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February 25, 1999

INTUIT HAS STRONG Q2, WEB REVENUE SHARE REMAINS STATIC

By CBR Staff Writer

Intuit Inc is in the process of trying to flatten the spikes in its revenue streams, which have traditionally been tied to the US tax year and reporting deadlines. Taxes are calculated for the calendar year period but must be submitted by April 15, which creates enormous surges in its revenues in the second and third quarters which, for Intuit, end on January 31 and April 30 respectively. The web is one of the solutions to this problems, believes Intuit and it reported another strong rise in page views at its Quicken.com financial portal. However, the web site’s shares of its revenues remained at 10% for the second quarter in a row (11/25/98). Intuit reported net income up 115% at $89.6m, or $1.42 per share. But on a pro-forma basis, including the results from Lacerte Software Corp, the tax preparation software company Intuit acquired in June 1998, the earnings per share came in at $1.34 per share, which is four cents better than Wall Street expected. Pro-forma second quarter net income was $84.8m, up 41% from the same quarter last year. Revenues rose 45.7% to $346m. Earlier this week, Inuit sold 450,000 of its shares in Excite Inc, which is being acquired by @home Networks Inc. It raised about $42m selling them at an average of $94.13 per share, but it still holds 5.35 million shares, or 9.94% of Excite’s common stock, which it also intends to sell. That move could net it about $520m, based on Excite’s current trading price. Intuit had $1.56bn in cash and marketable securities at the end of January. Personal tax products enjoyed their usually strong second quarter, while the small business division benefited from what the company said was the early release of QuickBooks 99 in January and contributed to the quarter’s stronger-than-expected performance with 80,000 news users registered in the first month. Intuit launched its internet-based payroll service during the quarter and says the initial response has been enthusiastic. Quicken is still the top-selling personal finance software in the US, beating out Microsoft Money with a 70% market share. Intuit signed advertising deals for Quicken.com worth more than $60m over the next two years during the quarter.

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