[10-Q] INTUIT INC. Quarterly Earnings Report
Filing Impact
Filing Sentiment
Form Type
10-Q
Rhea-AI Filing Summary
Intuit reported strong results for the quarter ended October 31, 2025. Total net revenue rose to $3.885 billion from $3.283 billion, driven mainly by service revenue growth to $3.497 billion. Product and other revenue was roughly flat at $388 million.
Operating income nearly doubled to $534 million from $271 million, and net income increased to $446 million from $197 million. Diluted earnings per share improved to $1.59 from $0.70. Cash flow from operations was strong at $637 million, up from $362 million, while cash, cash equivalents and restricted cash ended the period at $6.943 billion.
The company continues to build its lending platform, with business loans held for investment of $1.7 billion and an allowance for credit losses of $112 million. Intuit repurchased 1.2 million shares for $851 million and declared dividends of $1.20 per share. As of November 13, 2025, there were 278.4 million common shares outstanding. Intuit also combined its Consumer, Credit Karma, and ProTax operations into a single Consumer segment to align with its platform strategy.
Positive
- Revenue and profit acceleration: Net revenue increased to $3.885 billion from $3.283 billion, while net income more than doubled to $446 million and diluted EPS rose to $1.59 from $0.70.
- Stronger cash generation: Net cash provided by operating activities grew to $637 million from $362 million, supporting continued investment and capital returns.
- Shareholder returns: Intuit repurchased 1.2 million shares for $851 million and declared $343 million of dividends and dividend rights ($1.20 per share) in the quarter.
Negative
- Growing credit exposure: Business loans held for investment reached about $1.7 billion with the allowance for credit losses increasing to $112 million, including a $38 million provision and $31 million in charge-offs.
Insights
Intuit delivered strong double-digit revenue and profit growth with robust cash generation.
Intuit’s quarterly revenue grew to
Cash generation was solid: net cash from operating activities increased to
Capital returns remain significant. The company repurchased
Table of Contents
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________________________
FORM 10-Q
| Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | ||||||||
For the quarterly period ended October 31, 2025
OR
| Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | ||||||||
| For the transition period from ____________ to ____________ . | ||||||||
Commission File Number 0-21180
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) | |||||||
(Address of principal executive offices) (Zip Code)
(650 ) 944-6000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | |||||||||||||||
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☑ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | Smaller reporting company | Emerging growth company | |||||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. The number of shares (in thousands) of Common Stock, $0.01 par value, outstanding as of November 13, 2025 was 278,400 .
| INTUIT INC. FORM 10-Q INDEX | ||
| Page | |||||
PART I - FINANCIAL INFORMATION | |||||
ITEM 1: Financial Statements (Unaudited) | |||||
Condensed Consolidated Statements of Operations for the three months ended October 31, 2025 and 2024 | 4 | ||||
Condensed Consolidated Statements of Comprehensive Income for the three months ended October 31, 2025 and 2024 | 5 | ||||
Condensed Consolidated Balance Sheets at October 31, 2025 and July 31, 2025 | 6 | ||||
Condensed Consolidated Statements of Stockholders’ Equity for the three months ended October 31, 2025 and 2024 | 7 | ||||
Condensed Consolidated Statements of Cash Flows for the three months ended October 31, 2025 and 2024 | 8 | ||||
Notes to Condensed Consolidated Financial Statements | 10 | ||||
ITEM 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations | 29 | ||||
ITEM 3: Quantitative and Qualitative Disclosures about Market Risk | 44 | ||||
ITEM 4: Controls and Procedures | 45 | ||||
PART II - OTHER INFORMATION | |||||
ITEM 1: Legal Proceedings | 46 | ||||
ITEM 1A: Risk Factors | 46 | ||||
ITEM 2: Unregistered Sales of Equity Securities and Use of Proceeds | 60 | ||||
ITEM 5: Other Information | 60 | ||||
ITEM 6: Exhibits | 60 | ||||
Signatures | 61 | ||||
Intuit, QuickBooks, TurboTax, Credit Karma, and Mailchimp, among others, are registered trademarks and/or registered service marks of Intuit Inc., or one of its subsidiaries, in the United States and other countries. Other parties’ marks are the property of their respective owners.
Intuit Q1 Fiscal 2026 Form 10-Q | 2 | ||||||||||
Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements that involve risks and uncertainties. Please also see the section entitled "Risk Factors" in Item 1A of Part II of this Quarterly Report for important information to consider when evaluating these statements. All statements in this report, other than statements that are purely historical, are forward-looking statements. Words such as “will,” “expect,” “anticipate,” “intend,” “plan,” “believe,” “forecast,” “estimate,” “seek,” and similar expressions also identify forward-looking statements. In this report, forward-looking statements include, without limitation, the following:
•our expectations and beliefs regarding future conduct and growth of the business;
•statements regarding the impact of macroeconomic conditions on our business;
•our beliefs and expectations regarding seasonality, competition, and other trends that affect our business;
•our expectation that we will continue to invest significant resources in our product development, marketing and sales capabilities, including products and services incorporating artificial intelligence;
•our expectation that we will continue to invest significant management attention and resources in our information technology infrastructure and in our privacy and security capabilities;
•our expectation that we will work with the broader industry and government to protect our customers from fraud;
•our expectation that we will generate significant cash from operations;
•our expectation that total service revenue as a percentage of our total revenue will grow over the long term;
•our expectations regarding the development of future products, services, business models and technology platforms and our research and development efforts;
•our assumptions underlying our critical accounting estimates, including our judgments and estimates regarding revenue recognition; the fair value of goodwill; and expected future amortization of acquired intangible assets;
•our intention not to sell our investments and our belief that it is more likely than not that we will not be required to sell them before recovery at par;
•our belief that the investments we hold are not other-than-temporarily impaired;
•our belief that we take prudent measures to mitigate investment-related risks;
•our belief that our exposure to currency exchange fluctuation risk will not be significant in the future;
•our assessments and estimates that determine our effective tax rate;
•our belief that our income tax valuation allowance is sufficient;
•our belief that our cash and cash equivalents, investments and cash generated from operations will be sufficient to meet our seasonal working capital needs, capital expenditure requirements, contractual obligations, commitments, debt service requirements, and other liquidity requirements associated with our operations for at least the next 12 months;
•our expectation that we will return excess cash generated by operations to our stockholders through repurchases of our common stock and the payment of cash dividends, after taking into account our operating and strategic cash needs;
•our judgments and assumptions relating to our loan portfolio;
•our belief that our debt facilities will be available to us should we choose to borrow under them;
•our expectations regarding acquisitions and their impact on business and strategic priorities; and
•our assessments and beliefs regarding the future developments and outcomes of pending legal proceedings and inquiries by regulatory authorities, the liability, if any, that Intuit may incur as a result of those proceedings and inquiries, and the impact of any potential losses or expenses associated with such proceedings or inquiries on our financial statements.
We caution investors that forward-looking statements are only predictions based on our current expectations about future events and are not guarantees of future performance. Actual outcomes and results may differ materially from what is expressed or forecast in these forward-looking statements. Risks, uncertainties and other factors that might cause such differences, some of which could be material, include but are not limited to those discussed in the section entitled “Risk Factors” in Item 1A of Part II of this Quarterly Report. We encourage you to read carefully all information provided in this report and in our other filings with the Securities and Exchange Commission before deciding to invest in our stock or to maintain or change your investment. These forward-looking statements are based on information as of the filing date of this Quarterly Report and, except as required by law, we undertake no obligation to revise or update any forward-looking statement for any reason.
Intuit Q1 Fiscal 2026 Form 10-Q | 3 | ||||||||||
Table of Contents
| PART I - FINANCIAL INFORMATION | ||
| ITEM 1 - FINANCIAL STATEMENTS | ||
INTUIT INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) | |||||||||||
| Three Months Ended | |||||||||||
| (In millions, except per share amounts) | October 31, 2025 | October 31, 2024 | |||||||||
| Net revenue: | |||||||||||
Service | $ | $ | |||||||||
Product and other | |||||||||||
| Total net revenue | |||||||||||
| Costs and expenses: | |||||||||||
| Cost of revenue: | |||||||||||
Cost of service revenue | |||||||||||
Cost of product and other revenue | |||||||||||
| Amortization of acquired technology | |||||||||||
| Selling and marketing | |||||||||||
| Research and development | |||||||||||
| General and administrative | |||||||||||
| Amortization of other acquired intangible assets | |||||||||||
| Restructuring | |||||||||||
| Total costs and expenses | |||||||||||
| Operating income | |||||||||||
| Interest expense | ( | ( | |||||||||
| Interest and other income, net | |||||||||||
| Income before income taxes | |||||||||||
| Income tax provision | |||||||||||
| Net income | $ | $ | |||||||||
| Basic net income per share | $ | $ | |||||||||
| Shares used in basic per share calculations | |||||||||||
| Diluted net income per share | $ | $ | |||||||||
| Shares used in diluted per share calculations | |||||||||||
See accompanying notes.
Intuit Q1 Fiscal 2026 Form 10-Q | 4 | ||||||||||
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INTUIT INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) | |||||||||||
| Three Months Ended | |||||||||||
| (In millions) | October 31, 2025 | October 31, 2024 | |||||||||
| Net income | $ | $ | |||||||||
Other comprehensive loss, net of income taxes: | |||||||||||
| Foreign currency translation loss | ( | ||||||||||
| Total other comprehensive loss, net | ( | ||||||||||
| Comprehensive income | $ | $ | |||||||||
See accompanying notes.
Intuit Q1 Fiscal 2026 Form 10-Q | 5 | ||||||||||
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INTUIT INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) | |||||||||||
| (In millions) | October 31, 2025 | July 31, 2025 | |||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Investments | |||||||||||
| Accounts receivable, net | |||||||||||
Notes receivable held for investment | |||||||||||
Notes receivable held for sale | |||||||||||
| Income taxes receivable | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Current assets before funds receivable and amounts held for customers | |||||||||||
| Funds receivable and amounts held for customers | |||||||||||
| Total current assets | |||||||||||
| Long-term investments | |||||||||||
| Property and equipment, net | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Goodwill | |||||||||||
| Acquired intangible assets, net | |||||||||||
| Long-term deferred income tax assets | |||||||||||
| Other assets | |||||||||||
| Total assets | $ | $ | |||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Short-term debt | $ | $ | |||||||||
| Accounts payable | |||||||||||
| Accrued compensation and related liabilities | |||||||||||
| Deferred revenue | |||||||||||
| Other current liabilities | |||||||||||
| Current liabilities before funds payable and amounts due to customers | |||||||||||
| Funds payable and amounts due to customers | |||||||||||
| Total current liabilities | |||||||||||
| Long-term debt | |||||||||||
| Operating lease liabilities | |||||||||||
| Other long-term obligations | |||||||||||
| Total liabilities | |||||||||||
| Commitments and contingencies | |||||||||||
| Stockholders’ equity: | |||||||||||
| Preferred stock | |||||||||||
| Common stock and additional paid-in capital | |||||||||||
| Treasury stock, at cost | ( | ( | |||||||||
| Accumulated other comprehensive loss | ( | ( | |||||||||
| Retained earnings | |||||||||||
| Total stockholders’ equity | |||||||||||
| Total liabilities and stockholders’ equity | $ | $ | |||||||||
Intuit Q1 Fiscal 2026 Form 10-Q | 6 | ||||||||||
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.
INTUIT INC. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) | |||||||||||||||||||||||||||||||||||
| Three Months Ended October 31, 2025 | |||||||||||||||||||||||||||||||||||
(Dollars in millions, except per share amount; shares in thousands) | Shares of Common Stock | Common Stock and Additional Paid-In Capital | Treasury Stock | Accumulated Other Comprehensive Loss | Retained Earnings | Total Stockholders' Equity | |||||||||||||||||||||||||||||
| Balance at July 31, 2025 | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||
| Comprehensive income | — | — | — | ( | |||||||||||||||||||||||||||||||
| Issuance of stock under employee stock plans, net of shares withheld for employee taxes | ( | — | — | — | ( | ||||||||||||||||||||||||||||||
| Stock repurchases under stock repurchase programs | ( | — | ( | — | — | ( | |||||||||||||||||||||||||||||
Dividends and dividend rights declared ($ | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Balance at October 31, 2025 | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||
| Three Months Ended October 31, 2024 | |||||||||||||||||||||||||||||||||||
(Dollars in millions, except per share amount; shares in thousands) | Shares of Common Stock | Common Stock and Additional Paid-In Capital | Treasury Stock | Accumulated Other Comprehensive Loss | Retained Earnings | Total Stockholders' Equity | |||||||||||||||||||||||||||||
| Balance at July 31, 2024 | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||
| Comprehensive income | — | — | — | ||||||||||||||||||||||||||||||||
| Issuance of stock under employee stock plans, net of shares withheld for employee taxes | ( | — | — | — | ( | ||||||||||||||||||||||||||||||
| Stock repurchases under stock repurchase programs | ( | — | ( | — | — | ( | |||||||||||||||||||||||||||||
Dividends and dividend rights declared ($ | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Balance at October 31, 2024 | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||
See accompanying notes.
Intuit Q1 Fiscal 2026 Form 10-Q | 7 | ||||||||||
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INTUIT INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) | |||||||||||
| Three Months Ended | |||||||||||
| (In millions) | October 31, 2025 | October 31, 2024 | |||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | $ | |||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation | |||||||||||
| Amortization of acquired intangible assets | |||||||||||
| Non-cash operating lease cost | |||||||||||
| Share-based compensation expense | |||||||||||
| Deferred income taxes | ( | ||||||||||
| Other | ( | ||||||||||
| Total adjustments | |||||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable | ( | ||||||||||
| Income taxes receivable | |||||||||||
| Prepaid expenses and other assets | ( | ( | |||||||||
| Accounts payable | ( | ( | |||||||||
| Accrued compensation and related liabilities | ( | ( | |||||||||
| Deferred revenue | |||||||||||
| Operating lease liabilities | ( | ( | |||||||||
| Other liabilities | ( | ||||||||||
| Total changes in operating assets and liabilities | ( | ( | |||||||||
| Net cash provided by operating activities | |||||||||||
| Cash flows from investing activities: | |||||||||||
| Purchases of corporate and customer fund investments | ( | ( | |||||||||
| Sales of corporate and customer fund investments | |||||||||||
| Maturities of corporate and customer fund investments | |||||||||||
| Purchases of property and equipment | ( | ( | |||||||||
Originations and purchases of notes receivable held for investment | ( | ( | |||||||||
Sales of notes receivable originally classified as held for investment | |||||||||||
Principal repayments of notes receivable held for investment | |||||||||||
| Other | ( | ( | |||||||||
| Net cash provided by (used in) investing activities | ( | ||||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from borrowings under secured revolving credit facilities | |||||||||||
| Proceeds from issuance of stock under employee stock plans | |||||||||||
| Payments for employee taxes withheld upon vesting of restricted stock units | ( | ( | |||||||||
| Cash paid for purchases of treasury stock | ( | ( | |||||||||
| Dividends and dividend rights paid | ( | ( | |||||||||
| Net change in funds receivable and funds payable and amounts due to customers | ( | ||||||||||
| Other | ( | ||||||||||
| Net cash provided by (used in) financing activities | ( | ||||||||||
Intuit Q1 Fiscal 2026 Form 10-Q | 8 | ||||||||||
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| Effect of exchange rates on cash, cash equivalents, restricted cash, and restricted cash equivalents | ( | ||||||||||
| Net increase (decrease) in cash, cash equivalents, restricted cash, and restricted cash equivalents | ( | ||||||||||
| Cash, cash equivalents, restricted cash, and restricted cash equivalents at beginning of period | |||||||||||
| Cash, cash equivalents, restricted cash, and restricted cash equivalents at end of period | $ | $ | |||||||||
| Reconciliation of cash, cash equivalents, restricted cash, and restricted cash equivalents reported within the condensed consolidated balance sheets to the total amounts reported on the condensed consolidated statements of cash flows | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Restricted cash and restricted cash equivalents included in funds receivable and amounts held for customers | |||||||||||
| Total cash, cash equivalents, restricted cash, and restricted cash equivalents at end of period | $ | $ | |||||||||
Supplemental schedule of non-cash investing activities: | |||||||||||
Transfers of notes receivable originated or purchased as held for investment to held for sale | $ | $ | |||||||||
See accompanying notes.
Intuit Q1 Fiscal 2026 Form 10-Q | 9 | ||||||||||
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INTUIT INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) | ||
| 1. Description of Business and Summary of Significant Accounting Policies | ||
Description of Business | ||
Intuit Inc. (Intuit, we, us, or our) is a global financial technology platform with a mission to power prosperity around the world. We help consumers complete their taxes with ease and confidence and improve their financial success, from credit building to wealth building, with tax and personal financial management products. We help small and mid-market businesses grow and run their business end-to-end, from lead to cash. This encompasses financial management, which includes payments and capital, compliance, human capital management, and marketing products and services. For accounting professionals, we provide professional tax and financial management products and services.
We do this through our platform that powers TurboTax, Credit Karma, QuickBooks, Mailchimp, and Intuit Enterprise Suite. Lacerte, ProSeries, and ProConnect Tax Online are our leading tax preparation offerings for professional accountants. Incorporated in 1984 and headquartered in Mountain View, California, we sell our products and services primarily in the United States (U.S.).
Basis of Presentation | ||
These condensed consolidated financial statements include the financial statements of Intuit and its wholly-owned subsidiaries. We have eliminated all intercompany balances and transactions in consolidation. We have included all adjustments, consisting only of normal recurring items, which we considered necessary for a fair presentation of our financial results for the interim periods presented. We have reclassified certain amounts previously reported in our financial statements to conform to the current presentation.
Effective August 1, 2025, we combined our Consumer, Credit Karma, and ProTax businesses into a single Consumer segment in order to better serve the diverse financial needs of our customers as one consumer platform. Our chief operating decision maker allocates resources and assesses segment performance using regularly provided segment revenue and segment operating income information under this updated segment structure. To align results under this segment change, certain selling and marketing, product development, and general and administrative expenses for Credit Karma that were managed at the segment level are now managed at the platform level and are included in other corporate expenses rather than in segment expenses. Also on August 1, 2025, we reorganized certain marketing, communications, and customer success functions in our Global Business Solutions segment that support and benefit our overall platform and are managed at that level rather than at the segment level. Additionally, certain data science and analytics teams that were managed at the platform level are now managed at the segment level. We have recast certain previously reported amounts to conform to these segment changes. As a result of these changes, for the three months ended October 31, 2024, we reclassified expenses totaling $3 152
These unaudited condensed consolidated financial statements and accompanying notes should be read together with the audited consolidated financial statements in Part II, Item 8 of our Annual Report on Form 10-K for the fiscal year ended July 31, 2025. Results for the three months ended October 31, 2025 are not necessarily indicative of the results we expect for the fiscal year ending July 31, 2026 or any other future period.
Seasonality | ||
Significant Accounting Policies | ||
We described our significant accounting policies in Note 1 to the financial statements in Part II, Item 8 of our Annual Report on Form 10-K for the fiscal year ended July 31, 2025. There have been no changes to our significant accounting policies during the first three months of fiscal 2026.
Intuit Q1 Fiscal 2026 Form 10-Q | 10 | ||||||||||
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Use of Estimates | ||
In preparing our condensed consolidated financial statements in accordance with U.S. generally accepted accounting principles (GAAP), we make certain judgments, estimates, and assumptions that affect the amounts reported in our financial statements and the disclosures made in the accompanying notes. For example, we use judgments and estimates in determining how revenue should be recognized. These judgments and estimates include identifying performance obligations, determining if the performance obligations are distinct, determining the standalone sales price (SSP) and timing of revenue recognition for each distinct performance obligation, and estimating variable consideration to be included in the transaction price. We use estimates in determining the collectibility of accounts receivable and notes receivable held for investment, the appropriate levels of various accruals including accruals for litigation contingencies, the discount rate used to calculate lease liabilities, the amount of our worldwide tax provision, the realizability of deferred tax assets, the credit losses of available-for-sale debt securities, the fair value of assets acquired and liabilities assumed for business combinations, and the fair value of notes receivable held for sale. We also use estimates in determining the remaining economic lives and fair values of acquired intangible assets, property and equipment, and other long-lived assets. In addition, we use assumptions to estimate the fair value of reporting units and share-based compensation. Despite our intention to establish accurate estimates and use reasonable assumptions, actual results may differ from our estimates.
Computation of Net Income Per Share | ||
We compute basic net income or loss per share using the weighted-average number of common shares outstanding during the period. We compute diluted net income per share using the weighted-average number of common shares and dilutive potential common shares outstanding during the period. Dilutive potential common shares consist of the shares issuable upon the exercise of stock options and upon the vesting of restricted stock units (RSUs) under the treasury stock method.
We include stock options with combined exercise prices and unrecognized compensation expense that are less than the average market price for our common stock, and RSUs with unrecognized compensation expense that is less than the average market price for our common stock, in the calculation of diluted net income per share. We exclude stock options with combined exercise prices and unrecognized compensation expense that are greater than the average market price for our common stock, and RSUs with unrecognized compensation expense that is greater than the average market price for our common stock, from the calculation of diluted net income per share because their effect is anti-dilutive. Under the treasury stock method, the amount that must be paid to exercise stock options and the amount of compensation expense for future service that we have not yet recognized for stock options and RSUs are assumed to be used to repurchase shares.
Dividend rights apply to all RSUs that we grant and are accumulated and paid when the underlying RSUs vest. Since dividend rights are subject to the same vesting requirements as the underlying equity awards, they are considered a contingent transfer of value. Consequently, the RSUs are not considered participating securities, and we do not present them separately in earnings per share.
In loss periods, basic net loss per share and diluted net loss per share are the same since the effect of potential common shares is anti-dilutive and therefore excluded.
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The following table presents the composition of shares used in the computation of basic and diluted net income per share for the periods indicated.
| Three Months Ended | |||||||||||
| (In millions, except per share amounts) | October 31, 2025 | October 31, 2024 | |||||||||
| Numerator: | |||||||||||
| Net income | $ | $ | |||||||||
| Denominator: | |||||||||||
Shares used in basic per share calculations: | |||||||||||
| Weighted-average common shares outstanding | |||||||||||
Shares used in diluted per share calculations: | |||||||||||
| Weighted-average common shares outstanding | |||||||||||
Dilutive potential common equivalent shares from share-based awards | |||||||||||
| Dilutive weighted-average common shares outstanding | |||||||||||
| Basic and diluted net income per share: | |||||||||||
| Basic net income per share | $ | $ | |||||||||
| Diluted net income per share | $ | $ | |||||||||
Shares excluded from diluted net income per share: | |||||||||||
Weighted-average share-based awards that have been excluded from dilutive common equivalent shares outstanding due to their anti-dilutive effect | |||||||||||
Deferred Revenue | ||
We record deferred revenue when we have entered into a contract with a customer, and cash payments are received or due prior to transfer of control or satisfaction of the related performance obligation. Our deferred revenue primarily relates to our subscription offerings. During the three months ended October 31, 2025, we recognized revenue of $590 million that was included in deferred revenue at July 31, 2025. During the three months ended October 31, 2024, we recognized revenue of $524 million that was included in deferred revenue at July 31, 2024.
Our performance obligations are generally satisfied within 12 months of the initial contract date. As of October 31, 2025 and July 31, 2025, the deferred revenue balance related to performance obligations that will be satisfied after 12 months was $3 million and $4 million, respectively, and is included in other long-term obligations on our condensed consolidated balance sheets.
