Intuit Inc. · NASDAQ:INTU
Intuit — Investor Day (October 2017)
137 slides from Intuit's investor day presentation, Oct 3, 2017
Slide 1: Intuit FY'18 Investor Day
Intuit FY’18 Investor Day October 3, 2017
Slide 2: Investor Day Agenda
Investor Day Agenda Welcome Kim Watkins Company Overview: Reflections & Strategies to Win Brad Smith Being the Champion of Those Who Dare to Dream Globally Sasan Goodarzi Deliver Financial Freedom for all Consumers Dan Wernikoff BREAK & PRODUCT GALLERY WALK Brand & Go-to-Market Lucas Watson Investin
Slide 3: Forward-Looking Statements; Non-GAAP Financial Measures
Forward-Looking Statements These presentation materials include forward-looking statements. There are a number of factors that could cause our results to differ materially from our expectations. Please see the section entitled “Cautions About Forward-Looking Statements” in the enclosed Appendix for
Slide 4: Investor Day product demonstrations
Investor Day product demonstrations QuickBooks QuickBooks QuickBooks QuickBooks Online Accountant QuickBooks Self-Employed QuickBooks PaymentsPayments QuickBooks Assistant Assistant Find-a-ProAdvisor On-Demand Powered Expert by Machine Learning Find-a-ProAdvisor Presented PRESENTED BY by Presented P
Slide 5: Brad Smith
Brad Smith
Slide 6: Why isn't Intuit dead?
Geoff Colvin JULY 19, 2016 Why isn’t Intuit dead? “… the reason is easy to state, hard to emulate …” “…the company has continually disrupted itself …” 6
Slide 7: History of self-disruption & re-imagination
History of self-disruption & re-imagination ERA OF DOS ERA OF WINDOWS ERA OF WEB ERA OF MOBILE AND CLOUD QuickBooks IPO Online Global Intuit Founded INTU SHARE PRICE QuickBooks SnapTax Quicken TurboTax Windows Windows QuickBooks Online Mobile QBSE - TTSE QuickBooks Comp. A Windows SMB Acctg v2 Comp.
Slide 8: Our most recent reinvention to a cloud platform
Our most recent reinvention to a cloud platform • Cloud, mobile • Ecosystem connections • Global expansion FY’17 FY’12 • Restructure • Divestitures • Ratable revenue 8
Slide 9: Accelerating to the cloud
Accelerating to the cloud Online customers Desktop customers 37M 12% 23M 11M 9M (4%) FY’13 FY’14 FY’15 FY’16 FY’17 9
Slide 10: Connected services revenue
Connected services revenue Connected services Product FY’13-’17 $B CAGR $5.2 $3.9 73% 11% 63% 37% 27% (1%) FY’13 FY’14 FY’15 FY’16 FY’17 10
Slide 11: Growing global customers
Growing global customers QBO non-US QBO US FY’13-’17 CAGR In thousands 503 100% 43% 287 198 84 32 1,880 600 877 1,226 455 FY’13 FY’14 FY’15 FY’16 FY'17 11
Slide 12: FY'17 strong momentum
FY’17 strong momentum ACTUAL PRIOR YEAR +/- Revenue $5,177 $4,694 10% Operating Income $1,735 $1,555 12% Diluted EPS $4.41 $3.78 17% QBO Subscribers 2,383,000 1,513,000 58% $ in millions except EPS; operating income and diluted EPS are non-GAAP measures 12
Slide 13: Assessment: our foundation is solid with more work needed
Assessment: our foundation is solid with more work needed Progress made ... PERFORMANCE DRIVERS Progress needed ... Strong culture, high engagement Employee Engagement Velocity: scrum team NPS, decisions & tools Customer passion, focus on benefit Customer Delight Awesome E2E experiences, NPS advanta
Slide 14: Looking ahead: the next chapter of reinvention
Looking ahead: the next chapter of reinvention Digital Natives AI/Machine Learning Voice/Chatbots Disruptive Digitization Blockchain Mega-platforms Business Models of Government CATALYSTS FOR GROWTH 14
Slide 15: Translating insights into action
Translating insights into action INSIGHTS IMPLICATIONS CUSTOMER OBSESSION & EMPATHY CUSTOMER • Laser focus on delivering benefit • Increasing expectations • Personalized experiences • Self-employed accelerating • Connect people & products • Living life online CRITICAL PLAYERS & ROLES EMERGING TALENT
Slide 16: Intuit's Game Plan To Win
Intuit’s Game Plan To Win MISSION VALUES TRUE NORTH GOALS STRATEGY PRIORITIES METRICS 16
Slide 17: Mission
Mission MISSION VALUES TRUE NORTH GOALS STRATEGY PRIORITIES METRICS 17
Slide 18: Values
Values MISSION VALUES TRUE NORTH GOALS STRATEGY PRIORITIES METRICS 18
Slide 19: True North Goals
True North Goals MISSION Deliver best-we-can-be results in the current period for each key stakeholder, while building the foundation for an even stronger future EMPLOYEES CUSTOMERS PARTNERS SHAREHOLDERS VALUES The place where the world’s Delight customers more than Delight partners who add Drive lo
Slide 20: Strategy
Strategy MISSION VALUES TRUE NORTH More Money GOALS POWERING PROSPERITY No Work AROUND THE WORLD Complete Confidence STRATEGY PRIORITIES METRICS 20
Slide 21: Priorities
