INTU - Earnings call transcript Q4 2021

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Operator

Good afternoon. My name is Latif. And I will be your conference facilitator. At this time, I would like to welcome everyone to Intuit's Fourth Quarter and Fiscal Year 2021 conference call. All lines have been placed on mute to prevent any background noise. there a remarks, period. speaker's the will question-and-answer be After [Operator Message]. now With Investor over turn to I'll Relations. Kim of call President the that, Vice Watkins, Intuit's Ms. Watkins.

Kim Watkins

Thanks, Sasan Goodarzi, Fourth Michelle Clatterbuck, to call. Latif. here and and CFO. XXXX I'm CEO, Fiscal conference Intuit's Intuit's with our Good afternoon Quarter welcome

remind our I'd results factors remarks that cause that Intuit's will expectations. a include we start, everyone is of Before forward-looking differ number from materially to like to our statements. There could

these risks earlier about the press You issued more can in release we this learn afternoon.

our Our Form XXXX fiscal XX-K for other and SEC filings.

are All of statements. obligation these Relations on documents assume update at to available website of intuit.com. no We page Intuit's forward-looking Investor any the

metrics. comparable these are business And in metrics to non-GAAP numbers of website numbers I'll associated prior-year on refer remarks growth this our period otherwise the today's on rates the press the in of call release. worldwide comparable turn the Some current and that, Sasan. supplemental ends. information all period to call available remarks the and will and refer A GAAP growth Unless after prepared our be versus copy rates non-GAAP reconciled presented the with and financial noted, a over business basis. to We've

Sasan Goodarzi

Credit Group Thanks, Group. the We Full-year in the year. revenue Kim, for had Total you quarter growth small growth and business and today. growth off thanks the XX% for for revenue by an outstanding XX% grew of to joining a addition fourth us Karma. all Self-Employed was Consumer of the including capping very fueled strong XX%,

revenue, game Karma. and the includes fiscal in our year, XX team this durable. in grew has of includes accomplished This from strong proud to year Credit Credit QuickBooks X.X points and to year plan QX. very win what addition of I'm the remains the Online, a Combined another delivering had Online, Karma record Credit XX% billion Karma TurboTax quarter which platform While XXXX.

durable now This total up of with year extended marks our fourth our me outstanding strategy consecutive the tripled we've revenue X% where from focusing growth customer over progress segments, year, We Let turn made to and a on tax. and double-digit including year lead built of the approximately We've returns X customers, investor growth. last underpenetrated share by category growth we our of Do-It-Yourself year. rate into point. this

to assisted segment continue with Live, $XX We nearly by the billion customer total accelerating XXX%. TurboTax transform growth

our for program. highly not with as a plans We predictable significant runway we we announced platform to a participation have renew a model the growth in IRS innovation. Recently, and refile accelerate

XXX their prosperity. We within that refile free nearly of expect with over part to of no power overall tax offering tax impact on to this time, sure IRS over want our has the those revenue serve I our delivered decision And how understand and fits customers are with past the filings offerings a benefits filings million from Free this to strategy. XX% nearly decision. outside grow critical Intuit of strategy you coming eight program. make free years.

we refile IRS constraints, enjoy TurboTax, no innovation and offer customers with Karma, to Looking program our platform. can of Credit ahead Mint the have all on

growth These customers face driving and expert our and represent problems opportunities are are innovation strategy Our Intuit. largest Big big the strong the across Bets for on momentum platform accelerating AI-driven focused Company. and X durable bets

Investor month. X update bets the Today, provide business big the people I'll this are; made notable smart these at growth of will benefit, center next revolutionize experts, speed Day mid-market. we've highlight connects the bets to disrupt decisions, detailed money small on reminder, small a quarter and Bets Big on to As X business unlock of progress and big these be all a

help more problems access largest strong to to digitally. provides TurboTax their Live, effect people and do connect their of With creates XX $XX on Live TurboTax connecting and opportunity for the have new returns to tax over lack Intuit Live. Customer them TurboTax previously confidence, by people the QuickBooks experts is to million assisted providing we're in-person customers of taxes bet big complete the assistance, season. TurboTax virtually awareness Live face, The the TurboTax Live to second XX% to relied entire and experts than confidence We're filers who expertise funnel XXX%. or halo one our for grew grew consumers This with our was transforming Our experience. customers experts. this by billion solving category

attracted XX% nearly With segment full-service the new offering Do-It-For-Me from assisted higher TurboTax than Live our -Me offering. rate customers Our - at a Do-It

Credit Karma loans, insurance, the develop monetization engine, customers. free both combined savings also our wallet achieved of of monthly provides checking as on deliver To -- auto digital is with put Bet in frequency Credit QX helps goal, high and and we're including and consumers remained to the more offerings, smart their find all including and active users, Karma's of reaching integration fueled and Big strong. accounts. verticals, the and and the money money is effects, powerful data number towards with that our decisions focused personal revenue financial by focus strategic increasing all-time loans, platform, another unlock TurboTax on to expertise an core, goal with financial member a verticals credit access third cards visits in loans, Our emerging Karma our home quarter progress and paying personal such a and making share high, and grow money growth financial record this Credit partly advice. additional members creating expand products, pockets, network assistant right new

digital Karma a verticals the innovation focusing reflecting reflecting developing Credit and quarter, credit also momentum core, by achieved loans. in The money home card again, our on followed all-time the member. offering. Within growth emerging transactions strong revenue revenue by in per this auto with increase achieved high auto And an of on part insurance record and personal an another combined we're basis, high, loans Money verticals

