Intuit Beats Earnings Estimates, But Dissapoints With Revenue Forecast

Intuit Inc. INTU released its Q4 results after market close on Tuesday. Earnings per share came in above Wall Street consensus expectations, however, shares fell due to the company's weak revenue forecasts.

Intuit reported EPS of $0.08 and revenues of $754 million. Analyst consensus had an EPS estimate of $(0.02) and revenues of $732.7 million.

Intuit saw Q4 revenues at $740-$760 million vs. estimates of $772.73 million and FY17 Revenues of $5-$5.1 billion vs. estimates of $4.67 billion. Additionally, the company saw FY17 EPS of $4.30-$4.40 vs. estimates of $3.67. Management forecasts Q1 EPS between $0.01-$0.03.

Goldman's Take

In late June, Goldman Sach's Jesse Hulsing added Intuit to the firm's Americas Conviction Buy List due to the company's improving retention rate trends, as well as increasing confidence regarding the subscriber growth outlook for Quickbooks Online for FY17.

Intuit expected FY17 QuickBooks online subscribers to be between 2.0-2.2 million vs. 1.513 million FY16.If true, the forecasts show a continuance of its significant growth pattern.

"This was a strong year from start to finish. One of our strategic goals is to be the operating system behind small business success, and our small business ecosystem remains vibrant. Total QuickBooks Online subscribers grew to more than 1.5 million, and small business online ecosystem revenue grew 25 percent for the year," said Brad Smith, Intuit's chairman and chief executive officer. "Our tax businesses had another strong year, turning up the innovation machine to compete effectively in the marketplace."

At time of writing, Intuit traded at $109.95 in Tuesday's after-hours session, down 3.4 percent.