Intuit Inc.

Good afternoon. My name is Lateef, and I will be your conference facilitator. At this time, I would like to welcome everyone to Intuit's first quarter fiscal year 2020 conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer period. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. With that, I'll now turn the call over to Kim Watkins, Intuit's Vice President of Investor Relations. Ms. Watkins.

Thanks, Lateef. Good afternoon and welcome to Intuit's first quarter fiscal 2020 conference call. I'm here with Intuit's CEO, Sasan Ghadarzi, and Michelle Clutterbuck, our CFO. Before we start, I'd like to remind everyone that our remarks will include forward-looking statements. There are a number of factors that could cause Intuit's results to differ materially from our expectations. You can learn more about these risks in the press release we issued earlier this afternoon, our Form 10-K for fiscal 2019, and our other SEC filings. All of these documents are available on the Investor Relations page of Intuit's website at Intuit.com. We assume no obligation to update any forward-looking statement. Some of the numbers in these remarks are presented on a non-GAAP basis. We've reconciled the comparable GAAP and non-GAAP numbers in today's press release. Unless otherwise noted, all growth rates refer to the current period versus the comparable prior year period, and the business metrics and associated growth rates refer to worldwide business metrics. A copy of our prepared remarks and supplemental financial information will be available on our website after this call ends. And with that, I'll turn the call over to Sasan.

Great. Thanks, Kim, and thanks for everyone for joining us today. We're off to a strong start through the first quarter of fiscal 2020 and continue to make progress on our strategy of becoming an AI-driven expert platform. First quarter revenue grew 15% overall, fueled by 15% growth in the small business and self-employed group. Online ecosystem revenue grew 35%, exceeding our target to grow 30% or more. Consumer group revenue grew 11% and strategic partner group revenue was in line with our expectations. This is a great start to the year. At Investor Day, I shared our top five priorities, which we call our big bets. These big bets focus on the largest problems our customers face and also represent durable growth opportunities for Intuit. I'd like to share our progress on each of these. Our first bet is to revolutionize speed to benefit for our customers when they use our products and services. We aim to deliver instant benefit and make the interactions with our offerings frictionless by accelerating the application of artificial intelligence. This big bet is foundational to everything we do for our customers and positions us to accelerate execution across our other four bets. Here are a couple of examples of the progress that we're making. First, we're on a path to triple the number of customers who can apply for working capital loans through Cookbooks Capital by extending eligibility to our desktop customers using machine learning. Cookbooks Capital leverages customers' data to provide loans to small businesses, nearly 60% of whom may not qualify for loans elsewhere. Second, we're enhancing our ability to answer customer questions more efficiently through TurboTax Self-Help. By leveraging AI, we are delivering more relevant answers at the point of need and using natural language processing to expand personalized answers with TurboTax Assistant. In fiscal 2019, we handled millions of calls from customers needing help while using TurboTax. We expect this capability to help improve the customer satisfaction survey results and reduce customer contact rates by helping customers find answers to their questions more easily. Our second big bet is to connect people to experts. One of the largest problems our customers face is lack of confidence to do their own taxes and to manage their business. We're connecting customers to experts on our platform to solve this problem, allowing us to gain share and grow average revenue per customer, or ARPC. We're happy with the progress that we're making. We launched QuickBooks Live, connecting small businesses with live experts opening up access to a new $10 billion market opportunity. This offering is intended to increase our small business customers' confidence, helping them get set up, close their books each month, and ensure their records are accurate and up to date. Over the last six months, we've run more than 50 tests to learn what customers truly need, helping us develop the offering and refine our go-to-market and pricing strategies. At the same time, we continue to build out the expert pipeline, as 90% of TurboTax Live experts express interest in working with QuickBooks Live. In TurboTax Live, we continue to innovate, making our experts more accessible at different touchpoints, as we see a 32-point improvement in conversion for first-time filers when engaging with an expert. This season, we're launching real-time chat, an enhancement our customers have asked for since the inception of TurboTax Live. Our third big bet is to unlock smart money decisions for customers by connecting them to financial tools, partners, and benefits that help put more money in their pockets. Through our offerings, we are addressing key customer problems by helping them reduce high-cost debt, grow emergency funds, and improve their financial habits. Based on what we've learned from the tests we've ran during the extension season, we're optimistic about our ability to go beyond tax to help our customers make ends meet. For example, we introduced credit score goal setting and payment history tracking in Turbo to help customers improve their credit score. This is a key step in improving their overall financial health. Our fourth big bet is to become the center of small business growth by helping our customers get paid fast, manage capital, and pay employees with confidence. We introduced new QuickBooks innovations at our flagship QuickBooks Connect conference earlier this month to further support our customers' small businesses' growth. For example, we announced a cash flow planner to help our small business customers make better decisions as they grow. We also announced receipt capture in the mobile app and enhanced mileage tracking to enable our customers to automatically deduct expenses seamlessly. All of these innovations put more money in our customers' pockets and should increase their success. Over time, we see an opportunity to better serve product-based businesses by transforming omnichannel commerce, benefiting customers who sell products through multiple channels. Our fifth big bet is to disrupt the mid-market with QuickBooks Online Advanced, our online offering designed to address the needs of small business customers with 10 to 100 employees. This offering will help us increase retention of these larger customers, attract new mid-market customers who are over-served by higher-priced competitive offerings. we continue to make progress building out the offering since launching last year for example we recently introduced a revenue streams dashboard that allows customers to easily compare revenue across products services projects customers and employees and other attributes to better understand their business performance in summary the entire company is focused on executing against these big bets to deliver for our customers and accelerate growth before i hand it over to michelle I wanted to address the questions we've been getting on our free strategy. While the debate continues around whether the government should present a tax bill or taxpayers should prepare their own returns, our primary focus remains on meeting our customers' needs, helping them maximize their tax refund and going beyond tax to help them make ends meet. Let me give you some additional context around free. Based on IRS estimates, nearly 104 million Americans are eligible to file for free through the IRS Free File Program. However, that number does not tell the whole story. Recently, the IRS asked an independent organization, MITRE, to conduct a study of the Free File Program. The study concluded that overall the Free File Program was effective and that the majority of these 104 million taxpayers make a personal choice to use an alternative filing method for a variety of reasons. For example, many taxpayers, regardless of their income or complexity, prefer to have assistance as they lack the confidence to file on their own. As a result, the study concluded that the actual number of filers using do-it-yourself software and eligible to use FreeFile is roughly 30 million customers. Over 20 million taxpayers are already filing for free, either through the free file or commercial free offerings, including many that are not eligible for free file. And roughly 13 million of those Americans filing for free use TurboTax software and paid into it nothing. This is a testament to the quality of our free offerings, both the product we donate to the IRS free file program and our commercial free offering. We offer millions of customers the option to file for free because we believe they will stick with us over time as their life changes and their tax situation becomes more complex in the future. Therefore, we remain very confident in our durable free strategy. To wrap up, we're very pleased with our results in the first quarter and we remain focused on delivering against our objectives in fiscal 2020. Thank you, and now let me hand it over to Michelle to walk you through the financial details.