Priorities MISSION ACCELERATE VELOCITY IN DOING DELIVER SIGNIFICANT IMPROVEMENT WHAT’S RIGHT FOR CUSTOMERS … IN CUSTOMER BENEFITS … More Money, No Work, Complete Confidence VALUES Awesome E2E customer experiences: Fuel small business success globally: TRUE between customers, partners & products … bu
Slide 22: Metrics
Metrics ACCELERATE VELOCITY IN DOING DELIVER SIGNIFICANT IMPROVEMENT MISSION WHAT’S RIGHT FOR CUSTOMERS, VIA… IN CUSTOMER BENEFITS, VIA… PROVIDE AWESOME TECHNOLOGY FUEL PEACE-OF-MIND DELIVER SPEED E2E CUSTOMER TO ACCELERATE SMALL BUSINESS AND PROSPERITY FOR FINANCIAL FREEDOM AS A HABIT EXPERIENCES G
Slide 23: Powering Prosperity Around the World: One Intuit Ecosystem
MISSION POWERING PROSPERITY AROUND THE WORLD Integrity Without Compromise We Care & Give Back VALUES Be Bold Be Passionate Be Decisive Learn Fast Win Together Deliver Awesome Employees Customers Partners Shareholders TRUE The place where the world’s Delight customers more than Delight partners who a
Slide 24: 24
24
Slide 25: Value-creating connections in our ecosystem
Value-creating connections in our ecosystem SMALL BUSINESSES & ACCOUNTANTS MATCHMAKING PLATFORM Businesses lack confidence • 53% SMB’s have accts … +10 pts to make financial decisions. • 89% feel more successful w/acct Marketing and acquiring clients • 3X # of acct leads YoY are one of accountants’
Slide 26: New competitive moats
New competitive moats TOP STRENGTHS: HOW WE WIN TODAY TRUSTED REPUTATION • Trusted by customers & ecosystem partners (financial inst., accts., govts.) • Trusted product brands (TurboTax, QuickBooks) & company brand (Intuit) • Trusted stewards of sensitive financial data & personal information STRONG
Slide 27: Building durable competitive advantage
Building durable competitive advantage STRENGTHENING SOURCES OF DURABLE ADVANTAGE Customers become familiar with workflows and place Platform a high bar on relearning tools; the more offerings retention they use on our platform, the stickier they are PATHS TO DURABLE Data & Deliver customer benefit
Slide 28: Our strategy puts us in pursuit of a massive TAM
Our strategy puts us in pursuit of a massive TAM OPPORTUNITIES SEGMENT CUSTOMERS CUST. UNIVERSE $ TAM GROW THE CORE SMALL BUSINESS 5M • Core Products (QBO, QBSE, Tax) 215M • Core Markets (US, UK, CA, AU, BR, FR, IN) SELF-EMPLOYED 0.4M CONSUMER 48M 175M $30B TRAJECTORY CHANGE (I.E. REASONS TO BELIEVE
Slide 29: Our strategy puts us in pursuit of a massive TAM
Our strategy puts us in pursuit of a massive TAM OPPORTUNITIES SEGMENT CUSTOMERS CUST. UNIVERSE $ TAM GROW THE CORE SMALL BUSINESS 5M 215M • Core Products (QBO, QBSE, Tax) 0.4M $80B • Core Markets (US, UK, CA, AU, BR, FR, IN) SELF-EMPLOYED CONSUMER 48M 300M $30B CONNECT THE ECOSYSTEM Our opportunity
Slide 30: Our strategy puts us in pursuit of a massive TAM
Our strategy puts us in pursuit of a massive TAM OPPORTUNITIES SEGMENT CUSTOMERS CUST. UNIVERSE $ TAM GROW THE CORE SMALL BUSINESS 5M $145B 800M • Core Products (QBO, QBSE, Tax) 0.4M $80B • Core Markets (US, UK, CA, AU, BR, FR, IN) SELF-EMPLOYED CONSUMER 48M 300M $30B CONNECT THE ECOSYSTEM Our oppor
Slide 31: Powering Prosperity Around the World
Powering Prosperity Around the World 31
Slide 32: Sasan Goodarzi
Sasan Goodarzi
Slide 33: Powering Prosperity Around the World: One Intuit Ecosystem
MISSION POWERING PROSPERITY AROUND THE WORLD Integrity Without Compromise We Care & Give Back VALUES Be Bold Be Passionate Be Decisive Learn Fast Win Together Deliver Awesome Employees Customers Partners Shareholders TRUE The place where the world’s Delight customers more than Delight partners who a
Slide 34: Accelerated customer growth
Accelerated customer growth DRIVEN BY INTERNATIONAL & QBSE 2.38M QBO Customers 2M Accelerated to 58% growth in FY’17… March ‘17 GLOBAL QBO CUSTOMER BASE • First million took 15 years QBO Self-Employed • Second million took almost 2 years QBO International excl. Self-Employed • Next million will take
Slide 35: Global customer needs are universal and multi-sided
Global customer needs are universal and multi-sided I need to receive tax documents I need money I need to I need to retain get paid employees & contractors I need to pay and file taxes I can lend you I need to pay money I need to be taken contractors, care of employees, vendors I buy from those I t
Slide 36: Customer problem and benefit
Customer problem and benefit MORE MONEY NO WORK COMPLETE CONFIDENCE 64% 6B+ Hours 30% of small businesses are wasted by small of customers in have invoices businesses every any given month unpaid for more year on tasks that seek assistance than 60 days can be automated in QuickBooks 36
Slide 37: We are the champion of those who dare to dream
Vision WE ARE THE CHAMPION OF THOSE WHO DARE TO DREAM 37
Slide 38: Strategy: unlocking the power of many for the prosperity of one
