Good afternoon. My name is Chelsea and I will be your conference operator today. At this time, I would like to welcome everyone to Intuit's fourth quarter and full fiscal year 2022 conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer period. If you would like to ask a question during that time, simply press star then the number one on your telephone keypad. If you would like to withdraw your question, press star two. With that, I will now turn the call over to Kim Watkins, Intuit's Vice President of Investor Relations. Ms. Watkins, please begin.
Thanks, Chelsea. Good afternoon and welcome to Intuit's fourth quarter fiscal 2022 conference call. I'm here with Intuit's CEO, Sasan Goodarzi, and Michelle Clatterbuck, 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 2021, and our other SEC filings. All of those 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. With that, I'll turn the call over to Sasan.
Great. Thank you, Kim, and thanks to all of you for joining us today. We had a very strong fourth quarter, ending the year with momentum as we executed on our strategy to be the global AI-driven expert platform, powering prosperity for consumers and small businesses. We continue to be focused on solving our customers' biggest problems by putting more money in their pockets, eliminating work, and saving people time, and ensuring that they have complete confidence in every financial decision they make. Full year revenue reached $12.7 billion up 32%, including the addition of Mailchimp and a full year of Credit Karma. Excluding Mailchimp, revenue grew 24%. Total revenue growth was fueled by 38% growth for the small business and self-employed group, which includes 16 points from Mailchimp.
Consumer group revenue grew 10%, and Credit Karma had an outstanding year with revenue of $1.8 billion, up 58% on a pro forma basis year-over-year. I'm very proud of the team's performance, delivering strong growth and strong margins, which very few companies at our scale are able to achieve. I'm optimistic about our strategy and opportunities for growth, especially considering an uncertain global macroeconomic environment. The Intuit platform remains mission-critical for powering our customers' prosperity. I'm pleased we are guiding to another year of strong revenue growth and strong margins in fiscal year 2023. Our global AI-driven expert platform strategy is accelerating innovation, and our five big bets are solving the largest problems our customers face. We continue to deliver strong proof points that demonstrate this success and are well positioned for durable growth in the future.
As a reminder, our five big bets are revolutionize speed to benefit, connect people to experts, unlock smart money decisions, be the center of small business growth, and disrupt the small business mid- market. We will share more on our vision and the outcomes we're driving across each of these big bets next month at our investor day. Now let me turn to a topic that I know is top of mind for many of you, the resiliency of our business in a slowing macroeconomic environment. Our company is in a significantly different position than it was during the last recession more than a decade ago. Our platform and cloud-based offerings have significantly expanded to become the platform of choice for consumers and small businesses. Therefore, Intuit is even more mission-critical for our customers we serve. We have highly predictable recurring revenue and much of our business is subscription-based.
Additionally, the scale of our platform, along with our rich data, gives us the unique ability to see leading indicators such as growth in charge volume, number of hours employees are working, and number of workers paid, bank account balances of our small business customers, credit card utilization, and delinquency rates for members. This allows us to be forward-looking and adjust quickly. Let me share how we think about our business in context of a mild recession. To start, in fiscal year 2022, 51% of our revenue came from the small business and self-employed group, 35% from our consumer and pro tax businesses, and 14% from Credit Karma. First, on tax. Our tax businesses are very resilient and we do not expect a mild recession to have any significant impact.
Next, with small business and self-employed group, QuickBooks and Mailchimp are mission-critical for our customers whose livelihood depends on our platform. In fiscal year 2022, approximately 80% of the small business and self-employed group revenue was subscription-based. As a reminder, Mailchimp is also primarily subscription-based, which adds to the scale of our subscription volume. The approximately 20% is transactional-based and includes revenue from QuickBooks payments, capital, and per employee pricing for time tracking and payroll. In a mild recessionary environment, we may see an impact on these transactional businesses. In Q4, we did not see any impact. This demonstrates how mission-critical our platform is, especially in this environment. Finally, turning to Credit Karma, this is the business that could be most impacted by weakening economic environment. As a reminder, this business represents 14% of Intuit's revenue in fiscal year 2022.
While we expect member engagement to be strong in any economic environment, our financial institution partners could tighten access to credit. In Q4, we experienced increased volatility in personal loans. Many partners that securitize loans are facing a more challenging funding environment as interest rates rise. For context, personal loans represent just over 1/3 of Credit Karma's revenue in fiscal year 2022. Although several personal loan partners tightened underwriting during the quarter, we were able to offset some of this with volume from other partners. This demonstrates the power of the platform. In credit cards, we've not seen any significant impact. We continue to monitor delinquency rates, which we view as a leading indicator for future credit card origination trends. While delinquency rates have increased slightly, they remain near historical lows. We expect credit cards to be less negatively impacted by a mild recession than personal loans.
In the mild recession of 2001, 2002, credit card originations declined only a few points. For context, credit cards represent nearly half of Credit Karma revenue in fiscal year 2022. We do expect Lightbox to continue to be a differentiator for Credit Karma, as this technology allows lenders to deploy their targeting models in an encrypted environment and leverage thousands of anonymized financial attributes related to Credit Karma members and TurboTax customers. This provides more certainty to members and partners on the platform as recommendations are personalized. Currently, no one else can replicate this. Partners' usage of Lightbox at the end of fiscal year 2022 was at an all-time high, representing nearly 70% of credit card and personal loan transactions on a combined basis. This was up nearly 15 points from the prior year.
