Intuit Inc (INTU) Q3 2025 Earnings Call Highlights: Strong Revenue Growth and Raised Guidance ...

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Fri, May 23, 2025, 1:04 AM 4 min read

Revenue: $7.8 billion, up 15% year-over-year.
GAAP Operating Income: $3.7 billion, up 20%.
Non-GAAP Operating Income: $4.3 billion, up 17%.
GAAP Diluted Earnings Per Share (EPS): $10.02, up 19%.
Non-GAAP Diluted EPS: $11.65, up 18%.
Consumer Group Revenue: $4.0 billion, grew 11% in Q3.
TurboTax Live Revenue Growth: Expected 47% growth.
Global Business Solutions Group Revenue Growth: 19% in Q3.
QuickBooks Online Accounting Revenue Growth: 21% in Q3.
Credit Karma Revenue Growth: 31% in Q3.
Cash and Investments: Approximately $6.2 billion.
Debt: $6.4 billion.
Stock Repurchase: $754 million during the third quarter.
Quarterly Dividend: $1.04 per share, a 16% increase per share versus last year.
Fiscal 2025 Revenue Growth Guidance: Increased to 15% from prior guidance of 12% to 13%.
GAAP Operating Income Growth Guidance: 35%, up from prior guidance of 28% to 30%.
Non-GAAP Operating Income Growth Guidance: 18%, up from prior guidance of 13% to 14%.
GAAP Diluted EPS Growth Guidance: 26% to 27%, up from prior guidance of 18% to 20%.
Non-GAAP Diluted EPS Growth Guidance: 18% to 19%, up from prior guidance of 13% to 14%.

Warning! GuruFocus has detected 7 Warning Signs with INTU.

Release Date: May 22, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Intuit Inc (NASDAQ:INTU) reported a 15% revenue growth for the third quarter, driven by strong performance across its platform.
The company raised its guidance across all total company metrics, including revenue, operating income, operating margin, and earnings per share.
TurboTax Live revenue grew by 47%, significantly exceeding the long-term expectation of 15% to 20% growth.
Intuit Inc (NASDAQ:INTU) is leveraging AI to enhance customer experiences, resulting in a 12% reduction in the average time customers spend on their tax returns.
Credit Karma revenue grew by 31% in Q3, driven by strength in credit cards, personal loans, and auto insurance.

Negative Points

Intuit Inc (NASDAQ:INTU) expects online TurboTax units to decline approximately 1% this fiscal year, with a share of total returns declining by approximately 1 point.
Mailchimp revenue was relatively flat compared to the previous year, and the company expects it to take several quarters to deliver improved outcomes at scale.
The company faces challenges in improving the seamless experience for prior assisted customers, indicating areas of friction in their experience.
Intuit Inc (NASDAQ:INTU) is still in the early days of its go-to-market strategy for mid-market customers, indicating room for improvement.
Despite strong performance, the uncertain macro environment poses potential risks to future growth and stability.

Q & A Highlights

Q: What have you learned this year in your strategy, and how sustainable is the double-digit growth in the assisted category? A: Sasan Goodarzi, CEO, emphasized the focus on winning through experience, price, and fastest access to money. The investments in AI and AI-powered human experts have significantly improved conversion rates and customer experiences. The company is confident in sustaining growth due to insights gained from areas that didn't work, which will help improve the end-to-end experience.

Q: Can you unpack the 47% growth in TurboTax Live and full service, and what remains an opportunity for future seasons? A: Sasan Goodarzi highlighted three main drivers: increased adoption within their customer base, breakthrough adoption of new customers in full service, and improvements in go-to-market strategies. Opportunities for improvement include reducing friction in customer experience, such as simplifying the authentication process for new users.

Q: How are you planning to launch new AI agent offerings, and what pricing model are you contemplating? A: Sasan Goodarzi explained the launch of AI agents that perform tasks for customers, such as customer management and payment optimization. These agents will interact with human experts when needed. Pricing will be based on value, with some modules potentially incurring additional charges based on usage.

Q: What drove the significant improvement in Credit Karma's performance, and what have you learned about visibility for this business unit? A: Sandeep Aujla, CFO, attributed Credit Karma's success to stable macro conditions and strong execution, including AI integration that better connects customers with offers. Innovations like Lightbox have helped capture more partner spend in credit cards and personal loans, setting the business on a strong trajectory.

Q: How resilient is Intuit's business, particularly in the SME space, against potential economic downturns? A: Sasan Goodarzi emphasized Intuit's resilience due to its subscription-based, mission-critical offerings. The company is a low-cost disruptor in the assisted tax and mid-market segments, providing customers with better ROI and lower costs compared to multiple apps. This positions Intuit well to handle economic challenges.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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