Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.
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| Statement |
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| So, on MailChimp, we are getting good experiences that the automation and the marketing campaigns were driven through AI are resonating |
| And historically, Intuit has been exceptional in acquiring at scaled to small business side customers in the 1,2 or 10 employees like the truly small business, and one of the growth catalysts we have is how do we go mid-market, and the progress we're making there in terms of implementing those sales motions, making those product innovations |
| I feel good about our much your guidance to have expenses growth slower than revenues, hence implying gradual margin expansion over time |
| Sandeep Aujla So, we feel very good about our guidance to expand margins this year |
| First half of your fiscal year, you guys have done an outstanding job on margins outperformed significantly 200 basis points plus and I think in both Q1 and Q2 |
| So that's -- and plus our investments in gen AI and AI capabilities, that's all giving us confidence that we could continue to drive the cost to serve down while penetrating the assisted tax category |
| But when I look at the data, when we look at the behavior of the small business, we feel pretty good about the environment that they're operating in |
| And with that, we had a pretty solid Q2 |
| Are we opening up the segments we serve, prime, right? The team, thanks to all the amazing work that our tech team has done in four months, built a net worth capability in the CardiKarma app to now it is attractive to the prime customers, which are much higher ARPC than the nonprime customers |
| Is that structural advantage in how we are operating that allows us to continue to gradually increase margin while keeping pace with our revenue growth |
| Our first opportunity is that we feel that AI has a significant opportunity to unlock the growth funnel for us |
| And the teams are making good progress on that |
| Those are -- feel pleased with the progress that the team is doing there |
| So, feel good about all the progress |
| So, we feel good about the progress, and the teams are continuing to iterate |
| We're seeing good results in better ARPC better retention rates, given some of the changes the teams have made |
| We had three thesis when we did the acquisition and are confident that thesis is stronger than they've ever been |
| And quite frankly, our margins are really solid on the desktop side |
| So those are all things that are giving us confidence that as the economy comes back into a normalized mode, that Credit Karma is going to come out of the gate even stronger than what it was in the prior expansion environment |
| We're getting good adoption and repeat usage |
| So that is one item that gives us confidence that we have a clean comp |
| We have incorporated in our TurboTax offerings, we're in tax season, and we're getting feedback that the helpfulness of our AI experiences is 1.5x better than before, and we were pretty solid before as well |
| They actually are excited about the opportunity that this gives them to now move more upmarket, so they could charge higher for their offerings and have a very synergistical relationship with the QuickBooks product |
| And we are realizing that MailChimp is a low compliance product, and that has the ability to penetrate international markets much more efficiently, so we're using that as the tip of the spear to drive our international expansion |
| So, I would urge you not to focus on any single quarter, but look at our track record over the course of the year, and I feel pretty thought about our ability to expand margin this year as well as three years ago |
| So, when you look at the data, they're in a pretty good position |
| Keith, if I can add a little bit of context, going back a few years, we have been on this journey from being a very stable, solid high single-digit grower to actually being a growth software company |
| So those are some of the factors that's driving the advanced growth that you pointed to, but also what excites us about the opportunity to drive the bigger mid-market pie that we're excited about |
| software research practice here at Morgan Stanley, and very pleased to have with us, I think, for the first time at the TMT Conference |
| So that's been going quite well |
| Statement |
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| And it's my first tax season as the CFO and just learning the ins and out and our focus on executing the playbook we have to win in DIY category, do it yourself taxes, but really disrupting that $30 billion opportunity we have in the assisted tax category, where we right now have a 0% market share |
| You saw a slowdown in TurboTax Live last year |
| But when it comes to the small business side of the equation, how are you feeling about the overall spending environment? It's definitely something investors are concerned about |
| When you are unlocking growth, when you're going into new areas, you're going to make mistakes |
| For the past two years, we've actually seen declines in the number of IRS returns |
| The other thing to highlight, again, the challenge of the historical course, 70% of the population doesn't even realize that TurboTax offers an assisted tax category because we're so well known for do it yourself taxes |
| One of the learnings we had across not just tax, but the entire life platform is that even internally, some folks within our own company were over worried about the potential friction with the accountants |
| We got into a weaker macro environment at tighter credit conditions, and it's something that we're hoping to derisk on a go-forward basis |
| In any given quarter, you could have expenses slip out |
| So, I guess the fundamental question is, like how do you guys get confidence in the tax season? And what's going on? What's going on with the tax filer that like just these past three years have been so anomalous |
| When you're trying to drive the transformation of the business from having a software perspective to having a services perspective, your historical success could at times be a hindrance to progress |
| It seems like there was some normal factors that led to that |
| But you guys have made -- you've had a commentary in the past that, that's not really the case when it comes to like TurboTax Live or full service, that it's not necessarily a negative margin impact into it |
| You had a slower start |
| And what -- I don't know why it continues to surprise us is that American populus ability to procrastinate on their taxes |
| So those -- these are all intertwined in terms of what was driving the reductions in the DIY category because the live product is, in essence, is bought on to the DIY to get some questions addressed |
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