 | ||||||||||||||||||||
| Other income tax effects and adjustments [A] | (0.27 | ) | (0.13 | ) | (0.08 | ) | — | (0.47 | ) | ||||||||||||||||
| Non-GAAP diluted net income (loss) per share | $ | 0.29 | $ | 1.00 | $ | 5.55 | $ | — | $ | 6.84 | |||||||||||||||
| Shares used in GAAP diluted per share calculation | 264 | 264 | 264 | — | 264 | ||||||||||||||||||||
| Shares used in non-GAAP diluted per share calculation | 264 | 264 | 264 | — | 264 | ||||||||||||||||||||
| [A] |
As discussed in “About Non-GAAP Financial Measures – Income Tax Effects and Adjustments” following Table E, our long-term non-GAAP tax rate eliminates the effects of non-recurring and period-specific items. Other income tax adjustments consist primarily of the tax impact of the non-GAAP pre-tax adjustments and the excess tax benefits on share-based compensation. |
||
|
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. |
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|
TABLE B2 |
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INTUIT INC. |
|||||||||||||||||||||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|||||||||||||||||||||||||
|
TO MOST DIRECTLY COMPARABLE GAAP FINANCIAL MEASURES |
|||||||||||||||||||||||||
|
(In millions, except per share amounts) |
|||||||||||||||||||||||||
|
(Unaudited) |
|||||||||||||||||||||||||
| Fiscal 2018 | |||||||||||||||||||||||||
| * As Adjusted | |||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Full Year | |||||||||||||||||||||
| GAAP operating income (loss) | $ | (35 | ) | $ | 194 | $ | 1,601 | $ | (200 | ) | $ | 1,560 | |||||||||||||
| Amortization of acquired technology | 2 | 3 | 5 | 5 | 15 | ||||||||||||||||||||
| Amortization of other acquired intangible assets | 1 | 1 | 2 | 2 | 6 | ||||||||||||||||||||
| Professional fees for business combinations | — | 2 | — | — | 2 | ||||||||||||||||||||
| (Gain) loss on sale of long-lived assets | — | — | — | 79 | 79 | ||||||||||||||||||||
| Share-based compensation expense | 97 | 94 | 92 | 99 | 382 | ||||||||||||||||||||
| Non-GAAP operating income (loss) | $ | 65 | $ | 294 | $ | 1,700 | $ | (15 | ) | $ | 2,044 | ||||||||||||||
| GAAP net income (loss) | $ | (2 | ) | $ | 183 | $ | 1,186 | $ | (38 | ) | $ | 1,329 | |||||||||||||
| Amortization of acquired technology | 2 | 3 | 5 | 5 | 15 | ||||||||||||||||||||
| Amortization of other acquired intangible assets | 1 | 1 | 2 | 2 | 6 | ||||||||||||||||||||
| Professional fees for business combinations | — | 2 | — | — | 2 | ||||||||||||||||||||
| Loss on sale of long-lived assets | — | — | — | 79 | 79 | ||||||||||||||||||||
| Share-based compensation expense | 97 | 94 | 92 | 99 | 382 | ||||||||||||||||||||
| Net (gain) loss on debt securities and other investments | 2 | 2 | — | 2 | 6 | ||||||||||||||||||||
| Other income from divested businesses [A] | — | — | (8 | ) | — | (8 | ) | ||||||||||||||||||
| 2017 Tax Act [B] | — | (37 | ) | 10 | (2 | ) | (29 | ) | |||||||||||||||||
| Income tax effects and adjustments [C] | (56 | ) | (29 | ) | (36 | ) | (150 | ) | (271 | ) | |||||||||||||||
| Non-GAAP net income (loss) | $ | 44 | $ | 219 | $ | 1,251 | $ | (3 | ) | $ | 1,511 | ||||||||||||||
| GAAP diluted net income (loss) per share | $ | (0.01 | ) | $ | 0.70 | $ | 4.53 | $ | (0.15 | ) | $ | 5.09 | |||||||||||||
| Amortization of acquired technology | 0.01 | 0.01 | 0.02 | 0.02 | 0.06 | ||||||||||||||||||||
| Amortization of other acquired intangible assets | — | — | 0.01 | 0.01 | 0.02 | ||||||||||||||||||||
| Professional fees for business combinations | — | 0.01 | — | — | 0.01 | ||||||||||||||||||||
| Loss on sale of long-lived assets | — | — | — | 0.31 | 0.30 | ||||||||||||||||||||
| Share-based compensation expense | 0.38 | 0.36 | 0.35 | 0.38 | 1.46 | ||||||||||||||||||||
| Net (gain) loss on debt securities and other investments | 0.01 | 0.01 | — | 0.01 | 0.02 | ||||||||||||||||||||
| Other income from divested businesses [A] | — | — | (0.03 | ) | — | (0.03 | ) | ||||||||||||||||||
| 2017 Tax Act [B] | — | (0.14 | ) | 0.04 | (0.01 | ) | (0.11 | ) | |||||||||||||||||