QX technology such as auto, higher verticals, pent-up well of Lightbox Lightbox to as home Partners successful XX% resulting our and of enables usage is we that a Credit a over by who month now Just one and partners. Online innovation innovation past to less of opportunities both of Intuit. to of highs versus all creating Small just These place. our employees evidenced an manage a to aspects Karma likelihood Karma demand through, in ago. better proprietary two-sided cards that network a offers at our year effect, results in members their this are portion all-time connect are the growth in XX% achieved QuickBooks AI-powered payroll have more power and loan with integration drives problem. them solving The transactions to right a products a driven the focused and checking members all-time or than the we This this of present flowing all in bolstering them, platform, deliver for as high monetization XX% Lightbox with of from financials, for them for opportunities personal approval. the help investing over Credit of Business that experience more credit announced XX% are in month, is

pleased to about with upcoming the COVID end back benefit revolutionize to foundational our We year customers. our by coming year levels. - which strong pent-up after first of innovations. partners, a to circling investments to very our across I'm our progress expect and demand this pre very the returning our verticals investment taper is speed my I'll Bet, excited to Big bet core

work. in money the our every customers' number insights. AI, to customer of our is of pockets, deployed touchpoint using confidence hours by goal more and use put This eliminate deliver models AI increasing friction, our accelerated millions customers we Our saving nearly year, our of XX%, across platform by and at of

of application by velocity. of saving we the ran AI manual made our year, increased for has Our offering, enter millions TurboTax entry never number to XX% them hours data, this of than our it release of monetize dramatically payroll customers and tripling easier more experiments

and momentum with well accelerating plans which future. the win, our in we in our durable of for very us our positions confident believe We are by accelerated remain and Across pleased all growth innovation, Big building results we're digital tailwinds. to game Bets,

continue key drive will in to even to invest talent aggressively, including forward. faster We innovation going

let over to Now, Michelle. hand me it

Michelle Clatterbuck

afternoon, everyone. Good Sasan. Thanks,

last quarter last versus fourth of ago. share GAAP $X.XX billion. delivered fiscal versus the XXXX, million $XXX diluted operating of versus million $X.XX $X.XX GAAP per revenue $X.XX income For year earnings million non-GAAP diluted year. year. of of $X.X million per earnings $XXX a non-GAAP $XXX a And we income versus year, of of $XXX share last operating

quarter and revenue in in quarter, for In Self-Employed Online segments. Turning and Group, grew and XXXX. revenue year. XX% fourth the small the grew to business during business the Ecosystem fiscal XX% the XX% the XX%

source strategic connect ecosystem, small of for With the businesses, small is the and the core, aim trade being of globally. our Grow focus expand and the business three-fold. Self-Employed within the

by revenue and First, we accounting effective mix in continue driven Online higher growing fiscal the grew core. growth, XX% on QuickBooks customer QX, to prices. focus mainly shift,

payments, full-service customers Second, the we an tracking, in grew continued to reflects customer and revenue Within payments, and tailwinds quarter payroll, mix Online charge see payroll, XX% fiscal during growth ecosystem. to capital, revenue, the time in increase growth which customer. Within our with services QX. ongoing in continued connecting includes focus offering. growth to per we volume along revenue shift a payroll on from

which continued we level number services new s. growth. points to to seeing to per migrating We're lineup, quarter, back added pre-pandemic our also customer customers full-service the online X of employees the During approximately

driven XX% mid-single-digits growth, our Note fourth ecosystem consecutive measure believe Consumer XX% XXXX. business. Third, grew revenue end in basis. a XXXX, the is customers better data This XX% This X in expectation XXXX Group during of revenue strategy the our longer-term to the reflects grew Desktop consumer Enterprise July both to Fiscal million revenue to and our the Total Group. fiscal full Desktop There XX%. was XX, QuickBooks the revenue growth to double-digit season that ARPC. of the units season we fiscal drivers stimulus fourth grew in this last expected XX% July Online these versus progress X% expect XXXX are year through quarter best of We the Ecosystem grew the in primary grew of of health and X season. international Consumer through of in filings high expanding Ecosystem year. is for currency TurboTax QX. the fiscal over by growth approximately revenue constant which globally on success above XXXX. revenue season. the prior exclude metrics X% our XX, X% grow Online time. for added than revenue and growth online X% XX%

total the the is number than estimate will X% estimate approximately be of first with season, returns which The up approximately prior of filed up, this we higher IRS, our X%.

Do-It-Yourself is versus those of second returns slightly share returns the The this of estimate prior percentage of flat. category using software. DIY estimate was approximately We filed season, down total the IRS our

third is share. driver The our

returns our to approximately total category expanded, grew X X the of Our tax of point DIY season, share this share point. and XX% approximately

pleased is our points. premier retention Our this fall these we're last return, with that customers offering, estimate approximately excluding retention shifts season season growth Including filers again total stimulus is X was mix approximately per average revenue increased share didn't and TurboTax year-over-year, which to investors. slightly we free return total Live payments We stronger our down rose seeking contribution fourth season. estimate This filers, excluding results. reflects these again season, a by this used and by rate was which XX%. this The

revenue X%. ProConnect in Turning fiscal we XXXX, to million up the of reported Group, $XXX

and as revenue Karma, reflects core all-time for record credit Credit was transactions member cards high the in and in growth Sequential loans another onto strength growth increased. per Moving QX, both reflecting verticals. million $XXX highs predominantly personal

shared expect opportunities We after for the demand across ahead Fiscal earlier, verticals in by Sasan partners. about taper As remain the a investment platform. this to we excited XXXX, our pent-up strong sometime core of year

and faster double-digits operating than to growing committed principles, growing revenue. remain we Turning income to revenue our financial dollars organic

XX%. the into As as time. investment generate our shared cash expected yield platform we strategy, on than we take return We we that opportunity I've disciplined lean margin an greater investing expansion approach opportunities a the for management, in to before, over see capital

