Intuit Inc. (NASDAQ:INTU) Q2 2024 Earnings Call Transcript

Sasan Goodarzi: Keith. So let me start by just reminding us all that the GenAI cost for the current fiscal year have been incorporated into our guidance. So that’s first and foremost. But now let me address the themes of your question as I think about the cost structure, and I’ll focus on the cost structure, since that’s where your question was. We actually feel that we are quite advantageous versus the market in the sense that the data that we have, that we have touched on, that’s residing behind our firewalls, that we are training our large language models on, that are delivering more contextually relevant answers at a faster speed versus other generally available large language models, and that they are doing that at a fraction of the cost.

So just from a unit economics point of view, for the GenAI, it’s actually advantageous the way we are running it. Two, we don’t have our own data center, and we rely on AWS and other third party data centers to run our model. So that, again, is a cost advantage because we don’t have that build out cost as some others might have. Furthermore, as I look across our business, I do see opportunities for us to, over time, improve our economics using GenAI and AI. Now, we’ve already given examples on things such as in customer success, where agents no longer have to take notes or spend minutes summarizing the call that they just had. AI does that, and that’s just one small example. But expect that to continue to lead to more efficiencies in a customer success calls lead to more better unit economics in a full service than live offerings, as you kind of carry that forward.

Also, how we are staffing up builders in terms of project managers to designers to engineers ratios. So I see many opportunities for us to continue to benefit from GenAI, and I feel good about the early start that we have leaning into some of those capabilities.

Keith Weiss: Got it. So, Net-net, it seems like a positive dynamic versus something that could drag on margins overall.

Sasan Goodarzi: That would be the right takeaway, I guess.

Keith Weiss: Excellent. Thank you, guys.

Operator: Ladies and gentlemen, this does conclude today’s question-and-answer period. I will now turn the program back over to our presenters for any additional or closing remarks.

Sasan Goodarzi: All right, awesome, everybody. Thank you for listening in. Thank you for your wonderful questions. Be safe. We’ll talk to you next quarter. Thank you, everybody.

Operator: Ladies and gentlemen, thank you for participating. This concludes today’s conference call.