Intuit Shares Sink as Tax Season Revenue Falls Short

Intuit (INTU) shares tumbled 7.5% on Wednesday after sales of the maker of TurboTax tax filing software fell short of expectations during the key tax-filing season.

Intuit reported fiscal third quarter 2023 revenue increased 6.9% to $6.02 billion, short of analysts’ forecasts. Profit of $8.92 per share beat estimates.

The company noted that the results reflected its outlook for the full fiscal year. It anticipates a 2% decline in total Internal Revenue Service (IRS) returns, and the do-it-yourself share will be down 0.75%. Intuit explained that it believes the reason for that is that those who filed taxes in order to receive pandemic-era stimulus money and tax credits over the past several years didn’t file this season.

Even so, Intuit CEO Sasan Goodarzi explained that Intuit was raising its 2023 revenue, operating income, and earnings per share (EPS) guidance.

Goodarzi also warned about the possibility of the Internal Revenue Service (IRS) allowing Americans to directly file their taxes for free electronically, without needing a third-party provider such as Intuit. Goodarzi argued that such a move would “cost taxpayers billions of dollars.” The idea was part of the $80 billion in upgrades to the IRS included in last year’s Inflation Reduction Act. Last week, Treasury Secretary Janet Yellen told the IRS to move forward with tests of a prototype system.