We to continue AI-driven on These top with remain emphasis an becoming to platform. long-term principles expert priorities an our resources commitment. reallocate

dollars dividends. factors, is repurchase shares. conditions The and and authorization, and million and giving billion in billion in a generate $X the both us repurchase that share profitably approximately growth. of shareholders to investing Board the Board approximately investments invest business priority Our excess XX% fourth XXth, first We is dividend $XXX to authorization from market on be payable quarter can't revenue balance billion last a to total via we for billion cash XXXX. acquisitions during our cash business the We the drive finished This and product versus increase repurchased our the a the stock XXXX. of share Depending approved each of represents fiscal fill accelerate The our We $X.XX roadmap. aim October in other $X.X quarterly consider on to our approved in sheet. market out returned a a repurchases $X.X We new quarter. with we year. during to per quarter customer cash growth

to billion, guidance fiscal full-year full-year share Credit of of of $XX.XX. our includes and Karma. growth Moving non GAAP a revenue $XX.X $X.XX $X.XX including GAAP share XX%, on of - earnings $XX.XX earnings of per billion guidance, to to per $XX.XX to to XX% XXXX

into GAAP of Credit to our the Credit we a XXXX. $X.XXX billion to Karma around expect revenue rate during expectations. of guidance year translates like XX% I'd $X.XX XX% billion additional provide margin of fiscal We if Karma revenue XX% to growth that some context tax full operating for our had XXXX. in Note fiscal

continue over to opportunities time. margin the we before, platform expansion shared and I've to As leverage see drive

investments impact making implied However, in fiscal retain the acquisition XXXX fiscal Karma X compensation we're declined GAAP XXXX. reflects points This along our Credit with to and margin the guidance stock attract versus in over just talent. operating of

the XX On a implies approximately right guidance are to are basis, these non-GAAP basis in margin decisions long-term We XXXX confident drive growth. our operating expands points. fiscal

fiscal were business and the quarter, quickly pandemic, we last as of half the second then the conservative deep to shared when the was in investments anticipated year, during than a approach I a very half. bounce we we As to XXXX unique first year more the started in back took

Our non-GAAP though Even margin fiscal non-GAAP each the Karma XXXX. of on our guidance acquisition year initial negative a implies operating operating included expansion X-point fiscal margin XXXX a impact. average, closing since after Credit point

ahead. continue expansion to margin see opportunities We

earnings includes growth per $X.XX revenue XX% of of non-GAAP Our and guidance to QX fiscal per XXXX share GAAP earnings to of share to XX% $X.XX $X.XX $X.XX.

with press release fiscal on sheet. back our XXXX guidance Sasan. in details You that, it full to our can and find fact QX over and our And I'll turn

Sasan Goodarzi

the Super. Thank and team optimistic of you, Michelle. future. and accomplished I'm I'm always the together proud about

tailwinds a innovation are capabilities, to a We Virtual acceleration have and large, addressable market strategy with expert include five and offerings. that for and omnichannel Big AI-driven accelerated s, becoming an positioned and and money platform digital shift our Bet we growth. of online Solutions, digital to With well

Let's now to questions. open up it your

Operator

ISI. comes gentlemen, and Kirk [Operator Our from Thank first you. of the question of Ladies Materne Evercore Instructions] line

Your line is open.

Kirk Materne

bit as Sasan, really of factors and Yes, payroll X fiscal out thanks payments for of Thanks. a year. What a there release, around called unpack are trends in seeing guys wondering small you you congrats was you this are the offering? businesses. just very if those much, great sort more. do and the sustainable online on little and could you growth how press X those important think parts I

Sasan Goodarzi

are making instant getting provide customers a that only investments platform Yeah. of we about we've ago far with of heavily that online, allows your those in experts taxes, we've overall sorts sustainable. hear that compliant. with very it's making innovations where of you, whether payroll, in innovation ensure grow question, And same-day where are beginning tailwinds, in services making back that where we that I our all move upfront, time really our full-service think time where And areas of you it your run experience or when business and tracking, very that talked I payroll really to do stuff able the to have manage payroll, choice, payments, where yes, to examples from will they're we and our especially shift deposit, customers just things our Thank money to having but their like just important areas to in are are are this and accelerate payments, more Kirk. those take years along customers if them help next-day payroll, contributing. to online is been with those And And at on big and we paid to when online. innovating -- And better, you payroll looking have they you that investing to of their look several things. importance you. pay accelerating like out sure discover, for a us is those really illustrative your to two, to similar our the we in to areas easy digital starting be course of off, revenue, not good already help pan continuing the have their focused

platform customers able We are business. become to continuing that to to their to, that be run look

off Our starting we're standing pay are and innovations not still. to

Our as grow the customers, we I innovations there think fact our to we'll with we're off. that pay move see say, are to are transactions the them. those would non-consumption especially to be in accelerating, our starting to continue mid-market, continue last serve we mid-market we penetrate into that and for in where larger customers continue And expect larger would I thing and with would and the

Kirk Materne

lumpy this year, Karma the called I just bit one cadence how Obviously, should course realize back about that don't guys of of just about have around your in or pent-up we the second year? That's of How half the bit given would curious there's should half it's a fiscal follow-up terms year-over-year for the first-half-year year. of great. just but either that of we yet, little we you growth maybe Thanks. I that the fact in was think of Maybe a of full the think just comps be on out guide. the sort Michelle the helpful. Credit kind demand color any over

Michelle Clatterbuck

Thanks revenue. Yes. forward. was Karma your Kirk. We're pretty at high as continue about for all-time just to excited for Hey, look we question. Credit their QX

member And transactions so, strength we see personal we loans both you're increasing.Yes, really right. that about credit per cards as felt and good in and

we said, demand. Sasan heard you the As see pent-up of did some

XXXX, of investment We a taper partners. our we year by will pretty expect in that strong had Fiscal

And to so, more we pre-COVID do expect to investment that levels. return

you how there's might to lot of a seasonality As that think not the year, about across within whole CK.

but So, lot -- we are see a we and But Credit what for QX. Karma quarters individual of for pretty guided next year. haven't think the excited about there's opportunity obviously, we still except we we

Kirk Materne

much. very Thanks Super.

Sasan Goodarzi

Thank you.