Strategy: unlocking the power of many for the prosperity of one More Money No Work Complete Confidence Personalized Experiences Trusted Open Platform Indispensable Connections 38
Slide 39: Growth Priorities: focus on small business and self-employed
Growth Priorities: focus on small business and self-employed 39 More Money 39
Slide 40: Context: large market and opportunity to increase penetration
Context: large market and opportunity to increase penetration FY’16 FY’17 YoY IMPLICATIONS WORLDWIDE TAM 800M+ 800M+ − Large and untapped global market TAM IN CORE COUNTRIES Nail product market fit and 215M 215M − deploy the ecosystem TRAFFIC Increase awareness of our 69M 88M +26% brand benefits GRO
Slide 41: Global approach: evaluate markets and explore expansion
GLOBAL Global approach: evaluate markets and explore expansion Illustrative examples Large Large Market Large Market OPPORTUNITY Small Investment Large Investment MEXICO MALAYSIA INDONESIA PHILIPPINES US UK GERMANY JAPAN SOUTH AFRICA SINGAPORE IRELAND NORWAY NIGERIA ISRAEL CHILE ARGENTINA Small Mark
Slide 42: Global approach: evaluate markets and explore expansion
GLOBAL Global approach: evaluate markets and explore expansion Illustrative examples Large Large Market Large Market Small Investment Large Investment Standalone QB Self-Employed Full QB ecosystem OPPORTUNITY Standalone QBO Not a priority Small Market Small Market Small Small Investment Large Invest
Slide 43: Established markets: accelerating growth, with large opportunity
GLOBAL Established markets: accelerating growth, with large opportunity DRIVERS OF GROWTH US UK Canada Australia TOTAL Expanded total ADDRESSABLE MARKET 65M 5M 3M 3M addressable market • New countries and capabilities for self-employed • Ecosystem connections with TurboTax and Accountants 1,880 166
Slide 44: Emerging markets: start with nailing the product market fit
GLOBAL Emerging markets: start with nailing the product market fit TOTAL India Brazil France ADDRESSABLE MARKET 100M+ 34M 4M INITIAL TARGET INITIAL TARGET INITIAL TARGET 12M 8M 1M LAST MILE • GST compliance • Nota fiscal (invoice) & boleto (payment) • Full compliance (VAT, journal entries) (CUSTOMER
Slide 45: Fuel small business success
SMALL BUSINESS Fuel small business success FOCUS AREAS Personalized experiences • Instant personalized benefits • All data in flawlessly, matched via machine learning Trusted open platform • Apps embedded in key workflows (Time Capture, Payments, Payroll) • QB available in context of where the custo
Slide 46: Provide peace-of-mind & prosperity for self-employed
SELF-EMPLOYED Provide peace-of-mind & prosperity for self-employed FOCUS AREAS Personalized experiences • Starts small and simple, grows as you grow • All data in flawlessly, matched via machine learning Trusted open platform • App embedded in workflows (Etsy, Uber) • Access to benefits (find jobs,
Slide 47: Our strategy puts us in pursuit of a massive TAM
Our strategy puts us in pursuit of a massive TAM OPPORTUNITIES SEGMENT CUSTOMERS CUST. UNIVERSE $ TAM GROW THE CORE SMALL BUSINESS 5M • Core Products (QBO, QBSE, Tax) 215M • Core Markets (US, UK, CA, AU, BR, FR, IN) SELF-EMPLOYED 0.4M CONSUMER 48M 175M $30B TRAJECTORY CHANGE (I.E. REASONS TO BELIEVE
Slide 48: Our strategy puts us in pursuit of a massive TAM
Our strategy puts us in pursuit of a massive TAM OPPORTUNITIES SEGMENT CUSTOMERS CUST. UNIVERSE $ TAM GROW THE CORE SMALL BUSINESS 5M 215M • Core Products (QBO, QBSE, Tax) 0.4M $80B • Core Markets (US, UK, CA, AU, BR, FR, IN) SELF-EMPLOYED CONSUMER 48M 300M $30B CONNECT THE ECOSYSTEM Our opportunity
Slide 49: Our strategy puts us in pursuit of a massive TAM
Our strategy puts us in pursuit of a massive TAM OPPORTUNITIES SEGMENT CUSTOMERS CUST. UNIVERSE $ TAM GROW THE CORE SMALL BUSINESS 5M $145B 800M • Core Products (QBO, QBSE, Tax) 0.4M $80B • Core Markets (US, UK, CA, AU, BR, FR, IN) SELF-EMPLOYED CONSUMER 48M 300M $30B CONNECT THE ECOSYSTEM Our oppor
Slide 50: Dan Wernikoff
Dan Wenrnikoff
Slide 51: Powering Prosperity Around the World: One Intuit Ecosystem
MISSION POWERING PROSPERITY AROUND THE WORLD Integrity Without Compromise We Care & Give Back VALUES Be Bold Be Passionate Be Decisive Learn Fast Win Together Deliver Awesome Employees Customers Partners Shareholders TRUE The place where the world’s Delight customers more than Delight partners who a
Slide 52: Financial freedom for all consumers
VISION FINANCIAL FREEDOM FOR ALL CONSUMERS TAX AND BEYOND 52
Slide 53: Our consumer ecosystem
Our consumer ecosystem >50M Unique Tax Filers >10M 37.5M TurboTax Units Paid Workers More Money No Work 10M Complete Confidence Annual Active Users >600K Tax Pros / Experts >30M Consumer Returns >20K Financial Institutions 95% Consumer Coverage Personalized Experiences Trusted Open Platform Indispen
Slide 54: Customer problem and benefit