Concentration of Credit Risk and Significant Customers | ||
No customer accounted for 10% or more of total net revenue in the three months ended October 31, 2025 or October 31, 2024. No customer accounted for 10% or more of gross accounts receivable at October 31, 2025 or July 31, 2025.
Accounting Standards Not Yet Adopted | ||
Income Tax: In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures." This standard requires additional disclosures related to the income tax rate reconciliation, income taxes paid by jurisdiction, and other income tax-related disclosures. The standard is effective for fiscal years beginning after December 15, 2024, which means that it will be effective for us for our annual reporting for the fiscal year ending July 31, 2026. Early adoption is permitted on either a prospective or retrospective basis.
Disaggregation of Income Statement Expenses: In November 2024, the FASB issued ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses," and in January 2025, the FASB issued ASU 2025-01, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date," which clarified the effective date of ASU 2024-03. This standard requires entities to disaggregate operating expenses into specific categories such as employee compensation, depreciation, and intangible asset amortization, by relevant expense caption on the statement of
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operations. The standard is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, which means that it will be effective for our annual reporting for the fiscal year ending July 31, 2028 and for interim period reporting beginning in fiscal 2029. Early adoption is permitted on either a prospective or retrospective basis.
Measurement of Credit Losses for Accounts Receivable and Contract Assets: In July 2025, the FASB issued ASU 2025-05, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets.” This standard allows entities to apply a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under FASB Accounting Standards Codification (ASC) Topic 606, “Revenue from Contracts with Customers.” The standard is effective for fiscal years beginning after December 15, 2025, including interim periods within those fiscal years, which means that it will be effective for us in the first quarter of our fiscal year ending July 31, 2027. Early adoption is permitted, and the standard is to be applied prospectively.
Internal-Use Software: In September 2025, the FASB issued ASU 2025-06, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software.” The standard removes all references to project stages and clarifies the threshold entities apply to begin capitalizing costs. The standard is effective for fiscal years beginning after December 15, 2027, including interim reporting periods within those fiscal years, which means that it will be effective for us in the first quarter of our fiscal year ending July 31, 2029. Early adoption is permitted, and the standard is to be applied using a prospective, retrospective, or modified transition approach.
Credit Losses: Purchased Loans: In November 2025, the FASB issued ASU 2025-08, “Financial Instruments—Credit Losses (Topic 326): Purchased Loans.” The standard expands the population of acquired financial assets subject to the gross-up approach in Topic 326 whereby certain purchased loans are recognized at their purchase price plus an allowance for expected credit losses. The standard is effective for fiscal years beginning after December 15, 2026, including interim reporting periods within those fiscal years, which means that it will be effective for us in the first quarter of our fiscal year ending July 31, 2028. Early adoption is permitted, and the standard is to be applied prospectively.
We are currently evaluating the impact of our pending adoptions of the above standards on our consolidated financial statements and related disclosures.
| 2. Fair Value Measurements | ||
Fair Value Hierarchy | ||
The authoritative guidance defines fair value as the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. When determining fair value, we consider the principal or most advantageous market for an asset or liability and assumptions that market participants would use when pricing the asset or liability. In addition, we consider and use all valuation methods that are appropriate in estimating the fair value of an asset or liability.
The authoritative guidance establishes a fair value hierarchy that is based on the extent and level of judgment used to estimate the fair value of assets and liabilities. In general, the authoritative guidance requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. An asset or liability’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the measurement of its fair value. The three levels of input defined by the authoritative guidance are as follows:
•Level 1 uses unadjusted quoted prices that are available in active markets for identical assets or liabilities.
•Level 2 uses inputs other than quoted prices included in Level 1 that are either directly or indirectly observable through correlation with market data. These include quoted prices in active markets for similar assets or liabilities; quoted prices for identical or similar assets or liabilities in markets that are not active; and inputs to valuation models or other pricing methodologies that do not require significant judgment because the inputs used in the model, such as interest rates and volatility, can be corroborated by readily observable market data for substantially the full term of the assets or liabilities.
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Assets and Liabilities Measured at Fair Value on a Recurring Basis | ||
The following table summarizes financial assets that we measured at fair value on a recurring basis at the dates indicated, classified in accordance with the fair value hierarchy described above.
| October 31, 2025 | July 31, 2025 | ||||||||||||||||||||||||||||||||||
| (In millions) | Level 1 | Level 2 | Total Fair Value | Level 1 | Level 2 | Total Fair Value | |||||||||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||||||||||||||
Cash equivalents, primarily money market funds | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Available-for-sale debt securities: | |||||||||||||||||||||||||||||||||||
| Corporate notes | |||||||||||||||||||||||||||||||||||
| U.S. agency securities | |||||||||||||||||||||||||||||||||||
| Total available-for-sale debt securities | |||||||||||||||||||||||||||||||||||
| Total assets measured at fair value on a recurring basis | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
The following table summarizes our cash equivalents and available-for-sale debt securities by balance sheet classification and level in the fair value hierarchy at the dates indicated.
| October 31, 2025 | July 31, 2025 | ||||||||||||||||||||||||||||||||||
| (In millions) | Level 1 | Level 2 | Total Fair Value | Level 1 | Level 2 | Total Fair Value | |||||||||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||||||||||||||
| In cash and cash equivalents | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Available-for-sale debt securities: | |||||||||||||||||||||||||||||||||||
| In investments | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| In funds receivable and amounts held for customers | |||||||||||||||||||||||||||||||||||
| Total available-for-sale debt securities | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
We value our Level 1 assets, consisting primarily of money market funds, using quoted prices in active markets for identical instruments.
Financial assets whose fair values we measure on a recurring basis using Level 2 inputs consist of corporate notes and U.S. agency securities. We measure the fair values of these assets with the help of a pricing service that either provides quoted market prices in active markets for identical or similar securities or uses observable inputs for their pricing without applying significant adjustments. Our fair value processes include controls designed to ensure that we record appropriate fair values for our Level 2 investments. These controls include comparison to pricing provided by a secondary pricing service or investment manager, validation of pricing sources and models, review of key model inputs, and independent recalculation of prices where appropriate.
Financial assets whose fair values we measure using Level 3 inputs consist of notes receivable held for sale and notes receivable held for investment. Notes receivable held for sale are recorded at the lower of amortized cost or fair value. As of October 31, 2025, total notes receivable held for sale were not material and the difference between amortized cost and fair value was not material. As of July 31, 2025, we held no notes receivable for sale. As of October 31, 2025 and July 31, 2025, the difference between the amortized cost and fair value of notes receivable held for investment was not material.
Financial liabilities whose fair values we measure using Level 2 inputs consist of senior unsecured notes. We measure the fair value of our senior unsecured notes based on their trading prices and the interest rates we could obtain for other borrowings with similar terms. At each of the reporting periods ended October 31, 2025 and July 31, 2025, the total estimated fair value of the senior unsecured notes was $5.0 billion. At each of the reporting periods ended October 31, 2025 and July 31, 2025, the carrying value of the senior unsecured notes was $5.0
Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis | ||
Long-term investments primarily include non-marketable equity securities in privately-held companies that do not have a readily determinable fair value. They are accounted for at cost and adjusted based on observable price changes from orderly transactions for identical or similar investments of the same issuer, or impairment. These investments are classified as Level 3 in the fair value hierarchy because we estimate the value of these investments using a valuation method based on observable transaction price changes at the transaction date.
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The following table summarizes the adjustments to the carrying value of our long-term investments.
| Three Months Ended | |||||||||||
| (In millions) | October 31, 2025 | October 31, 2024 | |||||||||
Upward adjustments | $ | $ | |||||||||
Downward adjustments, including impairments | ( | ||||||||||
Net adjustments | $ | $ | ( | ||||||||
Cumulative upward adjustments amounted to $48 million, and cumulative downward adjustments, including impairments, amounted to $27 million through October 31, 2025 for measurement alternative investments held as of October 31, 2025. The carrying value of long-term investments on our condensed consolidated balance sheets was $92 million and $94 million at October 31, 2025 and July 31, 2025, respectively.
| 3. Cash and Cash Equivalents, Investments, and Funds Receivable and Amounts Held for Customers | ||
We consider highly liquid investments with maturities of three months or less at the date of purchase to be cash equivalents. In all periods presented, cash equivalents consist primarily of money market funds. Investments consist primarily of investment-grade available-for-sale debt securities. Funds receivable and amounts held for customers represent funds receivable from third-party payment processors for customer transactions, funds in transit to our customers, and funds held on behalf of our customers that are invested in cash and cash equivalents and investment-grade available-for-sale debt securities, restricted for use solely for the purpose of satisfying amounts we owe on behalf of our customers. Our obligations with respect to funds we transmit on behalf of our customers are satisfied when the funds are settled in the customers' accounts. These obligations, including funds in transit to our customers, are reflected in funds payable and amounts due to customers in the accompanying condensed consolidated balance sheets.
Except for direct obligations of the U.S. government, securities issued by agencies of the U.S. government, and money market funds, we diversify our investments in debt securities by limiting our holdings with any individual issuer.
The following table summarizes our cash and cash equivalents, investments, and funds receivable and amounts held for customers by balance sheet classification at the dates indicated.
| October 31, 2025 | July 31, 2025 | ||||||||||||||||||||||
| (In millions) | Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||||||||
| Classification on condensed consolidated balance sheets: | |||||||||||||||||||||||
| Cash and cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
| Investments | |||||||||||||||||||||||
| Funds receivable and amounts held for customers | |||||||||||||||||||||||
| Total cash and cash equivalents, investments, and funds receivable and amounts held for customers | $ | $ | $ | $ | |||||||||||||||||||
The following table summarizes our cash and cash equivalents, investments, and relevant portion of funds receivable and amounts held for customers by investment category at the dates indicated. As of October 31, 2025 and July 31, 2025, this excludes $331 million and $329 million, respectively, of funds receivable from third-party payment processors on our condensed consolidated balance sheets included in funds receivable and amounts held for customers that were not measured and recorded at fair value.
| October 31, 2025 | July 31, 2025 | ||||||||||||||||||||||
| (In millions) | Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||||||||
| Type of issue: | |||||||||||||||||||||||
| Total cash, cash equivalents, restricted cash, and restricted cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
| Available-for-sale debt securities: | |||||||||||||||||||||||
| Corporate notes | |||||||||||||||||||||||
| U.S. agency securities | |||||||||||||||||||||||
| Total available-for-sale debt securities | |||||||||||||||||||||||
| Total cash, cash equivalents, restricted cash, restricted cash equivalents, and investments | $ | $ | $ | $ | |||||||||||||||||||
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We use the specific identification method to compute gains and losses on investments. We include realized gains and losses on our available-for-sale debt securities in interest and other income, net in our condensed consolidated statements of operations. Gross realized gains and losses on our available-for-sale debt securities for the three months ended October 31, 2025 and October 31, 2024 were not material.
We accumulate unrealized gains and losses on our available-for-sale debt securities, net of tax, in accumulated other comprehensive income or loss in the stockholders’ equity section of our condensed consolidated balance sheets, except for certain unrealized losses described below. Gross unrealized gains and losses on our available-for-sale debt securities at October 31, 2025 and July 31, 2025 were not material.
For available-for-sale debt securities in an unrealized loss position, we determine whether a credit loss exists. The estimate of the credit loss is determined by considering available information relevant to the collectibility of the security and information about past events, current conditions, and reasonable and supportable forecasts. The allowance for credit loss is recorded to interest and other income, net in our condensed consolidated statements of operations, not to exceed the amount of the unrealized loss. Any excess unrealized loss greater than the allowance for credit loss at a security level is recognized in accumulated other comprehensive income or loss in the stockholders' equity section of our condensed consolidated balance sheets. We determined there were no credit losses related to available-for-sale debt securities as of October 31, 2025. Unrealized losses on available-for-sale debt securities at October 31, 2025 were not material and were primarily due to changes in market interest rates. We do not intend to sell these investments. In addition, it is more likely than not that we will not be required to sell them before recovery of the amortized cost basis, which may be at maturity.
The following table summarizes our available-for-sale debt securities, included in investments and relevant portion of funds receivable and amounts held for customers, classified by the stated maturity date of the security at the dates indicated.
| October 31, 2025 | July 31, 2025 | ||||||||||||||||||||||
| (In millions) | Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||||||||
| Due within one year | $ | $ | $ | $ | |||||||||||||||||||
| Due within two years | |||||||||||||||||||||||
| Due within three years | |||||||||||||||||||||||
| Total available-for-sale debt securities | $ | $ | $ | $ | |||||||||||||||||||
The following table summarizes our funds receivable and amounts held for customers by asset category at the dates indicated.
| (In millions) | October 31, 2025 | July 31, 2025 | |||||||||
| Restricted cash and restricted cash equivalents | $ | $ | |||||||||
| Restricted available-for-sale debt securities and funds receivable | |||||||||||
| Total funds receivable and amounts held for customers | $ | $ | |||||||||
| (In millions) | October 31, 2024 | July 31, 2024 | |||||||||
| Restricted cash and restricted cash equivalents | $ | $ | |||||||||
| Restricted available-for-sale debt securities and funds receivable | |||||||||||
| Total funds receivable and amounts held for customers | $ | $ | |||||||||
| 4. Notes Receivable and Allowances for Credit Losses | ||
As of October 31, 2025 and July 31, 2025, our notes receivable portfolio consisted of notes receivable held for investment, including small and mid-market business and consumer loans, and notes receivable held for sale, consisting of small and mid-market business loans. We classify notes receivable as held for investment when we have both the intent and ability to hold for the foreseeable future or until maturity or payoff. We classify notes receivable as held for sale when we have the intent and ability to sell substantially all of our rights and interests in a qualified loan to a third-party investor. A note receivable that is initially designated as held for sale or held for investment may be reclassified when our intent for that individual note receivable changes. When a note receivable held for investment is reclassified to held for sale and recorded at the lower of amortized cost or fair value, the related allowance for credit losses for that note receivable is released, and any adjustment to record the note receivable at the lower of amortized cost or fair value is recorded.
Notes Receivable Held for Investment | ||
Business loans. We provide financing to small and mid-market businesses via term loans (business loans) that we originate through an originating bank partner. During the three months ended October 31, 2025 and October 31, 2024, we purchased business loans from our originating bank partner with principal balances in the amount of $1.3 billion and $650 million,
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respectively. As of October 31, 2025, we had commitments to purchase $36 million in business loans that were originated on or prior to October 31, 2025.
The business loans are not secured and are recorded at amortized cost, which includes the unpaid principal balances net of any related deferred origination costs and fees, discounts, purchase premiums, and allowance for credit losses. As of October 31, 2025 and July 31, 2025, the net balance of business loans held for investment was $1.7 billion and $1.5 billion, respectively, which is net of an allowance for credit losses of $112 million and $100 million, respectively. The current portion is included in notes receivable held for investment and the long-term portion is included in other assets on our condensed consolidated balance sheets.
Interest income is earned on business loans purchased and held for investment in accordance with the specified period of time and defined interest rate noted in the loan contract. Interest income is recorded net of amortized direct origination costs and fees, discounts, and purchase premiums and is included in service revenue in our condensed consolidated statements of operations. Interest income was not material for all periods presented.
Consumer loans. We provide refund advance loans to eligible TurboTax customers based on the customer's anticipated income tax refund at no cost to the customer, and other consumer loans (consumer loans). The refund advance loans are repaid from the customer's income tax refund, which is generally received within three to four weeks after acceptance of the customer's income tax return by the Internal Revenue Service (IRS). We partner with third-party issuing banks to originate the consumer loans and subsequently purchase those consumer loans. The consumer loans are not secured and are recorded at amortized cost, net of any related deferred origination costs and fees, discounts, purchase premiums, and allowance for credit losses. Refund advance and other consumer loans were not material as of October 31, 2025 and July 31, 2025.
Allowance for credit losses. We maintain an allowance for credit losses on notes receivable held for investment to reserve for expected credit losses in the notes receivable portfolio. The allowance for credit losses is determined based on our current estimate of expected credit losses, historical credit losses, estimates of recoveries, and future expectations as of each balance sheet date. Adjustments to the allowance each period for changes in our estimate of lifetime expected credit losses are recognized in earnings through the provision for credit losses included in cost of service revenue in our condensed consolidated statements of operations. We evaluate the creditworthiness of our notes receivable portfolio on a pooled basis when shared credit risk characteristics exist.
The allowance for credit losses is subjective and requires management estimates, including such factors as known and inherent risks in the business loan portfolio, use of historical credit losses to estimate expected credit losses, adverse situations that may affect borrowers' ability to repay, and current and forecasted economic conditions. Other factors considered may include uncertainties in forecasting, subjective application of modeling techniques, changes in portfolio composition, seasonality, business conditions, and emerging trends.
For our business loan portfolio, expected credit losses are measured based on a credit loss forecasting model and calculated by applying loss curves derived from loan-level risk segment and term mixes, aggregated at monthly business loan vintages. Loss curves are estimated based on a combination of empirical loss curve data and management judgment. The loss rates and underlying models are updated periodically to reflect factors such as actual loan performance and changes in assumptions based on the credit risk characteristics of the business loan portfolio. We use empirical data and management judgment to estimate losses for new credit tests or products for which we do not have enough history.
We consider a business loan to be delinquent when the payments are one day past due. We place delinquent business loans on nonaccrual status and stop accruing interest income. Business loans are returned to accrual status if they are brought current or have performed in accordance with the contractual terms for a reasonable period of time and, in our judgment, will continue to make periodic principal and interest payments as per contractual terms. Previously recognized interest receivable from charged-off business loans that is accrued but not collected from the consumers is reversed. As of October 31, 2025 and July 31, 2025, the amortized cost basis for delinquent business loans held for investment and the balance of business loans held for investment on a nonaccrual status were not material. The interest income on nonaccrual business loans recognized on a cash basis for the three months ended October 31, 2025 and 2024 was not material.
The changes in the allowance for credit losses for our business loan portfolio for the three months ended October 31, 2025 and 2024 were as shown in the following table.
Three Months Ended | |||||||||||
(In millions) | October 31, 2025 | October 31, 2024 | |||||||||
Beginning balance | $ | $ | |||||||||
| Provision for expected credit losses | |||||||||||
Charge-offs | ( | ( | |||||||||
| Recoveries | |||||||||||
Ending balance | $ | $ | |||||||||
For our consumer loan portfolio, we maintain an allowance for credit losses to reserve for potentially uncollectible refund advance loans and other consumer loans. The allowance for credit losses for refund advance loans is determined based on
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expected funding of refunds by the IRS using historical trends and future expectations. The allowance for credit losses on refund advance loans and other consumer loans was not material as of October 31, 2025 and July 31, 2025.
When available information confirms that specific notes receivable or portions thereof are uncollectable, identified amounts are charged off against the allowance for credit losses. Notes receivable are charged off in accordance with our charge-off policy when the contractual principal becomes 120 days past due or when other charge-off policy requirements are met. Subsequent recoveries of the unpaid principal balance, if any, are credited to the allowance for credit losses.
Notes Receivable Held for Sale | ||
Business loans. We have entered into multiple forward flow arrangements with institutional investors that facilitate the sale of participation interests in eligible unsecured business loans. These arrangements have varying terms, with expiration dates ranging from 2027 to 2029.
Notes receivable held for sale are recorded at the lower of amortized cost or fair value determined on an individual note receivable basis. As of October 31, 2025, the balance of notes receivable held for sale was $48 million and is included in notes receivable held for sale on our condensed consolidated balance sheets. As of July 31, 2025, we held no notes receivable for sale. The total unpaid principal balance of business loans sold during the three months ended October 31, 2025 and October 31, 2024 amounted to $205 million and $106 million, respectively. For the three months ended October 31, 2025 and October 31, 2024, gains on sales of business loans and servicing income were not material.
| 5. Goodwill and Acquired Intangible Assets | ||
| Goodwill | ||
Changes in the carrying value of goodwill by reportable segment during the three months ended October 31, 2025 were as shown in the following table. Our reportable segments are described in Note 12, “Segment Information.”
| (In millions) | Balance July 31, 2025 | Goodwill Acquired | Foreign Currency Translation | Balance October 31, 2025 | ||||||||||||||||||||||
Global Business Solutions | $ | $ | $ | $ | ||||||||||||||||||||||
| Consumer | ||||||||||||||||||||||||||
| Totals | $ | $ | $ | $ | ||||||||||||||||||||||
Goodwill is net of accumulated impairment losses of $114 million, which were recorded prior to July 31, 2025 and are included in our Consumer segment.
Acquired Intangible Assets | ||
The following table shows the cost, accumulated amortization, and weighted-average life in years for our acquired intangible assets at the dates indicated. The weighted-average lives are calculated for assets that are not fully amortized.
| (Dollars in millions) | Customer and User Relationships | Purchased Technology | Trade Names and Logos | Total | |||||||||||||||||||
| At October 31, 2025: | |||||||||||||||||||||||
| Cost | $ | $ | $ | $ | |||||||||||||||||||
| Accumulated amortization | ( | ( | ( | ( | |||||||||||||||||||
| Acquired intangible assets, net | $ | $ | $ | $ | |||||||||||||||||||
| Weighted-average life in years | |||||||||||||||||||||||
| At July 31, 2025: | |||||||||||||||||||||||
| Cost | $ | $ | $ | $ | |||||||||||||||||||
| Accumulated amortization | ( | ( | ( | ( | |||||||||||||||||||
| Acquired intangible assets, net | $ | $ | $ | $ | |||||||||||||||||||
| Weighted-average life in years | |||||||||||||||||||||||
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The following table shows the expected future amortization expense for our acquired intangible assets at October 31, 2025. Amortization of purchased technology is generally charged to amortization of acquired technology in our condensed consolidated statements of operations. Amortization of other acquired intangible assets, such as customer and user relationships, is charged to amortization of other acquired intangible assets in our condensed consolidated statements of operations. If impairment events occur, they could accelerate the timing of acquired intangible asset charges.
| (In millions) | Expected Future Amortization Expense | ||||
| Fiscal year ending July 31, | |||||
| 2026 (excluding the three months ended October 31, 2025) | $ | ||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| 2030 | |||||
| Thereafter | |||||
| Total expected future amortization expense | $ | ||||
| 6. Debt | ||
The carrying value of our debt was as follows at the dates indicated:
(Dollars in millions) | October 31, 2025 | July 31, 2025 | Effective Interest Rate | ||||||||||||||
| Senior unsecured notes issued June 2020: | |||||||||||||||||
| $ | $ | ||||||||||||||||
Senior unsecured notes issued September 2023: | |||||||||||||||||
| Secured revolving credit facilities | |||||||||||||||||
| Total principal balance of debt | |||||||||||||||||
| Unamortized discount and debt issuance costs | ( | ( | |||||||||||||||
| Net carrying value of debt | $ | $ | |||||||||||||||
| Short-term debt | $ | $ | |||||||||||||||
| Long-term debt | $ | $ | |||||||||||||||
Future principal payments for debt at October 31, 2025 were as shown in the table below.
| (In millions) | Future Principal Payments | ||||
| Fiscal year ending July 31, | |||||
| 2026 (excluding the three months ended October 31, 2025) | $ | ||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| 2030 | |||||
| Thereafter | |||||
| Total future principal payments for debt | $ | ||||
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Senior Unsecured Notes | ||
2020 Notes. In June 2020, we issued four series of senior unsecured notes (together, the 2020 Notes) pursuant to a public debt offering. The proceeds from the issuance were $1.98 billion, net of debt discount of $2 million and debt issuance costs of $15 million. As of October 31, 2025, $1.0 billion in principal on the 2020 Notes remained outstanding.
