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INTUIT INC MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-K)

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September 3, 2022
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THRYV HOLDINGS, INC. Management’s Discussion and Analysis of Financial Condition and Results
of Operations (form 10-Q)
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Management's Discussion and Analysis of Financial Condition and Results of
Operations (MD&A) is intended to provide readers of our consolidated financial
statements with the perspectives of management. This should allow the readers of
this report to obtain a comprehensive understanding of our businesses,
strategies, current trends, and future prospects. Our MD&A includes the
following sections:

• Executive Overview: High level discussion of our operating results and some of the
trends that affect our business.



• Critical Accounting Policies and Estimates: Policies and estimates that we believe are
important to understanding the assumptions and judgments underlying our financial
statements.


• Results of Operations: A more detailed discussion of our revenue and expenses.



• Liquidity and Capital Resources: Discussion of key aspects of our consolidated
statements of cash flows, changes in our consolidated balance sheets, and our financial
commitments.


You should note that this MD&A contains forward-looking statements that involve
risks and uncertainties. Please see the section entitled "Forward-Looking
Statements" immediately preceding Part I for important information to consider
when evaluating such statements.

You should read this MD&A in conjunction with the consolidated financial
statements and related notes in Item 8 of this Annual Report.


Due to the ongoing COVID-19, pandemic we continue to conduct business with
modifications to employee work locations. Nearly all of our sites are now fully
open. We are transitioning to a hybrid model where our workforce will spend a
portion of their time working in our offices and a portion of their time working
from home. We continue to evaluate and refine our return to workplace strategy.

The Russia–Ukraine war and related sanctions imposed as a result of this
conflict have increased global economic and political uncertainty. Intuit does
not have offices or material business in Russia or Ukraine.


While we have not experienced significant disruptions to our operations from the
COVID-19 pandemic or the Russia-Ukraine war, we are unable to predict the full
impact that these events will have on our operations and future financial
performance, including demand for our offerings, impact to our customers and
partners, actions that may be taken by governmental authorities, impact to the
overall macroeconomic environment, and other factors identified in "Risk
Factors" in Item 1A of Part I of this Annual Report.

In April 2020, Intuit was approved as a non-bank Small Business Administration
lender for the Paycheck Protection Program (PPP). The PPP was authorized under
the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to provide
small businesses loans to pay payroll and group health costs, salaries and
commissions, mortgage and rent payments, utilities, and interest on other debt
which is designed to provide assistance to small businesses during the COVID-19
pandemic.

On December 3, 2020, we acquired Credit Karma in a business combination, which
operates as a separate reportable segment. We have included their results of
operations in our consolidated results of operations from the date of
acquisition. Segment operating income for Credit Karma includes all direct
expenses related to selling and marketing, product development, and general and
administrative, which is different from our other reportable segments where we
do not fully allocate corporate expenses. Therefore, Credit Karma segment
operating income is not comparable to the segment operating income of our other
reportable segments. See Note 7 to the consolidated financial statements in Item
8 of this Annual Report for more information.

On November 1, 2021, we acquired all of the outstanding equity of The Rocket
Science Group LLC (Mailchimp). Mailchimp is part of our Small Business &
Self-Employed segment. We have included the results of Mailchimp in our
consolidated results of operations from the date of acquisition. See Note 7 to
the consolidated financial statements in Item 8 of this Annual Report for more
information.

On August 1, 2022, to better align our personal finance strategy, our Mint
offering moved from our Consumer segment to our Credit Karma segment. We have
included the results of Mint in the Consumer segment in the segment results
below. Revenue and operating results for Mint are not significant and the
previously reported segment results have not been reclassified. Effective August
1, 2022, the operating results for Mint will be included in the Credit Karma
segment.

On August 1, 2022, we renamed our ProConnect segment as the ProTax segment. This
segment continues to serve professional accountants.

                            Intuit Fiscal 2018 Form 10-K      32


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EXECUTIVE OVERVIEW


This overview provides a high level discussion of our operating results and some
of the trends that affect our business. We believe that an understanding of
these trends is important in order to understand our financial results for
fiscal 2022 as well as our future prospects. This summary is not intended to be
exhaustive, nor is it a substitute for the detailed discussion and analysis
provided elsewhere in this Annual Report on Form 10-K.

Industry Trends and Seasonality

Industry Trends


Artificial intelligence (AI) is transforming multiple industries, including
financial technology. Disruptive start-ups, emerging ecosystems and
mega-platforms are harnessing new technology to create personalized experiences,
deliver data-driven insights and increase speed of service. These shifts are
creating a more dynamic and highly competitive environment where customer
expectations are shifting around the world as more services become digitized and
the array of choices continues to increase.

Seasonality


Our Consumer and ProConnect offerings have a significant and distinct seasonal
pattern as sales and revenue from our income tax preparation products and
services are typically concentrated in the period from November through April.
This seasonal pattern typically results in higher net revenues during our second
and third quarters ending January 31 and April 30, respectively.

In fiscal 2022, the IRS began accepting returns on January 24, 2022, and the tax
filing deadline was April 18, 2022. However, in fiscal 2021, the IRS began
accepting returns on February 12, 2021, and the tax filing deadline was May 17,
2021. In fiscal 2020, the IRS began accepting returns on January 27, 2020, and
the tax filing deadline was July 15, 2020. As a result of the extensions of the
tax filing deadlines in 2021 and 2020, a significant amount of our fiscal 2021
and 2020 Consumer segment and ProConnect segment revenues were recognized in the
fourth quarter as compared to the third quarter of fiscal 2022.

We expect the seasonality of our Consumer and ProConnect businesses to continue
to have a significant impact on our quarterly financial results in the future.


Key Challenges and Risks


Our growth strategy depends upon our ability to initiate and embrace disruptive
technology trends, to enter new markets, and to drive broad adoption of the
products and services we develop and market. Our future growth also increasingly
depends on the strength of our third-party business relationships and our
ability to continue to develop, maintain, and strengthen new and existing
relationships. To remain competitive and continue to grow, we are investing
significant resources in our product development, marketing, and sales
capabilities, and we expect to continue to do so in the future.

As we offer more online services, the ongoing operation and availability of our
platforms and systems and those of our external service providers is becoming
increasingly important. Because we help customers manage their financial lives,
we face risks associated with the hosting, collection, use, and retention of
personal customer information and data. We are investing significant management
attention and resources in our information technology infrastructure and in our
privacy and security capabilities, and we expect to continue to do so in the
future.

For our consumer and professional tax offerings, we have implemented additional
security measures and are continuing to work with state and federal governments
to implement industry-wide security and anti-fraud measures, including sharing
information regarding suspicious filings. We received ISO 27001 certification
for a portion of our systems, and we continue to invest in security measures and
to work with the broader industry and government to protect our customers
against this type of fraud. Additionally, Credit Karma's security measures are
regularly reviewed and updated.

For a complete discussion of the most significant risks and uncertainties
affecting our business, please see “Forward-Looking Statements” immediately
preceding Part I and “Risk Factors” in Item 1A of Part I of this Annual Report.

