Intuit plots AI agent expansion in August with consumption model

Intuit is launching "a sweeping expansion and a new lineup of our AI-driven expert platform" in August and has plans to start charging based on consumption.

The company previewed its next moves during its third quarter earnings call. CEO Sasan Goodarzi said:

"We are launching a sweeping expansion and a new lineup of our AI-driven expert platform in August. This represents a significant step forward, a unified system of intelligence that serves as a strategic control tower for both businesses and accountants seamlessly moving from insights to autonomous execution."

According to Goodarzi, Intuit is planning to help accountants and businesses better run their businesses with a control tower that can automate processes.

Intuit is betting that it can be an "all-in-one-business platform." The company's QuickBooks Online Advanced and Intuit Enterprise Suite revenue was up about 38% in the third quarter.

To grow, Intuit is planning to launch AI agent builder tools that help customers customize industry-specific KPIs. Intuit will also expand its total market with the launch of new products including QuickBooks Workforce.

Goodarzi fielded multiple questions about SaaS prospects vs. LLMs. He said Intuit customers pay for the confidence that they can get human experts should LLMs stray. He said:

"It's important to recognize that businesses, while they use Google, they use LLMs to do searches, queries, you can't run your business with an LLM because you're managing your books, you're managing your money, you're managing your payroll and accuracy and compliance of doing that matters. Running a business is mission critical. And so, the psyche of businesses is that they need us to be their AI platform to provide expertise so they can run and grow their business."

Goodarzi said there may be a market where Intuit is introduced to customers via an Anthropic or OpenAI model. "Once they actually become a legitimate business, they want to run their business on our platform," he said.

Intuit's secret sauce is that it's a system of intelligence that combines human and AI expertise.

"The reason we're structurally advantaged is we have built out a virtual expert platform that is all driven by all of our data, data engines and data ingestion capabilities. AI that does a lot of that," said Goodarzi.

As for monetization, Intuit is going to launch a consumption model. "As we evolve our lineup with expanded functionality, we expect to take pricing actions at the higher end of our portfolio, reflecting the increased value we are delivering to customers. We will also introduce a consumption-based model for our AI and human intelligence services, enabling customers to scale usage and unlock greater benefits and business outcomes. Based on initial tests, we see the strongest adoption among more complex customers on the Advanced and Plus offerings," he said.

And about those layoffs...

Intuit cut 17% of its workforce and you have to give Goodarzi credit in that he didn't hide behind AI.

He said the following:

• "This was not about AI. As you know, we are very invested in AI and the tools that we use internally, which is what's driving a lot of our efficiencies and margin expansion. And also, AI is embedded in everything that we do that helps us serve customers, which is what's fueling our growth."
• "We've been really studying what are actually the biggest blockers and what's getting in our way. And really, there are several things that led to this 17% reduction. The first is we significantly reduced the number of management layers and to reduce the complexity of information flow of how fast we make decisions so we can push decision-making to our frontline folks that are the builders."
• The company cut "coordination heavy roles" including product managers and designers. Also, Intuit needed less coordination between units now that its brands are operating off of one platform.
• Intuit also was looking to "resizing Mailchimp in the context of the growth opportunities ahead."

The results

Intuit reported a better-than-expected third quarter with revenue of $8.6 billion, up 10%, with earnings of $11.09 a share. Non-GAAP earnings were $12.80 a share. Sasan Goodarzi, CEO of Intuit, said the company's "AI-driven export platform strategy" and proprietary data are a winning combination.

As for the outlook, Intuit projected fourth quarter revenue growth of 11% to 12% with non-GAAP earnings of $3.56 a share to $3.62 a share. That outlook includes $300 million in restructuring charges. Intuit is cutting 17% of its workforce to become "a faster, leaner, more focused company."

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