Interest is payable semiannually on January 15 and July 15 of each year. The discount and debt issuance costs are amortized to interest expense using the effective interest method over the term of the 2020 Notes.
The 2020 Notes are senior unsecured obligations of Intuit and rank equally with all existing and future unsecured and unsubordinated indebtedness of Intuit and are redeemable by us at any time, subject to a make-whole premium. Upon the occurrence of change of control transactions that are accompanied by certain downgrades in the credit ratings of the 2020 Notes, we will be required to repurchase the 2020 Notes at a repurchase price equal to 101 % of the aggregate outstanding principal plus any accrued and unpaid interest to but not including the date of repurchase. The indenture governing the 2020 Notes requires us to comply with certain covenants. For example, the 2020 Notes limit our ability to create certain liens and enter into sale and leaseback transactions. As of October 31, 2025, we were compliant with all covenants governing the 2020 Notes.
2023 Notes. In September 2023, we issued four series of senior unsecured notes (together, the 2023 Notes) pursuant to a public debt offering. The proceeds from the issuance were $3.96 billion, net of debt discount of $20 million and debt issuance costs of $24 million, and were used, together with operating cash, to repay the outstanding balance on our unsecured term loan. As of October 31, 2025, $4.0 billion in principal on the 2023 Notes remained outstanding.
Interest is payable semiannually on March 15 and September 15 of each year. The discount and debt issuance costs are amortized to interest expense using the effective interest method over the term of the 2023 Notes.
The 2023 Notes are senior unsecured obligations of Intuit and rank equally with all existing and future unsecured and unsubordinated indebtedness of Intuit and are redeemable by us at any time, subject to a make-whole premium. The indenture governing the 2023 Notes requires us to comply with certain covenants. For example, the 2023 Notes limit our ability to create certain liens and enter into sale and leaseback transactions. As of October 31, 2025, we were compliant with all covenants governing the 2023 Notes.
Unsecured Credit Facilities | ||
2024 Credit Facility. On February 5, 2024, we terminated our amended and restated credit agreement dated November 1, 2021 (2021 Credit Facility), and entered into a credit agreement with certain lenders providing for a $1.5 billion unsecured revolving credit facility that expires on February 5, 2029 (2024 Credit Facility).
Under the 2024 Credit Facility, we may, subject to certain customary conditions, including approval of relevant lenders, on one or more occasions, increase commitments under the 2024 Credit Facility by an amount not to exceed $1 billion in the aggregate, and, on one or more occasions, extend the maturity date of the 2024 Credit Facility by one year . The 2024 Credit Facility includes a $500 million sublimit for borrowing swingline loans and a $250 million sublimit for the issuance of letters of credit. Advances under the 2024 Credit Facility accrue interest at rates equal to (a) in the case of U.S. dollar borrowings, at our election, either (i) the alternate base rate plus a margin that ranges from 0.0 % to 0.125 %, or (ii) the adjusted term Secured Overnight Finance Rate (SOFR) plus a margin that ranges from 0.7 % to 1.125 %, or (b) in the case of foreign currency borrowings, the interest benchmark for the relevant currency specified in the credit agreement plus a margin that ranges from 0.7 % to 1.125 %. The facility fee ranges from 0.050 % to 0.125 % per annum. The actual interest margins and the facility fee are based on our senior long-term debt credit ratings.
The 2024 Credit Facility includes customary affirmative and negative covenants, including a financial covenant that requires us to maintain a ratio of total gross debt to earnings before interest, taxes, depreciation, and amortization (EBITDA), as defined in the agreement, of not greater than 4.00 to 1.00 as measured on a rolling twelve month basis as of the last day of each fiscal quarter. As of October 31, 2025, we were compliant with all covenants governing the 2024 Credit Facility. At October 31, 2025, no amounts were outstanding under the 2024 Credit Facility.
Secured Revolving Credit Facilities | ||
2019 Secured Facility. On February 19, 2019, a subsidiary of Intuit entered into a secured revolving credit facility with a lender to fund the lending products and services we offer to qualified small and mid-market businesses (the 2019 Secured Facility). The 2019 Secured Facility is non-recourse to Intuit Inc. and is secured by cash and receivables of the subsidiary, which are in excess of the amount outstanding under the 2019 Secured Facility as of October 31, 2025. We have entered into several amendments to this facility. These amendments primarily increase the facility limit, extend the commitment term and final maturity date, and update the benchmark interest rate. Under the amended 2019 Secured Facility, the facility limit is $500 million, of which $300 million is committed and $200 million is uncommitted. Advances accrue interest at adjusted daily simple SOFR plus 1.25 %. Unused portions of the committed credit facility accrue a fee at a rate ranging from 0.25 % to 0.75 %, depending on the total unused committed balance. The commitment term is through August 31, 2027, and the final maturity date is August 31, 2028. The agreement includes certain affirmative and negative covenants, including financial covenants that require the subsidiary to maintain specified financial ratios. As of October 31, 2025, we were compliant with all covenants
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governing the 2019 Secured Facility. At October 31, 2025, $480 million was outstanding under the 2019 Secured Facility and the weighted-average interest rate was 5.57 %. Interest on the 2019 Secured Facility is payable monthly.
2022 Secured Facility. On October 12, 2022, another subsidiary of Intuit entered into a secured revolving credit facility with a lender to fund the lending products and services we offer to qualified small and mid-market businesses (the 2022 Secured Facility). The 2022 Secured Facility is non-recourse to Intuit Inc. and is secured by cash and receivables of the subsidiary, which are in excess of the amount outstanding under the 2022 Secured Facility as of October 31, 2025. We have entered into several amendments to this facility. These amendments primarily extend the commitment term and final maturity date, increase the commitment amount, and reduce the interest rate. Under the amended 2022 Secured Facility, the facility limit is $500 million, of which $400 million is committed and $100 million is uncommitted. Advances accrue interest at term SOFR plus 1.1 %. Unused portions of the committed credit facility accrue a fee at a rate ranging from 0.2 % to 0.4 %, depending on the total unused committed balance. The commitment term is through April 30, 2027, and the final maturity date is May 1, 2028. The agreement includes certain affirmative and negative covenants, including financial covenants that require the subsidiary to maintain specified financial ratios. As of October 31, 2025, we were compliant with all covenants governing the 2022 Secured Facility. At October 31, 2025, $400 million was outstanding under the 2022 Secured Facility and the weighted-average interest rate was 5.32 %. Interest on the 2022 Secured Facility is payable monthly.
2024 Secured Facility. On November 1, 2024, another subsidiary of Intuit entered into a secured revolving credit facility with a lender to fund the lending products and services we offer to qualified small and mid-market businesses (the 2024 Secured Facility). The 2024 Secured Facility is non-recourse to Intuit Inc. and is secured by cash and receivables of the subsidiary, which are in excess of the amount outstanding under the 2024 Secured Facility as of October 31, 2025. We have entered into several amendments to this facility. These amendments primarily increase the commitment amount. Under the amended 2024 Secured Facility, the facility limit is $300 million, all of which is committed. Advances accrue interest at daily simple SOFR plus 1.15 %. Unused portions of the committed credit facility accrue a fee at a rate ranging from 0.2 % to 0.4 %, depending on the total unused committed balance. The commitment term is through November 1, 2027, and the final maturity date is November 1, 2028. The agreement includes certain affirmative and negative covenants, including financial covenants that require the subsidiary to maintain specified financial ratios. As of October 31, 2025, we were compliant with all covenants governing the 2024 Secured Facility. At October 31, 2025, $300 million was outstanding under the 2024 Secured Facility and the weighted-average interest rate was 5.37 %. Interest on the 2024 Secured Facility is payable monthly.
Commercial Paper Program | ||
Under our established commercial paper program, we may issue and sell unsecured short-term promissory notes (commercial paper) up to $1.5 billion. The maturities of the commercial paper may vary but will not exceed 397 days from the date of issuance. At October 31, 2025 and July 31, 2025, no
| 7. Other Liabilities and Commitments | ||
Other Current Liabilities | ||
Other current liabilities were as follows at the dates indicated:
| (In millions) | October 31, 2025 | July 31, 2025 | |||||||||
| Executive deferred compensation plan liabilities | $ | $ | |||||||||
| Current portion of operating lease liabilities | |||||||||||
| Sales, property, and other taxes | |||||||||||
| Reserve for returns, credits, and promotional discounts | |||||||||||
| Interest payable | |||||||||||
| Other | |||||||||||
| Total other current liabilities | $ | $ | |||||||||
The balances of several of our other current liabilities, particularly our reserves for returns, credits, and promotional discounts, are affected by the seasonality of our business. See Note 1, “Description of Business and Summary of Significant Accounting Policies – Seasonality,” for more information.
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Other Long-Term Obligations | ||
Other long-term obligations were as follows at the dates indicated:
| (In millions) | October 31, 2025 | July 31, 2025 | |||||||||
| Income tax liabilities | $ | $ | |||||||||
| Other | |||||||||||
| Total other long-term obligations | $ | $ | |||||||||
Unconditional Purchase Obligations | ||
We describe our unconditional purchase obligations in Note 8 to the financial statements in Part II, Item 8 of our Annual Report on Form 10-K for the fiscal year ended July 31, 2025. There were no significant changes outside the ordinary course of business in our purchase obligations during the three months ended October 31, 2025.
| 8. Leases | ||
We lease office facilities under noncancellable operating lease arrangements. Our facility leases generally provide for periodic rent increases and may contain escalation clauses and renewal options. Our leases have remaining lease terms of up to 16 years, which include options to extend that are reasonably certain of being exercised. Some of our leases include one or more options to extend the lease for up to 10 years per option, which we are not reasonably certain to exercise. The options to extend are generally at rates to be determined in accordance with the agreements. Options to extend the lease are included in the lease liability if they are reasonably certain of being exercised.
We sublease certain office facilities to third parties. These subleases have remaining lease terms of up to 5 years, one of which includes an option to extend the sublease for up to 5 years.
The components of lease expense were as follows:
| Three Months Ended | |||||||||||
| (In millions) | October 31, 2025 | October 31, 2024 | |||||||||
Operating lease cost (1) | $ | $ | |||||||||
| Variable lease cost | |||||||||||
| Sublease income | ( | ( | |||||||||
| Total net lease cost | $ | $ | |||||||||
(1)Includes short-term leases, which were not material for the three months ended October 31, 2025 and 2024.
Supplemental cash flow information related to operating leases was as follows:
| Three Months Ended | |||||||||||
| (In millions) | October 31, 2025 | October 31, 2024 | |||||||||
| Cash paid for amounts included in the measurement of operating lease liabilities | $ | $ | |||||||||
| Right-of-use assets obtained in exchange for operating lease liabilities | $ | $ | |||||||||
Other information related to operating leases was as follows at the dates indicated:
| October 31, 2025 | July 31, 2025 | ||||||||||
| Weighted-average remaining lease term for operating leases | |||||||||||
| Weighted-average discount rate for operating leases | % | % | |||||||||
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Future minimum lease payments under noncancellable operating leases as of October 31, 2025 were as follows:
| (In millions) | Operating Leases (1) | ||||
| Fiscal year ending July 31, | |||||
| 2026 (excluding the three months ended October 31, 2025) | $ | ||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| 2030 | |||||
| Thereafter | |||||
| Total future minimum lease payments | |||||
| Less imputed interest | ( | ||||
| Present value of lease liabilities | $ | ||||
(1)Noncancellable future sublease proceeds as of October 31, 2025 totaled $20 million through July 31, 2030 and $1 million thereafter, and are not included in the table above.
Supplemental balance sheet information related to operating leases was as follows at the dates indicated:
| (In millions) | October 31, 2025 | July 31, 2025 | |||||||||
| Operating lease right-of-use assets | $ | $ | |||||||||
| $ | $ | ||||||||||
| Operating lease liabilities | |||||||||||
| Total operating lease liabilities | $ | $ | |||||||||
As of October 31, 2025, we have additional operating leases with total minimum lease payments of $47 million for office facilities that have not yet commenced and therefore are not reflected on the condensed consolidated balance sheets nor in the tables above. These operating leases are expected to commence in fiscal years 2026 and 2027 with lease terms ranging from to 10 years.
| 9. Income Taxes | ||
Effective Tax Rate | ||
We compute our provision for or benefit from income taxes by applying the estimated annual effective tax rate to income or loss from recurring operations and adding the effects of any discrete income tax items specific to the period.
We recognized excess tax benefits on share-based compensation of $30 million and $28 million in our provision for income taxes for the three months ended October 31, 2025 and 2024, respectively.
Our effective tax rate for the three months ended October 31, 2025 was approximately 20 %. Excluding discrete tax items primarily related to share-based compensation, our effective tax rate was approximately 24 %. The difference from the federal statutory rate of 21% was primarily due to state income taxes and non-deductible share-based compensation, which were partially offset by the tax benefit we received from the federal research and experimentation credit.
Our effective tax rate for the three months ended October 31, 2024 was approximately 8 %. Excluding discrete tax items primarily related to share-based compensation, our effective tax rate was approximately 24 %. The difference from the federal statutory rate of 21% was primarily due to state income taxes and non-deductible share-based compensation, which were partially offset by the tax benefit we received from the federal research and experimentation credit.
On July 4, 2025, the U.S. federal government enacted the One Big Beautiful Bill Act (OBBBA), which includes significant tax law changes, most notably the reinstatement of the immediate expensing of domestic research and developmental expenditures, effective in fiscal 2026. While this provision is not expected to have a material impact on our fiscal 2026 effective tax rate, we expect our fiscal 2026 cash tax payments and related deferred tax asset positions to decrease significantly compared to fiscal 2025.
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In the current global tax policy environment, the U.S. and other domestic and foreign governments continue to consider, and in some cases enact, changes in corporate tax laws. As changes occur, we account for finalized legislation in the period of enactment.
Unrecognized Tax Benefits and Other Considerations | ||
The total amount of our unrecognized tax benefits at July 31, 2025 was $394 million. If we were to recognize these net benefits, our income tax expense would reflect a favorable net impact of $276 million. There were no material changes to these amounts during the three months ended October 31, 2025.
| 10. Stockholders’ Equity | ||
Stock Repurchase Programs and Treasury Shares | ||
Intuit’s Board of Directors has authorized a series of common stock repurchase programs. Shares of common stock repurchased under these programs become treasury shares. During the three months ended October 31, 2025, we repurchased a total of 1.2 million shares for $851 million under these programs. Included in this amount were $12 million of repurchases, which occurred in late October 2025 and settled in early November 2025. On August 19, 2025, our Board of Directors approved an increase in the authorization under the existing stock repurchase program under which we are authorized to repurchase up to an additional $3.2 billion of our common stock. At October 31, 2025, we had authorization from our Board of Directors for up to $4.4 billion in stock repurchases. Future stock repurchases under the current program are at the discretion of management, and authorization of future stock repurchase programs is subject to the final determination of our Board of Directors.
Our treasury shares are repurchased at the market price on the trade date; accordingly, all amounts paid to reacquire these shares have been recorded as treasury stock on our condensed consolidated balance sheets. Any direct costs to acquire treasury stock are recorded to treasury stock on our condensed consolidated balance sheets. Repurchased shares of our common stock are held as treasury shares until they are reissued or retired. When we reissue treasury stock, if the proceeds from the sale are more than the average price we paid to acquire the shares, we record an increase in additional paid-in capital. Conversely, if the proceeds from the sale are less than the average price we paid to acquire the shares, we record a decrease in additional paid-in capital to the extent of increases previously recorded for similar transactions and a decrease in retained earnings for any remaining amount.
In the past, we have satisfied option exercises and restricted stock unit vesting under our employee equity incentive plans by reissuing treasury shares, and we may do so again in the future. For all periods presented, we issued new shares of common stock to satisfy option exercises and RSU vesting under our 2005 Equity Incentive Plan. We have not yet determined the ultimate disposition of the shares that we have repurchased in the past, and consequently we continue to hold them as treasury shares.
Dividends on Common Stock | ||
During the three months ended October 31, 2025, we declared quarterly cash dividends that totaled $1.20 per share of outstanding common stock for a total of $343 million. In November 2025, our Board of Directors declared a quarterly cash dividend of $1.20 per share of outstanding common stock payable on January 16, 2026 to stockholders of record at the close of business on January 9, 2026. Future declarations of dividends and the establishment of future record dates and payment dates are subject to the final determination of our Board of Directors.
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Share-Based Compensation Expense | ||
The following table summarizes the total share-based compensation expense that we recorded in operating income for the periods shown.
| Three Months Ended | |||||||||||
| (In millions) | October 31, 2025 | October 31, 2024 | |||||||||
| Cost of revenue | $ | $ | |||||||||
| Selling and marketing | |||||||||||
| Research and development | |||||||||||
| General and administrative | |||||||||||
| Total share-based compensation expense | $ | $ | |||||||||
Share-Based Awards Available for Grant | ||
A summary of share-based awards available for grant under our plans for the three months ended October 31, 2025 was as follows:
| (Shares in thousands) | Shares Available for Grant | ||||
| Balance at July 31, 2025 | |||||
Restricted stock units granted (1) | ( | ||||
| Options granted | |||||
Share-based awards canceled/forfeited/expired (1) (2) | |||||
| Balance at October 31, 2025 | |||||
(1)RSUs granted from the pool of shares available for grant under our 2005 Equity Incentive Plan reduce the pool by 2.3 shares for each share granted. RSUs forfeited and returned to the pool of shares available for grant under the 2005 Equity Incentive Plan increase the pool by 2.3 shares for each share forfeited.
(2)Stock options and RSUs canceled, expired, or forfeited under our 2005 Equity Incentive Plan are returned to the pool of shares available for grant. Under the 2005 Equity Incentive Plan, shares withheld for income taxes upon vesting of RSUs that were granted on or after July 21, 2016 are also returned to the pool of shares available for grant.
Restricted Stock Unit and Restricted Stock Activity | ||
A summary of RSU and restricted stock activity for the three months ended October 31, 2025 was as follows:
| (Shares in thousands) | Number of Shares | Weighted- Average Grant Date Fair Value | |||||||||
| Nonvested at July 31, 2025 | $ | ||||||||||
| Granted | $ | ||||||||||
| Vested | ( | $ | |||||||||
| Forfeited | ( | $ | |||||||||
| Nonvested at October 31, 2025 | $ | ||||||||||
At October 31, 2025, there was approximately $4.6 billion of unrecognized compensation cost related to non-vested RSUs and restricted stock with a weighted-average vesting period of 2.8 years. We adjust unrecognized compensation cost for actual forfeitures as they occur.
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Stock Option Activity | ||
A summary of stock option activity for the three months ended October 31, 2025 was as follows:
| Options Outstanding | |||||||||||
| (Shares in thousands) | Number of Shares | Weighted- Average Exercise Price Per Share | |||||||||
| Balance at July 31, 2025 | $ | ||||||||||
| Granted | $ | ||||||||||
| Exercised | ( | $ | |||||||||
| Canceled or expired | ( | $ | |||||||||
| Balance at October 31, 2025 | $ | ||||||||||
| Exercisable at October 31, 2025 | $ | ||||||||||
At October 31, 2025, there was approximately $132 million of unrecognized compensation cost related to non-vested stock options with a weighted-average vesting period of 3.0 years. We adjust unrecognized compensation cost for actual forfeitures as they occur.
| 11. Legal Proceedings | ||
Beginning in May 2019, various legal proceedings were filed and certain regulatory inquiries were commenced in connection with our provision and marketing of free online tax preparation programs. We believe that the allegations contained within these legal proceedings are without merit and continue to defend our interests in them. These proceedings included, among others, multiple putative class actions that were consolidated into a single putative class action in the Northern District of California in September 2019 (the Intuit Free File Litigation). In August 2020, the Ninth Circuit Court of Appeals ordered that the putative class action claims be resolved through arbitration. In May 2021, the Intuit Free File Litigation was dismissed on a non-class basis after we entered into an agreement that resolved the matter on an individual non-class basis, without any admission of wrongdoing, for an amount that was not material. These proceedings also include a class action lawsuit that was filed in the Ontario (Canada) Superior Court of Justice on August 25, 2022.
These proceedings also included individual demands for arbitration that were filed beginning in October 2019. As of January 31, 2023, we settled all of these arbitration claims, without any admission of wrongdoing, for an amount that was not material. In June 2021, we received a demand and draft complaint from the Federal Trade Commission (FTC) and certain state attorneys general relating to the ongoing inquiries described above. On March 29, 2022, the FTC filed an action in federal court seeking a temporary restraining order and a preliminary injunction enjoining certain Intuit business practices pending resolution of the FTC’s administrative complaint seeking to permanently enjoin certain Intuit business practices (the FTC Actions). On April 22, 2022, the Northern District of California denied the FTC’s requests for a temporary restraining order and a preliminary injunction. Beginning on March 27, 2023, a final hearing on the administrative action was held before an administrative law judge (ALJ) at the FTC and, on August 29, 2023, the FTC's ALJ issued a decision in favor of the FTC and adverse to Intuit. On January 19, 2024, the FTC Commissioners affirmed the ALJ's decision and issued a final order that requires us to adhere to certain marketing practices and does not contain any monetary penalties. On January 21, 2024, we filed a petition for review with the United States Court of Appeals for the Fifth Circuit and this appeal is pending. The FTC's order became effective on March 23, 2024, and is now pending review by the Court of Appeals. We intend to continue to defend our position on the merits of this case. However, the defense and resolution of this matter could involve significant costs.
The state attorneys general did not join the FTC Actions, and, on May 4, 2022, we entered into a settlement agreement with the attorneys general of the 50 states and the District of Columbia, admitting no wrongdoing, that resolved the states’ inquiry, as well as actions brought by the Los Angeles City Attorney and the Santa Clara County (California) Counsel. As part of this agreement, we agreed to pay $141 million and made certain commitments regarding our advertising and marketing practices. We recorded this as a one-time charge in the quarter ended April 30, 2022, and paid the full amount to the fund administrator in the quarter ended January 31, 2023.
In view of the complexity and ongoing and uncertain nature of the outstanding proceedings and inquiries, at this time, we are unable to estimate a reasonably possible financial loss or range of financial loss that we may incur to resolve or settle the remaining matters.
To date, the legal and other fees we have incurred related to these proceedings and inquiries have not been material. The ongoing defense and any resolution or settlement of these proceedings and inquiries could involve significant costs to us.
Intuit is subject to certain routine legal proceedings, including class action lawsuits, as well as demands, claims, government inquiries, and threatened litigation, that arise in the normal course of our business, including assertions that we may be infringing patents or other intellectual property rights of others. Our failure to obtain necessary licenses or other rights, or
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litigation arising out of intellectual property claims could adversely affect our business. We currently believe that, in addition to any amounts accrued, the amount of potential losses, if any, for any pending claims of any type (either alone or combined) will not have a material impact on our condensed consolidated financial statements. The ultimate outcome of any legal proceeding is uncertain and, regardless of outcome, legal proceedings can have an adverse impact on Intuit because of defense costs, negative publicity, diversion of management resources, and other factors.
| 12. Segment Information | ||
We have defined our two reportable segments, described below, based on factors such as how we manage our operations and how our chief operating decision maker views results. We define the chief operating decision maker as our Chief Executive Officer and our Chief Financial Officer. Our chief operating decision maker organizes and manages our business primarily on the basis of service and product offerings.