                            Intuit Fiscal 2022 Form 10-K      33


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Overview of Financial Results


The most important financial indicators that we use to assess our business are
revenue growth for the company as a whole and for each reportable segment;
operating income growth for the company as a whole; earnings per share; and cash
flow from operations. We also track certain non-financial drivers of revenue
growth and, when material, identify them in the applicable discussions of
segment results below. Service offerings are a significant part of our business.
Our total service and other revenue was $11.0 billion or 86% of our total
revenue in fiscal 2022, and we expect our total service and other revenue to
continue to grow in the future.

Key highlights for fiscal 2022 include the following:

                                      Small Business & Self-Employed
Revenue of                            revenue of                                Consumer revenue of
$12.7 B                               $6.5 B                                    $3.9 B
up 32% from fiscal 2021               up 38% from fiscal 2021                   up 10% from fiscal 2021

Credit Karma revenue of               ProConnect revenue of                     Operating income of
$1.8 B                                $546 M                                    $2.6 B
up 109% from fiscal 2021(1)           up 6% from fiscal 2021                    up 3% from fiscal 2021

Net income of                         Diluted net income per share of           Cash flow from operations of
$2.1 B                                $7.28$3.9 B
flat compared to fiscal 2021          down 4% from fiscal 2021              

up 20% from fiscal 2021



(1) Credit Karma revenue for fiscal 2021 includes the operations of Credit Karma
from the acquisition date of December 3, 2020, while fiscal 2022 includes the
full twelve months of operations.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES



In preparing our consolidated financial statements in accordance with U.S.
generally accepted accounting principles (GAAP), we are required to make
estimates, assumptions, and judgments that can have a significant impact on our
net revenue, operating income or loss and net income or loss, as well as on the
value of certain assets and liabilities on our consolidated balance sheets. We
believe that the estimates, assumptions, and judgments involved in the following
accounting policies have the greatest potential impact on our consolidated
financial statements, so we consider these to be our critical accounting
policies:

•Revenue Recognition

•Business Combinations

•Goodwill, Acquired Intangible Assets, and Other Long-Lived Assets – Impairment
Assessments


•Legal Contingencies

•Accounting for Income Taxes – Estimates of Deferred Taxes, Valuation
Allowances, and Uncertain Tax Positions

Our senior management has reviewed the development and selection of these
critical accounting policies and their disclosure in this Annual Report on Form
10-K with the Audit and Risk Committee of our Board of Directors.

                            Intuit Fiscal 2022 Form 10-K      34


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Revenue Recognition


We derive our revenue primarily from the sale of online services such as tax,
accounting, payroll, merchant payment processing, delivery of qualified links,
e-commerce, marketing automation, customer relationship management, and packaged
desktop software products and desktop software subscriptions. Our contracts with
customers often include promises to transfer multiple products and services. In
determining how revenue should be recognized, a five-step process is used, which
requires judgment and estimates within the revenue recognition process. The
primary judgments include identifying the performance obligations in the
contract and determining whether the performance obligations are distinct. If
any of these judgments were to change it could cause a material increase or
decrease in the amount of revenue we report in a particular period. For
additional information, see "Revenue Recognition" in Note 1 to the consolidated
financial statements in Item 8 of this Annual Report.

Business Combinations


As described in "Description of Business and Summary of Significant Accounting
Policies - Business Combinations," in Note 1 to the consolidated financial
statements in Item 8 of this Annual Report, under the acquisition method of
accounting we generally recognize the identifiable assets acquired, the
liabilities assumed, and any noncontrolling interests in an acquiree at their
fair values as of the date of acquisition. We measure goodwill as the excess of
consideration transferred, which we also measure at fair value, over the net of
the acquisition date fair values of the identifiable assets acquired and
liabilities assumed. The acquisition method of accounting requires us to
exercise judgment and make significant estimates and assumptions regarding the
fair values of the elements of a business combination as of the date of
acquisition, including the fair values of identifiable intangible assets,
deferred tax asset valuation allowances, liabilities related to uncertain tax
positions, and contingencies. This method allows us to refine these estimates
over a one-year measurement period to reflect new information obtained about
facts and circumstances that existed as of the acquisition date that, if known,
would have affected the measurement of the amounts recognized as of that date.
If we are required to retroactively adjust provisional amounts that we have
recorded for the fair values of assets and liabilities in connection with
acquisitions, these adjustments could materially decrease our operating income
and net income and result in lower asset values on our consolidated balance
sheet.

Significant estimates and assumptions that we must make in estimating the fair
value of acquired technology, customer lists, and other identifiable intangible
assets include future cash flows that we expect to generate from the acquired
assets. If the subsequent actual results and updated projections of the
underlying business activity change compared with the assumptions and
projections used to develop these values, we could record impairment charges. In
addition, we have estimated the economic lives of certain acquired assets and
these lives are used to calculate depreciation and amortization expense. If our
estimates of the economic lives change, depreciation or amortization expenses
could be accelerated or slowed.

Goodwill, Acquired Intangible Assets and Other Long-Lived Assets – Impairment
Assessments


We estimate the fair value of acquired intangible assets and other long-lived
assets that have finite useful lives whenever an event or change in
circumstances indicates that the carrying value of the asset may not be
recoverable. We test for potential impairment of goodwill and other intangible
assets that have indefinite useful lives annually in our fourth fiscal quarter
or whenever indicators of impairment arise. The timing of the annual test may
result in charges to our consolidated statement of operations in our fourth
fiscal quarter that could not have been reasonably foreseen in prior periods.

As described in "Description of Business and Summary of Significant Accounting
Policies - Goodwill, Acquired Intangible Assets and Other Long-Lived Assets," in
Note 1 to the consolidated financial statements in Item 8 of this Annual Report,
in order to estimate the fair value of goodwill we use a weighted combination of
a discounted cash flow model (known as the income approach) and comparisons to
publicly traded companies engaged in similar businesses (known as the market
approach). The income approach requires us to use a number of assumptions,
including market factors specific to the business, the amount and timing of
estimated future cash flows to be generated by the business over an extended
period of time, long-term growth rates for the business, and a rate of return
that considers the relative risk of achieving the cash flows and the time value
of money. We evaluate cash flows at the reporting unit level. Although the
assumptions we use in our discounted cash flow model are consistent with the
assumptions we use to generate our internal strategic plans and forecasts,
significant judgment is required to estimate the amount and timing of future
cash flows from each reporting unit and the relative risk of achieving those
cash flows. When using the market approach, we make judgments about the
comparability of publicly traded companies engaged in similar businesses. We
base our judgments on factors such as size, growth rates, profitability, risk,
and return on investment. We also make judgments when adjusting market multiples
of revenue, operating income, and earnings for these companies to reflect their
relative similarity to our own businesses. See Note 6 to the consolidated
financial statements in Item 8 of this Annual Report for a summary of goodwill
by reportable segment.