Customer problem and benefit More Money No Work Complete Confidence 62% 6B Hours 60% of Americans is wasted of people can’t come up annually on seek an assisted with $1,000 in tax prep solution an emergency “Money is extremely tight and “It takes a lot of time to sort “My finances are high stakes ju
Slide 55: Long term growth opportunity
Long term growth opportunity CORE OPPORTUNITIES EXPLORE OPPORTUNITIES 1 2 3 Extend our Transform the Evolve from Enable Expand Lead in DIY Assisted Tax Consumer App Developer our Reach Tax Prep Prep Category to Platform Innovation Globally Grow DIY category Leverage tech to enable Create a consumer
Slide 56: Extend our lead in DIY: prior season results
1 Extend our lead in DIY: prior season results TURBOTAX ONLINE US ACQUISITION FUNNEL TURBOTAX ONLINE US AVERAGE REVENUE PER RETURN TTO FY’16 FY’17 YoY Absolute Zero Promo $53 TOTAL IRS RETURNS 150M 150M Flat TTO Free Fed $49 $49 Edition rolled out broadly $46 $47 $47 $42 $43 DIY CONSIDERATION 92M 95
Slide 57: Extend our lead in DIY: critical focus areas
1 Extend our lead in DIY: critical focus areas WIN SIMPLE FILERS BY: Winning With Free • Raise free awareness • Add more value to free offering • Continued focus on mobile Creating Personalized Experiences • Deliver a frictionless 1st-use experience • Reimagine self-help with Machine Learning • Help
Slide 58: Transform Assisted: our largest unaddressed opportunity
2 Transform Assisted: our largest unaddressed opportunity ‘PROS’ STILL PREPARE THE BULK OF RETURNS WE’VE BEEN SCALING UP EXPERTISE CAPABILITIES Total Returns (U.S. + Canada) Total Spend SmartLook 178M $22B Sessions 3,000K Pros 46% share of returns 69% of total spend 2,500K Stores 82.3 10% share of r
Slide 59: Transform Assisted: critical focus areas
2 Transform Assisted: critical focus areas WIN COMPLEX FILERS BY: Extending our TurboTax Brand • Raise awareness of new TurboTax Live offering • Focus on building confidence through expertise • Leverage behavioral data to anticipate need for pro On Demand Expertise • Build an advantaged virtual Pro
Slide 60: Evolve from an app to a platform: an emerging opportunity
3 Evolve from an app to a platform: an emerging opportunity STRENGTH OF CONSUMER CHANNEL AND DATA SUCCESSFUL EXPERIMENTS FROM LAST SEASON POWERFUL FINANCIAL CHANNELS • 1.3M Free Mint credit scores delivered through TurboTax 101M Annual Unique Visitors • +7-10 pt conversion for TurboTax 17M Annual Un
Slide 61: Evolve beyond tax: solving everyday financial problems
3 Evolve beyond tax: solving everyday financial problems BUILD EVERYDAY ENGAGEMENT Connect Intuit’s Consumer Ecosystem • Deeper TurboTax and Mint capabilities integration • Consumer payroll experience integration • Bring experts to our Mint users Trusted Open Platform • Establish trusted FI partner
Slide 62: Our strategy puts us in pursuit of a massive TAM
Our strategy puts us in pursuit of a massive TAM OPPORTUNITIES SEGMENT CUSTOMERS CUST. UNIVERSE $ TAM GROW THE CORE Small business 5M $145B 800M • Core Products (QBO, QBSE, Tax) 0.4M $80B • Core Markets (US, UK, CA, AU, BR, FR, IN) Self-employed Consumer 48M 300M 300M 175M $30B CONNECT THE ECOSYSTEM
Slide 63: Investor Day product demonstrations
Investor Day product demonstrations QuickBooks QuickBooks QuickBooks QuickBooks Online Accountant QuickBooks Self-Employed QuickBooks PaymentsPayments QuickBooks Assistant Assistant Find-a-ProAdvisor On-Demand Powered Expert by Machine Learning Find-a-ProAdvisor Presented PRESENTED BY by Presented P
Slide 64: Lucas Watson
Lucas Watson
Slide 65: Powering Prosperity Around the World: One Intuit Ecosystem
MISSION POWERING PROSPERITY AROUND THE WORLD Integrity Without Compromise We Care & Give Back VALUES Be Bold Be Passionate Be Decisive Learn Fast Win Together Deliver Awesome Employees Customers Partners Shareholders TRUE The place where the world’s Delight customers more than Delight partners who a
Slide 66: Unlocking massive TAM is our key opportunity
Unlocking massive TAM is our key opportunity OPPORTUNITIES SEGMENT CUSTOMERS CUST. UNIVERSE $ TAM GROW THE CORE SMALL BUSINESS 5M $145B 800M • Core Products (QBO, QBSE, Tax) 0.4M $80B • Core Markets (US, UK, CA, AU, BR, FR, IN) SELF-EMPLOYED CONSUMER 48M 300M $30B CONNECT THE ECOSYSTEM Our opportuni
Slide 67: Turning market opportunity into delighted customers
Turning market opportunity into delighted customers • Elastic categories that respond to advertising 1 HELP NEW CUSTOMERS discover our product benefits • • Partner with agency experts who unlock user delight Create advertising scale advantage • Maximize customer growth HELP EXISTING USERS 2 realize
Slide 68: Help new customers discover our product benefits
1 Help new customers discover our product benefits 68
Slide 69: Elastic categories that respond to advertising
