Intuit Inc. operates through four segments: Small Business & Self-Employed (QuickBooks ecosystem — online accounting, payroll, payments, banking), Consumer (TurboTax), Credit Karma (personal finance marketplace acquired in 2020 for ~$8.1B), and ProConnect (professional tax software). Nearly 60% of revenue comes from business customers, reducing cyclicality. The company has 100M+ customers globally.
Intuit is a platform business with strong network effects and high switching costs. QuickBooks has ~80% market share in US small business accounting software. TurboTax dominates DIY tax filing. The business model generates 80%+ gross margins and 30%+ FCF margins with minimal capex requirements. The company is investing heavily in AI (Intuit Assist) to drive cross-platform engagement and reduce customer acquisition costs.
Investment Thesis
Intuit is a rare high-quality compounder trading at a significant discount to its 5-year average multiples. The 55% drawdown from 2025 highs reflects market fears about AI disruption to SaaS business models (the "SaaSpocalypse"). However, Intuit's competitive moat — regulatory complexity in tax, deep SMB workflow integration, and data network effects from 100M+ customers — makes it one of the more defensible software franchises.
Bull drivers: At 15x forward earnings and 16x FCF, valuation has compressed to levels not seen in a decade. Mid-teens revenue growth, expanding margins, and aggressive buybacks support double-digit EPS growth. If AI enhances rather than disrupts Intuit's products, the multiple should re-expand.
Key risks: AI-native competitors could disrupt tax preparation (free AI tax filing) and bookkeeping workflows. SBC at 10.5% of revenue dilutes real earnings power. Credit Karma monetization remains inconsistent.
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Revenue | $9.63B | $12.73B | $14.37B | $16.29B | $18.83B |
| Revenue Growth | +25.0% | +32.1% | +12.9% | +13.3% | +15.6% |
| Gross Profit | $7.95B | $10.32B | $11.23B | $12.82B | $15.21B |
| Gross Margin | 82.5% | 81.1% | 78.1% | 78.7% | 80.8% |
| Operating Income | $2.50B | $2.57B | $3.14B | $3.63B | $4.92B |
| Operating Margin | 26.0% | 20.2% | 21.9% | 22.3% | 26.1% |
| Net Income | $2.06B | $2.07B | $2.38B | $2.96B | $3.87B |
| EPS (Diluted) | $7.55 | $7.27 | $8.42 | $10.43 | $13.67 |
| R&D Expense | $1.68B | $2.35B | $2.54B | $2.75B | $2.93B |
| R&D % of Rev | 17.4% | 18.4% | 17.7% | 16.9% | 15.5% |
| SG&A Expense | $3.63B | $4.99B | $5.06B | $5.73B | $6.64B |
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Cash & ST Investments | $3.87B | $3.28B | $3.66B | $4.07B | $4.55B |
| Total Assets | $15.52B | $27.73B | $27.78B | $32.13B | $36.96B |
| Total Debt | $2.48B | $7.54B | $6.69B | $6.57B | $6.64B |
| Net Debt | -$0.08B | $4.74B | $3.84B | $2.96B | $3.76B |
| Stockholders' Equity | $9.87B | $16.44B | $17.27B | $18.44B | $19.71B |
| Current Ratio | 1.94x | 1.39x | 1.47x | 1.29x | 1.36x |