We estimate the recoverability of acquired intangible assets and other
long-lived assets that have finite useful lives by comparing the carrying amount
of the asset to the future undiscounted cash flows that we expect the asset to
generate. In order to estimate the fair value of those assets, we estimate the
present value of future cash flows from those assets. The key assumptions that
we use in our discounted cash flow model are the amount and timing of estimated
future cash flows to be generated by the asset over an extended period of time
and a rate of return that considers the relative risk of achieving the cash
flows and the time value of money. Significant judgment is required to estimate
the amount and timing of future cash flows and the relative risk of achieving
those cash flows. We also make judgments about the remaining useful lives of
acquired intangible assets and other long-lived assets that have finite lives.
See Note 6 to the consolidated financial statements in
                            Intuit Fiscal 2022 Form 10-K      35


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Item 8 of this Annual Report for a summary of cost, accumulated amortization and
weighted average life in years for our acquired intangible assets.


Assumptions and estimates about future values and remaining useful lives are
complex and often subjective. They can be affected by a variety of factors,
including external factors such as industry and economic trends, and internal
factors such as changes in our business strategy and our internal forecasts. For
example, if our future operating results do not meet current forecasts or if we
experience a sustained decline in our market capitalization that is determined
to be indicative of a reduction in fair value of one or more of our reporting
units, we may be required to record future impairment charges for goodwill and
acquired intangible assets. Impairment charges could materially decrease our
future net income and result in lower asset values on our consolidated balance
sheets.

During the fourth quarters of fiscal 2022, fiscal 2021, and fiscal 2020, we
performed our annual goodwill impairment tests. Using the methodology described
in "Description of Business and Summary of Significant Accounting Policies -
Goodwill, Acquired Intangible Assets and Other Long-Lived Assets," in Note 1 to
the consolidated financial statements in Item 8 of this Annual Report, we
determined that the estimated fair values of all of our reporting units
substantially exceeded their carrying values and that they were not impaired.

Legal Contingencies


We are subject to certain legal proceedings, as well as demands, claims and
threatened litigation that arise in the normal course of our business. We review
the status of each significant matter quarterly and assess our potential
financial exposure. If the potential loss from any claim or legal proceeding is
considered probable and the amount can be reasonably estimated, we record a
liability and an expense for the estimated loss. If we determine that a loss is
possible and the range of the loss can be reasonably determined, then we
disclose the range of the possible loss. Significant judgment is required in the
determination of whether a potential loss is probable, reasonably possible, or
remote as well as in the determination of whether a potential exposure is
reasonably estimable. Our accruals are based on the best information available
at the time. As additional information becomes available, we reassess the
potential liability related to our pending claims and litigation and may revise
our estimates. Potential legal liabilities and the revision of estimates of
potential legal liabilities could have a material impact on our financial
position and results of operations. See Note 14 to the consolidated financial
statements in Item 8 of this Annual Report for more information.

Accounting for Income Taxes – Estimates of Deferred Taxes, Valuation Allowances,
and Uncertain Tax Positions


We estimate our income taxes based on the various jurisdictions where we conduct
business. Significant judgment is required in determining our worldwide income
tax provision. The calculation of our tax liabilities involves dealing with
uncertainties in the application of complex tax rules and the potential for
future adjustment of our uncertain tax positions by the United States Internal
Revenue Service or other taxing jurisdictions. We estimate our current tax
liability and assess temporary differences that result from differing treatments
of certain items for tax and accounting purposes. These differences result in
deferred tax assets and liabilities, which we show on our consolidated balance
sheet. We must then assess the likelihood that our deferred tax assets will be
realized. To the extent we believe that realization is not likely, we establish
a valuation allowance. When we establish a valuation allowance or increase this
allowance in an accounting period, we record a corresponding tax expense in our
consolidated statement of operations.

We record a valuation allowance to reflect uncertainties about whether we will
be able to utilize our deferred tax assets before they expire. We assess the
need for an adjustment to the valuation allowance on a quarterly basis. The
assessment is based on our estimates of future sources of taxable income in the
jurisdictions in which we operate and the periods over which our deferred tax
assets will be realizable. While we have considered future taxable income in
assessing the need for a valuation allowance for the periods presented, we could
in the future be required to increase the valuation allowance to take into
account additional deferred tax assets that we may be unable to realize. An
increase in the valuation allowance could have an adverse impact on our income
tax provision and net income in the period in which we record the change.

We recognize and measure benefits for uncertain tax positions using a two-step
approach. The first step is to evaluate the tax position taken or expected to be
taken in a tax return by determining if the weight of available evidence
indicates that it is more likely than not that the tax position will be
sustained upon audit, including resolution of any related appeals or litigation
processes. For tax positions that are more likely than not of being sustained
upon audit, the second step is to measure the tax benefit as the largest amount
that is more than 50% likely of being realized upon settlement. Significant
judgment is required to evaluate uncertain tax positions. We evaluate our
uncertain tax positions on a quarterly basis. Our evaluations are based upon a
number of factors, including changes in facts or circumstances, changes in tax
law, correspondence with tax authorities during the course of audits and
effective settlement of audit issues. Changes in the recognition or measurement
of uncertain tax positions could result in material increases or decreases in
our income tax expense in the period in which we make the change, which could
have a material impact on our effective tax rate and operating results. See Note
11 to the consolidated financial statements in Item 8 of this Annual Report for
more information.



                            Intuit Fiscal 2022 Form 10-K      36

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  Tables of     Contents
RESULTS OF OPERATIONS


A discussion regarding our financial condition and results of operations for
fiscal 2022 compared to fiscal 2021 is presented below. A discussion regarding
our financial condition and results of operations for fiscal 2021 compared to
fiscal 2020 can be found under Item 7 of Part II in our Annual Report on Form
10-K for the fiscal year ended July 31, 2021, filed with the SEC on September 8,
2021, which is available free of charge on the SEC's website at www.sec.gov and
on the Investor Relations section of our corporate website at
investors.intuit.com.

Financial Overview


(Dollars in millions, except per         Fiscal               Fiscal               Fiscal               2022-2021               2021-2020
share amounts)                            2022                 2021                 2020                % Change                % Change
Total net revenue                       $12,726$9,633$7,679                      32  %                    25  %
Operating income                          2,571                2,500                2,176                       3  %                    15  %
Net income                                2,066                2,062                1,826                       -  %                    13  %
Diluted net income per share              $7.28$7.56$6.92                      (4  %)                    9  %


Total net revenue increased $3.1 billion or 32% in fiscal 2022 compared with
fiscal 2021. Our Small Business & Self-Employed segment revenue increased 38%
primarily due to growth in our Online Ecosystem revenue, which included $762
million of revenue from Mailchimp. Revenue for our Consumer segment increased
10% primarily due to a shift in mix to our higher priced offerings including
TurboTax Live and our Premier offering. Revenue for our Credit Karma segment
increased $940 million in fiscal 2022 compared to fiscal 2021. This increase was
primarily due to the fact that our fiscal 2021 results of operations included
Credit Karma from the date of acquisition, which was December 3, 2020, while our
fiscal 2022 results of operations include Credit Karma for the full reporting
period. Additionally, Credit Karma revenue increased year over year primarily
driven by growth in our credit card and personal loan verticals. See "Segment
Results" later in this Item 7 for more information.

