Intuit Inc at UBS Global Technology and AI Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Taylor McGinnis - UBS Equities - Analyst : Perfect. So I think a good place to start would be just in terms of what you guys are seeing in the demand environment, right? So across some of the SMB exposed software names, I think there was some signs of green shoots or maybe things getting a little bit better, maybe outside of your Mailchimp business pretty much across the board, growth was solid. So could you comment on what you guys are seeing in the environment? How much of the outperformance was really driven by your own execution right versus maybe some unlocking? And then also too not to throw too many questions to you but when you think about the sensitivity of your business to a recovery, what should be things that we should be looking out for?

Question: Taylor McGinnis - UBS Equities - Analyst : The third part was just on which I think you addressed pretty much, but it was just on the sensitivity, right? So is this something that you'll need an improvement in the environment and then you'll see the benefits to your business with a lag. I guess how should we think about those moving pieces?

Question: Taylor McGinnis - UBS Equities - Analyst : Perfect, that was great context and maybe just to dive a little bit more in terms of what this means for the numbers. So when we look at the 2Q revenue guide, very impressive and implies a strong acceleration. You guys talked about consumers is expected to be down low-single digits. So when we think about where that strong acceleration is coming from, whether that be Credit Karma being able to maintain the double-digit growth that we've seen or more of that coming from the global solutions business. How would you unpack that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 03, 2024 / 5:55PM, INTU.OQ - Intuit Inc at UBS Global Technology and AI Conference

Question: Taylor McGinnis - UBS Equities - Analyst : Yeah. That makes a lot of sense. I know I'm in this holiday season not trying to think about my taxes and (multiple speakers) trying to take advantage of the good shopping deals out there. So that (multiple speakers) that resonates.

Question: Taylor McGinnis - UBS Equities - Analyst : (laughter) Sure. So maybe I'm going back to what you talked about on Credit Karma, right? And maybe there being a bit of seasonality because I know we were getting questions on amazing like acceleration and growth 29%. Why not raise the full-year guide, right? So to your point, maybe there is some seasonality, maybe there was something one-time-ish in 1Q. But can you just elaborate on that? Because I know, I think for 3Q that you guys tend to see a good bump from Credit Karma there. So just the puts and takes, I think would be helpful to run through. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 03, 2024 / 5:55PM, INTU.OQ - Intuit Inc at UBS Global Technology and AI Conference

Question: Taylor McGinnis - UBS Equities - Analyst : Yeah, totally makes sense. And then we think about the 20% reiteration for online ecosystem growth this year. So if we take price and some of the headwinds that you're seeing in Mailchimp, if we put that aside, what is driving that comfort in that growth profile remaining durable? And when you think about the sources of potential upside there, is there any businesses within that, that you'd flag in particular?

Question: Taylor McGinnis - UBS Equities - Analyst : Perfect. Let's talk about Intuit Enterprise Suite because that's been one of the most exciting announcements that you guys have introduced over the last few months. So in terms of how you're thinking about that opportunity overlap with some of the ERP players out there, could you help quantify that a little bit, maybe more for the audience. And then when -- I think you mentioned this a little bit, but the potential for online services attached to be much higher with enterprise suite. So anyway, I guess any early insights from the customers that have adopted it that you could share. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 03, 2024 / 5:55PM, INTU.OQ - Intuit Inc at UBS Global Technology and AI Conference

Question: Taylor McGinnis - UBS Equities - Analyst : Perfect. And then another key investor question on this is the level of investment needed to be successful with enterprise suite. So I think you guys mentioned on this most recent earnings call hiring over 200 outbound go-to-market employees. So when we think about where that goes from here, do you need a lot more investment in that? Should we continue to think about that number? Accelerating in the near term, will growth be more gradual? And what does that mean for the level of sales and marketing expense as a percentage of revenue in the medium term?