Elastic categories that respond to advertising For illustrative purposes only A QuickBooks example 215 Million small businesses and self-employed in our core markets 2 of every 3 don’t know our brand 98 of every 100 don’t use cloud-based financial management software 69
Slide 70: QuickBooks far more responsive to advertising
As a result, QuickBooks far more responsive to advertising ~5-10% CONSUMER PRODUCTS ~25-30% SOFTWARE CATEGORY ~30% TURBOTAX ~46% QUICKBOOKS PERCENTAGE OF BUSINESS GROWTH DRIVEN BY INVESTMENTS IN ADVERTISING 70
Slide 71: Partner with agency experts who unlock user delight
Partner with agency experts who unlock user delight 71
Slide 72: Create advertising scale advantage
Create advertising scale advantage Intuit Competitor A Competitor B MARKETING SPEND FY’17 72
Slide 73: Greater discovery of customer benefit is working
Greater discovery of customer benefit is working Elastic category: DIY Tax 30% responsive SHARE +6 pts OVER 4 YEARS Leadership World-class investment creative partner: in advertising Persuasion 150 to ad benchmarks 73
Slide 74: We've had similar success with QuickBooks
We’ve had similar success with QuickBooks Elastic category: Cloud FMS 46% responsive GREAT CUSTOMER GROWTH +58% Leadership World-class investment creative in advertising partner: +23% YoY 74
Slide 75: Help existing users realize the value of our brands
2 Help existing users realize the value of our brands 75
Slide 76: Customer growth drives long-term revenue acceleration
Customer growth drives long-term revenue acceleration HELP USERS DISCOVER NEW BENEFITS TurboTax QuickBooks TurboTax Mint QuickBooks Payments EARN VALUE AFTER DELIVERY OF BENEFIT QuickBooks Payroll Promotional discounts expire QuickBooks Capital Earn price in proportion to benefit delivered TurboTax
Slide 77: Illustrative: earning value as we deliver benefit
Illustrative: earning value as we deliver benefit YEAR 1 $0 ASHLEY: a new college grad signs up for TurboTax Absolute Zero YEAR 3 $30 In year 3, Ashley chooses to pay $30 to import her data from last year and to receive access to a SmartLook agent YEAR 6 $80 In year 6 Ashley trades up to TurboTax De
Slide 78: Illustrative: earning value as we deliver benefit
Illustrative : earning value as we deliver benefit YEAR 1 $135 JOSH: opens cafe and signs up for QuickBooks. Gets 50% off first six months YEAR 2 $180 Promotional discounts end and we get full year of revenue YEAR 3 $670 Business is healthy and Josh hires an employee and adds payroll Customer signup
Slide 79: Constant innovation in our commercial models
3 Constant innovation in our commercial models 79
Slide 80: Driving benefit discovery: new business models
Driving benefit discovery: new business models PERSONAL FINANCIAL MANAGEMENT: Beyond-User-Paid Lead Generation WITH THEIR PERMISSION, WE CAN OFFER SERVICES LIKE: NEW BUSINESS MODELS STUDENT LOAN DEBT Potential to move MORTGAGE DEBT beyond-user-paid REVOLVING DEBT • 48 Million 5X Avg. TurboTax 401K S
Slide 81: Driving benefit discovery: sales innovation (Etsy)
Driving benefit discovery: sales innovation FOCUS AREAS Platform Selling: Etsy • 1.8M Sellers on Etsy • 10K QuickBooks Bought Thru Etsy in Year 1 • QuickBooks Cost Per Acquisition is 50% less than our average 81
Slide 82: Driving benefit discovery: sales innovation (TurboTax)
Driving benefit discovery: sales innovation FOCUS AREAS Platform Selling: TurboTax • 4M TurboTax Users are self-employed • 170K TurboTax Self-Employed customers activated QuickBooks Self-Employed in Year 1 82
Slide 83: Selling at scale through partners is big opportunity
Selling at scale through partners is big opportunity More Money No Work Complete Confidence Personalized Experiences Trusted Open Platform Indispensable Connections 83
Slide 84: Complete Confidence
Complete Confidence Signing major accounting Partnering with top 100 firms with 4K+ units We sell 1.4M units of universities and will provide over of QuickBooks sold to their TurboTax Online through 50K accounting students with SMB Customers bank websites QuickBooks for free 84
Slide 85: Driving benefit discovery: advertising innovation
Driving benefit discovery: advertising innovation Of 45 Million Self-employed people in the US, less than 0.4% use all three of our products that would be relevant for them: • TurboTax Self-Employed • QuickBooks Self-Employed • Mint 85
Slide 86: Mission: Powering Prosperity Around the World
Mission MISSION VALUES TRUE NORTH GOALS Powering Prosperity STRATEGY Around the World PRIORITIES METRICS 86
Slide 87: Origin Film: A Giant's Story
Origin Film: A Giant’s Story
Slide 88: LN TUIT. prosperity
e e 9 LN TUIT. prosperity INTUIT ¥turbotax. INTUIT @®mint — INTUIT @ quickbooks
Slide 89: Tayloe Stansbury
Tayloe Stansbury