Operating income increased $71 million or 3% in fiscal 2022 compared with fiscal
2021. The increase was due to the higher revenue described above partially
offset by an increase in expenses primarily for staffing, share-based
compensation, marketing, and amortization of other acquired intangible assets.
We also incurred a $141 million one-time charge related to our settlement with
the 50 state attorneys general and the District of Columbia, entered into on May
4, 2022. See "Operating Expenses" later in this Item 7 and Note 14 to the
consolidated financial statements in Item 8 of this Annual Report for more
information.

Net income increased $4 million in fiscal 2022 compared with fiscal 2021 due the
increase in operating income described above and a slightly lower effective tax
rate, which were partially offset by an increase in interest expense from
borrowing $4.7 billion on a term loan in fiscal 2022. Additionally, we recorded
a $30 million gain in fiscal 2021 from the sale of a note receivable that was
previously written off. Diluted net income per share decreased 4% to $7.28 for
fiscal 2022 due to the increase in the weighted average shares outstanding from
the shares issued as part of the acquisition of Mailchimp in the second quarter
of fiscal 2022, which was partially offset by the increase in net income.

Segment Results



The information below is organized in accordance with our four reportable
segments. All of our segments operate primarily in the United States and sell
primarily to customers in the United States. Total international net revenue was
approximately 8%, 5%, and 4% of consolidated total net revenue for the twelve
months ended July 31, 2022, 2021 and 2020.

On December 3, 2020, we acquired Credit Karma in a business combination and it
operates as a separate reportable segment. We have included the results of
operations of Credit Karma in our consolidated statements of operations from the
date of acquisition. See Note 7 to the consolidated financial statements in Item
8 of this Annual Report for more information. Segment operating income for
Credit Karma includes all direct expenses, which is different from our other
reportable segments where we do not fully allocate corporate expenses.

On November 1, 2021, we acquired Mailchimp in a business combination. Mailchimp
is part of our Small Business & Self-Employed segment. We have included the
results of operations of Mailchimp in our consolidated results of operations
from the date of acquisition.

On August 1, 2022, to better align our personal finance strategy, our Mint
offering moved from our Consumer segment to our Credit Karma segment. We have
included the results of Mint in the Consumer segment in the segment results
below. Revenue and operating results for Mint are not significant, and the
previously reported segment results have not been reclassified. Effective August
1, 2022, the operating results for Mint will be included in the Credit Karma
segment.

On August 1, 2022, we renamed our ProConnect segment as the ProTax segment. This
segment continues to serve professional accountants.

                            Intuit Fiscal 2022 Form 10-K      37


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Segment operating income is segment net revenue less segment cost of revenue and
operating expenses. We include expenses such as corporate selling and marketing,
product development, general and administrative, and non-employment related
legal and litigation settlement costs, which are not allocated to specific
segments, in unallocated corporate items as part of other corporate expenses.
For Credit Karma, segment expenses include all direct expenses related to
selling and marketing, product development, and general and administrative.
Unallocated corporate items for all segments include share-based compensation,
amortization of acquired technology, amortization of other acquired intangible
assets, and goodwill and intangible asset impairment charges. These unallocated
costs for all segments totaled $4.3 billion in fiscal 2022, $2.9 billion in
fiscal 2021, and $2.3 billion in fiscal 2020. Unallocated costs increased in
fiscal 2022 compared with fiscal 2021 due to increases in share-based
compensation expense, general and administrative expense, amortization of other
acquired intangible assets, amortization of acquired technology, product
development, and selling and marketing expense. See Note 15 to the consolidated
financial statements in Item 8 of this Annual Report for reconciliations of
total segment operating income to consolidated operating income for each fiscal
year presented.
                            Intuit Fiscal 2022 Form 10-K      38

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Small Business & Self-Employed



[[Image Removed: intu-20220731_g3.jpg]]
Small Business & Self-Employed segment revenue includes both Online Ecosystem
and Desktop Ecosystem revenue.

Our Online Ecosystem includes revenue from:
•QuickBooks Online, QuickBooks Live, QuickBooks Online Advanced and QuickBooks
Self-Employed financial and business management offerings;
•Small business payroll services, including QuickBooks Online Payroll, Intuit
Online Payroll, Intuit Full Service Payroll;
•Merchant payment processing services for small businesses who use online
offerings;
•Mailchimp's e-commerce, marketing automation, and customer relationship
management offerings;
•QuickBooks Commerce, QuickBooks Checking, and financing for small businesses.

Our Desktop Ecosystem includes revenue from:
•QuickBooks Desktop software subscriptions (QuickBooks Desktop Pro Plus,
QuickBooks Desktop Premier Plus, and QuickBooks Enterprise, and ProAdvisor
Program memberships for the accounting professionals who serve small
businesses);
•QuickBooks Desktop packaged software products (Desktop Pro, Desktop for Mac,
Desktop Premier, and QuickBooks Point of Sale);
•Desktop payroll products (QuickBooks Basic Payroll, QuickBooks Assisted Payroll
and QuickBooks Enhanced Payroll);
•Merchant payment processing services for small businesses who use desktop
offerings;
•Financial supplies; and
•Financing for small businesses.


Segment product revenue is primarily derived from revenue related to delivery of
software licenses and the related updates, including version protection, for our
QuickBooks Desktop subscriptions and desktop payroll offerings which are part of
our Desktop Ecosystem. Segment service and other revenue is primarily derived
from our Online Ecosystem revenue and revenue from the services and support that
are provided as part of our QuickBooks Desktop subscription and desktop payroll
offerings as well as merchant payment processing services.

                              Fiscal        Fiscal        Fiscal       2022-2021      2021-2020
(Dollars in millions)          2022          2021          2020        % Change       % Change
Product revenue             $ 1,113$ 1,085$ 1,032
Service and other revenue     5,347         3,603         3,018
Total segment revenue       $ 6,460$ 4,688$ 4,050             38  %          16  %
% of total revenue               51  %         49  %         53  %

Segment operating income    $ 3,499$ 2,590$ 2,091             35  %          24  %
% of related revenue             54  %         55  %         52  %



                            Intuit Fiscal 2022 Form 10-K      39

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Revenue classified by significant product and service offerings was as follows:

                                          Fiscal       Fiscal       Fiscal       2022-2021      2021-2020
  (Dollars in millions)                    2022         2021         2020        % Change       % Change
  Net revenue:
  QuickBooks Online Accounting           $ 2,267$ 1,699$ 1,354            33  %          25  %
  Online Services                          2,171        1,051          828           107  %          27  %
  Total Online Ecosystem                   4,438        2,750        2,182            61  %          26  %
  QuickBooks Desktop Accounting              851          789          755             8  %           5  %
  Desktop Services and Supplies            1,171        1,149        1,113             2  %           3  %
  Total Desktop Ecosystem                  2,022        1,938        1,868             4  %           4  %
  Total Small Business & Self-Employed   $ 6,460$ 4,688$ 4,050            38  %          16  %



Revenue for our Small Business & Self-Employed segment increased $1.8 billion or
38% in fiscal 2022 compared with fiscal 2021. The increase was primarily due to
growth in Online Ecosystem revenue, which included $762 million of revenue from
Mailchimp.

