A deep dive into a household-name fintech that's lost half its value — and why the story might not be what you think.
The stock market loves a good villain. Right now, Intuit's villain is a two-headed monster: artificial intelligence that supposedly makes tax software obsolete, and a U.S. government that supposedly offers free filing for everyone. It's a compelling narrative. It's also, in large part, wrong — or at least dramatically overblown.
Let me explain why I've been spending a lot of time thinking about Intuit (INTU) at $304.
First, the Basics — What Does Intuit Actually Do?
If you've ever filed your taxes on TurboTax, managed a small business on QuickBooks, or checked your credit score on Credit Karma, you've used Intuit. About 100 million people worldwide have.
The company runs four main businesses:
TurboTax handles consumer tax prep — from the classic DIY software to their growing "TurboTax Live" service where a real CPA reviews your return. QuickBooks is the dominant accounting platform for small and mid-sized businesses. Credit Karma is a personal finance marketplace that earns referral fees from lenders and insurers. Mailchimp — the email marketing platform they acquired in 2021 for $12 billion — rounds out the portfolio, though it's been the awkward member of the family ever since.
The revenue mix is mostly subscription-based, mostly recurring, and mostly sticky. QuickBooks users don't leave because migrating years of payroll data, banking connections, and accountant integrations is a genuine headache. TurboTax users come back every year because their prior return data is already loaded. Credit Karma users stay engaged through daily credit monitoring alerts.
For FY2026, Intuit is guiding to $21.3–$21.4 billion in revenue — about 13–14% growth — with non-GAAP operating margins above 40%. These are not the numbers of a business in crisis.
So Why Is the Stock Down 50% from Its Peak?
Great question. The stock traded above $800 less than a year ago. Today it's sitting around $305. That's a $500 drop, roughly $135 billion in market cap evaporated.
Two fears have driven the de-rating.
Fear #1: The IRS was going to eat Intuit's lunch. The government rolled out "IRS Direct File" — a free, government-run tax filing tool — and the market panicked that it would gradually expand to all 50 states and kill TurboTax's market. Free is a very hard price to compete with.
Fear #2: AI is going to make tax software irrelevant. If ChatGPT can draft a legal brief, why can't it file your taxes? The bear case is that general-purpose AI commoditizes the whole value proposition of TurboTax and QuickBooks within a few years, turning Intuit into the next Kodak.
These fears aren't crazy. They're just, in my reading, largely resolved or overstated.
The Biggest Bear Thesis Just Got Killed — Quietly
Here's the thing most people gliding through their news feeds missed: IRS Direct File was permanently shut down in November 2025.
The Trump administration terminated the program. Treasury Secretary Scott Bessent cited the numbers — the service processed only 296,531 returns in 2024 at a cost of roughly $138 per return. The IRS product manager sent letters to all 25 participating states: "IRS Direct File will not be available in Filing Season 2026. No launch date has been set for the future."
That's not a pause. That's not a delay. That's elimination.
The bear thesis that powered a 50% stock drop has been officially invalidated by the federal government, and the market has barely blinked. Intuit is still trading like the threat is live and expanding.
Meanwhile, TurboTax Live — the very product most threatened by a free government alternative — grew revenue 36% and customers 38% in FY2026. Intuit deliberately traded unit volume for higher-value, higher-ARPU assisted filers, and it's working.
What About the AI Threat?
This one deserves a real answer, not a dismissal.
Yes