Operator

Thank you.

comes of Ken Your from next Guggenheim Securities. question ahead. go Wong Please

Ken Wong

strong Great. And the I Thank year. you taking the sentiments for question. my on echo

maybe the just touching First, on payroll.

you would potentially this and aside. I think of mentioned we're early Michelle, full-service say see you driving we think tough this or services the X on of additive that as we growth adoption online Should could contribution still points longer-term? a in comp very of be

Michelle Clatterbuck

Oh, sure you. I I'm wasn't for that or was sorry, me if

Ken Wong

Susan you; to answer think I than is that question. qualified more

Sasan Goodarzi

well. hesitate in Michelle, happy to to be in please I'd chime and don't as jump

relative be and payments our all, going back to take put of to would revenue. longer-term deliver and XX% First payroll online expectations to there's to accounting revenue takes is always And growth. I and you just

it because unsaid it more revenue are question, of payoff, that are With XX% actually that of that online help said, expertise I I impact customers So the customers seeing Kirk's mentioned innovations, payroll. on please And problem to our full-service was our capabilities is migrating of Uber our frankly problem and answering of, are them with very the and as wanting sort get more Compass of and to to comes about payroll biggest has. let growth. earlier, we be as your, started is the these solve that is More full-service that confidence.

payroll have revenue XX% comes runway So, to would should of I a and we your accomplishment us. say growth. when Ken online ahead just it be

Ken Wong

a coming next just with And Fantastic. on of is share to high it. follow-up the any side. to that be Great. components Got possibly XX% going the quick from a year? At XX to level, attempts then of consumer tax some growth

Sasan Goodarzi

stats, you Investor more which our And your you will this we'll, our into really I of progress Ken. upcoming the think strategic I element by Yes, and on: about continued tell that would our course, repeating. feed our that I to I'm at We think level unpack growth, just IRS the share increased assisted future I segments. X of really that Day. repeating transforming underpenetrated with detailed and think superb a of When am I is our delighted most point, question. that results. total know the of worth really One, areas performance, they're focused returns segments the X we some but saw we're matter

overall investor Live volume awareness TurboTax XX%. tripled year-over-year. increased Our

rate the from TurboTax Our retention grew Live stayed little a assisted Live to total customers actually our with a overall. segment higher XXX%, Do-It-With-Me. up to to customers it our our grew bit XX% attracted new flat new rate franchise And customers TurboTax XXX%. offering, the full-service prior And over than at year

by it's next when flattish you returns of about the at metrics, very we we So, And knock are to wood, going growth. the IRS key inform next do assume, year's way, very, that year. expect on that be all and to healthy sort look

important quest a these So is just heard Though sharing. you've sort opportunity to underpinned assumption that's we're on. our continuation worthwhile assisted run multiple we're And this in areas year probably penetrated next another is XX-year decided me segment. and just pivotal in to be one transform year plus probably say of as the on focused that a that's important going times,

Ken Wong

Fantastic, Goodarzi.

Sasan Goodarzi

Ken. you, Thank Alright.

Operator

you. Thank

of Stanley. Weiss Keith from comes Morgan question next Our

question, Your please.

Keith Weiss

you, right, year I in the dig for Really the fiscal Thanks. side congratulations. my pretty the Intuit. what echo Online equation and I'm at plus that's a guide of I But do strong in actually the XX imply FY guys, that to XX% growth XX% or of math. plus. if something probably Desktop been shrinking sort with you've Is could a we sort growing FY team return and math just doing to question Michelle, end the how wanted a durable we're about or what that taking into sort stream particularly a and around math and all Ecosystem big in now of the bit, is was If the for should math here, am plus, actually a Thank 'XX part remarkable between doing to about had changing right, I'm doing little I Or wrong? your small my in sort XX% revenue Desktop that and balance my if talking a XX% guide businesses. equation. think of of been the very online, of business? ramping would online down Desktop

Michelle Clatterbuck

Hey, at Ecosystem first Small next strong all, time. be Business you with to also. year. We will growth. need of next we've really to And I'd has say be to that over obviously, Keith. Well, do your And about Online it been year XX% expect how that feel of guide to question. XX% look can performed better Thanks or this our really see for that feel revenue excited year continue you we XX%, we with

XX% to don't it to the ARPC. quarterly, the guided do by and do but of number being been over be driven on haven't to there we We long the expect XX% gross customers it. term We it

obviously, will Desktop, and around growth do it, more past saw Desktop. more We've in customers. time, seen few some this the we've in about got just that year and Now side, the you XXXX, when asking continue growth. have I over we anticipate decline that we X% we But to time. go over years, were to last other which

you've out they choose QBO. got XX customers and that As and they the of online come choose X come so in, X, versions in

would So your I on that's where help math you with that.

Keith Weiss

this in be is business line to course normal of And that is there more over of Got trend to version you've people time? shift this sort the the been structural trying and desktop version, just the change it. any aggressively terms of kind or online just to is clear, seeing from

Michelle Clatterbuck

online think more the We to online. them. if our choose products, have but not force experience value works the to just use -- we they where subscription. a to people have using they we better as we've want a Plus they're have they that people do is onto move they for chosen and better product, more and seen Desktop, much there proposition, are whatever But much We them have choosing

so part seeing. And been is what we've that of

Keith Weiss

Excellent. it. much, so Got Thank you guys.

Sasan Goodarzi

Thank you, Keith.

Operator

you. Thank

Our next question comes from Wolfe Alex Zukin Research. of

line Your is open.

Alex Zukin

since thanks guys, question. growth thinking. base again with monetizing on it's Karma start to and been you quarter the free you’re I the the then synergies Credit Intuit better in taking modeling I just I I Credit on little all in guidance, it's whether both or margins. a the with order. in digging I and that so bit have base. the Hey, whether think a unpack echo are the user anybody we've also maybe for really are Karma starting follow-up to wanted congratulations cross-selling the the see And to realizing want is to Karma -- that much quick you're is than been

