Intuit Dumping Quicken Unit to Focus on SMBs
Software developer Intuit, largely credited with popularizing desktop-centric personal finance, said it will sell off its $250 million Quicken unit, including titles Quicken, QuickBase and Demandforce, to focus on its SMB business.
Intuit said it will wipe its hands of the Quicken business to focus on sales to small businesses and “to do the nation’s taxes in the U.S. and Canada.” That means it will put its QuickBooks and TurboTax software, both of which command solid cloud-based and subscription sales, front and center in its strategy going forward. Intuit bought Demandforce, which produces marketing for small businesses, in 2012 for some $424 million.
Neil Williams, Intuit chief financial officer, said that “divesting Demandforce, QuickBase and Quicken enables both Intuit and these businesses to focus on meeting the needs of their respective customers, while allowing Intuit to accelerate our ability to deliver on our objectives.”
Without providing specifics, Williams said Intuit will continue to sell and support Quicken, QuickBase and Demandforce until it finds the “right outcome for each business.”
Intuit disclosed its plans to dump the Quicken unit as it announced its FQ4 results in which it posted a 7 percent year-over-year uptick in sales to $696 million and per share GAAP earnings of $0.05, as compared to the $0.10 loss it incurred this time last year.
The vendor also reported full year revenue of $4.2 billion, a 1 percent slide from last year, with per share earnings dropping 59 percent from last year to $1.28 a share. Intuit ended the fiscal year with approximately $1.7 billion in cash and investments.
Intuit projects a rosy view of fiscal 2016, guiding to full year sales of $4.5 billion to $4.6 billion, an 8 percent to 10 percent growth, and GAAP EPS of $2.50 to $2.55, or double what it earned in fiscal 2015.
The decision to dump the Quicken business will reduce revenue in fiscal 2016 by $250 million and pare non-GAAP earnings per share by $0.10, the company said.
Intuit chief executive Brad Smith said on the vendor’s FQ4 earnings call that it’s discarding Quicken because the software is desktop-centric and doesn’t fit into its SMB plans.
“As you know, Quicken is a desktop-centric business and it doesn’t strengthen the small business or tax ecosystems,” said Smith. “Our strategy is focused on building ecosystems and platforms in the cloud. We value our loyal Quicken customers and we’re seeking a buyer who will provide the product support and the service they deserve.”
Where Intuit will find that buyer, of course, is the question.
In late June, Intuit said it had laid off 399 people, or about 5 percent of its 8,000 headcount, in a workforce reduction the Mountain View, CA-based company described as a realignment of its priorities.