Intuit shares plunge as cautious fiscal 2027 guidance falls short of forecasts

Intuit (NASDAQ:INTU) shares dropped sharply in premarket trading on Wednesday after the financial software company issued fiscal 2027 guidance below Wall Street expectations as it adjusts its strategy to “accelerate customer growth, increase market share, and strengthen the long-term durability” of its growth model.

The stock was down 11.8% at 04:34 ET, or 08:34 GMT, despite Intuit reporting fourth-quarter results that exceeded analysts’ expectations.

First-quarter and full-year forecasts disappoint

For the first quarter of fiscal 2027, Intuit expects adjusted diluted earnings per share of between $2.44 and $2.48, substantially below the consensus estimate of $4.02.

Revenue is forecast at $4.29 billion to $4.31 billion, compared with Wall Street expectations of $4.35 billion.

The company’s full-year outlook also came in below forecasts. Intuit expects fiscal 2027 adjusted diluted earnings of $22.88 to $23.12 per share, versus the $27.30 consensus estimate.

Annual revenue is projected at between $23.28 billion and $23.51 billion, below analysts’ forecast of $23.74 billion.

Intuit attributed the expected slowdown to weaker growth at Mailchimp, contraction within its Desktop ecosystem and deliberate changes to TurboTax. The company is prepared to accept lower revenue per customer initially as it seeks to attract more users and increase market share.

Stifel expects strategic changes to take time

Analysts at Stifel said the weaker outlook reflected a significant resetting of expectations for Intuit.

“Consistent with our downgrade, Intuit reset expectations with FY27 guidance below consensus, and new 3-year CAGR-targets below previous expectations, driving the stock down,” Stifel analysts commented.

They also cautioned that changes to Intuit’s customer acquisition strategy could take time to deliver results.

“Given more structural issues as management needs to rebuild the top-of-funnel go-to-market (GTM), we expect the changes will take longer to work through and expect INTU to lag other large-cap application peers,” they added.

Beginning in fiscal 2027, Intuit will also change its financial reporting. Adjusted measures will no longer exclude share-based compensation expenses, while Mailchimp will be reported separately from the Global Business Solutions segment.

AI disruption concerns remain a challenge for Intuit

Intuit has been among the software companies facing investor concerns that generative artificial intelligence could disrupt established business models.

The shares came under significant pressure earlier this year after Intuit reduced its TurboTax revenue outlook and announced a restructuring. The stock has remained well below its highs for much of 2026 as investors reassess the prospects of established software companies in an increasingly AI-driven market.

Intuit is responding by positioning artificial intelligence at the centre of its longer-term strategy, including greater automation and deeper integration between its software products and human experts.

Fourth-quarter earnings and revenue beat expectations

The cautious outlook contrasted with stronger-than-expected fourth-quarter results.

Intuit reported adjusted diluted earnings of $4.03 per share, comfortably ahead of analysts’ estimate of $3.59. Revenue increased 14% year-over-year to $4.35 billion, beating the $4.27 billion consensus forecast.

Global Business Solutions revenue climbed 14% to $3.4 billion, while Online Ecosystem revenue increased 17% to $2.6 billion.

QuickBooks Online Accounting revenue grew 20%, supported by higher effective pricing, customer growth and a favourable shift in business mix.

Consumer revenue increased 14% to $930 million. Credit Karma contributed $743 million, representing growth of 16%, supported by personal loans, auto insurance and credit cards.

TurboTax revenue increased 3% to $153 million, while ProTax revenue advanced 6% to $34 million.

Intuit surpasses $20 billion in annual revenue

For fiscal 2026, Intuit generated adjusted diluted earnings of $24.27 per share, ahead of the $23.83 consensus estimate.

Full-year revenue increased 14% to $21.45 billion, exceeding analysts’ forecast of $21.37 billion.

“We surpassed $20 billion in revenue for the full year with growth fueled by our Big Bets which collectively grew 34 percent and represented 30 percent of full-year revenue,” said Sasan Goodarzi, CEO of Intuit.

Intuit uses Big Bets to describe five strategic priorities it considers central to future growth, including embedding AI throughout its products and connecting customers with human experts.

“Our strategy is to win as an AI-driven expert platform by creating a financial system of intelligence that increasingly does the work for consumers, businesses, and accountants and helps them accomplish the outcomes that matter most,” Goodarzi added.

While Intuit’s latest results demonstrated continued double-digit revenue growth, its weaker fiscal 2027 guidance indicates management is prioritising customer acquisition and longer-term market share gains at the expense of some near-term revenue and profitability.

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