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Intuit benefits from small-business push

The financial software and services company reports financial results ahead of expectations, as it starts to benefit from recent efforts to court small businesses.

Financial software and services company Intuit reported on Monday financial results ahead of expectations, as the company starts to benefit from recent efforts to court small businesses.

Intuit reported a loss of $54.7 million, or 26 cents a share, for the quarter, which ended Oct. 31. That compares with a loss of $92.4 million, or 44 cents a share, in the same period a year ago. Revenue for the quarter totaled $223.3 million, up from $168.7 million a year ago.

Excluding one-time charges, the first-quarter loss was $44.3 million, or 21 cents a share. On that basis, analysts polled by research company First Call had predicted a loss of 23 cents a share.

The first quarter typically is the weakest for Intuit, which depends heavily on seasonal income from its TurboTax tax preparation software and services. Revenue from those products will kick in during the latter half of the current quarter.

Intuit attributed the increase in revenue to its ongoing efforts to focus on small-business customers. As part of its "Right for My Business" campaign, Intuit has acquired numerous small specialty software makers, shed some consumer-oriented operations and expanded its offerings with numerous specialty applications for specific industries and business segments.

QuickBooks, Intuit's line of accounting software for small businesses, is the centerpiece of the strategy. Revenue from QuickBooks products was up 55 percent, to $38.1 million, in the first quarter. Income from small-business products and services, chiefly payroll services, was up 29 percent, to $100.8 million.

"There's a lot going on in the company, and I think the results show we're actually executing well against this strategy," said Raymond Stern, Intuit's vice president for strategy and development.

Stern said he expects the company's quarter-to-quarter financial patterns to smooth out somewhat as revenue from small-business efforts continues to grow.

"I expect we will see continued dampening of that seasonality over time," Stern said. "We're now launching products throughout the year--we're not on an annual cycle anymore. And we continue to grow our services business, and those are businesses that by nature are recurring."

Stern said Intuit is likely to make further acquisitions of specialty software makers and financial services companies over the next year to flesh out its small-business offerings. "You should see us continue to do acquisitions where we see opportunities," he said.