Slide 90: Powering Prosperity Around the World: One Intuit Ecosystem
MISSION POWERING PROSPERITY AROUND THE WORLD Integrity Without Compromise We Care & Give Back VALUES Be Bold Be Passionate Be Decisive Learn Fast Win Together Deliver Awesome Employees Customers Partners Shareholders TRUE The place where the world’s Delight customers more than Delight partners who a
Slide 91: Technology to power prosperity
Technology to power prosperity More Money No Work Complete Confidence Personalized Experiences Trusted Open Platform Indispensable Connections 91
Slide 92: History of self-disruption & re-imagination
History of self-disruption & re-imagination ERA OF DOS ERA OF WINDOWS ERA OF WEB ERA OF MOBILE & CLOUD ERA OF AI, CHAT & VR QuickBooks Quicken Online Global Intuit Founded Windows QuickBooks Online SnapTax QuickBooks TurboTax Windows Tax Knowledge Engine Mobile QuickBooks Windows Quicken DOS Live Co
Slide 93: Speed as a habit: enabling developers to innovate faster
Speed as a habit: enabling developers to innovate faster • Services refactoring of QuickBooks Online • Common tax platform • Cloud hosting 93
Slide 94: Strategic capabilities: groups of shared services
Strategic capabilities: groups of shared services POWERING PROSPERITY FOR Small Businesses Self-Employed Consumers OUR CUSTOMERS… …by delivering MORE MONEY NO WORK COMPLETE CONFIDENCE customer benefit Relationships Identity & Financial Data Intelligent Right-for-Me Security & Money & … Profile Platf
Slide 95: QuickBooks Online services refactoring: great progress
QuickBooks Online services refactoring: great progress 1999-2014 2015-2016 2016-2017 2018 User User User Plugin #1 experience experience experience monolith plug-ins (~100) plug-ins (~100) Company Billing User Mgmt QBO monolith Service Service Service User experience Stage Back-end Back-end monolith
Slide 96: Measurable success today: more releases
Measurable success today: more releases 440 PLUG-IN RELEASES PER MONTH 284 246 245 200 135 112 72 47 42 38 38 21 28 27 18 18 2 2 2 5 3 7 May 2015‘15Jul 2015 MAY Sep 2015 Nov 2015 Jan 2016 Mar 2016 May 2016 Aug 2016 Oct 2016 Dec 2016 Feb 2017 APRIL Apr 2017 ‘17 96
Slide 97: Common tax platform: multi-year effort with significant benefits
Common tax platform: multi-year effort with significant benefits ~10M lines of code ~10M lines of code FROM: Disparate tech stacks and technologies for tax products • Old technology, fragile platforms is difficult to work on • Innovation is slow • One-size-fits-all is a rigid experience • Expensive
Slide 98: Common tax platform: multi-year effort with significant benefits
Common tax platform: multi-year effort with significant benefits Consumer Small pro Big pro TO: (TurboTax) (ProSeries) (Lacerte) A single common tax platform interview forms input sheets logic consolidated data platform print e-file ~1M lines of code 98
Slide 99: Common tax platform: benefits
Common tax platform: multi-year effort with significant benefits BENEFITS: • Increased speed of innovation (from months to days) • Right-for-me, personalized and flexible experience • Significant efficiencies: Re-use frees capacity to innovate; closes competitive gaps 99
Slide 100: AWS cloud migration accelerating
AWS cloud migration accelerating SPEED IMPROVEMENTS FROM TO Provisioning weeks days development environment Increasing e-file weeks hours processing capacity Scaling up QuickBooks days hours Online capacity 100
Slide 101: Technology to Accelerate Growth
Technology to Accelerate Growth 101
Slide 102: Data is the lifeblood of the Intuit ecosystem
Data is the lifeblood of the Intuit ecosystem FINANCIAL INSTITUTIONS ACCOUNTANTS DEVELOPERS GOVERNMENT Returns W-2s W-2s Returns Transactions 1099s Paystubs SMALL BUSINESSES / SELF-EMPLOYED / CONSUMERS Analytics, Customer insights Behavior QuickBooks TurboTax & financial Data Self-Employed Self-Empl
Slide 103: We stand for our customers' privacy
We stand for our customers’ privacy. Our customers place a deep trust in Intuit because we hold their most sensitive data … therefore, we are a trusted steward of their data. 103
Slide 104: AI & knowledge-based systems from Intuit
AI & knowledge-based systems from Intuit Ideal for Intuit Not our sweet spot; we should rely on others FINANCIAL KNOWLEDGE GRAPH PREDICTIVE MODELING • Fast and accurate • Standard vs. itemized tax return; user experience Experience- Compliance data-driven error detection • Software that can explain
Slide 105: Intuit has been using AI/ML for the past 10 years
Intuit has been using AI/ML for the past 10 years LIVE COMMUNITY CUSTOMER CARE SECURITY is enhanced uses AI & computational offers a personalized by multiple uses of AI/ML linguistics to answer pre-search and Facebook to detect fraud & protect customers’ tax questions messenger chatbot customer iden