Sasan Goodarzi

from we to me hear your you Great the top you. comments. On Credit -- kind just briefly Sure, are Karma, terms let in at for start Alex. seeing. Thank of I'll what

customers of First of able relevant and the our that using paying they to beyond. home easy seeing I It's And personalized the providing when we ability that all, combined -- we the with to innovation them our for loans, leveraging is to get auto we're loans, that we're when really accelerated actually customers. areas then they the can need and offers with that Karma very most. offers. how provide offers more to data potential ensuring multiple innovation relevant deliver approval their the is But the of it think it's offers, cards, it than to Credit experiences, make actually have we insurance, them, important they personal in accelerated Lightbox and then are in off, whether be now help front click

invested off. their platform. than paying that the and the after critical they So good acquisition, those go I that have. of the to of to our power all that network platform just effect that And of the really And chunk a a data are customer testament decided we partners it dollars on really are areas demonstrates think of when the it's trust the members the innovation

the when because one cards. that's -- will of rate, one penetration element of continue that the our you just innovation, we in the given lowest So maybe our look highest it's believe accelerated credit insurance. ultimately, auto But first at our

much wallet so increased room share. have for we So,

terms synergies, of is want those synergies there areas That's quite think are would Alex, several possibilities TurboTax part Credit the actually really big about and future, about future. In benefits of of you the one the opportunity. the making synergy. in bullish entire really I we experience. One Karma to are And for

wish. where seamless big over monies as it and Credit be part free of Karma experience money actually deposit being we then part Karma other the And able your to into early time if account their do is taxes. experience and contextual, opportunity The can payroll they announced, checking customers and is be the payroll their of able a Credit which third, our to making savings access terms to in of what TurboTax just

and we're we're of not in out to doing near-term, into turning counting in And the and terms on in nail more and the across we our millions over would rolling we So experimenting continue launch remind of there because what customers material to months, it millions we're us, they're of in that a significant about a million incredible Karma purpose, incredible eight past well past talking benefit creating Credit revenue informed incredible what course, Karma to we you're to time, TurboTax feels I because the with just been year, like customers, those closed growth, on want really and ecosystem but on mid-term as the XXX those all members. payroll -- Credit just that in are going customer say things it's TurboTax -- counting opportunities and December. come. -- are These to. over customers, speed, year long I'll we experience This have that we're of intention.

that's that you're but only think of way Karma, us. growth seeing in would So about I not what the you ahead the Credit are want rates to

Alex Zukin

I see guide potential in of of questions you, Sasan. in was myself, business know that a margin dealing versus for guide I investment that on years, think of at maybe detail it last the delivered That's appreciate and the margin I least. And around leverage I think as with answer, clearly super-clear. the the few in I you leverage operating level lot Michelle, the incremental was level your you've guys an best -- opportunity but

So, gross savings I leverage can, deliver you're from unpack to us a coming that perspective. with fear I year. know it there was OpEx gross both margin the tell this margin lives, trying what to with to growth Unpack versus it few ago if I you has want remember be both ability scale. at into dilutive, particularly and margin a yet, this improved the gross margin years model actually would and the

think where you when is about bit coming how little a we of opportunity? think the it from durability understand to about want leverage, incremental margin should about I that that and So,

Michelle Clatterbuck

you. Alex. Thank question, Great

you delivery all, acknowledging margin have this thank the we year. of First for

You mentioned have continued gross say margin to time. flat and over gross fairly margin we to remain expect we that

we little how -- exactly in with and we And at margin a then and opportunity continue expectation exactly see the than the Live big a the a has there bouncing time. of I was how out full the swing is pandemic into over and But flattish at on Company. unique, leverage have that margin, back Investor as we as beginning, become platform gave to much a things that was are of that did the little we XX mean, right, going ended business TurboTax focus deteriorate really going weren't sure to to play FY and more I You're more we that questions thought. got bit it more gave And up quickly businesses Day. opportunities and investments. with more see remained the last we was last to to as our margins. obviously year conservative whether were we lot we drive

So, average of you over when expansion. we've as margin I about the XXXX, mentioned way a got on from back earlier, look point all

with good to we looking about feel especially our XX forward and that, And guide really points. basis so,

leaning customer we and use and and opportunities have technology really whether go-to-market duplicate of it how it, our it's looking technology expansion, though really whether in technology, there. customers across in leverage, services to rid deliver in get it's is So, when business getting see success for I more, the platform helping we'll us enabling about the where there into we think at a all and all additional drive can is or our

to to So, leverage. continue that opportunities do that think have we we drive

Alex Zukin

Thank Perfect. guys. Great job. you,

Sasan Goodarzi

Thank Alex. you,

Operator

Thank you.

Thill of comes Our next line your Jefferies, is from open. question Brent

Brent Thill

you if international year on next for and on quick U.S. and you're you're the update could you. that you on Business there. for traction what Small to maybe the critical how and beyond any approach Michelle follow-up give just trend side Thank expand Sasan, is can and lines QuickBooks in of seeing this us seeing you. traction the Live, And if an a terms the

Sasan Goodarzi

Great. trend those were Brent, lines trend sure asked I just your correctly. captured make businesses? that we question that to small just a we're follow-up question. The general about you want question seeing last lines, in

Brent Thill

QuickBooks More QuickBooks apologies, specifically Live. the Online Live. QuickBooks and My

Sasan Goodarzi

it. Got

Okay. Great.

start question me your the about let with international. So,

businesses the First in mentioned I call, and are of thing think trend is I last still same the as small the One earnings that's unchanged across recovering. continues. globe all,

pre-COVID have Some back levels. to -- recovered to

we their defined ish -- changed Some is data, down small have of see net And XX%. XX% actually in at are struggling accelerated are deposits least because their But they by, struggling. our the business still businesses model. what have they over

our with of you've But exciting business, and that sentiment open, than really able that's we a really that small critical of really as lot and a actually open, be there's of and UK, XX% accountants France, that overall, With shutdown, of shutdown seen, geography, grow But Australia in I like growth which assuming impacted delivered based is of flow, So, platform revenue bounced it's acceleration. U.S. even businesses. in usage still ever. to run much currency in both the just than small perspective context, quite and the as an it's of that happened answer we're your in your as the of strategically this recovery turn for last but are in this we QuickBooks platform it's account because I would we I recovery quarter to put slower into cash we business, And ever, And with in the get in really our businesses manage back mode. important still more crisis. digital Live has nature much in year. really do, our constant the whole seeing just the a said, we're context general the small recovery. And on the just next international International And I in I important be U.S. your terms XX% in in it's think the to to as that shared of than that taken say sort I U.S. if our has important look reason we've out are all, then our innovation, bounce believe is probably platform that I how Michele health I'll fact, we is and maybe would acceleration And why, your above say that and, the the future, is then of back that, U.S. countries over slower compliant businesses is recognize ahead. And is it would recovery. important general in the faster put just being terms much just Canada to question. much, what just become said, a our more guidance once economically both we outside will much, for think