Effective August 1, 2025, we combined our Consumer, Credit Karma, and ProTax businesses into a single Consumer segment in order to better serve the diverse financial needs of our customers as one consumer platform. Our chief operating decision maker allocates resources and assesses segment performance using regularly provided segment revenue and segment operating income information under this updated segment structure. To align results under this segment change, certain selling and marketing, product development, and general and administrative expenses for Credit Karma that were managed at the segment level are now managed at the platform level and are included in other corporate expenses rather than in segment expenses. Also on August 1, 2025, we reorganized certain marketing, communications, and customer success functions in our Global Business Solutions segment that support and benefit our overall platform and are managed at that level rather than at the segment level. Additionally, certain data science and analytics teams that were managed at the platform level are now managed at the segment level. We have recast certain previously reported amounts to conform to these segment changes. For the three months ended October 31, 2024, we reclassified expenses totaling $3 152
Global Business Solutions: This segment serves small and mid-market businesses around the world, and the accounting professionals who assist and advise them. QuickBooks and Intuit Enterprise Suite are offerings powered by our all-in-one business platform which includes financial management services, human capital management solutions such as payroll and time tracking, money solutions, such as merchant payment processing, bill pay, checking accounts through an FDIC-member bank partner, and financing for small and mid-market businesses. Intuit Enterprise Suite provides mid-market businesses with a configurable, AI-powered solution that includes multi-entity and multi-dimensional financial management capabilities designed to seamlessly scale and enhance productivity and profitability for more complex businesses to streamline operations. Mailchimp offerings include marketing automation and customer relationship tools. Consumer: This segment primarily serves consumers and professional accountants. Our TurboTax offerings primarily help consumers complete their taxes with confidence and maximize their financial outcomes—whether they do it themselves or with the help of an AI-enabled human expert. TurboTax delivers do-it-yourself and assisted income tax preparation products and services sold in the United States (U.S.) and Canada. We offer a variety of money products directly to consumers, including early refund access to any bank, as well as Credit Karma Money branded savings and checking accounts through an FDIC-member bank partner. Credit Karma is a personal finance solution that helps members find the right financial products and make smarter money decisions throughout the year to reach their financial goals. This includes personalized recommendations for credit card, home, auto, and personal loan, and insurance products; and access to their credit scores and reports, credit and identity monitoring, credit report dispute, credit building tools, credit card rewards optimization, and connected account capabilities to help members understand net worth and make financial progress. Finally, our ProTax offerings help professional accountants in the U.S. and Canada, who are essential to both business success and tax preparation and filing. Our professional tax offerings include Lacerte, ProSeries, and ProConnect Tax Online in the U.S., and ProFile and ProTax Online in Canada. | ||
All of our segments operate primarily in the U.S. and sell primarily to customers in the U.S. Total international net revenue was approximately 9 % and 10 % of consolidated net revenue for the three months ended October 31, 2025 and 2024, respectively.
We include expenses such as corporate selling and marketing, general and administrative, and non-employment related legal and litigation settlement costs, which are not allocated to specific segments, in unallocated corporate items as part of other corporate expenses. As part of our platform strategy, we also include customer success and product development for our segments in unallocated corporate items as we do not allocate these expenses to the segments because they are managed at the platform level. Customer success includes the costs of tax and bookkeeping experts that support our TurboTax Live and QuickBooks Live offerings. Unallocated corporate items also include share-based compensation, amortization of acquired technology, amortization of other acquired intangible assets, goodwill and intangible asset impairment charges, professional fees and transaction costs related to business combinations, and restructuring charges.
The accounting policies of our reportable segments are the same as those described in the summary of significant accounting policies in Note 1 to the financial statements in Part II, Item 8 of our Annual Report on Form 10-K for the fiscal year ended July 31, 2025 and in Note 1, "Description of Business and Summary of Significant Accounting Policies – Significant Accounting Policies" in this Quarterly Report on Form 10-Q. Except for goodwill and acquired intangible assets, we do not generally track
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assets by reportable segment and, consequently, we do not disclose total assets by reportable segment.
The following table shows our financial results by reportable segment for the periods indicated.
| Three Months Ended | |||||||||||
| (In millions) | October 31, 2025 | October 31, 2024 | |||||||||
| Net revenue: | |||||||||||
Global Business Solutions | $ | $ | |||||||||
| Consumer | |||||||||||
| Total net revenue | $ | $ | |||||||||
Segment cost of revenue and operating expenses (1): | |||||||||||
Global Business Solutions | $ | $ | |||||||||
Consumer | |||||||||||
Total segment cost of revenues and operating expenses | $ | $ | |||||||||
Operating income: | |||||||||||
| Global Business Solutions | $ | $ | |||||||||
| Consumer | |||||||||||
| Total segment operating income | |||||||||||
| Unallocated corporate items: | |||||||||||
| Share-based compensation expense | ( | ( | |||||||||
| Other corporate expenses | ( | ( | |||||||||
| Amortization of acquired technology | ( | ( | |||||||||
| Amortization of other acquired intangible assets | ( | ( | |||||||||
| Restructuring | ( | ||||||||||
| Total unallocated corporate items | ( | ( | |||||||||
| Total operating income | $ | $ | |||||||||
(1)Cost of revenues and operating expenses primarily include direct expenses related to selling and marketing, direct costs associated with our product and services offerings, certain data science and analytics related costs, and certain design and product management related costs. They exclude expenses that are recorded within unallocated corporate items, such as certain technology and customer success costs that support and benefit the overall platform and are managed at the corporate level.
Revenue classified by significant service and product offerings was as follows:
| Three Months Ended | |||||||||||
| (In millions) | October 31, 2025 | October 31, 2024 | |||||||||
| Net revenue: | |||||||||||
| QuickBooks Online Accounting | $ | $ | |||||||||
| Online Services | |||||||||||
| Total Online Ecosystem | |||||||||||
| QuickBooks Desktop Accounting | |||||||||||
| Desktop Services and Supplies | |||||||||||
| Total Desktop Ecosystem | |||||||||||
Global Business Solutions | |||||||||||
TurboTax | |||||||||||
Credit Karma | |||||||||||
ProTax | |||||||||||
| Consumer | |||||||||||
| Total net revenue | $ | $ | |||||||||
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| ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | ||
Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) is intended to provide readers of our condensed consolidated financial statements with the perspectives of management. This should allow the readers of this report to obtain a comprehensive understanding of our businesses, strategies, current trends, and future prospects. Our MD&A includes the following sections:
• Executive Overview: High-level discussion of our operating results and some of the trends that affect our business. • Critical Accounting Estimates: Significant changes since our most recent Annual Report on Form 10-K that we believe are important to understanding the assumptions and judgments underlying our financial statements. • Results of Operations: A more detailed discussion of our revenue and expenses. • Liquidity and Capital Resources: Discussion of key aspects of our condensed consolidated statements of cash flows, changes in our condensed consolidated balance sheets, and our financial commitments. | ||
You should note that this MD&A contains forward-looking statements that involve risks and uncertainties. Please see the section entitled “Forward-Looking Statements” immediately preceding Part I of this Quarterly Report for important information to consider when evaluating such statements.
You should read this MD&A in conjunction with the financial statements and related notes in Part I, Item 1 of this Quarterly Report and our Annual Report on Form 10-K for the fiscal year ended July 31, 2025.
In the Results of Operations section of this MD&A, where we describe two or more factors that contributed to changes in revenue and operating income, we have, where possible, quantified the impact of those factors. Where a change is the result of multiple factors that are interrelated and cannot be separately quantified, we have identified the interrelated factors without quantifying them.
Effective August 1, 2025, we combined our Consumer, Credit Karma, and ProTax businesses into a single Consumer segment in order to better serve the diverse financial needs of our customers as one consumer platform. Our chief operating decision maker allocates resources and assesses segment performance using regularly provided segment revenue and segment operating income information under this updated segment structure. To align results under this segment change, certain selling and marketing, product development, and general and administrative expenses for Credit Karma that were managed at the segment level are now managed at the platform level and are included in other corporate expenses rather than in segment expenses. Also on August 1, 2025, we reorganized certain marketing, communications, and customer success functions in our Global Business Solutions segment that support and benefit our overall platform and are managed at that level rather than at the segment level. Additionally, certain data science and analytics teams that were managed at the platform level are now managed at the segment level. We have recast certain previously reported amounts to conform to these segment changes. For the three months ended October 31, 2024, we reclassified expenses totaling $3 million from Global Business Solutions and $152 million from Consumer to other corporate expenses, respectively, to conform to the current presentation. See Note 12, "Segment Information," for more information.
| EXECUTIVE OVERVIEW | ||
This overview provides a high-level discussion of our operating results and some of the trends that affect our business. We believe that an understanding of these trends is important in order to understand our financial results, as well as our future prospects. This summary is not intended to be exhaustive, nor is it a substitute for the detailed discussion and analysis provided elsewhere in this Quarterly Report on Form 10-Q.
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About Intuit | ||
Intuit helps consumers and small and mid-market businesses prosper by delivering financial management, compliance, and marketing products and services. We also provide specialized tax products to accounting professionals. We organize our businesses into two reportable segments – Global Business Solutions and Consumer.
Global Business Solutions: This segment serves small and mid-market businesses around the world, and the accounting professionals who assist and advise them. QuickBooks and Intuit Enterprise Suite are offerings powered by our all-in-one business platform which includes financial management services, human capital management solutions such as payroll and time tracking, money solutions, such as merchant payment processing, bill pay, checking accounts through an FDIC-member bank partner, and financing for small and mid-market businesses. Intuit Enterprise Suite provides mid-market businesses with a configurable, AI-powered solution that includes multi-entity and multi-dimensional financial management capabilities designed to seamlessly scale and enhance productivity and profitability for more complex businesses to streamline operations. Mailchimp offerings include marketing automation and customer relationship tools. Consumer: This segment primarily serves consumers and professional accountants. Our TurboTax offerings primarily help consumers complete their taxes with confidence and maximize their financial outcomes—whether they do it themselves or with the help of an AI-enabled human expert. TurboTax delivers do-it-yourself and assisted income tax preparation products and services sold in the United States (U.S.) and Canada. We offer a variety of money products directly to consumers, including early refund access to any bank, as well as Credit Karma Money branded savings and checking accounts through an FDIC-member bank partner. Credit Karma is a personal finance solution that helps members find the right financial products and make smarter money decisions throughout the year to reach their financial goals. This includes personalized recommendations for credit card, home, auto, and personal loan, and insurance products; and access to their credit scores and reports, credit and identity monitoring, credit report dispute, credit building tools, credit card rewards optimization, and connected account capabilities to help members understand net worth and make financial progress. Finally, our ProTax offerings help professional accountants in the U.S. and Canada, who are essential to both business success and tax preparation and filing. Our professional tax offerings include Lacerte, ProSeries, and ProConnect Tax Online in the U.S., and ProFile and ProTax Online in Canada. | ||
Our Business and Growth Strategy | ||
The era of AI is igniting global innovations at an incredible pace and will fundamentally transform every part of our work and personal lives. We made an early bet on AI, declaring our AI-driven expert platform strategy in 2019. We have transformed the company from a tax and accounting platform to an AI-driven expert platform. We have a significant competitive advantage as we are creating a system of intelligence with our scale of data, data services, AI capabilities, ecosystem of applications, and our large network of AI-enabled human experts to become the all-in-one platform for consumers, businesses, and accountants. We're disrupting the categories we operate in to drive better money outcomes for our customers.
We leverage AI and human intelligence to provide our customers with done-for-you experiences that automate tasks, identify actionable insights to drive important decisions, and manage end-to-end workflows or entire processes to eliminate work, while ensuring the customer remains in control. When customers need additional help or want help to complete the work on their behalf, we connect them with the best human expert from our network of thousands of AI-enabled financial, tax, and bookkeeping experts who can complete a specific task, address specialized questions, or manage the entire workload. Our strategy, combined with our Big Bets that focus on the largest customer problems and growth opportunities, positions us for durable growth.
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We launched a transformative set of AI agents that provide customers with a virtual team to complete jobs on their behalf, dramatically improving how businesses run and grow. Combined with our AI-enabled human experts, these agents are automating workflows and delivering real-time insights to drive growth and improve cash flow. Our redesigned user interface and new business feed highlights these real-time insights and recommendations and the tasks completed by agents on behalf of the customer. We also launched AI agents in Intuit Enterprise Suite, including accounting, payments, finance, and project management agents, transforming how our small and mid-market business customers manage their finances by automating a variety of day-to-day tasks, and increasing productivity.
Our innovation has been possible with the investments in our proprietary Generative AI Operating System (GenOS), which have enabled us to fuel innovation with unparalleled speed for our customers. Built for our internal developers, GenOS not only keeps pace with rapid technological industry advances but is setting the pace—by melding the best of artificial intelligence and human intelligence on our platform. This enables us to rapidly deliver a new class of intelligent, autonomous financial solutions that will define the next decade of growth for our customers and for Intuit. Our AI-driven expert platform and products are built in keeping with the company’s commitment to data privacy, security, and responsible AI governance. We safeguard customer data and protect privacy using industry-leading technology and practices, and adhere to responsible AI principles that guide how we operate and scale our platform with our customers’ best interests in mind.
As we execute our global AI-driven expert platform strategy, we prioritize resources on Big Bets that solve the problems that matter most to our customers:
•Deliver done-for-you experiences: We will address our customers’ biggest pain points through a virtual team of AI agents and AI-enabled human experts that deliver done-for-you experiences, with customers in control. This means delivering done-for-you experiences to help businesses run and grow, from lead to cash, and fueling consumers’ financial success year-round, from credit building to wealth building.
•Accelerate Money Benefits: We will become the all-in-one platform for customers to manage their critical workflows, decisions, and money. For businesses, this means optimizing cash flow, including receivables, payables, capital, and spend management. For consumers, this means optimizing money and growing their savings, starting with fast access to their tax refund to help them manage cash flow year-round.
•Fuel Success for Mid-Market Businesses: We will become the all-in-one solution for mid-market customers, fueling their success by offering a better experience, better price, and lower total cost of ownership. Businesses are overdigitized, juggling too many disparate apps. Our platform, including QuickBooks Advanced, Intuit Enterprise Suite, and our ecosystem of connected services, brings the data and insights they need all in one place to grow revenue and profit.
As the external environment evolves, we continue to innovate and adapt our strategy and anticipate our customers’ needs. For more than 40 years, we have been dedicated to developing innovative solutions that are designed to solve our customers' most important financial problems. At Intuit, we believe that everyone should have the opportunity to prosper, and we never stop working to find new, innovative ways to make that possible.
Industry Trends and Seasonality | ||
Industry Trends
AI, including GenAI, predictive AI, and agentic AI, is transforming multiple industries, in particular financial technology. Disruptive start-ups, emerging ecosystems, and mega-platforms are harnessing new technology to create personalized experiences, deliver data-driven insights, and increase speed of service. These shifts are creating a more dynamic and highly competitive environment where customer expectations are shifting around the world as more services become digitized and the array of choices continues to increase.
Seasonality
Within our Consumer segment, our TurboTax and ProTax offerings have a significant and distinct seasonal pattern as sales and revenue from our income tax preparation products and services are typically heavily concentrated in the period from November through April. This seasonal pattern typically results in higher net revenues during our second and third quarters ending January 31 and April 30, respectively.
We expect the seasonality of these offerings to continue to have a significant impact on our quarterly financial results in the future.
Key Challenges and Risks | ||
Our growth strategy depends upon our ability to innovate, develop, and introduce emerging technologies, including AI and GenAI, to drive broad adoption of our products and services and enter new markets. Our future growth also increasingly depends on the strength of our third-party business relationships and our ability to continue to develop, maintain, and strengthen new and existing relationships. To remain competitive and continue to grow, we are investing significant resources in our product development, marketing, and sales capabilities, and we expect to continue to do so in the future. Much of our future success also depends on our ability to continue to attract, retain, and develop highly skilled employees, including those
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in technical and leadership roles who are critical to our strategic growth, in a highly competitive talent environment.
As we offer more online services, the ongoing operation and availability of our platforms and systems and those of our external service providers is becoming increasingly important. Because we help customers manage their financial lives, we face risks associated with the hosting, collection, use, and retention of personal customer information and data. We are investing significant management attention and resources in our information technology infrastructure and in our privacy and security capabilities, and we expect to continue to do so in the future.
We operate in industries that are experiencing an increasing amount of fraudulent activities by malicious third parties, and those fraudulent activities are becoming increasingly sophisticated, including through the use of AI. We continue to invest and implement additional security measures. We work with state and federal governments to implement industry-wide security and anti-fraud measures, including sharing information regarding suspicious activity. We also work with the broader industry and government to protect our customers against this type of fraud.
Our operations are impacted by a rapidly-evolving regulatory environment and face increasingly heightened scrutiny. We are subject to numerous federal, state, and local, as well as foreign laws and regulations covering a broad and increasing range of subjects, both in the U.S. and internationally.
For a complete discussion of the most significant risks and uncertainties affecting our business, please see “Forward-Looking Statements” immediately preceding Part I and “Risk Factors” in Item 1A of Part II of this Quarterly Report.
Overview of Financial Results | ||
The most important financial indicators that we use to assess our business are revenue growth for the company as a whole and for each reportable segment; operating income growth for the company as a whole; earnings per share; and cash flow from operations. We also track certain non-financial drivers of revenue growth and, when material, identify them in the applicable discussions of segment results below. Service offerings are a significant part of our business. Our total service revenue was $16.4 billion, or 87% of our total revenue, in fiscal 2025, and we expect our total service revenue as a percentage of our total revenue to grow over the long term.
Key highlights for the first three months of fiscal 2026 include the following:
| Revenue of | Global Business Solutions segment revenue of | Consumer segment revenue of | ||||||||||||
| $3.9B | $3.0B | $894M | ||||||||||||
| up 18% from the same period of fiscal 2025 | up 18% from the same period of fiscal 2025 | up 21% from same period of fiscal 2025 | ||||||||||||
| Operating income of | Net income of | Diluted net income per share of | ||||||||||||
| $534M | $446M | $1.59 | ||||||||||||
| up 97% from the same period of fiscal 2025 | up 126% from the same period of fiscal 2025 | up 127% from the same period of fiscal 2025 | ||||||||||||
CRITICAL ACCOUNTING ESTIMATES | ||
In preparing our condensed consolidated financial statements, we make estimates, assumptions, and judgments that can have a significant impact on our net revenue, operating income or loss, and net income or loss, as well as on the value of certain assets and liabilities on our condensed consolidated balance sheets. We believe that the estimates, assumptions, and judgments described in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended July 31, 2025 have the greatest potential impact on our financial statements, so we consider them to be our critical accounting estimates. There were no significant changes in those critical accounting estimates during the first three months of fiscal 2026. Senior management has reviewed the development and selection of our critical accounting estimates and their disclosure in this Quarterly Report on Form 10-Q with the Audit and Risk Committee of our Board of Directors.
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| RESULTS OF OPERATIONS | ||
Financial Overview | |||||||||||||||||||||||
| (Dollars in millions, except per share amounts) | Q1 FY26 | Q1 FY25 | $ Change | % Change | |||||||||||||||||||
| Total net revenue | $ | 3,885 | $ | 3,283 | $ | 602 | 18 | % | |||||||||||||||
| Operating income | 534 | 271 | 263 | 97 | % | ||||||||||||||||||
| Net income | 446 | 197 | 249 | 126 | % | ||||||||||||||||||
| Diluted net income per share | $ | 1.59 | $ | 0.70 | $ | 0.89 | 127 | % | |||||||||||||||
Total net revenue for the first quarter of fiscal 2026 increased $602 million, or 18%, compared with the same quarter of fiscal 2025. Our Global Business Solutions segment revenue increased 18% during the quarter due to growth in our Online Ecosystem revenue. Consumer segment revenue increased 21% due to strength in our Credit Karma personal loan, credit card, and auto insurance verticals. See “Segment Results” later in this Item 2 for more information about the results for all of our reportable segments.
Operating income for the first quarter of fiscal 2026 increased $263 million, or 97%, compared with the same quarter of fiscal 2025. The increase in operating income was due to the increase in revenue described above, partially offset by an increase in expenses. Expenses increased due to increases in staffing, outside services, share-based compensation, and SaaS subscriptions and licenses. See “Cost of Revenue” and “Operating Expenses” later in this Item 2 for more information.
Net income for the first quarter of fiscal 2026 increased $249 million, or 126%, compared with the same quarter of fiscal 2025. The increase in net income was due to the increase in operating income described and the increase in interest and other income, partially offset by an increase in income tax expense. The increase in interest and other income is the result of $34 million in net gains on long-term investments recorded in the first quarter of fiscal 2026 and $42 million in net losses on long-term investments recorded during the same quarter of fiscal 2025. The increase in income tax expense is due to the increase in operating income described above. Diluted net income per share increased to $1.59 for the first quarter of fiscal 2026 compared to $0.70 for the same quarter of fiscal 2025, relatively consistent with the increase in net income.
Segment Results | ||
The information below is organized in accordance with our two reportable segments. See “Executive Overview – About Intuit” earlier in this Item 2 and Note 12 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report for more information. All of our segments operate and sell to customers primarily in the U.S. Total international net revenue was approximately 9% and 10% of consolidated net revenue for the three months ended October 31, 2025 and October 31, 2024, respectively.
Effective August 1, 2025, we combined our Consumer, Credit Karma, and ProTax businesses into a single Consumer segment in order to better serve the diverse financial needs of our customers as one consumer platform. Our chief operating decision maker allocates resources and assesses segment performance using regularly provided segment revenue and segment operating income information under this updated segment structure. To align results under this segment change, certain selling and marketing, product development, and general and administrative expenses for Credit Karma that were managed at the segment level are now managed at the platform level and are included in other corporate expenses rather than in segment expenses. Also on August 1, 2025, we reorganized certain marketing, communications, and customer success functions in our Global Business Solutions segment that support and benefit our overall platform and are managed at that level rather than at the segment level. Additionally, certain data science and analytics teams that were managed at the platform level are now managed at the segment level. We have recast certain previously reported amounts to conform to these segment changes. For the three months ended October 31, 2024, we reclassified expenses totaling $3 million from Global Business Solutions and $152 million from Consumer to other corporate expenses, respectively, to conform to the current presentation.
Segment operating income or loss is segment net revenue less segment cost of revenue and operating expenses. See “Executive Overview – Industry Trends and Seasonality” earlier in this Item 2 for a description of the seasonality of our business. We include expenses such as corporate selling and marketing, general and administrative, and non-employment related legal and litigation settlement costs, which are not allocated to specific segments, in unallocated corporate items as part of other corporate expenses. As part of our platform strategy, we also include customer success and product development for our segments in unallocated corporate items as we do not allocate these expenses to the segments because they are managed at the platform level. Customer success includes the costs of tax and bookkeeping experts that support our TurboTax Live and QuickBooks Live offerings. Unallocated corporate items also include share-based compensation, amortization of acquired technology, amortization of other acquired intangible assets, goodwill and intangible asset impairment charges, professional fees and transaction costs related to business combinations, and restructuring charges. These unallocated corporate costs for all segments totaled $2.4 billion and $2.2 billion for the three months ended October 31, 2025 and October 31, 2024, respectively. Unallocated corporate items increased in the fiscal 2026 period,
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primarily due to increases in research and development expense, cost of service revenue and selling and marketing expense. See Note 12 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report for reconciliations of total segment operating income or loss to consolidated operating income or loss for each fiscal period presented.
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Global Business Solutions | ||
Global Business Solutions segment revenue includes both Online Ecosystem and Desktop Ecosystem revenue.