We expect Lightbox to help make Credit Karma's business more resilient in a recessionary environment. Now with that as context, the guidance we are providing today assumes current demand trends continue. Wrapping up, we feel more confident than ever in our long-term business strategy. In an uncertain macro environment, the benefits of our platform are more important and mission-critical than ever. As part of our three and one-year plans that the board just approved, we are investing heavily in innovation within each of our big bets to deliver benefits to our customers while delivering top-line growth and margin expansion, given the strength of our operational playbook. Combined with our strong business fundamentals, including our balance sheet, Intuit remains in a position of strength. We're proud to be the platform of choice for over a hundred million customers around the world who rely on Intuit to prosper.
Now let me hand it over to Michelle.
Thanks, Sasan. For the fourth quarter of fiscal 2022, we delivered revenue of $2.4 billion, down 6%, reflecting the earlier IRS tax filing deadline this year, partially offset by the addition of Mailchimp. GAAP operating loss of $75 million versus operating income of $402 million last year. Non-GAAP operating income of $433 million versus $715 million last year. GAAP loss per share of $0.20 versus diluted earnings per share of $1.37 a year ago. Non-GAAP diluted earnings per share of $1.10 versus $1.97 last year. You can find our full fiscal 2022 results in our press release and on our fact sheet.
Turning to the business segments, in the small business and self-employed group, revenue grew 41% during the quarter and 20% on an organic basis, excluding $265 million in Mailchimp revenue. In fiscal 2022, revenue grew 38% and 22% on an organic basis. Online ecosystem revenue grew 66% in Q4, or 32% excluding Mailchimp, and 61% for the full year, or 34% excluding Mailchimp. With the goal of being the source of truth for small businesses, our strategic focus within the small business and self-employed group is threefold. Grow the core, connect the ecosystem, and expand globally. First, we continue to focus on growing the core. QuickBooks Online accounting revenue grew 34% in fiscal Q4, driven mainly by higher effective prices, customer growth, and mix shift. In fiscal 2022, QuickBooks Online accounting revenue grew 33%.
Second, we continue to focus on connecting the ecosystem. Online services revenue, which includes Mailchimp, payroll, payments, capital, and time tracking, grew 116% in fiscal Q4. Excluding Mailchimp, online services revenue grew 29%. In fiscal 2022, QuickBooks Online services revenue grew 107%. Excluding Mailchimp, online services revenue grew 34%. Mailchimp's revenue included in online services was $265 million. Although we're making progress with this business as we accelerated our year-over-year revenue growth several points in fiscal Q4 versus when we closed the acquisition in fiscal Q2, revenue was slightly below our expectations. During the quarter, we focused on product innovation to improve conversion ahead of peak season, which starts in September and therefore pulled back on marketing investments.
I'm confident that these are the right steps to position us well as we head into Mailchimp's peak season. We expect to ramp up marketing in September after these enhancements are complete. We continue to have confidence in our game plan and acceleration priorities through Mailchimp. Within Payroll, revenue growth in the quarter reflects an increase in payroll customers and a mix shift to higher-end offerings. Within Payments, revenue growth reflects an increase in charge volume per customer and ongoing customer growth. Third, we continue to make progress expanding globally. On a constant currency basis, total international online ecosystem revenue grew 193% in fiscal Q4 and 23% on an organic basis excluding Mailchimp. Desktop ecosystem revenue grew 1% in the fourth quarter and 4% for the full year.
QuickBooks Desktop enterprise revenue grew low double digits in fiscal 2022, driven by price increases and customer growth. Nearly all of our desktop accounting revenue is now subscription-based, similar to our online accounting offerings. Moving on to Credit Karma, revenue grew 17% to $475 million in Q4, another record revenue quarter, driven primarily by growth in average revenue per monthly active user. Full year revenue was $1.8 billion. We've had two exceptional years for this business, growing 37% in fiscal 2021 and 58% in fiscal 2022 on a pro forma basis, well above our longer-term expectations of 20%-25%. On a product basis, revenue growth was driven primarily by credit cards and personal loans. This was partially offset by headwinds in auto insurance and home loans. As Sasan shared earlier, we're seeing increased volatility in personal loans.
We continue developing the emerging verticals by focusing on innovation with Credit Karma Money, which we believe is key to growing the frequency of visits over time. We remain excited about the opportunities ahead. Consumer group revenue was $3.9 billion in fiscal 2022, up 10%. I'm proud of our execution this season as we grew share and average revenue per return. Turning to the ProConnect Group, we reported $546 million in revenue for fiscal 2022, up 6%. Our financial principles guide our decisions, remain our long-term commitment, and are unchanged. We finished the quarter with approximately $3.3 billion in cash and investments and $6.9 billion in debt on our balance sheet. We repurchased $508 million of stock during the fourth quarter and $1.9 billion during fiscal 2022.