| Other income tax effects and adjustments [C] | (0.22 | ) | (0.11 | ) | (0.14 | ) | (0.58 | ) | (1.04 | ) | |||||||||||||||
| Non-GAAP diluted net income (loss) per share | $ | 0.17 | $ | 0.84 | $ | 4.78 | $ | (0.01 | ) | $ | 5.78 | ||||||||||||||
| Shares used in GAAP diluted per share calculation | 256 | 260 | 262 | 258 | 261 | ||||||||||||||||||||
| Shares used in non-GAAP diluted per share calculation | 259 | 260 | 262 | 258 | 261 | ||||||||||||||||||||
|
* Information has been restated for the adoption of ASU 2014-09, Revenue from Contracts with Customers (Topic 606), which we adopted on August 1, 2018. |
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| [A] |
During the three months ended April 30, 2018, we received payments from contingent earn out provisions related to businesses we previously divested. |
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| [B] |
The 2017 Tax Act adjustments relate to the provisional tax benefit for the re-measurement of our deferred tax balances at the enacted lower tax rate. |
||
| [C] |
As discussed in “About Non-GAAP Financial Measures – Income Tax Effects and Adjustments” following Table E, our non-GAAP tax rate eliminates the effects of non-recurring and period-specific items. Other income tax adjustments consist primarily of the tax impact of the non-GAAP pre-tax adjustments, which includes the loss on the sale of long-lived assets; the excess tax benefits on share-based compensation; and the tax benefits on a loss from a subsidiary reorganization. |
||
|
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. |
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TABLE C |
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INTUIT INC. |
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CONDENSED CONSOLIDATED BALANCE SHEETS |
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|
(In millions) |
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|
(Unaudited) |
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|
April 30, |
July 31, 2018 |
||||||||
| * As Adjusted | |||||||||
| ASSETS | |||||||||
| Current assets: | |||||||||
| Cash and cash equivalents | $ | 2,946 | $ | 1,464 | |||||
| Investments | 400 | 252 | |||||||
| Accounts receivable, net | 262 | 98 | |||||||
| Income taxes receivable | 3 | 39 | |||||||
| Prepaid expenses and other current assets | 255 | 202 | |||||||
| Current assets before funds held for customers | 3,866 | 2,055 | |||||||
| Funds held for customers | 383 | 367 | |||||||
| Total current assets | 4,249 | 2,422 | |||||||
| Long-term investments | 13 | 13 | |||||||
| Property and equipment, net | 799 | 812 | |||||||
| Goodwill | 1,611 | 1,611 | |||||||
| Acquired intangible assets, net | 43 | 61 | |||||||
| Other assets | 202 | 215 | |||||||
| Total assets | $ | 6,917 | $ | 5,134 | |||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||
| Current liabilities: | |||||||||
| Short-term debt | $ | 50 | $ | 50 | |||||
| Accounts payable | 383 | 178 | |||||||
| Accrued compensation and related liabilities | 311 | 369 | |||||||
| Deferred revenue | 572 | 581 | |||||||
| Income taxes payable | 338 | 3 | |||||||
| Other current liabilities | 254 | 195 | |||||||
| Current liabilities before customer fund deposits | 1,908 | 1,376 | |||||||
| Customer fund deposits | 383 | 367 | |||||||
| Total current liabilities | 2,291 | 1,743 | |||||||
| Long-term debt | 398 | 388 | |||||||
| Long-term deferred income tax liabilities | 13 | 68 | |||||||
| Other long-term obligations | 145 | 119 | |||||||
| Total liabilities | 2,847 | 2,318 | |||||||
| Stockholders’ equity | 4,070 | 2,816 | |||||||
| Total liabilities and stockholders’ equity | $ | 6,917 | $ | 5,134 | |||||
|
* Prior-period information has been restated for the adoption of ASU 2014-09, Revenue from Contracts with Customers (Topic 606), which we adopted on August 1, 2018. |
|
TABLE D |
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|
INTUIT INC. |
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|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