Our Online Ecosystem includes revenue from:
•QuickBooks Online and Intuit Enterprise Suite financial and business management offerings;
•QuickBooks Live;
•Workforce solutions, including QuickBooks Online Payroll and QuickBooks Time;
•Money offerings for businesses that use online offerings, which include merchant payment processing and bill pay services, and financing for small and mid-market businesses (QuickBooks Capital);
•Mailchimp’s marketing automation offerings; and
•Financing for small and mid-market businesses.
Our Desktop Ecosystem includes revenue from:
•QuickBooks Desktop software subscriptions (QuickBooks Desktop Plus, QuickBooks Enterprise, and ProAdvisor Program memberships for accounting professionals who serve small businesses);
•Desktop workforce solutions, including payroll products;
•Money offerings for businesses that use desktop offerings, which include merchant payment processing services and financing for small and mid-market businesses (QuickBooks Capital); and
•Financial supplies.
Segment service revenue is primarily derived from our Online Ecosystem revenue and revenue from the services, support, and when-and-if-available product upgrades and enhancements that are provided as part of our QuickBooks Desktop subscriptions, services and support for our desktop payroll offerings, and merchant payment processing services. Segment product and other revenue is primarily derived from revenue related to delivery of software licenses, version protection updates, and payroll software updates for our QuickBooks Desktop subscriptions and desktop payroll offerings, which are part of our Desktop Ecosystem.
| (Dollars in millions) | Q1 FY26 | Q1 FY25 | % Change | ||||||||||||||
Service revenue | $ | 2,626 | $ | 2,168 | 21 | % | |||||||||||
Product and other revenue | 365 | 376 | (3) | % | |||||||||||||
| Total segment revenue | $ | 2,991 | $ | 2,544 | 18 | % | |||||||||||
| % of total revenue | 77 | % | 77 | % | |||||||||||||
| Segment operating income | $ | 2,334 | $ | 2,002 | 17 | % | |||||||||||
| % of related revenue | 78 | % | 79 | % | |||||||||||||
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Revenue classified by significant service and product offerings was as follows:
| (Dollars in millions) | Q1 FY26 | Q1 FY25 | % Change | ||||||||||||||
| Net revenue: | |||||||||||||||||
| QuickBooks Online Accounting | $ | 1,206 | $ | 965 | 25 | % | |||||||||||
| Online Services | 1,145 | 978 | 17 | % | |||||||||||||
| Total Online Ecosystem | 2,351 | 1,943 | 21 | % | |||||||||||||
| QuickBooks Desktop Accounting | 356 | 329 | 8 | % | |||||||||||||
| Desktop Services and Supplies | 284 | 272 | 4 | % | |||||||||||||
| Total Desktop Ecosystem | 640 | 601 | 6 | % | |||||||||||||
Total Global Business Solutions | $ | 2,991 | $ | 2,544 | 18 | % | |||||||||||
Revenue for our Global Business Solutions segment increased $447 million, or 18%, in the first quarter of fiscal 2026 compared with the same period of fiscal 2025. The increase was primarily due to growth in Online Ecosystem revenue.
Online Ecosystem Revenue
Online Ecosystem revenue increased $408 million, or 21%, in the first quarter of fiscal 2026 compared with the same period of fiscal 2025. QuickBooks Online Accounting revenue increased $241 million, or 25%, in the first quarter of fiscal 2026 due to the interrelated factors of higher effective prices, customer growth, and mix-shift. Online Services revenue increased $167 million, or 17%, in the first quarter of fiscal 2026, due to increases in revenue from our money offerings of $105 million and our payroll offerings of $67 million. Revenue increases were due to the interrelated factors described below. Money revenue increased $105 million due to a $58 million increase in payments revenue from payments customer growth, an increase in total payment volume per customer, and higher effective payments prices, and a $47 million increase from QuickBooks Capital. Online payroll revenue increased due to mix-shift, customer growth, and higher effective prices.
Desktop Ecosystem Revenue
Desktop Ecosystem revenue increased $39 million, or 6%, in the first quarter of fiscal 2026 compared with the same period of fiscal 2025 due to higher effective prices.
Global Business Solutions segment operating income increased $332 million, or 17%, in the first quarter of fiscal 2026 compared with the same period of fiscal 2025, due to the increase in revenue described above, partially offset by increases in staffing expenses of $24 million, QuickBooks Capital cost of revenue of $23 million due to increased loan volume, marketing expenses of $21 million, outside services expenses of $16 million, and online payments cost of revenue of $10 million due to an increase in payments volume.
On August 1, 2025, we reorganized certain marketing, communications, and customer success functions in our Global Business Solutions segment that support and benefit our overall platform and are managed at that level rather than at the segment level. Additionally, certain data science and analytics teams that were managed at the platform level are now managed at the segment level. We have recast certain previously reported amounts to conform to these segment changes. For the three months ended October 31, 2024, we reclassified $3 million from Global Business Solutions to other corporate expenses to conform to the current presentation.
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Consumer | ||
Consumer segment revenue includes the following:
•TurboTax - TurboTax Online and TurboTax Live offerings; TurboTax desktop tax return preparation software; electronic tax filing services; Credit Karma Money; and related services.
•Credit Karma - cost-per-action transactions, which include the delivery of qualified links that result in completed actions such as credit card issuances and personal loan funding; cost-per-click and cost-per-lead transactions, which include user clicks on advertisements or advertisements that allow for the generation of leads, and primarily relate to mortgage and insurance businesses.
•ProTax - ProConnect Tax Online tax products; Lacerte, ProSeries, and ProFile desktop tax preparation software products, and related form updates; electronic tax filing services; connected services; and bank products.
Consumer segment service revenue is primarily derived from our online TurboTax and ProTax offerings, related electronic tax filing services, connected services, and bank products, and Credit Karma. Consumer segment product and other revenue is primarily derived from our TurboTax and ProTax desktop tax return preparation software and related form updates.
| (Dollars in millions) | Q1 FY26 | Q1 FY25 | % Change | ||||||||||||||
Service revenue | $ | 871 | $ | 721 | 21 | % | |||||||||||
Product and other revenue | 23 | 18 | 28 | % | |||||||||||||
| Total segment revenue | $ | 894 | $ | 739 | 21 | % | |||||||||||
| % of total revenue | 23 | % | 23 | % | |||||||||||||
| Segment operating income | $ | 584 | $ | 428 | 36 | % | |||||||||||
| % of related revenue | 65 | % | 58 | % | |||||||||||||
Revenue classified by significant service and product offerings was as follows:
| (Dollars in millions) | Q1 FY26 | Q1 FY25 | % Change | ||||||||||||||
| Net revenue: | |||||||||||||||||
TurboTax | $ | 198 | $ | 187 | 6 | % | |||||||||||
Credit Karma | 651 | 513 | 27 | % | |||||||||||||
ProTax | 45 | 39 | 15 | % | |||||||||||||
Total Consumer | $ | 894 | $ | 739 | 21 | % | |||||||||||
Revenue for our Consumer segment increased $155 million, or 21%, in the first three months of fiscal 2026 compared with the same period of fiscal 2025 due to an increase in Credit Karma revenue of $138 million. The increase in Credit Karma is due to increases in revenue from our personal loan vertical of $65 million, our credit card vertical of $53 million, and our auto insurance vertical of $16 million. Due to the seasonal nature of our TurboTax and ProTax offerings, they typically generate minimal revenue in our first fiscal quarter compared with our second and third fiscal quarters. The majority of revenue for the first quarter of each fiscal year for our TurboTax and ProTax offerings is for the filing of returns from the previous tax year.
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Consumer segment operating income increased $156 million, or 36%, in the first three months of fiscal 2026 compared with the same period of fiscal 2025, due to the increase in revenue described above.
Effective August 1, 2025, we combined our Consumer, Credit Karma, and ProTax businesses into a single Consumer segment in order to better serve the diverse financial needs of our customers as one consumer platform. Our chief operating decision maker allocates resources and assesses segment performance using regularly provided segment revenue and segment operating income information under this updated segment structure. To align results under this segment change, certain selling and marketing, product development, and general and administrative expenses for Credit Karma that were managed at the segment level are now managed at the platform level and are included in other corporate expenses rather than in segment expenses. Additionally, certain data science and analytics teams that were managed at the platform level are now managed at the segment level. We have recast certain previously reported amounts to conform to these segment changes. For the three months ended October 31, 2024, we reclassified $152 million from Consumer to other corporate expenses to conform to the current presentation.
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Cost of Revenue | |||||||||||||||||||||||
| (Dollars in millions) | Q1 FY26 | % of Related Revenue | Q1 FY25 | % of Related Revenue | |||||||||||||||||||
Cost of service revenue | $ | 824 | 24 | % | $ | 772 | 27 | % | |||||||||||||||
Cost of product and other revenue | 15 | 4 | % | 14 | 4 | % | |||||||||||||||||
| Amortization of acquired technology | 44 | N/A | 37 | N/A | |||||||||||||||||||
| Total cost of revenue | $ | 883 | 23 | % | $ | 823 | 25 | % | |||||||||||||||
Our cost of revenue has three components: (1) cost of service revenue, which includes the direct costs associated with our online and service offerings, such as staffing costs for ongoing production support, customer support, and tax and bookkeeping experts that support our TurboTax Live and QuickBooks Live offerings, costs for data processing and storage capabilities from cloud providers, and costs related to credit score providers; (2) cost of product and other revenue, which includes the direct costs of manufacturing and shipping or electronically downloading our desktop software and financial supplies products; and (3) amortization of acquired technology, which represents the cost of amortizing developed technologies that we have obtained through acquisitions, over their useful lives.
Cost of service revenue as a percentage of service revenue was relatively consistent in the first quarter of fiscal 2026 compared with the same period of fiscal 2025.
Cost of product and other revenue as a percentage of product and other revenue was consistent in the first quarter of fiscal 2026 compared with the same period of fiscal 2025. Costs of product and other revenue are expensed as incurred, and we do not defer any of these costs when product and other revenue is deferred.
Operating Expenses | |||||||||||||||||||||||
| (Dollars in millions) | Q1 FY26 | % of Total Net Revenue | Q1 FY25 | % of Total Net Revenue | |||||||||||||||||||
| Selling and marketing | $ | 1,082 | 28 | % | $ | 962 | 30 | % | |||||||||||||||
| Research and development | 843 | 22 | % | 704 | 21 | % | |||||||||||||||||
| General and administrative | 422 | 11 | % | 394 | 12 | % | |||||||||||||||||
| Amortization of other acquired intangible assets | 121 | 3 | % | 120 | 4 | % | |||||||||||||||||
Restructuring | — | — | % | 9 | — | % | |||||||||||||||||
| Total operating expenses | $ | 2,468 | 64 | % | $ | 2,189 | 67 | % | |||||||||||||||
Total operating expenses as a percentage of total net revenue decreased in the first quarter of fiscal 2026 compared to the same period of fiscal 2025. Total net revenue for the first quarter of fiscal 2026 increased $602 million, or 18%, while total operating expenses for the quarter increased $279 million, or 13%. The increase in total operating expenses was due to increases of $125 million for staffing expenses, $47 million for outside services expenses, and $46 million for share-based compensation expenses.
Non-Operating Income and Expenses | ||
Interest Expense
Interest expense of $58 million and $60 million for the first three months of fiscal 2026 and 2025, respectively, consisted of interest on our senior unsecured notes.
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Interest and Other Income, Net
| (In millions) | Q1 FY26 | Q1 FY25 | |||||||||
Interest income (1) | $ | 38 | $ | 42 | |||||||
Net gain on executive deferred compensation plan assets (2) | 15 | 4 | |||||||||
Other (3) | 32 | (44) | |||||||||
| Total interest and other income, net | $ | 85 | $ | 2 | |||||||
(1)Interest income for the three months ended October 31, 2025 decreased compared to the same period of fiscal 2025 due to lower average interest rates, partially offset by higher average investable balances.
(2)In accordance with authoritative guidance, we record gains and losses associated with executive deferred compensation plan assets in interest and other income and gains and losses associated with the related liabilities in operating expenses. The total amounts recorded in operating expenses for each period are approximately equal to the total amounts recorded in interest and other income in those periods.
(3)During the three months ended October 31, 2025 and 2024, we recorded $34 million in net gains and $42 million in net losses on long-term investments, respectively.
Income Taxes
We compute our provision for or benefit from income taxes by applying the estimated annual effective tax rate to income or loss from recurring operations and adding the effects of any discrete income tax items specific to the period.
We recognized excess tax benefits on share-based compensation of $30 million and $28 million in our provision for income taxes for the three months ended October 31, 2025 and 2024, respectively.
Our effective tax rate for the three months ended October 31, 2025 was approximately 20%. Excluding discrete tax items primarily related to share-based compensation, our effective tax rate was approximately 24%. The difference from the federal statutory rate of 21% was primarily due to state income taxes and non-deductible share-based compensation, which were partially offset by the tax benefit we received from the federal research and experimentation credit.
Our effective tax rate for the three months ended October 31, 2024 was approximately 8%. Excluding discrete tax items primarily related to share-based compensation, our effective tax rate was approximately 24%. The difference from the federal statutory rate of 21% was primarily due to state income taxes and non-deductible share-based compensation, which were partially offset by the tax benefit we received from the federal research and experimentation credit.
On July 4, 2025, the U.S. federal government enacted the One Big Beautiful Bill Act (OBBBA), which includes significant tax law changes, most notably the reinstatement of the immediate expensing of domestic research and developmental expenditures, effective in fiscal 2026. The deductibility of these expenditures is expected to significantly reduce our deferred tax assets and income tax payable for periods starting in fiscal 2026.
The OBBBA has multiple effective dates from fiscal 2025 through fiscal 2027. We are currently assessing all applicable provisions of the legislation and their impact on our consolidated financial statements for fiscal 2027 and beyond.
In the current global tax policy environment, the U.S. and other domestic and foreign governments continue to consider, and in some cases enact, changes in corporate tax laws. As changes occur, we account for finalized legislation in the period of enactment.
| LIQUIDITY AND CAPITAL RESOURCES | ||
Overview | ||
At October 31, 2025, our cash, cash equivalents, and investments totaled $3.7 billion, a decrease of $856 million from July 31, 2025 driven by cash used in financing activities, partially offset by cash from investing activities and operations. See the discussion of all factors under “Statements of Cash Flows” below. Our primary sources of liquidity have been cash from operations, which entails the collection of accounts receivable for products and services, the issuance of senior unsecured notes and commercial paper, and borrowings under our credit facilities. Our primary uses of cash have been for research and development programs, selling and marketing activities, capital projects, acquisitions of businesses, debt service costs and debt repayment, repurchases of our common stock under our stock repurchase programs, the payment of cash dividends, and funding of our financing for small and mid-market businesses and early tax refund offerings. As discussed in “Executive Overview – Industry Trends and Seasonality” earlier in this Item 2, our business is subject to significant seasonality. The balance of our cash, cash equivalents, and investments generally fluctuates with that seasonal pattern. We believe the seasonality of our business is likely to continue in the future.
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The following table summarizes selected measures of our liquidity and capital resources at the dates indicated:
| (Dollars in millions) | October 31, 2025 | July 31, 2025 | $ Change | % Change | |||||||||||||||||||
| Cash, cash equivalents, and investments | $ | 3,696 | $ | 4,552 | $ | (856) | (19) | % | |||||||||||||||
| Long-term investments | $ | 92 | $ | 94 | $ | (2) | (2) | % | |||||||||||||||
| Short-term debt | $ | 749 | $ | — | $ | 749 | NM | ||||||||||||||||
| Long-term debt | $ | 5,391 | $ | 5,973 | $ | (582) | (10) | % | |||||||||||||||
| Working capital | $ | 2,902 | $ | 3,737 | $ | (835) | (22) | % | |||||||||||||||
| Ratio of current assets to current liabilities | 1.4 : 1 | 1.4 : 1 | |||||||||||||||||||||
NM - Not meaningful
We have historically generated significant cash from operations, and we expect to continue to do so in the future. Our cash, cash equivalents, and investments totaled $3.7 billion at October 31, 2025. None of those funds were restricted and approximately 89% of those funds were located in the U.S.
Our $1.5 billion unsecured revolving credit facility and our commercial paper program are available to us for general corporate purposes. At October 31, 2025, no amounts were outstanding under the unsecured revolving credit facility or the commercial paper program. See Note 6 to the financial statements in Part I, Item 1 of this Quarterly Report for more information.
Our secured revolving credit facilities are available to fund the lending products and services we offer to qualified small and mid-market businesses. At October 31, 2025, $1.2 billion was outstanding under our secured revolving credit facilities.
Based on past performance and current expectations, we believe that our cash and cash equivalents, investments, cash generated from operations, borrowing capacity under our credit facilities and commercial paper program, and access to external financing will be sufficient to meet anticipated seasonal working capital needs, contractual obligations, commitments, debt service requirements, capital expenditure requirements, and other liquidity requirements associated with our operations for the next 12 months and the foreseeable future.
We expect to return excess cash generated by operations to our stockholders through repurchases of our common stock and payment of cash dividends, after taking into account our operating and strategic cash needs.
We evaluate, on an ongoing basis, the merits of acquiring technology or businesses, or establishing strategic relationships with and investing in other companies. Our strong liquidity profile enables us to quickly respond to these types of opportunities.
Statements of Cash Flows | ||
The following table summarizes selected items from our condensed consolidated statements of cash flows for the first three months of fiscal 2026 and fiscal 2025. See the financial statements in Part I, Item 1 of this Quarterly Report for complete condensed consolidated statements of cash flows for those periods.
| Three Months Ended | |||||||||||||||||
(In millions) | October 31, 2025 | October 31, 2024 | $ Change | ||||||||||||||
| Net cash provided by (used in): | |||||||||||||||||
| Operating activities | $ | 637 | $ | 362 | $ | 275 | |||||||||||
| Investing activities | 1,198 | (188) | 1,386 | ||||||||||||||
| Financing activities | (4,372) | 761 | (5,133) | ||||||||||||||
| Effect of exchange rates on cash, cash equivalents, restricted cash, and restricted cash equivalents | (1) | — | (1) | ||||||||||||||
| Net increase (decrease) in cash, cash equivalents, restricted cash, and restricted cash equivalents | $ | (2,538) | $ | 935 | $ | (3,473) | |||||||||||
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Our primary sources and uses of cash were as follows: | ||||||||
| Three Months Ended | ||||||||
| October 31, 2025 | October 31, 2024 | |||||||
Sources of cash: • Net sales and maturities of corporate and customer fund investments • Principal repayments of notes receivable held for investment • Operations • Sales of notes receivable originally classified as held for investment • Borrowings under our secured revolving credit facilities • Issuance of common stock under employee stock plans Uses of cash: • Net change in funds receivable and funds payable and amounts due to customers • Purchases of notes receivable held for investment • Repurchases of shares of our common stock • Payment of cash dividends and dividend rights • Payment of accrued bonuses for fiscal 2025 • Payments for employee taxes withheld upon vesting of restricted stock units | Sources of cash: • Net change in funds receivable and funds payable and amounts due to customers • Principal repayments of notes receivable held for investment • Operations • Sales of notes receivable originally classified as held for investment • Issuance of common stock under employee stock plans • Borrowings under our secured revolving credit facilities Uses of cash: • Purchases of notes receivable held for investment • Repurchases of shares of our common stock • Payment of accrued bonuses and restructuring for fiscal 2024 • Payment of cash dividends and dividend rights • Payments for employee taxes withheld upon vesting of restricted stock units | |||||||
Stock Repurchase Programs, Treasury Shares, and Dividends on Common Stock | ||
As described in Note 10 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report, during the first three months of fiscal 2026, we repurchased 1.2 million shares of our common stock under repurchase programs that our Board of Directors has authorized. On August 19, 2025, our Board of Directors approved an increase in the authorization under the existing stock repurchase program under which we are authorized to repurchase up to an additional $3.2 billion of our common stock. At October 31, 2025, we had authorization from our Board of Directors for up to $4.4 billion in stock repurchases. We currently expect to continue repurchasing our common stock on a quarterly basis; however, future stock repurchases under the current program are at the discretion of management, and authorization of future stock repurchase programs is subject to the final determination of our Board of Directors.
We have continued to pay quarterly cash dividends on shares of our outstanding common stock. During the three months ended October 31, 2025, we declared quarterly cash dividends that totaled $1.20 per share of outstanding common stock for a total of $343 million. In November 2025, our Board of Directors declared a quarterly cash dividend of $1.20 per share of outstanding common stock payable on January 16, 2026 to stockholders of record at the close of business on January 9, 2026. We currently expect to continue to pay comparable cash dividends on a quarterly basis. However, future declarations of dividends and the establishment of future record dates and payment dates are subject to the final determination of our Board of Directors.
Commitments for Senior Unsecured Notes | ||
In June 2020, we issued $2 billion of senior unsecured notes, of which $1.0 billion is outstanding as of October 31, 2025, and is comprised of the following:
•$500 million of 1.350% notes due July 2027; and
•$500 million of 1.650% notes due July 2030 (together, the 2020 Notes).
Interest is payable semiannually on January 15 and July 15 of each year. At October 31, 2025, our maximum commitment for interest payments was $55 million for the remaining duration of the outstanding 2020 Notes.
The 2020 Notes are senior unsecured obligations of Intuit and rank equally with all existing and future unsecured and unsubordinated indebtedness of Intuit and are redeemable by us at any time, subject to a make-whole premium. Upon the occurrence of change of control transactions that are accompanied by certain downgrades in the credit ratings of the 2020 Notes, we will be required to repurchase the 2020 Notes at a repurchase price equal to 101% of the aggregate outstanding principal plus any accrued and unpaid interest to but not including the date of repurchase. The indenture governing the 2020 Notes requires us to comply with certain covenants. For example, the 2020 Notes limit our ability to create certain liens and enter into sale and leaseback transactions. As of October 31, 2025, we were compliant with all covenants governing the 2020 Notes. See Note 6 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report for more information.
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In September 2023, we issued $4 billion of senior unsecured notes comprised of the following:
•$750 million of 5.250% notes due September 2026;
•$750 million of 5.125% notes due September 2028;
•$1,250 million of 5.200% notes due September 2033; and
•$1,250 million of 5.500% notes due September 2053 (together, the 2023 Notes).
Interest is payable semiannually on March 15 and September 15 of each year. At October 31, 2025, our maximum commitment for interest payments was $2.6 billion for the remaining duration of the outstanding 2023 Notes.
The 2023 Notes are senior unsecured obligations of Intuit and rank equally with all existing and future unsecured and unsubordinated indebtedness of Intuit and are redeemable by us at any time, subject to a make-whole premium. The indenture governing the 2023 Notes requires us to comply with certain covenants. For example, the 2023 Notes limit our ability to create certain liens and enter into sale and leaseback transactions. As of October 31, 2025, we were compliant with all covenants governing the 2023 Notes. See Note 6 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report for more information.
Credit Facilities | ||
Unsecured Revolving Credit Facilities
On February 5, 2024, we terminated our amended and restated credit agreement dated November 1, 2021 (2021 Credit Facility), and entered into a credit agreement with certain lenders providing for a $1.5 billion unsecured revolving credit facility that expires on February 5, 2029 (2024 Credit Facility).