The board approved a new $2 billion repurchase authorization, giving the company a total authorization of $3.5 billion to repurchase shares. Depending on market conditions and other factors, our aim is to be in the market each quarter. The board approved a quarterly dividend of $0.78 per share payable October 18th, 2022. This represents a 15% increase versus last year. We have an operating system we use to run the company, and this includes a proven playbook for operating in both good and difficult economic times. As a nearly 40-year-old company, we've been through many economic cycles. Our first priority is to do the right thing for customers, giving them access to the tools and offerings they need most.
We manage for the short and long term and control discretionary spend to deliver strong results while investing in what is most important for future growth. The economic environment was a consideration as we look ahead. We've identified several levers we can pull to deliver against our financial principles in a variety of scenarios based on where we see opportunities across our platform. Many of these can be pulled in real time should the need arise in areas like marketing spend, travel, hiring, and others as we progress through the year in order to maintain earnings power while positioning the company for a stronger future. We have a strong balance sheet that enables us to play offense in any macro environment. These principles are intended to accelerate our innovation in the future, and our goal remains for Intuit to emerge from any downturn in a position of strength.
Moving on to guidance. Our fiscal 2023 guidance includes revenue of $14.5 billion-$14.7 billion, growth of 14%-16%. Our guidance includes revenue growth of 19%-20% for small business and self-employed, 9%-10% for the consumer segment, and 10%-15% for Credit Karma. As a reminder, Credit Karma grew 58% on a pro forma basis year-over-year in fiscal 2022, well ahead of our long-term expectation of 20%-25%. Our overall guidance assumes recent demand trends continue. Our guidance also includes GAAP earnings per share of $6.92-$7.22. Non-GAAP earnings per share of $13.59-$13.89. We expect a GAAP tax rate of 25% in fiscal 2023.
Our fiscal 2023 guidance includes stock-based compensation of $1.8 billion, an increase of 39% over fiscal 2022. Approximately 25% of this total is equity granted as part of the Credit Karma and Mailchimp transactions, and approximately 75% of this total is related to our broad-based equity program designed to attract, retain, and incentivize employees. Looking ahead, we expect stock-based compensation as a percentage of revenue to flatten over the next few years. Our guidance for the first quarter of fiscal 2023 includes revenue growth of 23%-25%, GAAP loss per share of $0.43-$0.37, and non-GAAP earnings per share of $1.14-$1.20. You can find our full Q1 and fiscal 2023 guidance details in our press release and on our fact sheet.
Going forward, we're bringing Mint and Credit Karma together under a unified personal finance strategy. Starting in fiscal Q1, we will be reporting Mint as part of the Credit Karma segment. This is reflected in the guidance I shared today, but is not material to the growth rate. I also want to share an important change regarding our long-term expectations for small business and self-employed group revenue growth going forward. In the past, we've shared with you our aspiration to achieve online ecosystem revenue growth of better than 30% organically over time. We first provided this expectation in fiscal 2017 when our online ecosystem revenue was $850 million. It comprised less than a third of our small business ecosystem, and we were early in our journey building our online presence.
Today, the online ecosystem is over 5x larger at $4.4 billion, and it comprised more than two-thirds of total small business revenue in fiscal 2022. This, along with the fact that the majority of the business is now subscription-based, given the shift to subscription in desktop, we believe the right measure moving forward is to look at the performance of our overall business rather than just the online ecosystem. We now expect total small business and self-employed long-term revenue growth of 15%-20%, up from 10%-15% previously. While the online ecosystem will continue to be our growth catalyst, we will no longer provide specific online ecosystem goals. With that, I'll turn it back over to Sasan.
Great, Michelle. Thank you. As you have now heard from Michelle and I, we are seeing continued momentum across the company given our strategy of being an AI-driven expert platform. With our accelerated organic innovation and the addition of Credit Karma and Mailchimp, we are the leading global financial technology platform that powers prosperity for people and communities. We have a large TAM, secular shifts working in our favor, and a highly predictable set of revenue streams. Our innovation is unlocking new opportunities for our platform and delivering truly game-changing benefits for our customers. Intuit remains a best place to work around the world, and I'm proud of the team and what we've accomplished this year. Now let me turn it over to you for any questions that you may have.
Chelsea, I think we're ready to take questions.
Thank you, ladies and gentlemen. If you would like to ask a question, please press star then the number one on your telephone keypad. If you would like to withdraw your question, please press star two. Our first question will come from Keith Weiss with Morgan Stanley.
Thanks, Chelsea. Thank you guys for taking the question. Very nice quarter. Michelle, I think this is more of a question for you. For the FY 2023 guide, you're looking for operating margins to continue to move higher or just to move higher from where they were in FY 2022. Part of that is just kinda anniversarying the legal settlement that was part of FY 2022. Can you talk to us about sort of the organic, if you will, or sort of like the fundamental margin improvement that you're expecting in the business in FY 2023? How big is that and how durable on a go-forward basis if we think about the model like beyond FY 2023?
Is this a progression that we could see being more durable in terms of driving operating efficiencies, number one? Number two, in your remarks about finding levers in the business, the one that really stuck out to me is saying you said there's levers to maintain the earnings power. Should I take that to mean that a lot of those levers have to do with the OpEx side of the equation, that there's levers you could pull to maintain margins and maintain profitability even in a weaker macro environment, if you will? Thank you.