| Debt/Equity | 0.25x | 0.46x | 0.39x | 0.36x | 0.34x |
| Goodwill | $5.61B | $13.74B | $13.78B | $13.84B | $13.98B |
| Intangibles | $3.25B | $7.06B | $6.42B | $5.82B | $5.30B |
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $3.25B | $3.89B | $5.05B | $4.88B | $6.21B |
| Capital Expenditures | -$125M | -$229M | -$260M | -$191M | -$124M |
| Free Cash Flow | $3.13B | $3.66B | $4.79B | $4.63B | $6.08B |
| FCF Margin | 32.4% | 28.8% | 33.3% | 28.5% | 32.3% |
| Stock-Based Comp | $753M | $1.31B | $1.71B | $1.94B | $1.97B |
| SBC % of Rev | 7.8% | 10.3% | 11.9% | 11.9% | 10.5% |
| Share Buybacks | -$1.01B | -$1.86B | -$1.97B | -$1.99B | -$2.77B |
| Dividends Paid | -$646M | -$774M | -$889M | -$1.03B | -$1.19B |
| Multiple | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| P/E Ratio | 69.4x | 60.8x | 60.3x | 61.2x | 25.7x |
| P/S Ratio | 14.9x | 9.9x | 10.0x | 11.1x | 5.2x |
| P/B Ratio | 14.5x | 7.6x | 8.3x | 9.8x | 5.0x |
| P/FCF Ratio | 45.8x | 34.3x | 30.0x | 39.1x | 16.1x |
| EV/EBITDA | 48.5x | 38.7x | 36.5x | 40.2x | 17.2x |
| EV/Sales | 14.8x | 10.2x | 10.3x | 11.3x | 5.4x |
| Dividend Yield | 0.45% | 0.62% | 0.62% | 0.57% | 1.32% |
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Return on Equity | 20.9% | 12.6% | 13.8% | 16.1% | 19.6% |
| Return on Assets | 13.3% | 7.4% | 8.6% | 9.2% | 10.5% |
| ROIC | 15.6% | 8.5% | 10.4% | 12.0% | 14.8% |
| Asset Turnover | 0.62x | 0.46x | 0.52x | 0.51x | 0.51x |
| Days Sales Out | 24.5 | 30.1 | 28.5 | 29.5 | 38.4 |
| Cash Conv. Cycle | -110.6 | -81.7 | -45.6 | -46.4 | -41.3 |
| Metric | FY2025A | FY2026E | FY2027E | FY2028E | FY2029E |
|---|---|---|---|---|---|
| Revenue (Avg) | $18.83B | $21.25B | $23.89B | $26.85B | $31.05B |
| Rev Growth | +15.6% | +12.8% | +12.4% | +12.4% | +15.6% |
| EPS (Avg) | $13.67 | $23.22 | $26.40 | $30.25 | $35.13 |
| EPS Growth | +31.1% | +69.9% | +13.7% | +14.6% | +16.1% |
| # Analysts (Rev) | 17 | 24 | 23 | 19 | 9 |
| Fwd P/E | 25.7x | 15.1x | 13.3x | 11.6x | 10.0x |
| Name | Title | Type | Shares Vested | Tax W/H | Price | Date |
|---|---|---|---|---|---|---|
| Sasan Goodarzi | CEO | RSU/Tax | ~3,243 | 1,278 | $432.38 | Apr 1 |
| Sandeep Aujla | CFO | RSU/Tax | ~3,360 | 1,725 | $432.38 | Apr 1 |
| Kerry McLean | General Counsel | RSU/Tax | ~849 | 302 | $432.38 | Apr 1 |
| Lauren Hotz | CAO | RSU/Tax | ~330 | 121 | $432.38 | Apr 1 |
| Caryl Lyn Hilliard | EVP People | RSU/Tax | ~469 | 212 | $432.38 | Apr 1 |
| Anton Hanebrink | EVP Strategy | RSU/Tax | ~824 | 418 | $432.38 | Apr 1 |
"SaaSpocalypse" fears are overdone for Intuit. Tax compliance is regulatory, not optional — AI makes tax harder (more complex rules), not easier. QuickBooks' workflow integration makes switching extremely costly for SMBs.
At 15.1x FY2026E earnings, the market is pricing in near-zero growth for a company growing revenue 13%+ with expanding margins. Any stabilization in SaaS sentiment triggers a massive re-rating.