Online Ecosystem

Online Ecosystem revenue increased $1.7 billion or 61% in fiscal 2022 compared
with fiscal 2021. QuickBooks Online Accounting revenue increased 33% in fiscal
2022 compared with fiscal 2021 primarily due to higher effective prices, an
increase in customers, and a shift in mix to our higher priced offerings. Online
Services revenue increased 107% in fiscal 2022 compared with fiscal 2021
primarily due to additional revenue from the Mailchimp offerings and an increase
in revenue from our payroll and payments offerings. Online payroll revenue
increased due to an increase in customers and a shift in mix to our full service
offering. Online payments revenue increased due to an increase in charge volume
per customer and an increase in customers.

Desktop Ecosystem


Desktop Ecosystem revenue increased $84 million or 4% in fiscal 2022 compared
with fiscal 2021 primarily due to growth in our QuickBooks Desktop and
Enterprise subscription offerings which was partially offset by a decrease in
Desktop unit sales. In the first quarter of fiscal 2022, we discontinued our
QuickBooks Desktop packaged software products and now sell predominantly on a
subscription basis. Additionally, during fiscal 2022, there was an increase in
revenue from our Desktop Payroll and Desktop Payments offerings.

Small Business & Self-Employed segment operating income increased $909 million
or 35% in fiscal 2022 compared with fiscal 2021 primarily due to the increase in
revenue described above, partially offset by higher expenses. We incurred higher
expenses for staffing, marketing, and outside services.
                            Intuit Fiscal 2022 Form 10-K      40


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Consumer

[[Image Removed: intu-20220731_g4.jpg]]

Consumer segment product revenue is derived primarily from TurboTax desktop tax
return preparation software and related form updates.


Consumer segment service and other revenue is derived primarily from TurboTax
Online and TurboTax Live offerings, electronic tax filing services and connected
services, and also from our Mint offering.






                              Fiscal        Fiscal        Fiscal       2022-2021      2021-2020
(Dollars in millions)          2022          2021          2020        % Change       % Change
Product revenue             $   208$   201$   203
Service and other revenue     3,707         3,362         2,933
Total segment revenue       $ 3,915$ 3,563$ 3,136             10  %          14  %
% of total revenue               31  %         37  %         41  %

Segment operating income    $ 2,483$ 2,237$ 2,063             11  %           8  %
% of related revenue             63  %         63  %         66  %


Revenue for our Consumer segment increased $352 million or 10% in fiscal 2022
compared with fiscal 2021 primarily due to a shift in mix to our higher priced
product offerings including TurboTax Live and our Premier offering.

Consumer segment operating income increased $246 million or 11% in fiscal 2022
compared with fiscal 2021 due to the higher revenue described above, which was
partially offset by higher expenses for marketing and staffing.

Effective August 1, 2022, our Mint offering is part of our Credit Karma segment.

                            Intuit Fiscal 2022 Form 10-K      41


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Credit Karma


                    [[Image Removed: intu-20220731_g5.jpg]]







Credit Karma revenue is derived from cost-per-action transactions, which include
the delivery of qualified links that result in completed actions such as credit
card issuances and personal loan funding; and cost-per-click and cost-per-lead
transactions, which include user clicks on advertisements or advertisements that
allow for the generation of leads, and primarily relate to mortgage and
insurance businesses.





                              Fiscal       Fiscal      Fiscal      2022-2021      2021-2020
(Dollars in millions)          2022         2021        2020       % Change       % Change
Product revenue             $     -       $   -       $   -
Service and other revenue     1,805         865           -
Total segment revenue       $ 1,805$ 865       $   -            109  %            N/A
% of total revenue               14  %        9  %        -  %

Segment operating income    $   531$ 182       $   -            192  %            N/A
% of related revenue             29  %       21  %         N/A

We acquired Credit Karma on December 3, 2020. Our results of operations include
the operations of Credit Karma beginning on the date of acquisition.


Revenue for our Credit Karma segment increased $940 million in fiscal 2022
compared with fiscal 2021. Our fiscal 2021 results of operations include Credit
Karma from the date of acquisition, which was December 3, 2020, and our fiscal
2022 results of operations include Credit Karma for the full fiscal year. Credit
Karma revenue also increased in fiscal 2022 primarily driven by growth in our
credit card and personal loan verticals.

Credit Karma segment operating income increased $349 million in fiscal 2022
compared with fiscal 2021, primarily due to the increase in revenue described
above, which was partially offset by higher expenses for staffing and marketing.

Effective August 1, 2022, our Mint offering is part of our Credit Karma segment.



                            Intuit Fiscal 2022 Form 10-K      42


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ProConnect


[[Image Removed: intu-20220731_g6.jpg]]

ProConnect segment product revenue is derived primarily from Lacerte, ProSeries,
and ProFile desktop tax preparation software products and related form updates.

ProConnect segment service and other revenue is derived primarily from
ProConnect Tax Online tax products, electronic tax filing service, connected
services, and bank products.




                             Fiscal      Fiscal      Fiscal      2022-2021      2021-2020
(Dollars in millions)         2022        2021        2020       % Change       % Change
Product revenue             $ 426$ 412$ 400

Service and other revenue 120 105 93
Total segment revenue $ 546$ 517$ 493

              6  %           5  %
% of total revenue              4  %        5  %        6  %

Segment operating income    $ 383$ 372$ 346              3  %           8  %
% of related revenue           70  %       72  %       70  %


Revenue for our ProConnect segment increased $29 million or 6% in fiscal 2022
compared with fiscal 2021 primarily due to a higher average revenue per customer
and a shift in mix.

ProConnect segment operating income increased $11 million or 3% in fiscal 2022
compared with fiscal 2021 primarily due to the higher revenue described above,
which was partially offset by higher expenses for staffing.

In August 2022, we renamed our ProConnect segment as the ProTax segment. This
segment continues to serve professional accountants.














                            Intuit Fiscal 2022 Form 10-K      43

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Cost of Revenue

                                                     % of                      % of                      % of
                                       Fiscal       Related      Fiscal       Related      Fiscal       Related
(Dollars in millions)                   2022        Revenue       2021        Revenue       2020        Revenue
Cost of product revenue               $    69           4  %    $    69           4  %    $    72           4  %

Cost of service and other revenue 2,197 20 % 1,564

      20  %      1,284          21  %
Amortization of acquired technology       140            n/a         50            n/a         22            n/a
Total cost of revenue                 $ 2,406          19  %    $ 1,683          17  %    $ 1,378          18  %


Our cost of revenue has three components: (1) cost of product revenue, which
includes the direct costs of manufacturing and shipping or electronically
downloading our desktop software products; (2) cost of service and other
revenue, which includes the direct costs associated with our online and service
offerings, such as costs for data processing and storage capabilities from cloud
providers, customer support costs, costs for the tax and bookkeeping experts
that support our TurboTax Live and QuickBooks Live offerings, and costs related
to credit score providers; and (3) amortization of acquired technology, which
represents the cost of amortizing developed technologies that we have obtained
through acquisitions over their useful lives.

Cost of product revenue as a percentage of product revenue was relatively
consistent in fiscal 2022 compared with fiscal 2021. We expense costs of product
revenue as they are incurred for delivered software, and we do not defer any of
these costs when product revenue is deferred.

Cost of service and other revenue as a percentage of service and other revenue
was relatively consistent in fiscal 2022 compared with fiscal 2021.