Hi, Keith. Thanks for your questions. Appreciate it. Yes, you know, we are very happy to see our operating margin guidance for this coming year by margin expansion of 100 basis points versus FY 2022. As you know, that aligns to our financial principles to be able to grow revenue double digits and operating income dollars faster than revenue. We feel really good about that. As we look at where that's really coming from, you know, as we've been continuing to grow more and more as a platform over time, that really does enable us to look across the business and be able to drive efficiencies and effectiveness while driving accelerated revenue growth, which is resulting in our ability to expand margins while being able to continue to invest to really drive the accelerated revenue growth.
How we think about that, I don't really see anything that's, you know, really structurally that impacts that over time. We haven't given any longer-term expectations or long-term guidance on what margins might look like in the longer term. I don't necessarily see anything really structurally that prevents us, as we continue to grow as a platform, that prevents us from continuing that growth. To the second part of your questions, as for the levers that we would pull, yes, I mean, there are a number of things that we would pull, which could be OpEx, as I mentioned. You know, there's you know, marketing spend or travel, hiring, other things like that we can pull pretty much in a lot of those in real time to be able...
Mm.
to impact our operating expenses and be able to maintain the margins that we have committed to. You know, we wanna be ready. It's really kind of what we do on a day-to-day basis. We're always looking for opportunities to drive different efficiencies across the business.
Awesome. Thank you very much.
Thank you. Our next question will come from Brad Zelnick with Deutsche Bank.
Great. Thank you so much, and congrats on a strong finish to the year and a strong guide for next year. Maybe for my first question, with Mailchimp a bit disappointing, can you double-click on the actions you're taking and what it is that gives you the confidence it's product and not the environment?
Yeah. Yes, Brad. How are you? I will take that question. You know, first and foremost, I would share with you that we are the ones that pulled back that resulted in the performance that we just shared. The great news is it's in our control. The second point I would make is, you know, the biggest thing that's been reaffirmed as we've become one family with Mailchimp is two of the biggest problems that matters most to our customers and especially, by the way, in tougher times, is being able to grow their customer base and being able to manage their cash flow.
The biggest insight that we learned as we started accelerating our marketing spend, which we had shared with all of you that we would do, is that there are conversion gaps in the product that we felt like were critical to address and not just spend the marketing dollars without the benefit of improved conversion. Specifically, those were things like coming to the website and the number of people that we saw falling off versus what we would expect based on our experience with across the QuickBooks platform, across the Credit Karma platform, the TurboTax platform, what we believe are some best-in-class engagements and conversion.
When you get into the product, we measure active use and making sure that you're getting into the features that you really wanted to get into, and hence why you signed up for Mailchimp, and even our checkout process. Those are just three illustrative examples of what I would say just basic blocking and tackling product conversion that we really wanted to double down on to make sure that we are ready for busy season. That did not take away from the priorities that we have shared about Mailchimp, which is one, to create one growth platform with QuickBooks, which we are on track to do. Two, it's to double down on international.
In fact, it is now part of our refreshed international strategy to double down on helping customers grow customers with Mailchimp. Then the third is to actually go into mid-market. What we just announced in terms of our results actually has nothing to do with the environment. It has everything to do with what's in our control and decisions that we made very explicitly to be ready for busy season, and these are playbooks that, you know, we know how to execute when it comes to product conversion.
Thank you. That makes a lot of sense, Sasan. Maybe if I can follow up with a quick one for Michelle. Michelle, just on the long-term guidance and how we're thinking about small business going forward, and you talked about a range of 15%-20% growth versus up from 10%-15%. But thinking more holistically, just as I think about some of the pricing actions more recently in Desktop, for example, can you just remind us as you think about that long-term view, you know, how should we think about pricing as a lever, and pricing for value going forward? Thank you.
Hi, Brad. Thanks for the question. You know, we're really excited about being able to raise the long-term expectations for small business from 10-15% to 15-20%. I just think it goes to show, as Sasan talked about earlier, really the mission-critical nature of the products and the offerings that we have in small business. You know, as we have increased the growth expectations, the growth algorithm overall is really still focused on the same things. It's about driving customers and it's about driving ARPC. You know, yes, pricing may be part of ARPC, but really it is about focusing on driving value and how do we continue to provide offerings for customers that may have a higher ARPC, whether it's QBO Advanced, QuickBooks Live, those kinds of products.
We really are focused on pricing for value, so not just continually raising price, but once we're delivering those additional features that are providing additional value to the customers and we're bringing more innovation to the table, then we look at, you know, really should we be raising the price. Overall, very excited about the growth we see with small business.
Excellent. Thank you so much, and thanks for taking the question.
Thanks, Sasan, please.
Just to add one other thing that's just amplifying what Michelle just shared, and that is, our reliance on price has not changed, meaning that we have an algorithm whereby price is just an element of our overall performance, and we're not relying more on price looking ahead than we did looking backwards. Just reiterating one point that Michelle made just a moment ago.
Excellent. Thanks again.
Thank you. Our next questions will come from Alex Zukin with Wolfe Research.