Question: Taylor McGinnis - UBS Equities - Analyst : That's really helpful. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 03, 2024 / 5:55PM, INTU.OQ - Intuit Inc at UBS Global Technology and AI Conference And then on that, we've gotten a lot of questions on how we should think about the seasonality of expenses this year. So when we look at the first half of this year, it seems a lower non-GAAP EPS growth than we've seen historically. And when we translate that to what it means in the guide, we estimate that maybe it implies OpEx growth around 19% to 20% in the first half. And then that going to maybe somewhere in like the mid-single digits or so in the second half. So just in terms of, can you just walk us through like what is it just this year is a little bit more front-end loaded in terms of the expenses. How is this typical seasonality going forward? How should the audience think about some of the moving pieces this year as it relates to prior years?

Question: Taylor McGinnis - UBS Equities - Analyst : Perfect. And then I think there was an expectation from some investors going into this last print that with some of the activity that you saw in the summer timeframe that you might see greater than the 50% of margin expansion that's implied for this year. So in terms of the puts and takes there, I guess one, is the plan to invest, right? A lot of that back into the business. And then when we think about the offsets, right? Are there areas of because it sounds like you guys are doing a lot of investment across key strategic growth areas that are obviously important long term, but are there any areas of operating efficiency or cost efficiency that are still to be had in the business that you guys are focusing on? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 03, 2024 / 5:55PM, INTU.OQ - Intuit Inc at UBS Global Technology and AI Conference

Question: Taylor McGinnis - UBS Equities - Analyst : That's really, really helpful color. And then just as we think about what this means for longer-term growth. So as I mentioned earlier, a lot of these investments sound very strategic right to what you guys see is I think that's going forward. So in terms of when we could see the fruits of that when you look across consumer and the quick books business, when for these varying investments, could we start to see that really start to contribute to revenues or some that might happen earlier, some that might take a little bit more time. How would you characterize all of that?

Question: Taylor McGinnis - UBS Equities - Analyst : Perfect and then you'd be shifting gears to the consumer business. So if we look at the high end of the revenue guide for consumer, it's very similar to what you did last year. So based on our math, in order to get upside and correct me if I'm wrong, but you might need to see a modest acceleration either in TurboTax live or the DIY business. So when you just think about where you could see -- where you see the most opportunity based on some of the initiatives you guys have in place here. I guess what are you most excited about? And then there's a second part to that question what is Intuit doing that's different. I know you talked a lot about like the promotional side, right? But anything else beyond that, that's different this year than last year that's giving you guys a lot of that optimism that we heard on the call.

Question: Taylor McGinnis - UBS Equities - Analyst : And because you mentioned AI and this is a AI conference, I'd love to get your thoughts in terms of what you guys are seeing with momentum behind Intuit Assist. Are you starting to see that contribute in a material way? Either that be with onboarding new online services, right? Or creating more cross sell or is it like any interest, I guess in add-ons and how you guys are thinking of monetizing it? Do you mind giving us an update there and what you're seeing?

Question: Taylor McGinnis - UBS Equities - Analyst : Yeah. I appreciate all the color. Lots of excitement. I know earlier, you mentioned you've been getting a lot of investor questions on the promotional activity. So I have two right here (laughter) to throw at you in the last couple of minutes that we have. But the first one is just on the promotional activity being pushed out what makes you confident that there will be demand drivers as well at this point in time.

Question: Taylor McGinnis - UBS Equities - Analyst : I would imagine (multiple speakers)--

Question: Taylor McGinnis - UBS Equities - Analyst : Perfect. And then the last one still on the promotional activity is a question why now. Why not do this in prior years? And was there any weaker demand signals that you guys might have been seeing that led to that. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 03, 2024 / 5:55PM, INTU.OQ - Intuit Inc at UBS Global Technology and AI Conference

Question: Taylor McGinnis - UBS Equities - Analyst : Perfect. So with that, we're just at time. So thank you everyone in the audience for attending. And Sandeep, thank you so much. Let's give him a round of applause.