Operating Expenses

                                                             % of                                  % of                                  % of
                                                            Total                                 Total                                 Total
                                         Fiscal              Net               Fiscal              Net               Fiscal              Net
(Dollars in millions)                     2022             Revenue              2021             Revenue              2020             Revenue
Selling and marketing                  $ 3,526                   29  %       $ 2,644                   28  %       $ 2,048                   27  %
Research and development                 2,347                   18  %         1,678                   17  %         1,392                   18  %
General and administrative               1,460                   11  %           982                   10  %           679                    9  %
Amortization of other acquired
intangible assets                          416                    3  %           146                    2  %             6                    -  %

Total operating expenses               $ 7,749                   61  %       $ 5,450                   57  %       $ 4,125                   54  %


Total operating expenses as a percentage of total net revenue increased in
fiscal 2022 compared to fiscal 2021. Total net revenue increased $3.1 billion or
32% and total operating expenses increased $2.3 billion or 42%. Total staffing
increased $585 million; total share-based compensation expense increased $478
million; total marketing increased $434 million; and total amortization of other
acquired intangible assets increased $270 million, which was primarily related
to Mailchimp and Credit Karma. We also incurred a $141 million one-time charge
related to the company's settlement with the 50 state attorneys general and the
District of Columbia, entered into on May 4, 2022.

Non-Operating Income and Expenses

Interest Expense


Interest expense of $81 million in fiscal 2022 consisted primarily of interest
on our unsecured term loan, senior unsecured notes, and secured revolving credit
facility. Interest expense of $29 million in fiscal 2021 consisted primarily of
interest on our senior unsecured notes, secured revolving credit facility,
unsecured term loan, and unsecured revolving credit facility. See Note 8 to the
consolidated financial statements in Item 8 of this Annual Report for more
information.
                            Intuit Fiscal 2022 Form 10-K      44


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Interest and Other Income, Net


(In millions)                                                   Fiscal 2022           Fiscal 2021           Fiscal 2020
Interest income (1)                                           $         15          $         11          $         39
Net gain (loss) on executive deferred compensation plan
assets (2)                                                             (12)                   28                     5

Other (3)                                                               49                    46                    (8)
Total interest and other income, net                          $         52          $         85          $         36

(1) Interest income increased in fiscal 2022 compared to fiscal 2021 due to
higher average interest rates.


(2)  In accordance with authoritative guidance, we record gains and losses
associated with executive deferred compensation plan assets in interest and
other income and gains and losses associated with the related liabilities in
operating expenses. The total amounts recorded in operating expenses for each
period are approximately equal to the total amounts recorded in interest and
other income in those periods.

(3)  In fiscal 2022, we recorded $47 million of net gains on other long-term
investments. In fiscal 2021, we recorded a $30 million gain from the sale of a
note receivable that was previously written off and net gains on other long-term
investments of $17 million.

Income Taxes

Our effective tax rates for fiscal 2022 and fiscal 2021 were approximately 19%
for both periods. Excluding the tax benefits related to share-based
compensation, our effective tax rates for fiscal 2022 and fiscal 2021 were
approximately 24%. This rate differed from the federal statutory rate of 21%
primarily due to state income taxes and non-deductible share-based compensation,
which were partially offset by the benefit we received from the federal research
and experimentation credit. See Note 11 to the consolidated financial statements
in Item 8 of this Annual Report for more information about our effective tax
rates.

At July 31, 2022, we had net deferred tax liabilities of $608 million which
included a valuation allowance for state research and experimentation tax credit
carryforwards, foreign loss carryforwards, foreign intangible deferred tax
assets and state operating loss carryforwards. See "Critical Accounting Policies
and Estimates" earlier in this Item 7 and Note 11 to the consolidated financial
statements in Item 8 of this Annual Report for more information.

A provision enacted as part of the 2017 Tax Cuts & Jobs Act requires companies
to capitalize research and experimental expenditures for tax purposes in tax
years beginning after December 31, 2021. This provision is applicable to us for
our fiscal 2023. If this provision is not repealed or deferred, we expect our
fiscal 2023 cash tax payments to increase significantly compared to our fiscal
2022.

The Inflation Reduction Act was enacted on August 16, 2022. This law, among
other provisions, provides a corporate alternative minimum tax on adjusted
financial statement income, which is effective for us beginning in fiscal 2024,
and an excise tax on corporate stock repurchases, which is effective for our
share repurchases after December 31, 2022. We are continuing to evaluate the
impact it may have on our financial position and results of operations.

In the current global tax policy environment, the U.S. and other domestic and
foreign governments continue to consider, and in some cases enact, changes in
corporate tax laws. As changes occur, we account for finalized legislation in
the period of enactment.
                            Intuit Fiscal 2022 Form 10-K      45

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LIQUIDITY AND CAPITAL RESOURCES


Overview



At July 31, 2022, our cash, cash equivalents and investments totaled $3.3
billion, a decrease of $589 million from July 31, 2021, due to the factors
described in "Statements of Cash Flows" below. Our primary sources of liquidity
have been cash from operations, which includes the collection of accounts
receivable for products and services, the issuance of senior unsecured notes,
and borrowings under our credit facilities. Our primary uses of cash have been
for research and development programs, selling and marketing activities,
acquisitions of businesses, repurchases of our common stock under our stock
repurchase programs, the payment of cash dividends, debt service costs and debt
repayment, and capital projects. As discussed in "Executive Overview - Industry
Trends and Seasonality" earlier in this Item 7, our business is subject to
significant seasonality. The balance of our cash, cash equivalents and
investments generally fluctuates with that seasonal pattern. We believe the
seasonality of our business is likely to continue in the future.

The following table summarizes selected measures of our liquidity and capital
resources at the dates indicated:


                                                    July 31,      July 31,         $           %
(Dollars in millions)                                 2022          2021        Change       Change
Cash, cash equivalents and investments             $  3,281$  3,870$  (589)       (15) %
Long-term investments                                    98            43           55        128  %
Short-term debt                                         499             -          499            NM
Long-term debt                                        6,415         2,034        4,381        215  %
Working capital                                       1,417         2,502       (1,085)       (43) %
Ratio of current assets to current liabilities        1.4 : 1       1.9 : 1


NM – Not meaningful

We have historically generated significant cash from operations, and we expect
to continue to do so during fiscal 2023. Our cash, cash equivalents, and
investments totaled $3.3 billion at July 31, 2022, none of those funds were
restricted, and approximately 90% of those funds were located in the U.S.


On November 1, 2021, we terminated our amended and restated credit agreement
dated May 2, 2019, and entered into a credit agreement with certain
institutional lenders with an aggregate principal amount of $5.7 billion, which
includes a $1 billion unsecured revolving credit facility that matures on
November 1, 2026, and a $4.7 billion unsecured term loan that matures on
November 1, 2024. On November 1, 2021, we borrowed the full $4.7 billion under
the unsecured term loan to fund a portion of the cash consideration for the
acquisition of Mailchimp. The $1 billion unsecured revolving credit facility is
available to us for general corporate purposes and serves as a source of
liquidity. See Note 8 to the consolidated financial statements in Item 8 of this
Annual Report for more information.