Hey, guys. Thanks for taking the question. I guess one bigger picture kind of question and then just one on tax. You know, as we parse the numbers, I think the surprise factor sitting here is the guidance and it's surprising in that it feels like it's not that conservative, I guess. Sasan, I want to press on that a little bit. I think what you're saying is that, look, you guys have a lot of forward-looking indicators into the macro environment and you're looking at those indicators and they were really good in the quarter. Then I think you mentioned in your script that, you know, your guidance does not assume significant deterioration in those factors. I guess my first question would be why not?
Why, you know, what gives you the confidence to guide with that methodology? Then if you know, what levels, if you did add conservatism into the guidance for next year, where would we find it? Just tactically, maybe what is the assumption for Mailchimp growth given that variability you talked about that was, you know, a choice, I guess, in the quarter?
Sure, Alex, appreciate the question. You know, I'll say a couple of things. You know, first of all, our approach to how we run the company and our approach to guidance and how we factor things in has not at all changed. Just know that our approach is, you know, consistent with the way Intuit has always set expectations and set guidance, which is really to deliver on our commitments. You know, that's the number one. Number two, what really informed our perspective as we look ahead is all of the indicators that we see that are forward-looking, but let me just, if I could, double-click in a few of the areas.
I'll start with tax to put that out of the way, which is, no matter the environment, we're not gonna expect, nor have we seen in our history really, any material impact in tax. That's 35%, you know, of the company. When you look at the other 51% of the company, which is, you know, small business, it's important to note that we are a very different company today than we were three years ago, much less five years ago, where small businesses are relying on our platform to run their business. It's actually their livelihood, and 80% of our revenue is subscription. The 20% that is transactional based, you know, we take the current environment and how things could play out into account as we set guidance.
The third, which is Credit Karma and 14% of the overall company revenue, you know, we have taken the current environment and what we assume will take place into account, and most of our verticals other than Credit Karma in fact have seen an impact, and we have included that in our guidance. Really that was a long way of saying we are fairly consistent across all of our segments and we feel very good about the indicators that we see, how we view things will play out and how that informs our guidance moving forward.
That's helpful. It sounds like it like you're reaffirming a notion of diversification and exposure. I guess maybe just a follow-up. On the tax side, on the consumer business, when you think about, I mean, you mentioned that business is kind of much more resilient irrespective of the macro, everybody's doing their taxes. Is there any impact we should think about from recent legislation and just in general the type of a tax season that a more volatile macroeconomic recession might or environment might instigate?
Yeah, Alex, I would say, nothing more than what we've experienced in the last, you know, couple of years. That's really the short answer. When you look at the last two to three years, you know, environmentally, it has had probably more of an impact in the tax business than we've seen, you know, in years. As you know, I've been with the company for 17+ years, ran the tax business for three years. You know, what happened when we hit COVID, the implications on consumers, the extended tax season, the child tax credit, there are so many things that played into the tax season the last, you know, several years. As we look at the year ahead, you know, frankly, we view a much more simplified approach to the tax season.
Although some of the tax laws will impact what we need to do in the product, that's what we're great at, that's what we know how to do well. We actually see more normalcy as we look ahead than we experienced in the last two to three years.
Got it. Can't argue with the results, guys. Congratulations.
Thank you, Alex.
Thank you. Our next questions will come from Kash Rangan with Goldman Sachs.
Hi. Congratulations on a superb finish to the fiscal year and also very constructive guidance. Sasan or Michelle, we look at the. I know you're not gonna be talking about the small business online ecosystem revenue split going forward. But it clearly looks like the business is at a point where, I mean, you have two-thirds of the business coming from online ecosystem that's growing roughly 30%+ range, right? I think many of us are surprised that the outlook for that business, you raised the overall business to 15%-20%. It looks like online ecosystem is actually doing pretty decently, right? In the event of a downturn, and I know, Sasan, this was exactly the question that I've asked you on prior conference calls. But how confident are you that
Of course, retaining subs is one thing, but then adding net new subscribers in a challenging economy, how confident are you that you can keep that ball rolling while continuing to have your price increases stick, and at the same time managing retention in such a way because if retention goes down, then you have more pressure to add more new subs. How does that mathematical equation play out during a downturn? Thank you so much, and congrats.
Yeah, sure, Kash. Thank you for the compliment. I actually love the nature of your question, and let me hit on a couple of things. This is why earlier one of the things I talked about is we are such a different company when it comes to the small business platform than we were, you know, even three years ago. To your question of why do we have confidence around our guidance and I know that it doesn't go past us that in this environment, we actually raised our long-term expectation and it's because of just how mission-critical the platform is, but the services that we have.
Two examples I would share with you is when you look at the formula that we've shared, which is we're gonna grow customers 10%-20% and we're gonna grow ARPC 10%-20%. The two examples I would give is, you know, we have a set of offerings on our platform today that we didn't have before. QuickBooks Advanced, which is going after mid-market, which has much higher ARPC, 4x the use of sort of services, is something that we didn't have three to four years ago and we are just early in our penetration into that TAM. In fact, we've not only seen no slowing but strengthening in this environment because folks wanna ensure that they're on our platform to get paid faster, to be able to take care of their employees.
