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Intuit lowers fiscal 2003 forecast

The financial-software maker lowers its fiscal 2003 earnings forecast, citing a sluggish economy. Investors respond with displeasure, driving down the company's shares.

Financial-software maker Intuit lowered its fiscal 2003 earnings forecast Thursday, citing a sluggish economy.

Investors showed their displeasure with the news Friday by driving Intuit's shares down $12.17, or nearly 24 percent, to close at $38.72.

The company's lowered forecast comes a month after Intuit raised its financial estimates for the year, based on a stronger than expected second quarter.

Intuit said its revenue for fiscal 2003 is expected to fall within the $1.65 billion to $1.69 billion range. Previously, it forecast revenue of $1.71 billion to $1.77 billion.

The tax-software company also anticipates pro forma earnings of $1.30 to $1.35 a share for fiscal 2003, compared with its earlier forecast of $1.38 to $1.42 a share.

For Intuit, the economic climate has changed so much in the past month that its revised earnings projections are even below the level it forecast before raising its guidance last month. The original forecast had been $1.32 to $1.38 per share.

"We're disappointed to see a sluggish economy worsening in the past few weeks with a further decrease in customer spending in all our categories?all our businesses have been affected," Steve Bennett, Intuit chief executive, said in a statement. "Consequently, we won't grow as fast as we'd originally projected."

Intuit's growth is expected to fall toward the low end of its forecast range.

QuickBooks is now anticipated to post revenue growth of 20 percent to 30 percent for fiscal 2003, while small business services are expected to yield growth of more than 30 percent.

TurboTax revenue growth is forecast to come in at around 20 percent to 30 percent, while professional accounting may reach only 10 percent to 15 percent and business verticals 10 percent to 30 percent.