Our secured revolving credit facility is available to fund a portion of our
loans to qualified small businesses. At July 31, 2022, $230 million was
outstanding under the secured revolving credit facility. See “Credit Facilities”
later in this Item 7 for more information.


Based on past performance and current expectations, we believe that our cash and
cash equivalents, investments, and cash generated from operations will be
sufficient to meet anticipated seasonal working capital needs, capital
expenditure requirements, contractual obligations, commitments, debt service
requirements, and other liquidity requirements associated with our operations
for at least the next 12 months.

We expect to return excess cash generated by operations to our stockholders
through payment of cash dividends, after taking into account our operating and
strategic cash needs.


On December 3, 2020, we acquired Credit Karma. The fair value of the purchase
consideration totaled $7.2 billion and included $3.4 billion in cash, 10.6
million shares of Intuit common stock with a fair value of $3.8 billion and
assumed equity awards for services rendered through the acquisition date of $47
million. See "Business Combinations" below for more information.

On November 1, 2021, we acquired all of the outstanding equity of Mailchimp for
total consideration of $12.0 billion, which included $5.7 billion in cash and
10.1 million shares of Intuit common stock with a value of approximately $6.3
billion. See Note 7 to the consolidated financial statements in Item 8 of this
Annual Report for more information.

We evaluate, on an ongoing basis, the merits of acquiring technology or
businesses, or establishing strategic relationships with and investing in other
companies. Our strong liquidity profile enables us to quickly respond to these
types of opportunities.
                            Intuit Fiscal 2022 Form 10-K      46

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Statements of Cash Flows


The following table summarizes selected items from our consolidated statements
of cash flows for fiscal 2022, fiscal 2021, and fiscal 2020. See the
consolidated financial statements in Item 8 of this Annual Report for complete
consolidated statements of cash flows for those periods.

                                                               Fiscal           Fiscal            Fiscal
(Dollars in millions)                                           2022             2021              2020
Net cash provided by (used in):
Operating activities                                         $ 3,889$  3,250$ 2,414
Investing activities                                          (5,421)           (3,965)             (97)
Financing activities                                           1,732            (3,176)           2,034

Effect of exchange rates on cash, cash equivalents,
restricted cash, and restricted cash equivalents

                 (22)               13               (6)

Net increase (decrease) in cash, cash equivalents,
restricted cash, and restricted cash equivalents

             $   178

$ (3,878)$ 4,345



During fiscal 2022, we generated $3.9 billion in cash from operations. We also
received $4.7 billion from borrowings under our term loan, $928 million for the
net sales and maturities of investments, and $162 million from the issuance of
common stock under employee stock plans. During the same period, we used $5.7
billion for the acquisition of a business, $1.9 billion for the repurchase of
shares of our common stock under our stock repurchase programs, $774 million for
the payment of cash dividends, $611 million for payments for employee taxes
withheld upon vesting of restricted stock units, $414 million for net
originations of term loans, and $229 million for capital expenditures.

During fiscal 2021, we generated $3.3 billion in cash from operations and $196
million from the issuance of common stock under employee stock plans. During the
same period, we used $3.1 billion for the acquisitions of businesses, $1.3
billion for the repayment of debt, $1.0 billion for the repurchase of shares of
our common stock under our stock repurchase programs, $710 million for the net
purchases of investments, $646 million for the payment of cash dividends, $383
million for payments for employee taxes withheld upon vesting of restricted
stock units, $125 million for capital expenditures, and $96 million for net
originations of term loans.

Stock Repurchase Programs and Dividends on Common Stock



As described in Note 12 to the financial statements in Item 8 of this Annual
Report, during fiscal 2022 and fiscal 2021, we continued to repurchase shares of
our common stock under a series of repurchase programs that our Board of
Directors has authorized. At July 31, 2022, we had authorization from our Board
of Directors to expend up to an additional $1.5 billion for stock repurchases.
On August 19, 2022, our Board approved an increased authorization to purchase up
to an additional $2 billion of our common stock under the existing stock
repurchase program. We currently expect to continue repurchasing our common
stock on a quarterly basis; however, future stock repurchases under the current
program are at the discretion of management, and authorization of future stock
repurchase programs is subject to the final determination of our Board of
Directors.

We have continued to pay quarterly cash dividends on shares of our outstanding
common stock. During fiscal 2022, we declared cash dividends that totaled $2.72
per share of outstanding common stock or approximately $781 million. In August
2022, our Board of Directors declared a quarterly cash dividend of $0.78 per
share of outstanding common stock payable on October 18, 2022 to stockholders of
records at the close of business on October 10, 2022. We currently expect to
continue paying comparable cash dividends on a quarterly basis; however, future
declarations of dividends and the establishment of future record dates and
payment dates are subject to the final determination of our Board of Directors.

Business Combinations


Mailchimp

On November 1, 2021, we acquired all of the outstanding equity of Mailchimp for
total consideration of $12.0 billion, which included $5.7 billion in cash and
10.1 million shares of Intuit common stock with a value of approximately $6.3
billion. The fair value of the stock consideration is based on the October 29,
2021 closing price of Intuit common stock of $625.99.

Pursuant to the equity purchase agreement, we also issued approximately 583,000
restricted stock units (RSUs) in substitution of outstanding equity incentive
awards. These RSUs have a grant date fair value of approximately $355 million
and will be expensed over three years. Additionally, we issued approximately
325,000 RSUs with a total grant date fair value of approximately $211 million to
Mailchimp employees, of which $151 million will be expensed over four years and
$60 million was expensed during the first six months following the acquisition
date.

Mailchimp is part of our Small Business & Self-Employed segment. We have
included the financial results of Mailchimp in the consolidated financial
statements from the date of acquisition.

                            Intuit Fiscal 2022 Form 10-K      47


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Credit Karma

On December 3, 2020, we acquired Credit Karma for total consideration of
$8.1 billion which included assumed equity awards and restricted shares subject
to a revest provision.


The fair value of the purchase consideration totaled $7.2 billion and included
$3.4 billion in cash, 10.6 million shares of Intuit common stock with a fair
value of $3.8 billion and assumed equity awards for services rendered through
the acquisition date of $47 million.

We also issued shares of common stock with a fair value of $275 million which
are restricted due to a revest provision and will be expensed over a service
period of three years. The share-based compensation expense related to these
restricted shares is non-deductible for income tax purposes. Additionally, we
assumed equity awards for future services with a fair value of $663 million that
are being charged to expense over the remaining service periods, which average
approximately three years.

The fair value of the stock consideration is based on the December 2, 2020
closing price of Intuit common stock of $355.49.


As part of the merger agreement, following the close of the transaction, we
issued approximately $300 million of restricted stock units to the employees of
Credit Karma, which will be charged to expense over a service period of four
years.

Credit Karma operates as a separate reportable segment. We have included the
financial results of Credit Karma in the consolidated financial statements from
the date of acquisition. See Note 7 to the consolidated financial statements in
Item 8 of this Annual Report for more information.