Intuit Assist (AI) is additive, not cannibalistic. AI-powered categorization, tax suggestions, and financial insights increase platform value and reduce churn. Management is embedding AI to upsell, not replace.
FCF generation of $6B+ supports $2.8B in buybacks plus a growing dividend (1.3% yield). Capital return alone provides meaningful downside protection.
AI disruption is real and accelerating. Free AI tax filing tools could erode TurboTax's consumer franchise. AI bookkeeping agents could reduce QuickBooks' value proposition for micro-businesses.
SBC at $2B/year (10.5% of revenue) significantly dilutes real earnings. Buybacks barely offset dilution — share count has been flat for 5 years despite $10B+ in cumulative buybacks.
Credit Karma (acquired for $8.1B) has underperformed expectations. The segment is cyclically sensitive to lending markets and has not been a reliable growth engine.
Goodwill and intangibles of $19.3B represent 52% of total assets. A material impairment write-down is possible if growth disappoints.
AI-native tax and bookkeeping tools pose an existential threat to Intuit's consumer tax franchise. Free AI tax prep from Google, Apple, or startups could compress pricing. AI bookkeeping agents may reduce need for traditional accounting software.
Stock-based compensation runs at $2B/year (10.5% of revenue), masking true profitability. Despite $2.8B in annual buybacks, share count has been flat. GAAP earnings significantly lag adjusted metrics.
Small business health directly impacts QuickBooks growth. Credit Karma revenue depends on lending market conditions. A recession would pressure both segments simultaneously while TurboTax faces countercyclical pressure from simpler tax returns.
SaaSpocalypse fears prove overdone. FY2026 results beat estimates. AI integration works as additive. Multiple re-rates to ~24x forward earnings.
Steady execution. Revenue grows 12-13%. Moderate multiple expansion to ~18.5x FY2026E as panic subsides.
AI disruption accelerates. TurboTax market share erosion materializes. SMB spending weakens. Multiple compresses to ~11x forward earnings.
| Metric | Base (FY2025) | FY2026 | FY2027 | FY2028 | FY2029 | FY2030 | FY2031 | FY2032 | Terminal |
|---|
Model type: 7-year unlevered free cash flow DCF with Gordon Growth terminal value. All values in USD millions.
Base year: Fiscal Year 2025 (ended July 2025). Revenue: $18.8B. FCF: $6.1B.
Revenue assumptions: Years 1-3 reflect analyst consensus estimates (~$21B FY2026, ~$24B FY2027, ~$27B FY2028). Years 4-7 taper growth from 11% to 5% as Intuit's addressable market matures and base effects increase. Default slider values represent a scenario where Intuit maintains market leadership with steady mid-single-digit organic growth at maturity.
Margin assumptions: OCF margin defaults to 33.0% (FY2025 actual). CapEx/Revenue at 0.7% (FY2025: 0.66%), reflecting Intuit's extremely capital-light software model. Terminal FCF margin of 30% assumes modest margin compression from increased AI investment and competitive pressure over the long term.
WACC: Derived from CAPM with 1.21 beta (FMP profile), 4.3% risk-free rate, 5.0% equity risk premium. Debt weight of 6% reflects D/(D+E) = $6.6B / ($6.6B + $97.7B). Cost of debt at 3.7% pre-tax. The resulting WACC of ~10% is appropriate for a mature, defensive software compounder.
Caveats: DCF models are highly sensitive to terminal value assumptions, which dominate output for companies with Intuit's growth profile. The FY2026E EPS jump to $23.22 from $13.67 may reflect adjusted (non-GAAP) estimates. Users should stress-test growth and margin assumptions. SBC dilution is not explicitly modeled — the share count input should be adjusted upward if dilution is expected to exceed buybacks. The model does not account for potential M&A or structural disruption from AI competitors.
This report was generated using FMP financial data as of April 12, 2026. Interactive DCF model included. All inputs are adjustable. This is for informational purposes only and does not constitute investment advice. Past performance is not indicative of future results.