Michelle Clatterbuck

for Live. Live. live with here the The what progress opportunity. more help that's to what early us because virtual product, a opportunities for back earlier the Intuit, to the penetrate Seeing on, focused same us say we're pandemic product-market goes fit. help great a opportunity customers are is the has so much to as acquisition. acceleration continuing over platform And as to way to which do actually we're leverage been with us non-consumption, TurboTax I Great. would think to new to bring on still Hey, to actually use is market to mentioned is opportunity huge we've seen It that really last an now, And there bring year on world. know, this a Brent, a I it Right built in who to we customer some make signs you it's platform enabled as QuickBooks quickly. achieving some

more types open anxious so, using much customers And are obviously, much these experiences. to more or of to

platform enables one Small customers, of is Business we have really our with so, confidence. does It And solve problems that. the biggest which

has You see that TurboTax too. side really the also Expert continued on to interest strong. remain

point setup a get in, customers within the more solving, good their come that queue right communicate for last collection. that. up get-go. some offerings A confidence have on really streamlining, then thing say set so us businesses can see. document messaging we've easily we from enabling And with and And the we're year good that seen small so I'd launched last is to that are so bookkeeper. help currently been has QuickBooks, we could the on the on success few pains And working with automating thing And customer then and

Brent Thill

Thank you.

Sasan Goodarzi

Brad. Thank you,

Operator

from Next Sachs. Kash Rangan question of comes Goldman

line open. Your is

Kash Rangan

looks that the but the be IT, small added businesses Sasan, the the is changing the success could clearly, you with payroll a transformation. you with payments. thank out, year. Hi, as on with with Business underspent perpetually on wanted I'm like, having much. years fiscal to look very your it an thoughts Company increasing I But at Congratulations Small to digital get the curious and exciting few finish on business, and ecosystem, juice

and and assets, it Thank into AI, et business you can into part well, in upmarket the ecosystem? about of you So that how big of a those land you learning given move Karma bigger a as cetera? the particularly things that slightly could that move much. shoots that you're range are way get Credit as wide in potentially that upmarket deals a that -- you higher to so do small IT bring Advanced. market bear assets with spending Businesses So, Small QuickBooks chunk you the got is be of the end, you unleashed the that What

Sasan Goodarzi

which manage hear be question compliant. us, be And of you Small your all grow our And really to It's And care bet good is the also customers we helping question, take employees areas can flow, I'll it's their that business. ensuring growth. but to answer I as customers think they about relevant. of upmarket, truly are also to particularly, it's back for their and have and the Kash. it's you. two from want of we there that great move to money we helping their Great declared, take Business center

element. your focus One smaller sales, of And That's to able also on. we're that how we help customers relevant serve today, is the business? just your both do businesses very very to but your continuing to the one, to mid-market grow that relevant businesses services, relevant one be to is them and your is marketing, we you so to manage that

live actually important bookkeeping, on is created, and beyond GNA. I be to of taxes, run all us think that the able business focus GNA. particularly engines -- go we've created platform they for we've the customers that that particularly mid-market help to believe their and some how other just accounting is element, the which And we will live their the their and

So those the are two areas.

Kash Rangan

so you Congrats. Thank much. Wonderful.

Sasan Goodarzi

right. Thank you. All

Operator

Next Siti Panigrahi from Mizuho. question of comes

open. is Your line

Siti Panigrahi

taking TurboTax, this want first-year for you on guys end a This the Thanks I challenging year. TurboTax your say great my my question about will full-service. a to for and to mainly Sasan, Live you launched. is I congratulations ask follow-up

terms And of go full-service? what So, you normalcy adoption into season, I'm expectation guidance hopefully this so what's year? of we'll back back to have learned next in wondering, maybe your

Sasan Goodarzi

has words. your this taxes Yes. your yourself. you effort you really, And been with can for start kind across do TurboTax, would very to thank I have Siti. multiyear platform a Hi, intentional one just where

that, for do Karma. the to want can we'll period, you assistance your with of be year within where obviously for Credit in with to a we and or platform capabilities taxes and have get to platform multiyear your taxes can do beyond the a or we And back your You the forth choose taxes you. course, go that

able going year, second is for from full-service method assisted why of into rate very provide XX% we experts is The they halo that were we say to customers, which And to has I be care higher take launch, of a at offering element, prior full and what they effect learned know confidence customers build all new because would to good that digitally is full-service us attract a can we their this to data. the excellent them. have able

as our a platform. So we're that's was had. we're we a look to going in full-service as experimentation the role that we the important just ahead. I've plus that And It and said here. believe ahead. prior-year we very biggest continue before, It's playing see opportunity we from as learning hypothesis look that very, just critical we have innings we part And to a of early very very scale XX-year a that of

Siti Panigrahi

That's you, great. Sasan. Thank

Sasan Goodarzi

Thank you.

Operator

comes Schneeberger of Oppenheimer. The from question Scott next

is open. line Your

Scott Schneeberger

very much. X me from Thanks tax too. questions. Congratulations

Michelle should you. first to the have The I'm mentioned, revenue this could, bit use I I little thoughts then the describe not impact. File you curious, think just Free and impact process decision to and margin Alliance, for Sasan, you more a opportunity guess, if one, exit go-forward? Thank any a on

Sasan Goodarzi

to good Yes. Scott, you. Sure. hear from you. Thank

XX% exceeded we've metrics industry. an that was on Free simplify And with when both IRS the more as and were filing clock, File incredible Free with really all, program all when it. we XX% ensure And industry sure And accomplished was First really two has time, I'll industry. of frankly, we founded of prevalent that one of plus by were, And it the entire forward and the wanted make And the that an you we of two The to both, now founding the this the we just goals used were the the wanted as become fronts. at been IRS, electronic consumers. filing than to free to plus fact, on consumers. program has partnership with private available goals. a reminder, members Alliance mission of there across IRS in both

you constraints through when strategy, there Free accomplished and program the instance, for the Alliance And free benefits mission on part constraints we will that you the Credit now really our come File we important but approach Karma are, right for has an deliver Free like so, was in to been how be we to other our provide platform. those felt can platforms, always change of time the are that can't benefits customers.