Commitments for Senior Unsecured Notes

In June 2020, we issued $2 billion of senior unsecured notes comprised of the
following:

•$500 million of 0.650% notes due July 2023;

•$500 million of 0.950% notes due July 2025;

•$500 million of 1.350% notes due July 2027; and

•$500 million of 1.650% notes due July 2030 (together, the Notes).

Interest is payable semiannually on January 15 and July 15 of each year. At
July 31, 2022, our maximum commitment for interest payments under the Notes was
$117 million through the maturity dates.


The Notes are senior unsecured obligations of Intuit and rank equally with all
existing and future unsecured and unsubordinated indebtedness of Intuit and are
redeemable by us at any time, subject to a make-whole premium. Upon the
occurrence of change of control transactions that are accompanied by certain
downgrades in the credit ratings of the Notes, we will be required to repurchase
the Notes at a repurchase price equal to 101% of the aggregate outstanding
principal plus any accrued and unpaid interest to but not including the date of
repurchase. The indenture governing the Notes requires us to comply with certain
covenants. For example, the Notes limit our ability to create certain liens and
enter into sale and leaseback transactions. As of July 31, 2022, we were
compliant with all covenants governing the Notes. See Note 8 to the consolidated
financial statements in Item 8 of this Annual Report for more information.

Credit Facilities

Unsecured Revolving Credit Facility and Term Loan


On November 1, 2021, we terminated our amended and restated credit agreement
dated May 2, 2019 (2019 Credit Facility), and entered into a credit agreement
with certain institutional lenders with an aggregate principal amount of $5.7
billion, which includes a $4.7 billion unsecured term loan that matures on
November 1, 2024, and a $1 billion unsecured revolving credit facility that
matures on November 1, 2026 (2021 Credit Facility).

Under the 2021 Credit Facility we may, subject to certain customary conditions
including lender approval, on one or more occasions increase commitments under
the unsecured revolving credit facility in an amount not to exceed $250 million
in the aggregate and may extend the maturity date up to two times. Advances
under the unsecured revolving credit facility accrue interest at rates that are
equal to, at our election, either (i) the alternate base rate plus a margin that
ranges from 0.0% to 0.1%, or (ii) the Secured Overnight Finance Rate (SOFR) plus
a margin that ranges from 0.69% to 1.1%. Actual margins under either election
will be based on our senior debt credit ratings. At July 31, 2022, no amounts
were outstanding under the unsecured revolving credit facility. We monitor
counterparty risk associated with the institutional lenders that are providing
the credit facility.

On November 1, 2021, we borrowed the full $4.7 billion under the unsecured term
loan to fund a portion of the cash consideration for the acquisition of
Mailchimp. Under this agreement we may, subject to certain customary conditions,
on one or more occasions increase commitments under the term loan in an amount
not to exceed $400 million in the aggregate. The term loan accrues interest at
rates that are equal to, at our election, either (i) the alternate base rate
plus a margin that ranges from 0.0% to 0.125% or SOFR plus a margin that ranges
from 0.625% to 1.125%. Actual margins under either election are based on our
senior debt credit ratings. At July 31, 2022, $4.7 billion was outstanding under
the term loan.
                            Intuit Fiscal 2022 Form 10-K      48

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The 2021 Credit Facility includes customary affirmative and negative covenants,
including financial covenants that require us to maintain a ratio of total gross
debt to annual earnings before interest, taxes, depreciation and amortization
(EBITDA) of not greater than 3.25 to 1.00 and a ratio of annual EBITDA to annual
interest expense of not less than 3.00 to 1.00 as of the last day of each fiscal
quarter. As of July 31, 2022, we were compliant with all required covenants.

Secured Revolving Credit Facility


On February 19, 2019, a subsidiary of Intuit entered into a secured revolving
credit facility with a lender to fund a portion of our loans to qualified small
businesses. The revolving credit facility is secured by cash and receivables of
the subsidiary and is non-recourse to Intuit Inc. We have entered into several
amendments to the secured revolving credit facility, most recently on July 18,
2022, primarily to increase the facility limit, extend the commitment term and
maturity date and update the benchmark interest rate. Under the amended
agreement, the facility limit is $500 million, of which $300 million is
committed and $200 million is uncommitted. Advances accrue interest at adjusted
simple SOFR plus 1.5%. Unused portions of the committed credit facility accrue
interest at a rate ranging from 0.25% to 0.75%, depending on the total unused
committed balance. The commitment term is through July 18, 2025, and the final
maturity date is July 20, 2026. The agreement includes certain affirmative and
negative covenants, including financial covenants that require the subsidiary to
maintain specified financial ratios. As of July 31, 2022, we were compliant with
all required covenants. At July 31, 2022, $230 million was outstanding under
this facility and the weighted-average interest rate was 3.96%, which includes
the interest on any unused committed portion. The outstanding balance is secured
by cash and receivables of the subsidiary totaling $615 million.

Cash Held by Foreign Subsidiaries



Our cash, cash equivalents and investments totaled $3.3 billion at July 31,
2022. Approximately 10% of those funds were held by our foreign subsidiaries and
subject to repatriation tax considerations. These foreign funds were located
primarily in Canada, the United Kingdom, and India. We do not expect to pay
incremental U.S. taxes on repatriation. We have recorded income tax expense for
Canada, India, and Israel withholding taxes on earnings that are not permanently
reinvested. In the event that funds from foreign operations are repatriated to
the United States, we would pay withholding taxes at that time.

CONTRACTUAL OBLIGATIONS



The following table summarizes our known contractual obligations to make future
payments at July 31, 2022:

                                                                                  Payments Due by Period
                                                     Less than            1-3              3-5             More than
(In millions)                                         1 year             years            years             5 years             Total
Amounts due under executive deferred compensation
plan                                               $      147          $     -          $     -          $        -          $    147
Senior unsecured notes                                    500              500              500                 500             2,000
Unsecured term loan                                         -            4,700                -                   -             4,700

Secured revolving credit facility                           -                -              230                   -               230
Interest and fees due on debt                             161              227               37                  25               450
Operating leases (1)                                       64              198              143                 323               728
Purchase obligations (2)                                  673              904              261                 468             2,306
Total contractual obligations (3)                  $    1,545          $ 

6,529 $ 1,171$ 1,316$ 10,561




(1)Includes operating leases for facilities and equipment. Amounts do not
include $31 million of future sublease income. We had no significant finance
leases at July 31, 2022. See Note 10 to the consolidated financial statements in
Item 8 of this Annual Report for more information.

(2)Represents agreements to purchase products and services that are enforceable,
legally binding and specify terms, including: fixed or minimum quantities to be
purchased; fixed, minimum or variable price provisions; and the approximate
timing of the payments.

(3)Other long-term obligations on our consolidated balance sheet at July 31,
2022, included long-term income tax liabilities of $44 million which related
primarily to unrecognized tax benefits. We have not included this amount in the
table above because we cannot make a reasonably reliable estimate regarding the
timing of settlements with taxing authorities, if any.

RECENT ACCOUNTING PRONOUNCEMENTS



For a description of recent accounting pronouncements and the potential impact
of these pronouncements on our consolidated financial statements, see Note 1 to
the financial statements in Item 8 of this Annual Report.
                            Intuit Fiscal 2022 Form 10-K      49


——————————————————————————–

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