One is when you look at going up mid-market, when you look at QuickBooks Live, which is really an opportunity for us to lift heads and go after non-consumption. Those are offerings we have that we didn't have before that are actually higher ARPC. That's one. Two, you know, remember four to five years ago, our payments business was growing 11%, because of where we were on innovation in the platform. Now we're growing, you know, north of 30%. We have about almost $2 trillion of invoices that are managed on our platform. We're growing at that rate, and our penetration is very low, and more and more customers are starting to digitize their form of payments because of the innovation on our platform, and they're already on our platform. We have
Those are just two illustrative examples, but very real examples of why we're seeing the strength that we're seeing, you know, here and now and the strength in all the indicators that we see in the coming year. I would just sort of finish with the bang box of 80% of our business is subscription business, so it's highly predictable. Those are the things that give us confidence as we look ahead.
Tremendous dissection of what is driving your confidence. Thank you so much. We will not let Microsoft tell us anything about SMB. We'll listen to you first. Thank you so much.
We are the ones to look for when we talk about SMB.
Well said. Well said. Thank you.
Thank you. Our next question will come from Daniel Jester with BMO Capital Markets.
Great. Thanks for taking my question. Maybe just on Credit Karma and now moving Mint into that segment on an official basis, maybe we just spend a minute talking about sort of the opportunities there in a little more detail. How much can Mint drive engagement in addition to Credit Karma Money? And just over the long term, how should we be thinking about that combination?
Yeah, Daniel, thank you for your question. You know, we kicked off a strategy project. It's been almost probably a year ago to just understand how we can accelerate making ends meet and our vision to truly have a consumer financial platform that can be the self-driving platform for consumers no matter where they are in their life, whether, you know, they're students or someone that is later in their life where they have achieved a level of financial freedom and have different sets of needs.
Given the work that we did around our vision, we decided to bring Mint and Credit Karma together because in essence, although we have a lot of prime members as part of the Credit Karma base, Mint actually has a number of features and functionalities that the prime members need the most. That's number one, is bringing some of the features and functionalities together as part of the Credit Karma platform, and over time, that will actually make Credit Karma much more robust to be able to serve all kinds of members no matter what their sort of credit band is.
Number two is actually leveraging the scale, and the power of, the algorithms, the machine learning capabilities, the decision engines that we have in Credit Karma that ultimately deliver north of 35 billion machine learning predictions per day. We can leverage a lot of those capabilities to make Mint a lot better as part of Credit Karma. We do expect that this will be accretive, in the long term, delivering benefits to members and ultimately, truly achieving our mission and our vision of, unlocking smart money decisions for consumers. That is our approach and thinking, and we're very excited about it.
Great. Thanks. Just a second one on Mailchimp. I appreciate all the context you provided about the quarter and the trajectory of the business. I guess, are there any learnings from the Mailchimp acquisition that you'd share that maybe will impact your acquisition philosophy going forward? Just, you know, maybe a comment on sort of what the acquisition outlook and playbook is today. Thank you very much.
Sure. Absolutely. Let me start with the single biggest thing that we've learned and we're diagnosing. It wouldn't have changed any of what we've done. We're very, very excited about what we're gonna do in executing our vision with Mailchimp and QuickBooks coming together. It's having diagnosed upfront some of the product conversion opportunities that we are going after. I would say that's probably the single biggest thing that we did not diagnose as well as I would like to see us diagnose. I would also say that's a, if you're gonna misdiagnose something, that's an okay one because it's within your control, and you can address it. I would say that's probably the biggest one.
It has not at all altered the priorities that I mentioned a moment ago, but it is something that we've really gone back, and we're looking at how we can put that in our playbook to do a better job diagnosing upfront. In no way, shape, or form does it change how we feel about the possibilities ahead, and it has not impacted our timeline at all. The second thing is our M&A playbook has not changed. Our uber goal is time to market. Our principles around looking at capabilities that could help us accelerate delivering our vision are unchanged. I would just leave it at that. Nothing new to report. It's unchanged.
Great. Thank you.
You're very welcome.
Thank you. Our next question will come from Siti Panigrahi with Mizuho.
Thank you. Thanks for taking my question and great quarter. Just wanted to dig into the payment part of the business. I guess that's one of the underappreciated asset I would say Intuit has. You talked about total invoices now growing $2 trillion versus last year, $1.5 trillion. Could you help us understand how you have been gaining share within that business? And also, what are the opportunity you see in for Intuit payments to expand beyond QuickBooks, like some of the acquired asset? If you could share some of your long-term vision on that'll be great.
Sure. Absolutely. You know what's great about your question, Siti, is our big bet four, which is about being the center of small business growth is really about helping our customers grow their customer base, and it's actually about cash flow, managing their cash flow, and that's where the power of Mailchimp and QuickBooks come together. Specifically, you know, around the $2 trillion of invoices that we're now managing on our platform and your question about how do we continue to gain share, I'll start with just sharing how we've accelerated our growth from the 11% several years ago to the 30% that I mentioned a moment ago from a charge volume perspective. It's really just basic innovation.
