Intuit Beats on EPS But GAAP Results Lag

Intuit (Nasdaq: INTU  ) reported earnings on Feb. 21. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Jan. 31 (Q2), Intuit met expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue shrank. Non-GAAP earnings per share shrank significantly. GAAP earnings per share dropped significantly.

Margins contracted across the board.

Revenue details
Intuit booked revenue of $968.0 million. The 13 analysts polled by S&P Capital IQ expected a top line of $963.2 million on the same basis. GAAP reported sales were 5.0% lower than the prior-year quarter's $1.02 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.33. The 16 earnings estimates compiled by S&P Capital IQ anticipated $0.30 per share. Non-GAAP EPS of $0.33 for Q2 were 35% lower than the prior-year quarter's $0.51 per share. GAAP EPS of $0.23 for Q2 were 41% lower than the prior-year quarter's $0.39 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 79.1%, 70 basis points worse than the prior-year quarter. Operating margin was 9.6%, 920 basis points worse than the prior-year quarter. Net margin was 7.3%, 430 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $2.26 billion. On the bottom line, the average EPS estimate is $2.95.

Next year's average estimate for revenue is $4.60 billion. The average EPS estimate is $3.39.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 590 members out of 625 rating the stock outperform, and 35 members rating it underperform. Among 201 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 193 give Intuit a green thumbs-up, and eight give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Intuit is outperform, with an average price target of $63.81.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool recommends Intuit. The Motley Fool owns shares of Intuit. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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4/17/2014 3:59 PM
INTU $74.03 Down -0.24 -0.32%
Intuit CAPS Rating: ****