Intuit’s latest earnings report gave investors fresh evidence for the bull case Morgan Stanley laid out before the company’s fiscal third-quarter results, while also leaving some of Wall Street’s biggest concerns around TurboTax and artificial intelligence unresolved.
The company reported fiscal third-quarter revenue of $8.56 billion, up 10% from a year earlier, while GAAP diluted earnings per share rose 11% to $11.09. Non-GAAP diluted earnings per share climbed 10% to $12.80, as Consumer revenue increased 8% and Global Business Solutions revenue rose 15%.
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Those results landed after Morgan Stanley framed the quarter as a key test for Intuit. In a note given to TheStreet by Morgan Stanley, analyst Keith Weiss kept an Overweight rating on Intuit, named it a Top Pick in large-cap software, and set a $580 price target on the stock. The note said shares had fallen about 40% year to date before the report and traded at 19 times calendar 2027 GAAP EPS, creating what Morgan Stanley viewed as a favorable risk-reward setup.
Intuit raised its full-year fiscal 2026 revenue outlook to a range of $21.34 billion to $21.37 billion, representing growth of about 13% to 14%. It also raised its outlook for non-GAAP operating income and non-GAAP EPS, with the company now expecting non-GAAP EPS of $23.80 to $23.85.
TurboTax still carries the debate
In the quarter, Intuit said Consumer revenue rose to $5.3 billion, while TurboTax revenue grew 7% to $4.4 billion. Credit Karma revenue increased 15% to $631 million, driven by strength in personal loans, auto insurance, and home loans, while ProTax revenue was flat from the prior year.
The company’s full-year tax guidance showed both the strength and the pressure in the business. Intuit expects TurboTax Live revenue to grow 36% to $2.8 billion and represent about 53% of total TurboTax revenue, with TurboTax Live customers expected to grow 38%. At the same time, the company expects total TurboTax Online units to decline about 2%, TurboTax share of e-files to decline about 1 point, and pay-nothing customers to fall to roughly 7 million from 8 million last year.
The note said investors were worried that lower-cost tax options and AI-native entrants could pressure TurboTax units and average revenue per customer, especially among simple DIY filers. Morgan Stanley argued TurboTax still has advantages in consumer trust, prior-year continuity, tax-form imports, integrated filing workflows, refund visibility, and access to expert help when returns become more complex.