Under the 2024 Credit Facility, we may, subject to certain customary conditions, including approval of relevant lenders, on one or more occasions, increase commitments under the 2024 Credit Facility by an amount not to exceed $1 billion in the aggregate, and, on one or more occasions, extend the maturity date of the 2024 Credit Facility by one year. The 2024 Credit Facility includes a $500 million sublimit for borrowing swingline loans and a $250 million sublimit for the issuance of letters of credit. Advances under the 2024 Credit Facility accrue interest at rates equal to (a) in the case of U.S. dollar borrowings, at our election, either (i) the alternate base rate plus a margin that ranges from 0.0% to 0.125%, or (ii) the adjusted term Secured Overnight Finance Rate (SOFR) plus a margin that ranges from 0.7% to 1.125%, or (b) in the case of foreign currency borrowings, the interest benchmark for the relevant currency specified in the credit agreement plus a margin that ranges from 0.7% to 1.125%. The facility fee ranges from 0.050% to 0.125% per ann um. The actual interest margins and the facility fee are based on our senior long-term debt credit ratings.
The 2024 Credit Facility includes customary affirmative and negative covenants, including a financial covenant that requires us to maintain a ratio of total gross debt to earnings before interest, taxes, depreciation, and amortization (EBITDA), as defined in the agreement, of not greater than 4.00 to 1.00 as measured on a rolling twelve month basis as of the last day of each fiscal quarter. As of October 31, 2025, we were compliant with all covenants governing the 2024 Credit Facility. At October 31, 2025, no amounts were outstanding under the 2024 Credit Facility.
We monitor counterparty risk associated with the lenders that are providing the unsecured revolving credit facility.
Secured Revolving Credit Facilities
On February 19, 2019, a subsidiary of Intuit entered into a secured revolving credit facility with a lender to fund the lending products and services we offer to qualified small and mid-market businesses (the 2019 Secured Facility). The 2019 Secured Facility is non-recourse to Intuit Inc. and is secured by cash and receivables of the subsidiary, which are in excess of the amount outstanding under the 2019 Secured Facility as of October 31, 2025. We have entered into several amendments to this facility. These amendments primarily increase the facility limit, extend the commitment term and final maturity date, and update the benchmark interest rate. Under the amended 2019 Secured Facility, the facility limit is $500 million, of which $300 million is committed and $200 million is uncommitted. Advances accrue interest at adjusted daily simple SOFR plus 1.25%. Unused portions of the committed credit facility accrue a fee at a rate ranging from 0.25% to 0.75%, depending on the total unused committed balance. The commitment term is through August 31, 2027, and the final maturity date is August 31, 2028. The agreement includes certain affirmative and negative covenants, including financial covenants that require the subsidiary to maintain specified financial ratios. As of October 31, 2025, we were compliant with all covenants governing the 2019 Secured Facility. At October 31, 2025, $480 million was outstanding under the 2019 Secured Facility and the weighted-average interest rate was 5.57%.
On October 12, 2022, another subsidiary of Intuit entered into a secured revolving credit facility with a lender to fund the lending products and services we offer to qualified small and mid-market businesses (the 2022 Secured Facility). The 2022 Secured Facility is non-recourse to Intuit Inc. and is secured by cash and receivables of the subsidiary, which are in excess of the amount outstanding under the 2022 Secured Facility as of October 31, 2025. We have entered into several amendments to this facility. These amendments primarily extend the commitment term and final maturity date, increase the commitment amount, and reduce the interest rate. Under the amended 2022 Secured Facility, the facility limit is $500 million, of which $400 million is committed and $100 million is uncommitted. Advances accrue interest at term SOFR plus 1.1%. Unused portions of the committed credit facility accrue a fee at a rate ranging from 0.2% to 0.4%, depending on the total unused committed balance. The commitment term is through April 30, 2027, and the final maturity date is May 1, 2028. The agreement includes
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certain affirmative and negative covenants, including financial covenants that require the subsidiary to maintain specified financial ratios. As of October 31, 2025, we were compliant with all covenants governing the 2022 Secured Facility. At October 31, 2025, $400 million was outstanding under the 2022 Secured Facility and the weighted-average interest rate was 5.32%.
On November 1, 2024, another subsidiary of Intuit entered into a secured revolving credit facility with a lender to fund the lending products and services we offer to qualified small and mid-market businesses (the 2024 Secured Facility). The 2024 Secured Facility is non-recourse to Intuit Inc. and is secured by cash and receivables of the subsidiary, which are in excess of the amount outstanding under the 2024 Secured Facility as of October 31, 2025. We have entered into several amendments to this facility. These amendments primarily increase the commitment amount. Under the amended 2024 Secured Facility, the facility limit is $300 million, all of which is committed. Advances accrue interest at daily simple SOFR plus 1.15%. Unused portions of the committed credit facility accrue a fee at a rate ranging from 0.2% to 0.4%, depending on the total unused committed balance. The commitment term is through November 1, 2027, and the final maturity date is November 1, 2028. The agreement includes certain affirmative and negative covenants, including financial covenants that require the subsidiary to maintain specified financial ratios. As of October 31, 2025, we were compliant with all covenants governing the 2024 Secured Facility. At October 31, 2025, $300 million was outstanding under the 2024 Secured Facility and the weighted-average interest rate was 5.37%.
We monitor counterparty risk associated with the lenders that are providing the secured revolving credit facilities.
Commercial Paper Program | ||
Under our established commercial paper program, we may issue and sell unsecured short-term promissory notes (commercial paper) up to $1.5 billion. The maturities of the commercial paper may vary but will not exceed 397 days from the date of issuance. At October 31, 2025 and July 31, 2025, no amounts were outstanding under this program.
Cash Held by Foreign Subsidiaries | ||
Our cash, cash equivalents, and investments totaled $3.7 billion at October 31, 2025. Approximately 11% of those funds were held by our foreign subsidiaries and subject to repatriation tax considerations. These foreign funds were located primarily in India, the United Kingdom, and Canada. We do not expect to pay incremental U.S. taxes on repatriation. We have recorded income tax expense for Canada, India, and Israel withholding taxes on earnings that are not permanently reinvested. In the event that funds from foreign operations are repatriated to the U.S., we would pay withholding taxes at that time.
CONTRACTUAL OBLIGATIONS | ||
We presented our contractual obligations at July 31, 2025 in our Annual Report on Form 10-K for the fiscal year then ended. There were no material changes outside the ordinary course of business to our contractual obligations during the three months ended October 31, 2025.
RECENT ACCOUNTING PRONOUNCEMENTS | ||
For a description of recent accounting pronouncements, if any, and the potential impact of these pronouncements on our condensed consolidated financial statements, see Note 1 to the financial statements in Part I, Item 1 of this Quarterly Report.
| ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | ||
There were no material changes to our quantitative and qualitative disclosures about market risk during the three months ended October 31, 2025.
See Part II, Item 7A of our Annual Report on Form 10-K for the fiscal year ended July 31, 2025 for a detailed discussion of our market risks.
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| ITEM 4 - CONTROLS AND PROCEDURES | ||
Evaluation of Disclosure Controls and Procedures
Based upon an evaluation of the effectiveness of disclosure controls and procedures, Intuit’s Chief Executive Officer (CEO) and Chief Financial Officer (CFO) have concluded that as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures as defined under Exchange Act Rules 13a-15(e) and 15d-15(e) were effective to provide reasonable assurance that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified by the Securities and Exchange Commission and is accumulated and communicated to management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Controls
Our management, including our CEO and CFO, believes that our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives and that they are effective at the reasonable assurance level. However, no matter how well conceived and executed, a control system can provide only reasonable and not absolute assurance that the objectives of the control system are met. The design of any control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. There are also limitations that are inherent in any control system. These limitations include the realities that breakdowns can occur because of errors in judgment or mistakes, and that controls can be circumvented by individual persons, by collusion of two or more people, or by management override of the controls. Because of these inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
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| PART II - OTHER INFORMATION | ||
| ITEM 1 - LEGAL PROCEEDINGS | ||
See Note 11 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for a description of legal proceedings.
| ITEM 1A - RISK FACTORS | ||
Our businesses routinely encounter and address risks, many of which could cause our future results to be materially different than we presently anticipate. Below, we describe material factors, events and uncertainties that make an investment in our securities speculative or risky, categorized solely for ease of reference as strategic, operational, legal and compliance, and financial risks, and which you should consider carefully in evaluating our business. The following events and consequences could have a material adverse effect on our business, growth, prospects, financial condition, results of operations, cash flows, liquidity, reputation and credit rating, and the trading price of our common stock could decline. Some of the factors, events, and uncertainties discussed below may have occurred in the past. However, these disclosures are not representations as to whether or not the factors, events or uncertainties have occurred in the past, instead they reflect our beliefs and opinions as to the factors, events or uncertainties that could materially and adversely affect us in the future. We could also be affected by other events, factors or uncertainties that are presently unknown to us or that we do not currently consider to present significant risks to our business. These risks may be amplified by the effects of global developments and conditions or events, including macroeconomic and geopolitical conditions, which have caused significant global economic instability and uncertainty. Therefore, you should not consider the following risks to be a complete statement of all the potential risks or uncertainties that we face.
STRATEGIC RISKS
We face intense competitive pressures that may harm our operating results.
We face intense competition in all of our businesses, and we expect competition to continue to intensify in the future. Our competitors and potential competitors range from large and established entities to emerging start-ups. Our competitors may introduce superior products and services, successfully use and deploy new technologies such as AI that may reduce customer demand for our products or services, reduce prices, have greater technical, marketing and other resources, have greater name recognition, have larger installed bases of customers, have well-established relationships with our current and potential customers and partners, advertise aggressively or beat us to market with new products and services. In addition, we face competition from existing companies with large established consumer user bases and broad-based platforms, who may change or expand the focus of their business strategies and marketing to target our customers, including small businesses, tax and personal financial management customers.
We also face competition from companies with a variety of business models and monetization strategies, including increased competition from providers of free and low cost offerings, particularly in our tax, accounting, payments and consumer finance platform businesses. We have also introduced free offerings in several categories, but we may not be able to attract and retain customers as effectively as our competitors with different business models. In addition, other providers of free offerings may provide features that we do not offer and customers who have formerly paid for our products and services may elect to use our competitors’ free offerings instead. These competitive factors may diminish our revenue and profitability, and harm our ability to acquire and retain customers.
Our consumer tax business also faces significant, increasing competition from the public sector, where we face the risk of federal and state taxing authorities implementing revenue-raising strategies that involve developing and providing government tax software or other government return preparation systems at public expense. These or similar programs have been and may continue to be introduced or expanded in the future, which may change the voluntary compliance tax system in ways that could cause us to lose customers and revenue. For example, the IRS made available a free direct filing system and has stated it will explore ways to expand eligibility for the program, including partnering with more states. Additionally, the legacy IRS Free File Program enables the IRS to offer free commercial tax software directly to qualifying taxpayers, and taxpayer adoption of this program could expand with increased awareness of and government support for the program.
Through these or other programs, federal and state governments are or could become publicly funded direct competitors of the U.S. tax services industry and of Intuit. Government funded services that curtail or eliminate the role of taxpayers in preparing their own taxes could potentially have material and adverse revenue implications on us.
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Future revenue growth depends upon our ability to adapt to technological change and successfully extend our platform, introduce new and enhanced products, features, services and business models.
We operate in industries that are characterized by rapidly changing technology, evolving industry standards and frequent new product introductions. To meet the evolving needs and expectations of our customers and partners and attract and retain top technical talent, we must continue to innovate, develop and extend our platform, introduce new products, services, and features, and enhance our ability to anticipate and solve new and existing customer problems, including with emerging technologies, such as AI. If we are not able to do this successfully, we may face a competitive disadvantage and our business could be harmed. We have and will continue to devote significant resources to continue to develop our skills, tools and capabilities to capitalize on existing and emerging technologies, including AI. There can be no assurance that we or our customers will realize the expected benefits from these investments. Legislation or regulatory changes in these areas may mandate changes in our products that make them less attractive to users and hinder our ability to leverage emerging technologies and build out our platform capabilities.
Our consumer and professional tax businesses depend significantly on revenue from customers who return each year to use our updated tax preparation and filing software and services. They include customers who use our free consumer tax products and whose tax scenarios evolve in subsequent years to require paid services. Encouraging continued use of our offerings in successive years can become increasingly difficult if customers do not perceive our offerings to provide continuing or meaningfully l incremental value. The growth of our business depends, in part, on our ability to successfully provide customers value in this way.
In addition, when customers consent to the use of their data across our platform, we work to provide additional benefits to them through our existing offerings and through the development of new offerings. Our inability to demonstrate value of any of these offerings to existing customers may negatively impact our ability to build new data-driven offerings and our revenue.
We may expend a significant amount of resources and management attention on offerings that do not ultimately succeed in their markets. We have encountered difficulty in launching new offerings in the past. If we misjudge customer needs in the future, our new offerings may not succeed and our revenues and earnings may be harmed. We have also invested, and in the future, expect to invest in new business models, technologies, geographies, strategies and initiatives. Such endeavors may involve significant risks and uncertainties, including a rapidly changing regulatory environment, diversion of management's attention from current operations, expenses associated with the initiatives, inadequate return on investments, and social or ethical scrutiny. Because these new initiatives are inherently risky, they may not be successful and may harm our financial condition, operating results, or reputation.
We rely on intellectual property in our products and services.
Many of our products and services utilize our own intellectual property, as well as the intellectual property of third parties, which we license under agreements that may need to be renewed or renegotiated from time to time. We may not be able to obtain licenses to these third-party technologies or content on reasonable terms, or at all, in the future. If we are unable to obtain the rights necessary to use certain intellectual property in our products and services, we may not be able to provide the affected offerings, and customers who are currently using the affected product may be disrupted, which may in turn harm our future financial results, damage our brand, and result in customer loss. Also, we and our customers have been and may continue to be subject to infringement claims as a result of the third-party intellectual property incorporated in our offerings, including through our use of AI. If an infringement claim is successfully asserted against us, it could require us to pay substantial damages or ongoing royalty payments, prevent us from offering our services, require us to change our products, technology, or business practices, or require our compliance with other unfavorable contractual terms. Even if we are not ultimately liable for any potential infringement, pending claims require us to use significant resources, require management attention and could result in loss of customers.
Some of our offerings include third-party software that is licensed under “open source” licenses, some of which may include a requirement that, under certain circumstances, we make available, or grant licenses to, any modifications or derivative works we create based upon the open source software. Our established internal review and approval processes may not mitigate these risks, and we cannot be sure that all open source software is submitted for approval prior to use in our products. Our inability to mitigate the risks associated with the usage of open source software may harm our business.
Our intellectual property rights are valuable, and any inability to protect them could reduce the value of our products, services and brand.
Our patents, trademarks, trade secrets, copyrights, domain names and other intellectual property rights are important assets for us. We aggressively protect our intellectual property rights by relying on federal, state and common law rights in the U.S. and internationally, as well as a variety of administrative procedures and contractual restrictions. However, the efforts that we take to protect our proprietary rights, including through litigation, monitoring, and enforcement programs, may not always be sufficient or effective. We often observe unauthorized copies of our software being sold through online marketplaces, and despite our effort to implement technical countermeasures, we expect piracy to continue to remain a persistent problem that results in lost revenue and increased expenses. In addition, there is uncertainty about the validity and enforceability of intellectual property rights that may result from our use of GenAI. Protecting our intellectual property rights is costly and time consuming and may not be successful in every location. Any significant impairment of our intellectual property rights could harm our business, our brand, and our ability to compete.
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Our business depends on our strong reputation and the value of our brands.
Developing and maintaining awareness of our brands and platform strategy is critical to achieving widespread acceptance of our existing and future products and services and is an important element in attracting new customers and expanding our business with existing customers. Adverse publicity (whether or not justified) relating to events, activities, or views attributed to us, members of our workforce or Board of Directors, agents, third parties we rely on, or our users, may tarnish our reputation and reduce the value of our brands. Perceived social harm or unfairness of outcomes relating to the use of new and evolving technologies such as AI in our offerings, may result in reputational harm and liability, and may cause us to incur additional research and development costs to resolve such issues. Our brand value also depends on our ability to provide secure and trustworthy products and services, as well as our ability to protect and use our customers’ data in a manner that meets their expectations. In addition, a security incident that results in unauthorized disclosure of our customers’ sensitive data could cause material reputational harm. Damage to our reputation and loss of brand equity may reduce demand for our products or services and thus have an adverse effect on our future financial results, as well as require additional resources to rebuild our reputation and restore the value of the brands and could also reduce our stock price.
Our efforts related to environment, social, and governance matters expose us to risks that could adversely affect our reputation and performance.
Environmental, social and governance matters continue to be an area of focus for shareholders, regulators, customers, employees, and other stakeholders. Our efforts and reporting on these matters expose us to risks that could adversely affect our reputation, operations, and performance. This could happen if we fail, or are perceived to fail, to meet evolving stakeholder expectations or varying state or federal regulatory requirements, or to uphold or achieve our public commitments. Standards and best practices for tracking and reporting these matters continue to evolve and we may not be able to implement new and changing standards and best practices in ways that meet the varied expectations of all of our stakeholders. Any of the foregoing may also expose us to increased scrutiny from stakeholders and negatively impact demand for our products, our ability to attract and retain talent or our relationships with customers, suppliers or other stakeholders.
Our acquisition and divestiture activities may disrupt our ongoing business, may involve increased expenses and may present risks not contemplated at the time of the transactions.
We have acquired and may continue to acquire companies, products, technologies and talent that complement our strategic direction, both in and outside the United States. Acquisitions involve significant risks and uncertainties, including:
•inability to successfully integrate the acquired technology, data assets and operations into our business and maintain uniform standards, controls, policies, and procedures;
•inability to realize synergies or anticipated benefits within the expected time frame or at all;
•disruption of our ongoing business and distraction of management;
•challenges retaining the key employees, customers, resellers and other business partners of the acquired operation;
•the internal control environment of an acquired entity may not be consistent with our standards or with regulatory requirements, and may require significant time and resources to align or rectify;
•unidentified issues not discovered in our due diligence process, including product or service quality issues, security policies, standards, and practices, intellectual property issues and legal contingencies;
•failure to successfully further develop an acquired business or technology and any resulting impairment of amounts currently capitalized as intangible assets;
•risks associated with businesses we acquire or invest in, which may differ from or be more significant than the risks our other businesses face;
•in the case of foreign acquisitions and investments, the impact of particular economic, tax, currency, political, legal and regulatory risks associated with specific countries; and
•to the extent we use debt to fund acquisitions or for other purposes, our interest expense and leverage will increase significantly, and to the extent we issue equity securities as consideration in an acquisition, current shareholders’ percentage ownership and earnings per share will be diluted.
We have divested and may in the future divest certain assets or businesses that no longer fit with our strategic direction or growth targets. Divestitures involve significant risks and uncertainties, including:
•inability to find potential buyers on favorable terms;
•failure to effectively transfer liabilities, contracts, facilities and employees to buyers;
•requirements that we retain or indemnify buyers against certain liabilities and obligations;
•the possibility that we will become subject to third-party claims arising out of such divestiture;
•challenges in identifying and separating the intellectual property, systems and data to be divested from the intellectual property, systems and data that we wish to retain;
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•inability to reduce fixed costs previously associated with the divested assets or business;
•challenges in collecting the proceeds from any divestiture;
•disruption of our ongoing business and distraction of management;
•loss of key employees who leave us as a result of a divestiture; and
•if customers or partners of the divested business do not receive the same level of service from the new owners, or the new owners do not handle the customer data with the same level of care, our other businesses may be adversely affected, to the extent that these customers or partners also purchase other products offered by us or otherwise conduct business with our retained business.
In addition, any acquisition or divestiture that we announce may not be completed if closing conditions are not satisfied. Evolving regulatory expectations and changes in the political environment may make it more challenging to obtain any required regulatory approval. Because acquisitions and divestitures are inherently risky, our transactions may not be successful and may, in some cases, harm our operating results or financial condition. In particular, if we are unable to successfully operate together with any company that we acquire to achieve shared growth opportunities or combine reporting or other processes within the expected time frame or at all, there may be a material and adverse effect on the benefits that we expect to achieve as a result of the acquisition, and we could experience additional costs or loss of revenue. Moreover, adverse changes in market conditions and other factors, including those listed above, may cause an acquisition to be dilutive to Intuit’s operating earnings per share for a period of time. Any dilution of our non-GAAP diluted earnings per share could cause the price of shares of Intuit Common Stock to decline or grow at a reduced rate.
OPERATIONAL RISKS
Security incidents, improper access to or disclosure of our data or customers’ data, or other cyberattacks on our systems could harm our reputation, business, and financial condition.
We host, collect, use and retain large amounts of sensitive and personal customer and workforce data, including credit card information, tax return information, bank account numbers, credit report information, login credentials and passwords, personal and business financial data, transaction records, social security numbers and payroll information, as well as our confidential, nonpublic business information. The significant resources we expend to implement security protections designed to shield this data against potential theft and security incidents cannot provide absolute security.
Our technologies, systems, and networks have been subject to, and are increasingly likely to continue to be the target of, cyberattacks, computer viruses, ransomware or other malware, worms, social engineering, malicious software programs, insider threats, denial-of-service attacks and other cybersecurity threats that have in the past, and could in the future, result in the unauthorized release, gathering, monitoring, use, loss or destruction of sensitive and personal data of our customers and our workforce, or Intuit's sensitive business data or cause temporary or sustained unavailability of our data, software, and systems. Cybersecurity incidents can be caused by malicious third parties, acting alone or in groups, or more sophisticated organizations, including nation-states or state-sponsored organizations, and the risks could be elevated in connection with significant armed conflicts, acts of war or terrorism. Customers who fail to update their systems, continue to run software that we no longer support, fail to install security patches on a timely basis or inadequately use security controls create vulnerabilities and make it more difficult for us to detect and prevent these kinds of attacks. Further, we are increasingly incorporating open source software into our products, and there may be vulnerabilities in open source software that make it susceptible to cyberattacks. In addition, techniques used to obtain unauthorized access to sensitive information change frequently and, as technologies like AI develop rapidly, malicious third parties are using these technologies to create new sophisticated attack methods that are increasingly automated, targeted and coordinated and more difficult to defend against. We have been and may in the future be a more frequent target of cyberattacks because cyber-criminals tend to focus their efforts on well-known offerings that are popular among customers and hold sensitive personal or financial information.
Further, the security measures that we implement may not be able to prevent unauthorized access to our products and our customers’ account data. Malicious third parties have in the past, and may in the future, be able to fraudulently induce members of our workforce, customers, vendors, partners, or users by social engineering means, such as email phishing, to disclose sensitive information in order to gain access to our systems. Unauthorized access to or disclosure of customer data may occur due to inadequate use of security controls by our customers or our workforce. Accounts created with weak or recycled passwords could allow cyber-attackers to gain access to customer data. Unauthorized persons could gain access to customer accounts if customers do not maintain effective access controls of their systems and software. Inadvertent exposure of data or access to our systems may also be caused by members of our workforce, including by their error or use of AI.
Criminals may also use stolen identity information obtained outside of our systems to gain unauthorized access to our customers’ data. We have experienced such instances in the past and as the broader accessibility of stolen identity information increases, we may experience further instances of unauthorized access to our systems through the use of stolen identity information of our customers or our workforce in the future. Further, our customers may choose to use the same login credentials across multiple products and services unrelated to our products. Such customers’ login credentials may be stolen from products offered by third-party service providers unrelated to us and the stolen identity information may be used by a malicious third party to access our products, which could result in disclosure of confidential information. In addition, our hybrid
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workplace model, where our workforce spends a portion of their time working away from our offices, increases the potential for attacks and adds operational complexity that exacerbates our security-related risks.