Slide 106: Pre-search gives users a list of answers before they search
Pre-search gives users a list of answers before they search 106
Slide 107: Answers are personalized to the user's unique situation
Answers are personalized to the user’s unique situation FOCUS AREAS Answers come from Live Community Uses signals such as e-file status, location and tax situation data to predict which answers are the most relevant to the user at a given time 107
Slide 108: Natural language processing
Natural language processing in search In the last tax year ... • 48M visitors to Live Community • 77% helpful rating 108
Slide 109: Simplified tax experience instills greater confidence
Simplified tax experience instills greater confidence Using both logic (rules) and machine learning (data) BEFORE AFTER Walk through every topic Personalized topics • Tax knowledge is encoded into a knowledge graph • User data can be inconsistent or incomplete at any moment • The system knows when i
Slide 110: Automatic classification of business expenses using ML
Automatic classification of business expenses using ML 110
Slide 111: Expense Finder customer benefit
Expense Finder customer benefit MORE MONEY NO WORK COMPLETE CONFIDENCE $4,340 78% 90% in potential of time spent accuracy in tax savings per on manual business expense year for categorization is predictions QBSE users eliminated 111
Slide 112: Our plan to get to the next technology era
Our plan to get to the next technology era: All in service to our customers AI/MACHINE LEARNING CONVERSATIONAL UI SERVICES REFACTORING TRANSITION TO AWS BLOCKCHAIN DATA 112
Slide 113: Neil Williams
Neil Williams
Slide 114: Great execution on FY'17 objectives
Great execution on FY’17 objectives LAST YEAR’S SUMMARY FY’17 OUTCOMES • Fast-growing SaaS business 58% QuickBooks Online subscriber growth with highly profitable desktop portfolio 30% Small business online ecosystem rev growth • Double-digit growth in 34% Intuit non-GAAP operating margin earnings p
Slide 115: Powering Prosperity Around the World: One Intuit Ecosystem
MISSION POWERING PROSPERITY AROUND THE WORLD Integrity Without Compromise We Care & Give Back VALUES Be Bold Be Passionate Be Decisive Learn Fast Win Together Deliver Awesome Employees Customers Partners Shareholders TRUE The place where the world’s Delight customers more than Delight partners who a
Slide 116: Multi-year financial plan delivers for all, short & long
Multi-year financial plan delivers for all, short & long EMPLOYEES CUSTOMERS + PARTNERS SHAREHOLDERS Delight customers more than Drive long-term growth, The place where the world’s rivals in what matters most – increasing shareholder value. top talent does the best customer benefit. Delight work of
Slide 117: Financial principles remain enduring
Financial principles remain enduring GROW ORGANIC REVENUE DOUBLE DIGITS • Customer growth fueled by delivery of the customer benefit • Small business online ecosystem growth >30%; win every tax season GROW OPERATING INCOME MID-TEENS AT THE INTUIT LEVEL • Margins in mid-30s going forward • Acceptable
Slide 118: Small Business TAM: focus on new customers, commercial innovation
Small Business TAM: focus on new customers, commercial innovation SMALL BUSINESS & SELF-EMPLOYED TOTAL PAYING CUSTOMERS COUNTRY MARKET SIZE FY’17 QBO SUBS QBO SUBS GROWTH QBO, Desktop Subs, Desktop Units U.S. 65M 1.9M 53% Canada 3M 150K 67% U.K. 5M 166K 132% Australia 3M 104K 95% Brazil 34M 22K 39%
Slide 119: Consumer TAM: focus on new customers, commercial innovation
Consumer TAM: focus on new customers, commercial innovation PROS/STORES STILL PREPARE THE BULK OF RETURNS WE’VE BEEN SCALING UP EXPERTISE CAPABILITIES SmartLook Sessions 3,000K 2,500K 2,000K 1,500K 1,000K Tax Advice Sessions 500K • Win with free in do-it-yourself 0K • Use technology to enhance do-it
Slide 120: Online products & global growth
Online products & global growth REVENUE GROWTH QBO QBO Online is the growth engine ... TurboTax Online Online TurboTax • Small business online ecosystem DesktopDesktop revenue accelerating 63% • Significant portion of Consumer and Small Business revenue recurring/highly predictable 37% FY'14 FY'15 F
Slide 121: Highly predictable revenue model
Highly predictable revenue model FOR FY’18 WE EXPECT: 73% Of revenue from returning customers 85% Of revenue from existing customer base 90% Of revenue from returning customers 80% Of Intuit’s revenue from existing or returning customers 121
Slide 122: ARPC: customer growth first, improved monetization over time
ARPC: customer growth first, improved monetization over time FY’16 FY’17 FY’18 – FY’20 ARPC ARPC LOOKING AHEAD TRAJECTORY QuickBooks Online US $420 $434 Slight Increase / Maturing base, attach services, price increase QuickBooks Non – US $120 $135 Slight Increase / Monetization balanced with dsct to