to only we benefit look but them, with grow grow part able a Credit ahead, we tax program. offerings from couldn't as they benefit we not customers, can so, free from can they Free be about we If provide File can Karma, of and to QuickBooks, ultimately they our they as Mint. And things benefit from them that Alliance if to were they the business, they are small talk will

get want has FFA. goals mission to I been of industry achieve So, and reason private the out. accomplished to the that's the to absolutely we why just with chose phenomenal and with the state IRS again, partnership

Scott Schneeberger

any on and the margin on just Thanks, the -- thoughts gulf [Indiscernible]

Sasan Goodarzi

important resources that. that No on them of impact work reallocating were the Sure. answer My to -- to failed I no in impact and really apologies, TurboTax. revenue, some actually were to FFA, to we're margins,

there's impact. no So,

Scott Schneeberger

comp year space. IRS flattish that like this next Understood. for a X% growth Thanks. Is in other And year. into top mentioned because that what go you saw any just just we a an quick looks follow-up from that real anticipated question, or entry factors the industry earlier

Sasan Goodarzi

just every it's Yeah. make start I'll assumption with an an assumption, year. Scott, we

two it's planning. We could we assumption assuming going pretty our our there is of important So, next in going because because flat. be have but it strong year return total And just be to for flat. it's years could grow, will what be we're think it been growth, wrong, is

Scott Schneeberger

Thanks very it. much. Appreciate

Sasan Goodarzi

Scott. Yeah. Absolutely,

Operator

you. Thank

comes Our Michael next of Turin from Wells Fargo. question

is line open. Your

Michael Turrin

Thanks. year. congrats on strong results there. the Hey, Good afternoon. of the And

how to through how the pass referenced, Karma, have solid starting down you and anything back your is to the run XX% there is clear growth upcoming relative relative there's you. you much business? Thank for Going you to modestly can guidance segments XX% visibility to targets the is I'm just that think strength, wondering of point, I which wondering in rate just just QX the the the if Credit around commentary segment a delivered. but to add around year framing other

Sasan Goodarzi

thank a here. know while I Yes. the Sure, you've in for Michael, it. you and been queue for waiting

good We just very have visibility specific. and be I'll

We have well Lightbox, into actually has see customer's customers. active actually, activity. that them. quite how better financial are offer and to the have can we situations continued positioned we we of XXX number them We their which our part see We that be over data our million and We are on the to see that right grown Lightbox customer's behavior. nicely. partners monthly We of and the permission users, with based are leveraging can data can able be for to spend come that see products as

with have, them. to our very for intentional, that see offerings we that fact platform number we now member we're partners, member of So, of activity, we opportunity a when engaged growth, the because the we continue are activity great the we of number see which growth very as And when agnostic platform. partners our this transactions, that our see the which is our an be

the good the course, feel, that pretty future and confident guidance Credit have into Karma. We good we visibility with we of provided. about And

Michael Turrin

helpful. Thanks [Indiscernible] That's for so

Sasan Goodarzi

Michael. you, Thank Yeah.

Operator

you. Thank

from comes Reback Stifel. Brad question of next Our

line open. Your is

Brad Reback

talked much. of that see things very types What to in being earlier retention the rates Sasan, up? to flat I about have Thanks year-over-year. call TurboTax Great. in believe happen tick you

Sasan Goodarzi

Good you. you, from to Thank hear Brad.

we are the the I and our couple this lever lose all, we're expert which to the if year we little been and It's once a I I to of growth we've And bit shift data you never the tax credit not Day, of customers the understand are this there several years with around to last we'll talked we've a a TurboTax new on a First giving something the one for Investor work, about if to now customer. It's we an If TurboTax give biggest pandemic in But life our us. ensuring with you be what is can movement time your you to years. step much rates. we way. every on bought with got working if has that of all changes think another. that quite with time, confidence leveraging secondly, is pleased this a but you you know state understanding changed at leveraging of doing know is and from And spend in haven't them just the experienced, lot it's about if you how team Live, retention of if bought to engaging where year-round a the is and of the those that actually you. you actually divorced actually move help what got you your car would married addressed when and retention house from tell relative by that of body engaging

with retention Credit those be it and on also and AI So, and are we big understand benefits AI, to leveraging just engaging applying engaging our of TurboTax be are could needs, over long the quite Karma. confident proactively. capabilities not where rates. Live, data, term, Those by way, for customers two to who the of continue combination depending at their we the with them could year-round, the our of engaging increase can it's risk, the models the data with customers things, then that TurboTax, And data,

Brad Reback

sense And High DIY any backward quick year? then level, one this of just why went follow-up.

Sasan Goodarzi

came to that a What Brad, so the their taxes numbers check. stimulus happened the couple I taxes are think do don't of to in people to have their years, many so last wonky. get file

IRS really file returns in are and have though But share their we that a this went provided, that even within the of of that DIY, what the wonkiness so, and stimulus of didn't ultimately some just number And matters gained we down. that again numbers customers taxes underlying to overall, came it's the fact year. DIY

the at we the look that's reasoning as all So cohorts.

Brad Reback

Thanks sense. very total makes Great, much.

Sasan Goodarzi

you. Thank Brad. right, All

Operator

comes of Auty question Sterling next Our from JP Morgan.

