The TurboTax and QuickBooks owner is sacrificing near-term growth to rebuild customer acquisition, expand free offerings and position its financial software platform for an AI-driven market.
Intuit (INTU) entered its new fiscal year with a difficult message for investors: its core businesses remain profitable and capable of strong earnings growth, but the company needs to spend more aggressively and charge some customers less if it wants to protect its competitive position.
Shares fell about 12% in premarket trading after Intuit forecast fiscal 2027 revenue growth of 9% to 10%, a marked slowdown from the 14% increase recorded in fiscal 2026. The company expects revenue of $23.28 billion to $23.51 billion, below the roughly $23.7 billion Wall Street had been anticipating.
The cautious outlook overshadowed a solid fourth quarter. Revenue increased 14% to $4.35 billion, while adjusted earnings rose 47% to $4.03 a share. For the full year, revenue reached $21.4 billion, up 14%, and adjusted earnings per share climbed 20% to $24.27.
Those figures suggest Intuit is not dealing with an immediate deterioration in profitability. Instead, management is attempting to address a longer-term strategic problem: customer acquisition has not kept pace with the company’s ability to extract more revenue from existing users.
That tension is particularly visible at TurboTax.
Full-year TurboTax revenue increased 7% to $5.3 billion, helped by the continued shift toward higher-value assisted tax preparation. TurboTax Live revenue grew 37% and accounted for more than half of TurboTax revenue. Yet total U.S. TurboTax units fell 2%, including a 7% decline in desktop users and a 2% decline in online units.
The divergence matters because pricing and product mix can sustain revenue growth for only so long if the underlying customer base is shrinking. Management acknowledged losing some do-it-yourself tax customers to lower-cost alternatives. Intuit is responding by widening the number of consumers who can enter its ecosystem at little or no upfront cost.
That strategy will pressure average revenue per customer in the short term. TurboTax revenue is expected to grow only 2% to 3% in fiscal 2027, far below the pace of the past year. Consumer-segment revenue, which also includes Credit Karma and ProTax, is expected to rise 4% to 6%.
The company is applying a similar philosophy to small-business accounting. Intuit has introduced QuickBooks Free and QuickBooks Lite to reach businesses earlier in their development rather than waiting until they are large enough to justify a traditional accounting-software subscription.
More than 20,000 customers were already using QuickBooks Free or had upgraded from it to paid services as of last month. The economics depend on Intuit converting those users over time into paying customers or earning revenue from payments, payroll, credit products and other financial services embedded in the platform.
That approach reflects an important change in the software business model. Intuit increasingly wants QuickBooks to function as an operating and financial platform rather than simply an accounting subscription.
The opportunity is substantial. Businesses manage more than $2.7 trillion of invoices through QuickBooks each year, while online payment volume increased 30% during fiscal 2026 to more than $225 billion. Customers using more advanced QuickBooks products are also significantly more likely to adopt payroll and payment services, giving Intuit a path to higher lifetime revenue even when entry-level software is offered cheaply.
The strongest part of the company remains Global Business Solutions, where full-year revenue rose 16% to $12.9 billion. Excluding Mailchimp, growth reached 18%, while QuickBooks Online Accounting revenue increased 23%.
Mid-market businesses have become particularly important. Intuit said revenue from its major strategic growth initiatives, including assisted tax, money services and mid-market products, increased 34% and represented about 30% of companywide revenue.
Even so, Intuit lowered its longer-term growth expectations for Global Business Solutions. The company now sees a three-year growth range of roughly 10% to 15%, down from its previous 15% to 20% target. That revision helps explain why investors reacted more severely than the fourth-quarter numbers alone might suggest.
Mailchimp is another challenge. Intuit expects the marketing platform’s revenue to range from a 1% decline to flat growth this year and will begin reporting Mailchimp as a separate business segment. Separating the operation will give investors a clearer view of whether the 2021 acquisition can regain momentum.
Artificial intelligence adds another layer of uncertainty. Intuit has positioned itself as an AI-driven financial platform, using automated agents and financial data to perform accounting, tax and business-management tasks. But AI is also lowering barriers for competitors that can replicate functions traditionally sold through specialized software.
Earlier this year, Intuit announced a 17% reduction in its full-time workforce as part of a broader effort to simplify the organization and redirect investment toward AI, customer acquisition and higher-growth products. The company is effectively betting that a leaner cost structure can fund more aggressive product development without undermining long-term margins.
Investors will also need to adjust to a financial-reporting change. Beginning in fiscal 2027, Intuit will include share-based compensation in its non-GAAP results rather than excluding it. Its forecast for adjusted earnings of $22.88 to $23.12 a share therefore includes a $5.81 impact from stock compensation, making direct comparisons with previous adjusted figures less straightforward.
Intuit still has considerable financial flexibility. It repurchased $5.5 billion of shares during fiscal 2026, nearly double the previous year’s amount, and the board raised the quarterly dividend 15% to $1.38 a share. The company has another $7.9 billion of authorized buybacks available.
The central question is no longer whether Intuit can raise prices and expand margins. It is whether the company can restart meaningful customer growth while defending its franchise against cheaper software and rapidly improving AI alternatives.
Fiscal 2027 is shaping up as a transition year. Intuit is accepting slower revenue growth today in exchange for the possibility of a broader customer base and greater platform monetization later. For investors, the success of that trade-off will determine whether the latest selloff represents a temporary reset or a more lasting reassessment of one of the software industry’s most durable business models.