Slide 123: Disciplined investment: drives operating income growth
Disciplined investment: drives operating income growth GAAP BASIS, UNLESS NOTED OTHERWISE FY’17 % OF REVENUE LONG-TERM EXPECTATION Revenue 100 Double-digit growth driven by customers Gross margin 84 ~ % flat over time Sales & marketing 27 % will increase, governed by LTV to CAC Research & developmen
Slide 124: Reallocating 10% of spend to accelerate growth
Reallocating 10% of spend to accelerate growth FROM: TO: • High-touch customer care • Deeper integration of AI/ML to create personalized experiences • Inconsistent developer tools and processes, legacy code bases • Standard tools, services based architecture • Layers of management • Accelerated tran
Slide 125: Overall capital allocation
Overall capital allocation ($B’s) A HEALTHY MIX OF USES OF CAPITAL Repay Debt Dividends Share Repurchases Highest yield opportunities CapEx 3.1 for our cash… 0.3 • Investing in organic growth drivers 2.0 1.9 (R&D, infrastructure, sales & mktg) 1.8 0.2 0.3 2.3 0.5 • Use acquisitions to accelerate gro
Slide 126: Share repurchase guiding principles
Share repurchase guiding principles SHARE REPURCHASE IS USED TO RETURN CASH TO SHAREHOLDERS IN THE ABSENCE OF ACCEPTABLE INVESTMENT OPPORTUNITIES. 1. At a maximum, we limit repurchase amounts to: • Cash in excess of liquidity needs • Price level defined by “smart grid” to exceed cost of capital on a
Slide 127: FY'18 guidance balances customer growth and profitability
FY’18 guidance balances customer growth and profitability GUIDANCE GROWTH QBO SUBSCRIBERS 3.275 – 3.375 37% - 42% Total Revenue $5,640 – $5,740 9% - 11% Small Business & Self-Employed $2,850 – $2,900 12% - 14% Consumer $2,355 – $2,395 7% - 9% Strategic Partner $435 – $445 0% – 2% (in millions, excep
Slide 128: FY'18 guidance balances customer growth and profitability
FY’18 guidance balances customer growth and profitability GUIDANCE GROWTH GAAP Op Income $1,485 - $1,535 6% - 10% Non-GAAP Op Income $1,885 – $1,935 9% - 12% GAAP diluted EPS $4.00 - $4.10 8% - 10% Non-GAAP diluted EPS $4.90 – $5.00 11% - 13% Dividend per share $1.56 15% (in millions, except EPS) 12
Slide 129: Our plan for FY'18 reflects our commitment, short and long
Our plan for FY’18 reflects our commitment, short and long • Fast-growing SaaS business with highly profitable desktop portfolio • Double-digit revenue growth • Disciplined investments yield revenue growing faster than expense • Stable share count and consistent dividend increases • ROIC ~45% in FY’
Slide 130: Q&A
Q&A
Slide 131: Appendix
Appendix 131
Slide 132: About Non-GAAP Financial Measures
About Non-GAAP Financial Measures INTUIT INC. ABOUT NON-GAAP FINANCIAL MEASURES The accompanying presentation contains non-GAAP financial measures. Table 1, Table 2 and Table 3 reconcile the non-GAAP financial measures in that presentation to the most directly comparable financial measures prepared
Slide 133: About Non-GAAP Financial Measures (cont.)
About Non-GAAP Financial Measures (cont.) The following are descriptions of the items we exclude from our non-GAAP financial measures. Share-based compensation expenses. These consist of non-cash expenses for stock options, restricted stock units, and our Employee Stock Purchase Plan. When consideri
Slide 134: Table 1: Reconciliations of historical Non-GAAP financial measures
Table 1: Reconciliations of historical Non-GAAP financial measures to most directly comparable GAAP financial measures (Dollars in millions, except share amounts) Fiscal Fiscal 2017 2016 GAAP operating income from continuing operations $ 1,395 $ 1,242 Amortization of acquired technology 12 22 Amorti
Slide 135: Table 2: Reconciliations of forward-looking guidance
Table 2: Reconciliations of forward-looking guidance for Non-GAAP financial measures to projected GAAP revenue, operating income and EPS (In millions, except share amounts) Forward-Looking Guidance GAAP Non-GAAP Range of Estimate Range of Estimate From To Adjustments From To Twelve Months Ending Jul
Slide 136: Table 3: Calculation of free cash flow
Table 3: Calculation of free cash flow (Dollars in millions) Fiscal Fiscal Fiscal Fiscal Fiscal 2013 2014 2015 2016 2017 Net cash provided by operating activities $ 1,435 $ 1,528 $ 1,589 $ 1,460 $ 1,599 Less capital expenditures: Purchases of property and equipment (129) (104) (142) (416) (102) Capi
Slide 137: Cautions about Forward-Looking Statements
Cautions about Forward-Looking Statements This presentation includes "forward-looking statements" which are subject to safe harbors created under the U.S. federal securities laws. All statements included in this presentation that address activities, events or developments that Intuit expects, believ