It's around discoverability. It's around innovation like instant deposit. It's around innovation like get paid upfront, which really gives you the ability to send an invoice and get paid instantly because of all the data points that we see. It's just really making the experience, you know, auto-enabling the experience for payments to always be on versus opting in. Those are illustrative examples of where we have innovated to accelerate the growth in payments. By the way, I wanna be clear, there's so much more yet to do there because when you look at the last five to six years, our team has spent probably the first half of those six years just building the basic platform capabilities to be able to innovate much faster.
We have a lot of those capabilities. Now we're able to innovate and deliver faster innovation, you know, to our customers. That's one area where we'll continue to double down to take more share. We also have a significant opportunity to digitize all of business to business. You know, a big chunk of this $2 trillion of invoices that are managed on our platform is actually business to business, where it's a QuickBooks customer that transacts with another QuickBooks customer. The opportunity that we have is that, you know, at the end of the day, you can look up that small business, send them an invoice, that invoice ends up sitting, you know, showing up in their books, and they can pay it instantly right on our rail.
That's an example of the types of things that we are working on in addition to what I shared a moment ago to really accelerate increasing our penetration and share of this $2 trillion. I'll just end with going back to a couple of questions that I think were asked around what gives us confidence around our small business guidance. It's really this is one great example of helping customers get paid faster. It's already happening on our rails. We don't need to go acquire the customer. These invoices are being managed on our platform. Now the question is, how do we help the customer put more money in their pocket faster?
It's sort of our right to win, and this is a great example of what gives us a lot of confidence as we look ahead.
Sasan, that's great color. Just a quick follow-up to one of your comment on Mailchimp that you're planning to go to mid-market. Can you help us understand where the Mailchimp strength right now, maybe in the employee segment and where you're targeting, right, you know, that mid-market? Is it also something you're trying to expand your features more beyond email marketing when you're trying to go into the mid-market?
Yeah, absolutely. You know, since you and many that are listening have followed us for years, I would liken the Mailchimp journey that we are on very similar to the QuickBooks journey. Specifically, there's a lot of overlap in the type of customers that we serve. Mailchimp generally has served the small businesses, you know, less than 10 employees. However, it actually has a lot of the capabilities to be able to serve the mid-market customers. It comes down to adding some features and functionalities, basic things like, you know, how you do billing, to actually ensure that you have the right inside sales force and customer success agents to be able to serve these mid-market customers.
A lot of what we have built and know how to build in mid-market for QuickBooks Advanced, we're doing the same thing now with Mailchimp. It has a lot of the feature functionalities but we're building out additional ones, but we're also building out our sales and customer success, inside sales and customer success to be able to then serve those customers. You put that together with going to market together with QuickBooks, it really sort of brings the power of the benefits that we're able to deliver to customers and makes us far more attractive in the market for those small businesses that we wanna serve.
Thank you. Next, we have Michael Turrin with Wells Fargo Securities.
Hey there. Thanks and good afternoon. Appreciate you taking the question. The EPS guide for the full year, it's, if not the highest among the highest we've ever seen at 16% growth as a starting point from Intuit. You've had some questions. It's especially notable given the current environment. I think it's clear that increasing the target range for small business helps. Is there anything else you'd point to? Are there platform advantages you're finding with some of the newer segments or just anything else you'd point us towards that's helping to unlock the bigger EPS growth algorithm?
Yeah, sure, Michael. I'll just amplify what Michelle shared earlier. We have leverage that is coming from three places that we view is durable. You know, one is on the technology side. We are actually excited about having Marianna walk all of you through our technology stack, our technology vision, and how it's fueling innovation and also how it's giving us margin leverage at Investor Day. In that context, you know, that's one significant lever where we are continuing to build services so we can build them once and use them multiple times across the company. It's actually one of the things that is an accelerant to fueling innovation and acquisitions like Mailchimp and Credit Karma.
The second is the leverage we get from how we're building out our marketing platform so that our martech services can be used across all of the segments across the company. Third is the technology that we're building once and applying to all of our customer success operations, which just recall is quite large. You know, we have over 700 million interactions with customers and we shifted the company years ago from every segment, you know, builds out their own operations to we're building it once and the segments leverage the same operations across the company. Making sure that we ensure that those services and those platforms are used by not only across the company, but our acquisitions like Credit Karma and Mailchimp.
The leverage is coming from technology across the company, martech, and customer success, operations. That's what's driving, you know, what we delivered this past year, the guidance that you heard Michelle talk about, and the durability that we believe we have looking ahead.
Thank you. Just a quick follow-on, if I may. Some useful commentary around mix throughout the call. With Credit Karma, you're guiding for 10%-15% growth. It's below the longer-term targets we've seen, but clearly there was some outsized growth there over the past year. I'm wondering if there's any way you can help disaggregate the tough comps versus some of the macro assumptions that frame that guide in relation to the longer-term targets we've seen. Thank you.
Yeah, sure. Sure, Michael. It is in fact both. One is we have a big comp, you know, two years of 37%, and then last year, 58% growth. We have a lot of confidence in our long-term expectations for 20%-25%, so that is unchanged. Yes, one element is the tough comp. Really, I would say the other element, probably a bigger element, is the current trends that we are seeing that we have really incorporated, you know, in our guide. You know, when you look at our verticals around credit cards, personal loans, insurance, and then home loans and then there's the money vertical, almost every vertical has been impacted.