Further, because we have created an ecosystem where customers can have one identity across multiple Intuit products, a security incident may give access to increased amounts of customer data. From time to time, we detect, or receive notices from customers or public or private agencies that they have detected, actual or perceived vulnerabilities in our infrastructure, our software or third-party software components that are distributed with our products or fraudulent activity by unauthorized persons utilizing our products with stolen customer identity information. The existence of such vulnerabilities or fraudulent activity, even if they do not result in a security breach, may undermine customer confidence as well as the confidence of government agencies that regulate our offerings. Such perceived vulnerabilities could also seriously harm our business by tarnishing our reputation and brand and limiting the adoption of our products and services and could cause our stock price to decline. In some cases, such vulnerabilities may not be immediately detected, which could exacerbate the risk of a security incident and the related effects on our businesses.
While we maintain cybersecurity insurance, our insurance may not be sufficient to cover all liabilities described herein. The occurrence of any of the foregoing may result in disclosure of confidential information, loss of customer confidence in our products, possible litigation, material harm to our reputation and financial condition, disruption of our or our customers’ business operations, and a decline in our stock price.
Additionally, our use of Credit Karma member data is subject to an order issued in 2014 by the Federal Trade Commission (FTC) that, among other things, requires maintenance of a comprehensive security program relating to the development and management of new and existing products and services and biennial independent security assessments for 20 years from the date of the order. Our failure to fulfill the requirements of the FTC’s order could result in fines, penalties, enforcement inquiries, investigations and claims, and negatively impact our business and reputation.
A cybersecurity incident affecting the third parties we rely on could expose us or our customers to a risk of loss or misuse of confidential information and significantly damage our reputation.
We depend on a number of third parties, including vendors, developers and partners who are critical to our business. We or our customers may grant access to customer data to these third parties to help deliver customer benefits, or to host certain of our and our customers' sensitive and personal data. In addition, we share sensitive, nonpublic business information (including, for example, materials relating to financial, business and legal strategies) with other vendors in the ordinary course of business.
It is possible that malicious third parties may misrepresent their intended use of data or may circumvent our controls, resulting in accidental or intentional disclosure or misuse of our customer or workforce data, despite our efforts to conduct background checks of our workforce, conduct reviews of partners, developers, and vendors and use commercially available technologies to limit access to systems and data. Further, while we conduct due diligence on the security and business controls of our third-party partners, we may not have the ability to effectively monitor or oversee the implementation of these control measures. Malicious third parties may be able to circumvent these security and business controls or exploit vulnerabilities that may exist in these controls, resulting in the disclosure or misuse of sensitive business and personal customer or workforce information and data. In addition, malicious actors may attempt to use the information technology supply chain to compromise our systems by, for example, introducing malware through software updates. This risk is exacerbated with the advancement of technologies like AI, which malicious third parties are using to create new, sophisticated and more frequent attacks on our third-party partners.
A security incident involving third parties we rely on may have serious negative consequences for our businesses, including disclosure of sensitive customer or workforce data, or confidential or competitively sensitive information regarding our business, including intellectual property and other proprietary data; make our products more vulnerable to fraudulent activity; cause temporary or sustained unavailability of our software and systems; result in possible litigation, fines, penalties and damages; result in loss of customer confidence; cause material harm to our reputation and brands; lead to further regulation and oversight by federal or state agencies; result in an adverse financial condition; and result in a reduced stock price.
Concerns about the broader cybersecurity environment could deter current and potential customers from adopting our products and services and damage our reputation.
The continued occurrence of cybersecurity incidents affecting governments, businesses and consumers in general indicates that we operate in an external environment where cybersecurity incidents are increasingly more common and frequent. If the global cybersecurity environment worsens, and there are increased instances of security breaches of third-party offerings where consumers’ data and sensitive information is compromised, consumers may be less willing to use online offerings, particularly offerings like ours in which customers often share sensitive financial data. Additionally, political uncertainty and military actions may subject us and our service providers to heightened risks of security incidents. In addition, the increased availability of data obtained as a result of cybersecurity incidents affecting third-party offerings could make our own products more vulnerable to fraudulent activity. Even if our products are not affected directly by such incidents, any such incident could damage our reputation and deter current and potential customers from adopting our products and services or lead customers to cease using online and connected software products to transact financial business altogether.
If we are unable to effectively combat the increasing amount and sophistication of fraudulent activities by malicious third parties, we may suffer losses, which may be substantial, and lose the confidence of our customers and government agencies and our revenues and earnings may be harmed.
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Many of the industries in which we operate have been experiencing an increasing amount of fraudulent activities by malicious third parties, and those fraudulent activities are becoming increasingly sophisticated, including through the use of AI. We have been and may from time to time become targeted by such malicious third parties engaging in fraudulent activities. Any such fraudulent activities may adversely impact our business, and the risk is heightened when our workforce is working away from our offices under our hybrid work model. In addition to any losses that may result from such fraud, which may be substantial, a loss of confidence by our customers or by governmental agencies in our ability to prevent fraudulent activity may seriously harm our business and damage our brand. If we cannot adequately combat such fraudulent activity, governmental authorities may refuse to allow us to continue to offer the affected services, or these services may otherwise be adversely impacted, which could include federal or state tax authorities refusing to allow us to process our customers’ tax returns electronically, resulting in a significant adverse impact on our business, earnings, and revenue. As fraudulent activities become more pervasive and increasingly sophisticated, our fraud detection and prevention measures, and the teams that create and maintain them, must become correspondingly more sophisticated to combat them across the various industries in which we operate. Accordingly, we have implemented and may continue to implement risk control mechanisms that could make it more difficult for legitimate customers to obtain and use our products. These control mechanisms could result in lost revenue and negatively impact our earnings.
If we fail to process transactions effectively or fail to adequately protect against disputed or potential fraudulent activities, our business may be harmed.
Our operations process a significant volume and dollar value of transactions on a daily basis, especially in our money and personal financial management businesses. It is possible that we may make errors or that funds may be misappropriated due to fraud despite our efforts to ensure that effective processing systems and controls are in place to handle transactions appropriately. The likelihood of any such error or misappropriation is magnified as we increase the volume and speed of the transactions we process. If we are unable to effectively manage our systems and processes, or if there is an error in our products, we may be unable to process customer data in an accurate, reliable and timely manner, which may harm our reputation, the willingness of customers to use our products, and our financial results. In our payments processing service business, if a disputed transaction between a merchant and its customer is not resolved in favor of the merchant, we may be required to pay those amounts to the payment or credit card network and these payments may exceed the amount of the customer reserves established to make such payments.
Business interruption or failure of our information technology and communication systems may impair the availability of our products and services, which may damage our reputation and harm our future financial results.
Our reputation and ability to attract, retain and serve our customers is dependent upon the reliable performance of our products and our underlying technical infrastructure. As we continue to grow our online services, we become more dependent on the continuing operation and availability of our information technology and communications systems and those of our external service providers, including, for example, third-party Internet-based or cloud computing services. We do not have redundancy for all of our systems, and our disaster recovery planning may not account for all eventualities. We have designed a significant portion of our software and computer systems to utilize data processing and storage capabilities provided by public cloud providers. If any public cloud service that we use is unavailable to us for any reason, our customers may not be able to access certain of our cloud products or features, which could significantly impact our operations, business, and financial results.
Failure of our systems or those of our third-party service providers may result in interruptions in our service and loss of data or processing capabilities, all of which may cause a loss in customers, refunds of product fees, material harm to our reputation and operating results.
Our tax businesses must effectively handle extremely heavy customer demand during critical peak periods. We face significant risks in maintaining adequate service levels during these peak periods when we have historically derived a substantial portion of our overall revenue from the tax businesses. Any interruptions in our online tax preparation or electronic filing service at any time during the tax season, particularly during a peak period, could result in significantly decreased revenue, lost customers, unexpected refunds of customer charges, negative publicity and increased operating costs, any of which could significantly harm our business, financial condition and results of operations.
We rely on internal systems and external systems maintained by manufacturers, distributors, and other service providers to take and fulfill customer orders, handle customer service requests and host certain online activities. Any interruption or failure of our internal or external systems may prevent us or our service providers from accepting and fulfilling customer orders or cause company and customer data to be unintentionally disclosed. Our continuing efforts to upgrade and expand our network security and other information systems as well as our high-availability capabilities are costly, and problems with the design or implementation of system enhancements may harm our business and our results of operations.
Our business operations, information technology and communications systems are vulnerable to damage or interruption from natural disasters, effects of climate change, human error, malicious attacks, fire, power loss, telecommunications failures, computer viruses and malware, computer denial of service attacks, terrorist attacks, public health emergencies and other events beyond our control. For example, we operate under a hybrid workplace model where our workforce spends a portion of their time working in our offices and a portion of their time working away from our offices. This model has introduced risks of disruptions to our operations, which may impair our ability to perform critical functions or could make it considerably more difficult to develop, enhance and support our products and services.
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In addition, since our corporate headquarters and other critical business operations are located near major seismic faults, our recovery in the event of a major earthquake or other catastrophic event may require us to expend significant time and resources and may adversely affect our financial condition and operating results. Further, the adverse effects of any such adverse event would be exacerbated if experienced at the same time as another unexpected and adverse event. In the event of a major natural or man-made disaster, our insurance coverage may not completely compensate us for our losses and our future financial results may be materially harmed.
We regularly invest resources to update and improve our internal information technology systems and software platforms. Should our investments not succeed, or if delays or other issues with new or existing internal technology systems and software platforms disrupt our operations, our business could be harmed.
We rely on our network infrastructure, data hosting, public cloud, and software-as-a-service providers, and internal technology systems for many of our development, marketing, operational, support, sales, accounting, and financial reporting activities. We are continually investing resources to update and improve these systems and environments in order to meet existing needs, as well as the growing and changing requirements of our business and customers. If we experience prolonged delays or unforeseen difficulties in updating and upgrading our systems and architecture, we may experience outages, defects or other performance problems, and may not be able to deliver certain offerings or develop new offerings and enhancements that we need to remain competitive. Such improvements and upgrades are often complex, costly and time consuming. In addition, such improvements can be challenging to integrate with our existing technology systems, or may uncover problems with our existing technology systems. Unsuccessful implementation of hardware or software updates and improvements could result in outages, disruption in our business operations, loss of revenue, or damage to our reputation.
If we are unable to develop, manage and maintain critical third-party business relationships, our business may be adversely affected.
Our growth is increasingly dependent on the strength of our business relationships and our ability to continue to develop, manage and maintain new and existing relationships with third-party partners. We rely on various third-party partners, including software and service providers, platforms, suppliers, credit reporting bureaus, vendors, manufacturers, distributors, accountants, contractors, financial institutions, core processors, licensing partners and development partners, among others, in many areas of our business in order to deliver our offerings and operate our business. Credit Karma generates revenue from its relationships with financial institutions and other partners, which are subject to particular risks that affect their willingness to offer their products on Credit Karma's platform, such as adverse economic conditions, evolving limitations on their capacity to offer products on the platform, the introduction of competing products on their platforms, and an increasing complexity in the regulatory environment. We also rely on third parties to support the operation of our business by maintaining our physical facilities, equipment, power systems and infrastructure. In certain instances, these third-party relationships are sole source or limited source relationships and can be difficult to replace or substitute depending on the level of integration of the third party’s products or services into, or with, our offerings and/or the general availability of such third party’s products and services. In addition, there may be few or no alternative third-party providers or vendors in the market. Further, there can be no assurance that we will be able to adequately retain third-party contractors engaged to help us operate our business.
In particular, we have relationships with banks, credit unions and other financial institutions that support certain critical services we offer to our customers. If macroeconomic conditions or other factors cause any of these institutions to fail, consolidate, stop providing certain services, impose new or higher costs for certain services, or institute cost-cutting efforts, or give rise to speculation relating to such events, it may be more difficult to offer, if at all, those services to our customers, in which case our business and financial results may suffer. For example, if one of the counterparty financial institutions with whom we have significant deposits were to become insolvent, placed into receivership, or file for bankruptcy, our ability to recover our assets from such counterparty may be limited, which could negatively impact our results of operations and financial condition.
Additionally, the business operations of our third-party partners and the third-party partners who support them have been and could continue to be disrupted, including as a result of major technical outages, uncertain macroeconomic conditions, such as trade wars, and global health crises, such as pandemics and endemics. If our third-party partners are unable to help us operate our business or prevent us from delivering critical services to our customers or accepting and fulfilling customer orders, our business and financial results may be negatively impacted. The failure of third parties to provide acceptable and high quality products, services and technologies or to update their products, services and technologies may result in a disruption to our business operations and our customers, which may reduce our revenues and profits, cause us to lose customers and damage our reputation. Alternative arrangements and services may not be available to us on commercially reasonable terms or at all, or we may experience business interruptions upon a transition to an alternative partner.
As we cannot control the day-to-day practices of our suppliers and business partners, we cannot ensure their compliance with the law and our policies regarding workplace and employment practices, data use and security, environmental compliance, intellectual property licensing, and other applicable regulatory and compliance requirements. Any violation of laws or implementation of practices regarded as unethical could result in supply chain disruptions, canceled orders, terminations of or damage to key relationships, and damage to our reputation.
We increasingly utilize the distribution platforms of third parties like Apple’s App Store and Google’s Play Store for the distribution of certain of our offerings, benefiting from the strong brand recognition and large user base of these distribution platforms to attract new customers. However, the platform owners have wide discretion to change the pricing structure, terms
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of service and other policies with respect to us and other developers. Any adverse changes by these third parties could adversely affect our financial results.
Competition for our key employees is intense and we may not be able to attract, retain and develop the highly skilled employees we need to support our strategic objectives.
Much of our future success depends on the continued service and availability of skilled employees, including members of our executive team, and individuals in technical and other key positions. Experienced individuals with expertise in software as a service, financial technology, mobile technologies, data science, AI, and cybersecurity are in high demand. We have faced and will continue to face intense competition globally to attract and retain a diverse workforce with these and other skills that are critical to our success. This is especially the case in California and India where a significant number of our employees are located. In cases where existing employees cannot be effectively developed to meet evolving business needs, our ability to attract and retain top-tier talent becomes even more important. The compensation and incentives we have available to attract, retain and motivate employees may not meet the expectations of current and prospective employees as the competition for talent intensifies. For example, our equity awards may become less effective if our stock price decreases or increases at a slower rate than our talent competitors. In addition, our ability to issue significant additional equity to attract or retain employees may be limited by the risks of dilution to our existing stockholders and the related increase in our expenses. We may experience higher compensation costs to retain and recruit senior management and highly-skilled employees that may not be offset by improved productivity or revenue. Other factors may make it more challenging for us to continue to successfully attract, retain and develop key employees.
Uncertainty in the development, deployment, and use of artificial intelligence in our platform and products and by our customers may result in harm to our business and reputation.
We continue to build and invest in systems and tools that incorporate AI technologies, including GenAI for customers, experts, and our workforce. We also use third parties to support this work. As with many innovations, AI presents risks, uncertainties, and challenges that could adversely impact our business. The development, adoption, and use for GenAI technologies are still in their early stages, and ineffective or inadequate AI development or deployment practices by Intuit or third-party developers or vendors could result in unintended consequences. For example, AI algorithms that we use may be flawed or may be based on datasets that are biased or insufficient. In addition, any latency, disruption, or failure in our AI systems or infrastructure could result in delays or errors in our offerings. Developing, testing, and deploying resource-intensive AI systems may require additional investment and increase our costs. There also may be real or perceived social harm, unfairness, or other outcomes that undermine public confidence in the use and deployment of AI. In addition, third parties may deploy AI technologies in a manner that reduces customer demand for our products and services. Any of the foregoing may result in decreased demand for our products or harm to our business, results of operations or reputation.
The legal and regulatory landscape surrounding AI technologies is rapidly evolving and uncertain including in the areas of intellectual property, cybersecurity, and privacy and data protection. In addition, there is uncertainty around the validity and enforceability of intellectual property rights related to our use, development, and deployment of AI. Compliance with new or changing laws, regulations, or industry standards relating to AI may impose significant operational costs and may limit our ability to develop, deploy or use AI technologies. Failure to appropriately respond to this evolving landscape may result in legal liability, regulatory action, or brand and reputational harm.
If we experience significant product accuracy or quality problems or delays in product launches, it may harm our revenue, earnings and reputation.
Our customers rely on the accuracy of our offerings. All of our tax products and many of our non-tax products have rigid development timetables that increase the risk of errors in our products and the risk of launch delays. Our tax preparation software product development cycle is particularly challenging due to the need to incorporate unpredictable, ambiguous, and potentially late tax law and tax form changes each year and because our customers expect high levels of accuracy and a timely launch of these products to prepare and file their taxes by the tax filing deadline. Due to the complexity of our products and the condensed development cycles under which we operate, our products have in the past, and may contain in the future unexpected errors that could interfere with the operation of the software or result in incorrect calculations. The complexity of the tax laws on which our products are based may also make it difficult for us to consistently deliver offerings that contain the features, functionality and level of accuracy that our customers expect. When we encounter problems, we may be required to modify our code, work with state tax administrators to communicate with affected customers, assist customers with amendments, distribute patches to customers who have already purchased the product and recall or repackage existing product inventory in our distribution channels. If we encounter development challenges or discover errors in our products either late in our development cycle or after release, it may cause us to delay our product launch date or suspend product availability until such issues can be fixed. Any major defects, launch delays or product suspensions may lead to loss of customers and revenue, negative publicity, customer and employee dissatisfaction, reduced retailer shelf space and promotions, and increased operating expenses, such as inventory replacement costs, legal fees or other payments, including those resulting from our accuracy guarantee in our tax preparation products. For example, an error in our tax products could cause a compliance error for taxpayers, including the over or underpayment of their federal or state tax liability. While our accuracy guarantee commits us to reimburse penalties and interest paid by customers due solely to calculation errors in our tax preparation products, such errors may result in additional burdens on third parties that we may need to address or that may cause us to suspend the availability of our products until such errors are addressed. This could also affect our reputation, the
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willingness of customers to use our products, and our financial results. Further, as we develop our platform to connect people to experts, such as connecting TurboTax customers with tax experts through our TurboTax Live offering, or connecting QuickBooks customers with bookkeepers through our QuickBooks Live offering, we face the risk that these experts may provide advice that is erroneous, ineffective or otherwise unsuitable. Any such deficiency in the advice given by these experts may cause harm to our customers, a loss of customer confidence in our offerings or harm to our reputation or financial results. Moreover, as we continue to incorporate emerging technologies, like AI, into our offerings, they may not function as designed or have unintended consequences, any of which could subject us to new or enhanced competitive harm, legal liability, regulatory scrutiny or reputational harm.
Our international operations are subject to increased risks which may harm our business, operating results, and financial condition.
In addition to uncertainty about our ability to generate revenues from our foreign operations and expand into international markets, there are risks inherent in doing business internationally, including:
•different or more restrictive privacy, data protection, data localization, and other laws that could require us to make changes to our products, services and operations, such as mandating that certain types of data collected in a particular country be stored and/or processed within that country;
•difficulties in developing, staffing, and simultaneously managing a large number of varying foreign operations as a result of distance, language, and cultural differences;
•stringent local labor laws and regulations;
•credit risk and higher levels of payment fraud;
•profit repatriation restrictions, and foreign currency exchange restrictions;
•geopolitical events and dynamics, including natural disasters or severe weather events (including those caused or exacerbated by climate change), acts of war and terrorism (including any conflicts in the Middle East) and any related military, political or economic responses, and public health emergencies, including divergent governmental responses thereto affecting the jurisdictions in which we operate or maintain a workforce or facilities;
•compliance with sanctions and import or export regulations, including those arising from the Russia-Ukraine war;
•compliance with the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act, and laws and regulations of other jurisdictions prohibiting corrupt payments to government officials and other third parties;
•antitrust and competition regulations;
•potentially adverse tax developments;
•economic uncertainties relating to European sovereign and other debt;
•changes in trade policies and regulations, including the threat or imposition of protective trade measures, such as tariffs or other trade restrictions, as well as any retaliatory actions;
•political or social unrest, economic instability, repression, or human rights issues; and
•risks related to other government regulation or required compliance with local laws.
Violations of the rapidly evolving and complex foreign and U.S. laws and regulations that apply to our international operations may result in fines, criminal actions or sanctions against us, our officers or our broader workforce, prohibitions on the conduct of our business and damage to our reputation. Our policies and procedures designed to promote compliance with these laws cannot ensure that our workforce, contractors and agents are in compliance with our policies. These risks inherent in our international operations and expansion increase our costs of doing business internationally and may result in harm to our business, operating results, and financial condition.
Climate change may have an impact on our business.
Our environmental programs and efforts to partner with organizations that are also focused on mitigating their own climate-related risks may not be sufficient to mitigate the business risks associated with climate change. Additionally, we recognize that there are inherent climate-related risks wherever business is conducted. Any of our primary workplace locations may be vulnerable to the adverse effects of climate change. For example, our offices globally have historically experienced, and are projected to continue to experience, climate-related events at an increasing frequency, including drought, water scarcity, heat waves, cold waves, extreme wind, wildfires and resultant air quality impacts and power shutoffs associated with wildfire prevention. Furthermore, it is more difficult to mitigate the impact of these events on our employees to the extent they work away from our offices. Changing market dynamics, global policy developments and the increasing frequency and impact of extreme weather events on critical infrastructure in the U.S. and elsewhere have the potential to disrupt our business, the business of our third-party suppliers and the business of our customers, and may cause us to experience higher attrition, losses and additional costs to maintain or resume operations. We also expect to face increasing regulatory requirements and regulatory scrutiny related to climate matters, resulting in higher associated compliance costs.
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LEGAL AND COMPLIANCE RISKS
Increasing and changing regulation of our businesses may adversely affect our ability to operate or harm our operating results.
We are subject to an increasing number of local, state, federal, and international laws, regulations, and rules and standards. These relate to, without limitation, labor, advertising and marketing, tax, financial services, AI, data privacy and security, electronic funds transfer, money transmission, lending, digital content, consumer protection, real estate, billing, e-commerce, promotions, quality of services, intellectual property ownership and infringement, import and export requirements, anti-bribery and anti-corruption, insurance, foreign exchange controls and cash repatriation restrictions, antitrust and competition, environmental, health and safety, and other regulated activities.
The legal and regulatory environment in which we operate is complex, varies across jurisdictions and is subject to frequent change and evolving interpretations. New or amended laws, regulations, executive orders, directives, policies, and enforcement priorities may also be introduced. These dynamics affect our business. As we expand our offerings and evolve our business models, we have, and may in the future, become subject to additional regulatory requirements and heightened regulatory scrutiny. Our ability to adopt emerging technologies, including AI, and to innovate for our customers and operate our business may be harmed by the uncertainty and complexity created by the evolving legal and regulatory environment. For example, in February 2025, the European Union's Artificial Intelligence Act (AI Act) went into force regulating AI systems that affect individuals located in the EU. Additionally, countries and states are applying their data and consumer protection laws to AI and/or enacting or considering legal frameworks on AI, including Utah, Colorado, and California. Compliance with these laws, and similar emerging laws, may add significant costs to our business and may require us to change certain business practices to comply. In addition, some of our offerings, such as our lending and payments products, require licenses to operate. Our inability to obtain or maintain a license, or to comply with current or new license requirements, may materially harm our ability to operate in specific jurisdictions or subject us to regulatory fines or penalties.