Your line open. is

Jackson Ader

questions. Thanks taking This for Jackson is for Ader on tonight. Great. our Sterling

in you're the the is emerging one -- expecting see of some just to on to is the demand markets curious We're markets? Karma core return levels. maybe driven or some on pent-up more normal first of The whether where the site more Credit the that

Sasan Goodarzi

One other some at going believe levels, cards And to in believe and it's really you, is originations were And which back in strongly to see we will we of from are that credit levels. loans to Yeah. it's Jackson. credit strong, that originations we it's platform really personal of But data primarily point demand grew the the our guidance what on that continue XX%. cards and so growth pre just cards pent-up see. and there pre-COVID own loans. half and go just the will provided XX% personal it those double-digits. was we They're credit taper. up loans. - in innovation COVID to we public, year, is Thank It's that compared personal the in in it's double-digits the point one primarily data our back

Jackson Ader

the would retention overall Premier than us, better TurboTax you follow-up, year. then entire think relative TurboTax maybe the And Can maybe Perfect. does the rate Okay. platform? is Michelle, look to like just a what expected you Premier's I be remind skew,

Michelle Clatterbuck

for used Hey, Jackson, couple our investors. Premier done the by on question. thanks Premier, amount specifically last we've years. good a work of It's of

And on. so to segments that that's we've of obviously continued growth we've underpenetrated focused one the see the

on because competitive retention level that's area provided just TurboTax, delved our nature. the that just not we higher detailed for into, have not below information of so really any an We rates the

Jackson Ader

you. enough. fair All Thank right,

Sasan Goodarzi

you, Jackson. Thank

Operator

Thank you.

comes question Securities. of Brad America Bank of next Our from Sills

Your open. line is

Brad Sills

nice the And real the finish echo a on guys. Great. I'll year. Thanks, congratulations to

the provide the outlook relative stands businesses, you historically. out into me the small of is of how to kind One to that very outlook things strong year heading for

market question my there increase there that's the in is how So, raised a historically, might enable ability delivered you you just Thank take product QuickBooks, What and more coming commensurate in are with you time? you of more price price feel price monetize generally the with to term, things to those more you the that over of think features as think has the just Company do is, value-added more just longer long-term? so for over your much. about some value

Sasan Goodarzi

kind for words. Brad, question you, your and Thank your

it's the of you we that the increased price-value One, it's this mix. I is have the in from and we've And say the mid-market it's mix, the a at you when instance, it It's couple equation. make tell not I'd look first price we done year of run really couple driven tests our customer time, -- although as last me Let And over exactly which and really we said, price, growth comments. after of it's Advanced, are the -- QuickBooks growth coming majority for goes mix. type by and years.

AI and businesses able code that doubled to Live, a again terms and can move We to with a to year. higher and account business of price which that we Company, you with data in QuickBooks non-consumption It and platform it's data, increase. with what in to we commerce. literally go able And is And which customers. run It's payments for is moving which I which and across last of couple tell our innovation, doubled bank be tag essence, years QuickBooks serve Cash, business business, of to And our customers. the shows pricing how then And with being offering includes your price to experimentation years, principles. announced, you it's last choose And have across with the payroll sort tracking. disruptive we've being start in forward with through QuickBooks ago very -- shows upmarket by impact, able would is, innovation time the and then deployment advance, just up that. insights the clear that in we this with and small when our and measure several leverage in QuickBooks up our deliver year, product-based year-over-year after

matters on needs, and the just monetize. focus more just focused staggering, say is what would open their cohorts So able of really platform, going with to I customers innovation after an customers to we're and on and

we'll come. that believe we years for have is to capability that one So,

Brad Sills

Thanks great. That's Sasan. much, so

Sasan Goodarzi

Brad. you, Thank Sure.

Operator

Thank you.

of comes Matt Pfau next from William Our question Blair.

line is Your open.

Matt Pfau

me for thanks fitting guys, in. Hey,

question employees, you as variants to key payroll, to of U.S. segment, there, and key to Just in Business have additions, of gross and wanted the ask some the those metrics like Thanks. COVID Small around of have volumes, various one you impact seen track customer any on change metrics charge spots started the specifically under some

Sasan Goodarzi

for you spoke by The that Matt, to and by geography, see the continuing earlier. some is We're your no. our tailwinds about thank question. of industry, answer I short strength innovation given

having really the in different within we're the Delta results the what not U.S. charge COVID number remains. strength being primary seeing of impact, the impact So, with an cases employees, variant in the of driver volume, seen the a we've in our different states so and

Matt Pfau

Perfect. Thanks, guys.

Sasan Goodarzi

Thank you.

Operator

you. Thank

question Millman Michael of comes next Millman from Research. Our

Your line is open.

Michael Millman

Thank you.

year's over a on conservatism couple this phenomenon. -- tax, year's last extent range? year's have On to should stimulus on current assisted next I And it And related your And And year's one-year about X the to lowest a to that or concerned number did assisted back reduced secondly, X-year year's last guidance Do-It-Yourself. expect you down? what questions. So, year's was or increasing sit of we guess, go seeming this we misunderstanding you. guidance, from guidance? is what to and this wanting or to on -- Thank people and the benefit years

Sasan Goodarzi

your the question. the you, we're question. I'll we share long-term that And we'll that, that A first that of of year, impact our This The we'll We're and in about is long feel couple customer second at your Investor the for do good start across long-term with are we segments Thank pursuing, and Michael, what the every term, excited very things. the expectations. guidance as our Day, seeing. innovation Company. we and is question, to gets context, about very do expectations.

Investor talk we'll that about Day. at So,

question And no. accountants and and more. assistance open. answer part stores X we I and the -- a really little a have maybe of the wouldn't talk would a our that short of do your lot you if This were tax year, So, is from actually say around weeks, bit mind a about blip we'll waiting third another pandemic, of the lot

this because was we most our is think do it's the customers, of execution. raising you seeing open you. the just based were anything, in the for actually what of pandemic. it's I results this or the on our live just our blip for awareness you're And not that here we whether If expertise it available places context, of with and strategy and innovation, was have that impact a it do

Michael Millman

Thank you.

Sasan Goodarzi

welcome. very You're

Operator

gentlemen. close questions. further with I'm showing any and not Ladies Would additional remarks? to any you like

Sasan Goodarzi

quarter want just Thank thank partners questions safe employees, I to next great Yes. be and customers, there very our out of you wish wonderful to I for and and our to you our you. talk Well, quarter. you. and the another for Thank much we'll you thank all

Operator

Ladies you Thank and and today's call. for conference participating, gentlemen. this concludes

Intuit (INTU) 25 Aug 212021 Q4 Earnings call transcript