By the way, you can see, based on our guide, the resiliency of the platform, other than, of course, the credit card vertical that really has not seen any significant impacts. That's the second piece that we have incorporated into our guidance is, in fact, the macroeconomic environment that we see.
Thank you. Our next questions will come from Brent Thill with Jefferies.
Thanks. Sasan, a number of CEOs have been calling out the shift to a services-based economy from a product base. I believe, correct me if I'm wrong, you have a heavy services base.
In small business. I'm curious if you think that's helping kinda shelter the small business in this environment right now. Is that playing into some of the defensive nature of what you're seeing in the results in small business for your core?
Yeah. It's a great question, Brent. I think the short answer, absolutely. There are two elements. You know, I'll start with just a reminder that when we look at the small business market of sort of 0 to 100 employees, about 70% of it is service-based businesses and about 30% is product-based businesses. Our real strength is in the service-based businesses. I think the second thing I would just say is we're very diversified in the service-based businesses that we serve. We're not sort of overly anchored in one vertical or another, and that really helps with the diversification of not only our performance looking backwards, but opportunity, you know, as we look ahead.
When you look at Credit Karma in past downturns, can you just give us a compare or contrast? I know you've compared the small business segment to be more SaaS. You've got obviously layered services around. Is there something different that they've done in the business to diversify? Assuming things got a little worse, I'm not saying that's what you're saying in the guide, but if that was the case, what gives the defensive nature of that business?
The single largest, I would say uniqueness about Credit Karma, aside from you got 100 million customers, incredible trust, high net promoter, 14+ years of behavioral data where we know so much about these customers and know what they need, when they need it, and how they need it. Putting that to the side as a foundation, which is critically important, it's Lightbox. With Lightbox, it raises certainty of the experiences that and offers that we can deliver members. But in this environment, more importantly, it is quality which is there's a huge flight to quality by our partners. Because we now have almost 70% of our credit card and personal loan transactions on Lightbox, and by the way, growing, that's 15 points higher than it was last year, and of course, almost nonexistent, you know, years ago.
I don't even think Lightbox existed in the last recession. That is the single biggest thing of where financial institutions have a lot of certainty when their models are a part of Lightbox because they can identify the kinda customer they want, the kind of offers that they wanna provide, and of course, we make the perfect match. I would say that is the single biggest thing. It's just the scale of the platform. We are a large part of the economy providing a match between what consumers want to the financial products that they have. I would say Lightbox.
Thank you. Our next question will come from Kirk Materne with Evercore ISI.
Thanks very much. I'll echo the congrats. Sasan, you've alluded to this a couple times, but I was wondering if you could just sort of dive into it in a little bit more detail. Just the power of the platform in small business, and as we go into a you know potentially you know soft economic backdrop. You know, are customers starting to talk to you all about trying to consolidate onto your platform in a bigger way now? You obviously have the ability to help them address both the back office and the front office.
While we're seeing that, I think anecdotally in payments and payroll, I was just kinda curious, you know, given that budgets might come under more scrutiny, are you benefiting from the idea of consolidating, you know, towards one platform versus maybe taking a best of breed approach? Thanks.
Yeah, sure, Kirk. In fact, it, this is probably one of the most misunderstood or least understood elements of the benefit that our platform provides. I'll just start with stating something that I mentioned a moment ago because it really plays into your question and that is we're not a line item on the small businesses' budget. We are the platform that fuels their success. We are mission critical. Without our platform, a small business can't run their business. It's really important to have that frame of mind as to what's the role that we play in the lives of small businesses. The second to get to your question is we now have the services that we didn't have three years ago, five years ago.
In fact, yes, they are having those conversations with us less from a "can I save money" but more from a perspective of I don't wanna deal with all of these different applications where things are sort of separate and discrete where I can have everything on your platform. If I'm using somebody else's payroll or somebody else's capital or somebody else's payments, why not just use all the services on your platform? Frankly, this is an area where our small business team is actually doubling down on looking forward, which is how do we evolve our go-to-market to actually have a conversation with our customers about all the services that they don't use that they should use, where they'll be far more efficient, effective, and potentially even save some money? Because we see all their transactions.
You know, we can see what they do if they don't do it on our platform because they've connected, you know, their bank accounts and so on. We believe this is an opportunity as we look ahead.
Thank you. Ladies and gentlemen, that is all the time we have today for questions and I would like to turn the call back over to management for any additional or closing remarks.
Awesome. Well, thank you for the wonderful questions, and we are really looking forward to seeing hopefully all of you at our Investor Day at September 29th. We'll number one, walk through probably the next level of depth around the experiences that we are delivering and why in this environment they matter the most to our customers across all of our five big bets. You'll have a great opportunity to not only ask more questions, but to, you know, connect with my wonderful team that leads a lot of this great work. Look forward to seeing you then. Until then, be good, stay safe, and we'll talk to you all soon. Thank you.
Ladies and gentlemen, thank you for your time today and this concludes our conference. We appreciate your participation and you may disconnect at any time.