The tax preparation industry continues to receive heightened attention from federal and state governments. New legislation, regulation, public policy considerations, changes in the cybersecurity environment, litigation by the government or private entities, changes to or new interpretations of existing laws may result in greater oversight of the tax preparation industry, restrict the types of products and services that we can offer or the prices we can charge, or otherwise cause us to change the way we operate our tax businesses or offer our tax products and services. We are also required to comply with a variety of state revenue agency standards in order to successfully operate our tax preparation and electronic filing services. Changes in state-imposed requirements by one or more of the states, including the required use of specific technologies or technology standards, may significantly increase the costs of providing those services to our customers and may prevent us from delivering a quality product to our customers in a timely manner.
Any perceived or actual failure to comply with applicable laws, regulations, and rules, including new interpretations of existing laws, regulations, and rules, could negatively impact our reputation, expose us to legal liability, fines, penalties, or require us to change our offerings or business operations. In addition, evolving laws, regulations, and rules may require us to modify our business practices or compliance programs in order to continue operating our businesses. Regulatory or legislative changes and other actions that materially affect our business may be announced with little or no advance notice, and we may be unable to respond quickly. As a result, we may face increased operating costs, reduced revenue opportunities, and may be unable to mitigate some or all of the adverse impacts those changes may cause. Any of the foregoing may adversely affect our ability to operate and may harm our results of operations.
Complex and evolving privacy and data protection regulations or changing customer expectations could result in claims, changes to our business practices, penalties or increased cost of operations or otherwise harm our business.
Regulations related to data privacy, cybersecurity, the collection, processing, storage, transfer and use of data, and the use of AI are evolving. Many jurisdictions in which we operate globally have enacted, or are in the process of enacting, data privacy legislation or regulations aimed at creating and enhancing individual privacy rights. For example, the General Data Protection Regulation (GDPR) regulates the collection, use, and retention of personal information by our offerings in the EU. In addition, in the absence of a unified federal privacy standard, a growing number of U.S. states have enacted or introduced data privacy laws and regulations. Several countries have established specific legal requirements for cross-border data transfers and governmental authorities and privacy advocates around the world continue to propose new regulatory actions concerning data protection. Moreover, several jurisdictions are considering regulatory frameworks for AI that implicate data protection laws.
In our efforts to meet the various data privacy regulations that apply to us, we have made and continue to make certain changes to our offerings, business practices, and use of certain third party tools and vendors. Additionally, customer sensitivity to privacy continues to increase and our privacy statements and practices may create additional customer expectations about the collection, use, and sharing of personal information.
In addition, the evolution of global privacy treaties and frameworks has created compliance uncertainty and increased complexity. For example, the judicial invalidation of the EU-U.S. Privacy Shield and Safe Harbor frameworks that we relied on to transfer data created additional compliance challenges for the transfer of EU personal data to the U.S. While a new EU-U.S. Data Privacy Framework currently provides a basis for us to transfer personal data from the European Union the U.S., the future of this framework is uncertain because it faces legal challenges in the European courts.
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Each of these privacy, security and data protection requirements could impose significant limitations on us, require changes to our business practices, require notification to customers, workers, and others of a security incident, restrict our use or storage of personal information, limit our use of third-party tools and vendors, or cause changes in customer purchasing behavior that may make our business more costly, less efficient or impossible to conduct, and may require us to modify our current or future products or services, which may make customers less likely to purchase our products and may harm our future financial results. Additionally, any actual or alleged noncompliance with these laws and regulations, or failure to meet customer expectations could result in negative publicity or harm to our reputation and subject us to investigations, claims or other remedies, including demands that we modify or cease existing business practices, and expose us to significant fines, penalties and other damages. We have incurred, and may continue to incur, significant expenses to comply with existing privacy and security standards and protocols imposed by law, regulation, industry standards or contractual obligations.
We are frequently a party to litigation and regulatory inquiries which could result in an unfavorable outcome and have an adverse effect on our business, financial condition, results of operation and cash flows.
We are subject to various legal proceedings (including class action lawsuits), claims and regulatory inquiries that have arisen out of the ordinary conduct of our business and are not yet resolved and additional proceedings, claims and inquiries may arise in the future. The number and significance of these proceedings, claims and inquiries may increase as our businesses evolve. Any proceedings, claims or inquiries initiated by or against us, whether successful or not, may be time consuming; result in costly litigation, damage awards, consent decrees, injunctive relief or increased costs of business; require us to change our business practices or products; require significant amounts of management time; result in diversion of significant operations resources; or otherwise harm our business and future financial results. For further information about specific litigation, see Part II, Item 1, “Legal Proceedings.”
Third parties claiming that we infringe their proprietary rights may cause us to incur significant legal expenses and prevent us from selling our products.
We may become increasingly subject to infringement claims, including patent, copyright, trade secret, and trademark infringement claims. Litigation may be necessary to determine the validity and scope of the intellectual property rights of others. We have received a number of allegations of intellectual property infringement claims in the past and expect to receive more claims in the future based on allegations that our offerings infringe upon the intellectual property held by third parties. Some of these claims are the subject of pending litigation against us and against some of our customers. These claims may involve patent holding companies or other adverse intellectual property owners who have no relevant product revenues of their own, and against whom our own intellectual property may provide little or no deterrence. The ultimate outcome of any allegation is uncertain and, regardless of outcome, any such claim, with or without merit, may be time consuming to defend, result in costly litigation, divert management’s time and attention from our business, require us to stop selling, delay shipping or redesign our products, or require us to pay monetary damages for royalty or licensing fees, or to satisfy indemnification obligations that we have with some of our customers. Our failure to obtain necessary licenses or other rights, or litigation arising out of intellectual property claims made against us may harm our business.
We are subject to risks associated with information disseminated through our services.
The laws relating to the liability of online services companies for information such as online content disseminated through their services are subject to frequent challenges, and there has been an increasing demand for repealing or limiting the protections afforded by these laws through either judicial decision or legislation. In spite of settled law in the U.S., claims are made against online services companies by parties who disagree with the content. Where our online content is accessed on the internet outside of the U.S., challenges may be brought under foreign laws which do not provide the same protections for online services companies as in the U.S. These challenges in either U.S. or foreign jurisdictions may require altering or limiting some of our services or may require additional contractual terms to avoid liabilities for our customers’ misconduct and may further give rise to legal claims alleging defamation, libel, invasion of privacy, negligence, copyright or trademark infringement, or other theories based on the nature and content of the materials disseminated through the services. Certain of our services include content generated by users of our online services. Claims of intellectual property infringement, defamation or other injury may be made against us for that content, even if that content is not generated by us. Any claims, meritorious or not, may lead to business disruption and costs incurred as a result of this potential liability, which may harm our business.
FINANCIAL RISKS
The results of operations of our tax business may fluctuate from period to period due to the seasonality of the business and other factors beyond our control.
Our tax offerings have significant seasonal patterns. Revenue from income tax preparation products and services has historically been heavily concentrated from November through April, as the tax filing deadline for the IRS and many states is traditionally in April. This seasonality has caused significant fluctuations in our quarterly financial results. In addition, unanticipated changes to federal and state tax filing deadlines may further exacerbate the impact of the seasonality.
Our financial results from our tax offerings may also fluctuate from quarter to quarter and year to year due to a variety of other factors, some of which may affect the timing of revenue recognition. These include the timing of the availability of federal and state tax forms from taxing agencies and the ability of those agencies to receive or process electronic tax return submissions or
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issue refunds; changes to our offerings that result in the inclusion or exclusion of ongoing services; changes in product pricing strategies or product sales mix; changes in customer behavior; and the timing of our discontinuation of support for older product offerings. Other factors, including unanticipated changes to the tax code or the administration of government programs and payments by tax authorities, may cause variations from year to year in the number of tax filers. Any of the foregoing could negatively impact the number of tax returns we prepare and file and the operating results of our tax business. Other factors that may affect our quarterly or annual financial results include the timing of acquisitions, divestitures, and goodwill and acquired intangible asset impairment charges. Any fluctuations in our operating results may adversely affect our stock price.
If actual customer refunds for our offerings exceed the amount we have reserved, our future financial results may be harmed.
Like many software companies, we refund customers for product returns and subscription and service cancellations. We establish reserves against revenue in our financial statements based on estimated customer refunds. We closely monitor this refund activity in an effort to maintain adequate reserves. In the past, customer refunds have not differed significantly from these reserves. However, if we experience actual customer refunds or an increase in risks of collecting customer payments that significantly exceed the amount we have reserved, it may result in lower net revenue.
Unanticipated changes in our income tax rates or other indirect tax may affect our future financial results.
Our future effective income tax rates may be favorably or unfavorably affected by unanticipated changes in the valuation of our deferred tax assets and liabilities, by changes in our stock price, or by changes in tax laws or their interpretation. Foreign governments may enact tax laws, including in response to guidelines issued by international organizations such as the Organisation for Economic Co-operation and Development, that could result in further changes to global taxation and materially affect our financial position and results of operations. In addition, we are subject to the continuous examination of our income tax returns by the Internal Revenue Service and other tax authorities. We regularly assess the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of our provision for income taxes. These continuous examinations may result in unforeseen tax-related liabilities, which may harm our future financial results.
An increasing number of states and foreign jurisdictions have adopted laws or administrative practices that impose new taxes on all or a portion of gross revenue or other similar amounts or impose additional obligations to collect transaction taxes such as sales, consumption, value added, or similar taxes. We may not have sufficient lead time to build systems and processes to collect these taxes properly, or at all. Failure to comply with such laws or administrative practices, or a successful assertion by such states or foreign jurisdictions requiring us to collect taxes where we do not, could result in material tax liabilities, including for past sales, as well as penalties and interest.
Adverse global macroeconomic conditions could harm our business and financial condition.
Adverse macroeconomic conditions, and perceptions or expectations about current or future conditions, such as volatility or distress in the financial markets, recession or inflationary pressures, slowing growth, rising interest rates, rising unemployment, rising consumer debt levels, reduced consumer confidence or economic activity, government fiscal and tax policies, U.S. and international trade relationships, government shutdowns and austerity programs could negatively affect our business and financial condition. These macroeconomic conditions or global events, such as political instability, sanctions, and war, have caused, and could, in the future, cause disruptions and volatility in global financial markets, increased rates of default and bankruptcy, decreases in consumer and small business spending and other unforeseen consequences. It is difficult to predict the impact of such events on our partners, customers, members, or economic markets more broadly, which have been and will continue to be highly dependent upon the actions of governments and businesses in response to macroeconomic events, and the effectiveness of those actions. Additionally, adverse developments that affect financial institutions, such as bank failures, or concerns or speculation about similar events or risks, could lead to liquidity challenges and further instability in the financial markets, which may in turn cause third parties, including customers, to become unable to meet their obligations under various types of financial arrangements. Moreover, because the majority of our revenue is derived from sales within the U.S., economic conditions in the U.S. have an even greater impact on us than companies with a more diverse international presence. Macroeconomic conditions, and perceptions or expectations about current or future conditions, could cause potential new customers not to purchase or to delay purchasing our offerings, and could cause our existing customers to discontinue purchasing or delay upgrades of our existing offerings. Some financial institutions and other partners have in the past decreased or suspended their activity on Credit Karma’s platform and could do so in the future. In addition, increased interest rates may make offers from Credit Karma’s partners less attractive to Credit Karma's members. Members may decrease their engagement on the platform or their creditworthiness could be negatively impacted, reducing members' ability to qualify for credit cards and loans. Decreased consumer spending levels could also reduce payment processing volumes, causing reductions in our payments revenue. High unemployment and changes in the tax code and the government programs that are administered by tax authorities have caused, and could in the future cause, a significant decrease in the number of tax returns filed, which may have a significant effect on the number of tax returns we prepare and file. In addition, weakness in our end-user markets could negatively affect the cash flow of our distributors who could, in turn, delay paying their obligations to us, which could increase our credit risk exposure and cause delays in our recognition of revenue or future sales to these customers. Adverse economic conditions may also increase the costs of operating our business, including vendor, supplier and workforce expenses. Additionally, any inability to access the capital markets when needed due to volatility or illiquidity in the markets or increased regulatory liquidity and capital requirements may strain our liquidity positions. Such conditions may also
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expose us to fluctuations in foreign currency exchange rates or interest rates that could materially and adversely affect our financial results. Any of the foregoing could harm our business and negatively impact our future financial results.
We provide access to capital to small and mid-market businesses, which exposes us to risk, and may cause us material financial or reputational harm.
We provide qualified small and mid-market businesses with access to capital from third-party lenders and then we purchase some or all of those loans from the lender. This activity exposes us to the risk of the borrowers’ inability to repay such loans. We have entered into credit arrangements with financial institutions as a source of funding to purchase some or all of the loans. Any termination or interruption in the financial institutions’ ability to lend to us could interrupt our ability to provide capital to these businesses. Further, the credit decisioning, pricing, loss forecasting, scoring and other models used to evaluate loan applications may contain errors or may not adequately assess creditworthiness of the borrowers, or may be otherwise ineffective, resulting in incorrect approvals or denials of loans. It is also possible that loan applicants could provide false or incorrect information. Moreover, adverse macroeconomic conditions, such as inflation and rising interest rates, have impacted and may continue to impact these businesses, which are disproportionately adversely affected by economic downturns, and may increase the likelihood that the borrowers are unable to repay their loans. If any of the foregoing events were to occur, our reputation, relationships with borrowers, collections of loans receivable and financial results could be harmed.
Amortization of acquired intangible assets and impairment charges may cause significant fluctuation in our net income.
Our acquisitions have resulted in significant expenses, including amortization and impairment of acquired technology and other acquired intangible assets, and impairment of goodwill. We may incur impairment charges related to the goodwill already recorded and to goodwill arising out of future acquisitions. We test the impairment of goodwill annually in our fourth fiscal quarter or more frequently if indicators of impairment arise. The timing of the formal annual test may result in charges to our statement of operations in our fourth fiscal quarter that may not have been reasonably foreseen in prior periods. New acquisitions, and any impairment of the value of acquired intangible assets, may have a significant negative impact on our future financial results.
We have incurred indebtedness and may incur other debt in the future, which may adversely affect our financial condition and future financial results.
We have indebtedness outstanding and may incur additional short-term and long-term debt in the future. This debt may adversely affect our financial condition and future financial results by, among other things:
•increasing our vulnerability to downturns in our business, to competitive pressures and to adverse economic and industry conditions;
•requiring the dedication of a portion of our expected cash from operations to service our indebtedness, thereby reducing the amount of expected cash flow available for other purposes, including capital expenditures, share repurchases and acquisitions; and
•limiting our flexibility in planning for, or reacting to, changes in our businesses and our industries.
If we are unable to generate sufficient cash flow from operations in the future to service our debt, we may be required, among other things, to seek additional financing in the debt or equity markets, refinance or restructure all or a portion of our indebtedness, sell selected assets or reduce or delay planned capital, operating or investment expenditures. Such measures may not be sufficient to enable us to service our debt.
Additionally, the agreements governing our indebtedness impose restrictions on us and require us to comply with certain covenants. For example, our credit facilities restrict the ability of our subsidiaries to incur indebtedness and require us to maintain compliance with specified financial ratios. Our ability to comply with these ratios may be affected by events beyond our control. In addition, our credit facilities and the indenture governing our senior unsecured notes limit our ability to create liens on our and subsidiaries’ assets and engage in sale and leaseback transactions. If we breach any of these covenants and do not obtain a waiver from the lenders or the noteholders, as applicable, then, subject to applicable cure periods, any or all of our outstanding indebtedness may be declared immediately due and payable.
Under the terms of our 2020 Notes, we may be required to repurchase the notes for cash prior to their maturity in connection with the occurrence of certain changes of control that are accompanied by certain downgrades in the credit ratings of the notes. The repayment obligations under the notes may have the effect of discouraging, delaying or preventing a takeover of our company. If we were required to pay the notes prior to their scheduled maturity, it could have a negative impact on our cash position and liquidity and impair our ability to invest financial resources in other strategic initiatives.
In addition, changes by any rating agency to our credit rating may negatively impact the value and liquidity of both our debt and equity securities. If our credit ratings are downgraded or other negative action is taken, the interest rate payable by us under our unsecured revolving credit facility may increase. In addition, adverse economic conditions or any downgrades in our credit ratings may affect our ability to obtain additional financing in the future and may negatively impact the terms of any such financing. There can be no assurance that any refinancing or additional financing would be available on terms that are favorable or acceptable to us, if at all. For further information about our indebtedness, see Note 6 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report.
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We cannot guarantee that our share repurchase program will be fully consummated or that it will enhance long-term stockholder value.
We have a stock repurchase program under which we are authorized to repurchase our common stock. The repurchase program does not have an expiration date and we are not obligated to repurchase a specified number or dollar value of shares. Our repurchase program may be suspended or terminated at any time. Even if our stock repurchase program is fully implemented, it may not enhance long-term stockholder value. Also, the amount, timing, and execution of our stock repurchase programs may fluctuate based on our priorities for the use of cash for other purposes and because of changes in cash flows, tax laws, and the market price of our common stock.
Our stock price may be volatile and your investment could lose value.
Our stock price is subject to changes in recommendations or earnings estimates by financial analysts, changes in investors’ or analysts’ valuation measures for our stock, our credit ratings and market trends unrelated to our performance. Furthermore, speculation in the press or investment community about our strategic position, financial condition, results of operations, business, security of our products, or legal proceedings can cause changes in our stock price. These factors, as well as general economic and political conditions, including the effects of a general slowdown in the global economy, inflationary pressures, pandemics and endemics, significant armed conflicts, acts of war and terrorism, and the timing of announcements in the public market regarding new products, product enhancements or technological advances by our competitors or us, and any announcements by us of acquisitions, major transactions, or management changes may cause volatility in our stock price. Moreover, inflationary pressures, pandemics and endemics, and significant armed conflicts, acts of war and terrorism have caused, and in the future may cause, increased volatility in the global financial markets and, in turn, our stock price. Further, any changes in the amounts or frequency of share repurchases or dividends may also adversely affect our stock price. A significant drop in our stock price could expose us to the risk of securities class action lawsuits, which may result in substantial costs and divert management’s attention and resources, which may adversely affect our business.
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| ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS | ||
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
Stock repurchase activity during the three months ended October 31, 2025 was as follows:
| Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans | Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans | ||||||||||||||||||||||
| August 1, 2025 through August 31, 2025 | 457,695 | $ | 709.71 | 457,695 | $ | 4,958,117,856 | ||||||||||||||||||||
| September 1, 2025 through September 30, 2025 | 372,355 | $ | 673.51 | 372,355 | $ | 4,707,332,705 | ||||||||||||||||||||
| October 1, 2025 through October 31, 2025 | 414,753 | $ | 665.38 | 414,753 | $ | 4,431,364,124 | ||||||||||||||||||||
| Total | 1,244,803 | $ | 684.11 | 1,244,803 | ||||||||||||||||||||||
Note: On August 20, 2024, our Board of Directors approved an increase in the authorization under the existing stock repurchase program under which we are authorized to repurchase up to an additional $3 billion of our common stock. On August 19, 2025, our Board of Directors approved an increase in the authorization under the existing stock repurchase program under which we are authorized to repurchase up to an additional $3.2 billion of our common stock. All of the shares repurchased during the three months ended October 31, 2025 were purchased under these plans. At October 31, 2025, we had authorization from our Board of Directors for up to $4.4 billion in stock repurchases.
ITEM 5 - OTHER INFORMATION | ||
During the three months ended October 31, 2025, none of our directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted or terminated September 3, 2025 , Scott D. Cook , Board Member and Founder , adopted a plan for the sale of up to 1,843,868 shares of the Company's common stock, subject to certain conditions, from December 3, 2025 through October 9, 2026 . On September 26, 2025 , Sandeep S. Aujla , Executive Vice President and Chief Financial Officer , adopted a plan for the sale of up to 12,940 shares of the Company's common stock, subject to certain conditions, from January 5, 2026 through October 9, 2026 . On October 3, 2025 , Kerry J. McLean , Executive Vice President, General Counsel and Corporate Secretary , adopted a plan for the sale of up to 25,077 shares of the Company's common stock, subject to certain conditions, from January 2, 2026 through October 9, 2026 . On October 6, 2025 , Sasan K. Goodarzi , President, Chief Executive Officer and Board Member , adopted a plan for the sale of up to 41,000 shares of the Company's common stock, subject to certain conditions, from January 5, 2026 through October 9, 2026.
| ITEM 6 - EXHIBITS | ||
See the Exhibit Index immediately following the signature page of this Quarterly Report on Form 10-Q.
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| SIGNATURES | ||
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
INTUIT INC. (Registrant) | |||||||||||||||||
| Date: | November 20, 2025 | By: | /s/ SANDEEP S. AUJLA | ||||||||||||||
Sandeep S. Aujla | |||||||||||||||||
| Executive Vice President and Chief Financial Officer (Authorized Officer and Principal Financial Officer) | |||||||||||||||||
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| EXHIBIT INDEX | ||
| Exhibit Number | Exhibit Description | Filed Herewith | Incorporated by Reference | |||||||||||||||||
| 31.01 | Certification of Chief Executive Officer | X | ||||||||||||||||||
| 31.02 | Certification of Chief Financial Officer | X | ||||||||||||||||||
| 32.01* | Section 1350 Certification (Chief Executive Officer) | X | ||||||||||||||||||
| 32.02* | Section 1350 Certification (Chief Financial Officer) | X | ||||||||||||||||||
| 101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | X | ||||||||||||||||||
| 101.SCH | XBRL Taxonomy Extension Schema | X | ||||||||||||||||||
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase | X | ||||||||||||||||||
| 101.LAB | XBRL Taxonomy Extension Label Linkbase | X | ||||||||||||||||||
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase | X | ||||||||||||||||||
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase | X | ||||||||||||||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | X | ||||||||||||||||||
________________________________
| * | This exhibit is intended to be furnished and shall not be deemed “filed” for purposes of the Securities Exchange Act of 1934, as amended. | ||||
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FAQ
How did Intuit (INTU) perform financially in the quarter ended October 31, 2025?
Intuit reported net revenue of $3.885 billion, up from $3.283 billion a year earlier. Net income rose to $446 million from $197 million, and diluted EPS increased to $1.59 from $0.70.
What drove Intuit’s revenue growth this quarter?
The main driver was service revenue, which increased to $3.497 billion from $2.889 billion. Product and other revenue was relatively stable at $388 million versus $394 million.
What were Intuit’s key profitability metrics for Q1 fiscal 2026?
Operating income was $534 million, up from $271 million. Net income reached $446 million, and basic and diluted EPS were $1.60 and $1.59, respectively, compared with $0.70 in the prior-year period.
How strong was Intuit’s cash flow and liquidity this quarter?
Net cash provided by operating activities was $637 million versus $362 million a year ago. Cash, cash equivalents, restricted cash, and restricted cash equivalents totaled $6.943 billion at period end.
What is happening with Intuit’s lending and credit loss profile?
Business loans held for investment totaled about $1.7 billion, with an allowance for credit losses of $112 million. The quarter included a $38 million provision, $31 million in charge-offs, and $5 million in recoveries.
How much capital did Intuit return to shareholders in the quarter?
Intuit repurchased 1.2 million shares of common stock for $851 million and declared dividends and dividend rights totaling $343 million, or $1.20 per share.
What structural or segment changes did Intuit make in 2025?
Effective August 1, 2025, Intuit combined its Consumer, Credit Karma, and ProTax businesses into a single Consumer segment and reallocated certain expenses between segments and corporate to reflect how management now runs the platform.
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Software - Application
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