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|
(In millions) |
||||||||||
|
(Unaudited) |
||||||||||
| Nine Months Ended | ||||||||||
| April 30, 2019 | April 30, 2018 | |||||||||
| * As Adjusted | ||||||||||
| Cash flows from operating activities: | ||||||||||
| Net income | $ | 1,601 | $ | 1,367 | ||||||
|
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||
| Depreciation | 147 | 173 | ||||||||
| Amortization of acquired intangible assets | 19 | 18 | ||||||||
| Share-based compensation expense | 303 | 283 | ||||||||
| Deferred income taxes | (44 | ) | 1 | |||||||
| Other | 12 | (1 | ) | |||||||
| Total adjustments | 437 | 474 | ||||||||
| Changes in operating assets and liabilities: | ||||||||||
| Accounts receivable | (165 | ) | (207 | ) | ||||||
| Income taxes receivable | 67 | 62 | ||||||||
| Prepaid expenses and other assets | (30 | ) | (37 | ) | ||||||
| Accounts payable | 205 | 160 | ||||||||
| Accrued compensation and related liabilities | (55 | ) | (8 | ) | ||||||
| Deferred revenue | (7 | ) | (61 | ) | ||||||
| Income taxes payable | 334 | 351 | ||||||||
| Other liabilities | 59 | 48 | ||||||||
| Total changes in operating assets and liabilities | 408 | 308 | ||||||||
| Net cash provided by operating activities | 2,446 | 2,149 | ||||||||
| Cash flows from investing activities: | ||||||||||
| Purchases of corporate and customer fund investments | (379 | ) | (303 | ) | ||||||
| Sales of corporate and customer fund investments | 60 | 87 | ||||||||
| Maturities of corporate and customer fund investments | 175 | 137 | ||||||||
| Net change in customer fund deposits | 16 | 47 | ||||||||
| Purchases of property and equipment | (129 | ) | (97 | ) | ||||||
| Acquisitions of businesses, net of cash acquired | — | (363 | ) | |||||||
| Originations of term loans to small businesses | (235 | ) | (77 | ) | ||||||
| Principal repayments of term loans from small businesses | 188 | 44 | ||||||||
| Other | 3 | (16 | ) | |||||||
| Net cash used in investing activities | (301 | ) | (541 | ) | ||||||
| Cash flows from financing activities: | ||||||||||
| Proceeds from borrowings under unsecured revolving credit facility | — | 800 | ||||||||
| Repayments on borrowings under unsecured revolving credit facility | — | (800 | ) | |||||||
| Proceeds from borrowings under secured revolving credit facility | 48 | — | ||||||||
| Repayment of debt | (38 | ) | (38 | ) | ||||||
| Proceeds from issuance of stock under employee stock plans | 231 | 205 | ||||||||
|
Payments for employee taxes withheld upon vesting of restricted stock units |
(93 | ) | (58 | ) | ||||||
| Cash paid for purchases of treasury stock | (408 | ) | (272 | ) | ||||||
| Dividends and dividend rights paid | (374 | ) | (305 | ) | ||||||
| Other | (7 | ) | (1 | ) | ||||||
| Net cash used in financing activities | (641 | ) | (469 | ) | ||||||
|
Effect of exchange rates on cash, cash equivalents, restricted cash, and restricted cash equivalents |
(6 | ) | (7 | ) | ||||||
|
Net increase in cash, cash equivalents, restricted cash, and restricted cash equivalents |
1,498 | 1,132 | ||||||||
|
Cash, cash equivalents, restricted cash, and restricted cash equivalents at beginning of period |
1,631 | 701 | ||||||||
|
Cash, cash equivalents, restricted cash, and restricted cash equivalents at end of period |
$ | 3,129 | $ | 1,833 | ||||||
|
Reconciliation of cash, cash equivalents, restricted cash, and restricted cash equivalents reported within the consolidated balance sheet to the total amounts reported on the consolidated statement of cash flows |
||||||||||
| Cash and cash equivalents | $ | 2,946 | $ | 1,614 | ||||||
|
Restricted cash and restricted cash equivalents included in funds held for customers [A] |
183 | 219 | ||||||||
|
Total cash, cash equivalents, restricted cash, and restricted cash equivalents at end of period |
$ | 3,129 | $ | 1,833 | ||||||
Contacts
Investors
Kim Watkins
Intuit Inc.
650-944-3324
[email protected]
Media
Diane Carlini
Intuit Inc.
650-944-6251
[email protected]
