Dive Brief:
- TurboTax owner Intuit is reducing its full-time workforce by 17%, or by approximately 3,000 employees, to “simplify its organizational structure,” the software provider said Wednesday as part of its third quarter earnings results.
- The “leaner structure will accelerate how we operate with greater focus, speed, agility and an even stronger commitment to profitability,” Intuit CFO Sandeep Aujla said during the company’s earnings call Wednesday, according to a transcript. As part of the planned restructuring, the company will also be “rightsizing” its investment in its Mailchimp offering, Aujla said during the call.
- Executives for the Mountain View, California-based company, including Aujla and CEO, President and Chairman Sasan Goodarzi, insisted the decision-making behind the planned reduction was “not about AI” in response to an analyst question during the Wednesday call. Rather, the layoffs come as the company considers “how we can continue culturally to have a company that's a company of builders and move fast,” Goodarzi said.
Dive Insight:
The reductions are fundamentally about continuing to invest across the tax and accounting software provider’s three “Big Bets,” Aujla agreed in his response to the question by the same analyst.
Those including scaling its AI-native platform, being the “center of money” for its customers, and expanding its “authority and right to win” in the mid-market space, according to a May 20 memo published by Goodarzi following the layoff announcements.
The workforce reductions also differ from a 2024 decision to reduce its workforce — where it cut about 1,800 employees as part of a strategic pivot to AI — as Intuit expects most of the cost reductions from the 2026 decision “to flow the bottom line,” Aujla said. “And at the core, this is all about the three assets Sasan called out, focused organization, flatter organization, faster organization.”
Even as executives sought to distance the coming reductions from AI, however, they also stressed the importance of continued deployment of the technology for Intuit’s future growth.
AI is “embedded in everything that we do that helps us serve customers, which is what's fueling our growth,” Goodarzi said Wednesday. Intuit’s investments into its proprietary generative AI operating system, meanwhile, have “enabled us to fuel innovation with unparalleled speed for our customers,” according to its 10-K filing with the Securities and Exchange Commission for its Q3 ended April 30.
“The era of AI is igniting global innovations at an incredible pace and will fundamentally transform every part of our work and personal lives,” the company wrote in the filing. “We made an early bet on AI, declaring our AI-driven expert platform strategy in 2019. We have transformed the company from a tax and accounting platform to an AI-driven expert platform.”
Intuit joins several other tech firms which have announced layoffs in recent months amid a surge in spending on AI technologies and tools. Cisco Systems announced earlier this month that it plans to cut 4,000 jobs as it sharpens its focus on AI, CFO Dive previously reported.
Facebook parent Meta, meanwhile, announced on Wednesday it would be slashing 10% of its workforce, or about 8,000 employees, as it accelerates its own AI efforts, according to a CNBC report.
“Success isn’t a given” in the AI industry, Meta CEO Mark Zuckerberg said in a memo announcing the layoffs to staff, CNBC reported.
Intuit expects to incur between $300 million to $340 million in charges related to the restructuring, which it anticipates will be largely recognized in its Q4, according to its Q3 earnings release. For the quarter, Intuit reported GAAP operating income of $4 billion, an 8% increase year-over-year, according to its earnings report. Total revenue rose by 10% YoY to $8.6 billion.
