Core Insights - SGA's U.S. Large Cap Growth Strategy experienced a portfolio return of -1.3% (Gross) and -1.4% (Net) in Q3, underperforming the Russell 1000 Growth Index which returned 10.5% and the S&P 500 Index which returned 8.1% [1] - The investment strategy focuses on high-quality growth businesses expected to achieve consistent mid-teens earnings growth, but faced challenges as lower-quality stocks and cyclical industries outperformed in the market [1] Company Performance - Intuit Inc. (NASDAQ:INTU) was highlighted as a key stock in the SGA portfolio, with a one-month return of -0.10% and a 52-week gain of 6.36%, closing at $662.42 per share with a market capitalization of $184.418 billion on December 31, 2025 [2] - Despite strong fiscal-year results with 15% revenue growth, Intuit's cautious guidance for FY 2026 led to investor disappointment, as the projected revenue growth of 12-13% was below expectations [3] - Management emphasized long-term growth targets and resilience in most business segments, with MailChimp expected to return to double-digit growth by fiscal year-end, indicating a strong brand and high user retention as competitive advantages [3]

Core Insights - Bristol Gate Capital Partners' Q3 2025 investor letter indicates that the US Equity Strategy underperformed the S&P 500® Total Return Index this quarter, primarily due to limited exposure to the AI/TMT and Value sectors, which benefited from the Federal Reserve's rate cut [1] - Despite the underperformance, the portfolio achieved a 15% dividend growth over the past 12 months, supported by strong underlying fundamentals [1] Company Highlights: Intuit Inc. (NASDAQ:INTU) - Intuit Inc. reported a one-month return of 5.39% and a 52-week gain of 6.58%, with its stock closing at $669.88 on December 30, 2025, and a market capitalization of $186.495 billion [2] - The company faced challenges as its outlook and guidance for FY26 fell short of investor expectations, particularly due to ongoing weakness in MailChimp and a decline in TurboTax units [3] - For FY26, Intuit's management projected EPS between $22.98-23.18, representing a 14.5% year-over-year growth at the midpoint, and revenue forecasted at $20.997-21.186 billion, indicating a 12% increase at the midpoint [3] Hedge Fund Interest - Intuit Inc. was held by 96 hedge fund portfolios at the end of Q3 2025, a decrease from 105 in the previous quarter [4] - The company reported Q1 FY26 revenue of $3.9 billion, reflecting an 18% year-over-year increase [4]

Core Insights - Intuit has entered a multi-year partnership with Circle to integrate the USDC stablecoin into its products and services, enhancing financial transactions for consumers and businesses [1][2] - The partnership aims to leverage stablecoins for tax refunds and payments, providing a new experience that was not possible with traditional financial systems [2][3] - Intuit's scale and leadership in the industry position it well to utilize USDC for everyday financial transactions, contributing to a more efficient financial system [2][3] Company Developments - Intuit's shares (INTU) increased by 1.45% on the day of the announcement and have risen 6.45% year-to-date [4] - Circle's shares (CRCL) saw a jump of over 4% following the announcement, although they remain significantly below their yearly high [3] Market Context - Over 63% of the circulating USDC, which totals more than $77 billion, is currently on the Ethereum mainnet, indicating a strong reliance on this blockchain for stablecoin transactions [3]

Core Insights - Intuit shares experienced a significant increase following the release of better-than-expected quarterly results, driven by heightened demand for its AI tools among mid-market businesses [1][8]. Financial Performance - For the first quarter of fiscal 2026, Intuit reported adjusted earnings of $3.34 per share, exceeding analyst expectations by 25 cents. Revenue rose 18% to $3.89 billion, also surpassing estimates [2][8]. Demand and AI Integration - The company is witnessing stronger demand as it enhances its artificial intelligence tools, which are streamlining accounting and payment processes. This has resulted in increased revenue for its QuickBooks platform [3][4]. - The Global Business Solutions division contributed significantly to revenue, with an 18% increase to $2.99 billion. QuickBooks Online Accounting revenue saw a notable 25% rise to $1.21 billion [3]. CEO Insights - CEO Sasan Goodarzi emphasized the company's commitment to its AI-driven expert platform strategy, highlighting that the Accounting Agent saves customers up to 12 hours a month, while the Payments Agent accelerates payment receipt by an average of five days [4].

Summary of Intuit's Q3 Fiscal 2025 Conference Call Company Overview - **Company**: Intuit - **Fiscal Quarter**: Q3 Fiscal 2025 - **Key Executives Present**: CEO Sankat Arzi, CFO Sandeep Ojala Core Industry Insights - **Industry**: Financial Software and Services - **Market Size**: $300 billion total addressable market, with a focus on small and mid-market businesses Key Financial Metrics - **Total Revenue**: $7.8 billion, up 15% year-over-year [7] - **GAAP Operating Income**: $3.7 billion, up 20% [7] - **Non-GAAP Operating Income**: $4.3 billion, up 17% [7] - **GAAP Diluted EPS**: $10.02, up 19% [7] - **Non-GAAP Diluted EPS**: $11.65, up 18% [7] - **Consumer Group Revenue**: $4 billion, grew 11% in Q3 [7] Strategic Highlights - **AI-Driven Platform**: The company is leveraging AI to enhance customer experiences and automate workflows, which is driving growth across its services [2][4]. - **TurboTax Performance**: TurboTax Live customers expected to grow by 24%, with revenue projected to increase by 47%, significantly above the long-term expectation of 15-20% [2][8]. - **Credit Karma Integration**: Credit Karma is expected to contribute a point of growth to consumer group revenue, showcasing the seamless integration with TurboTax [11]. Customer Experience Improvements - **Time Reduction**: A 12% reduction in the average time customers spent on tax returns, with over half completing their returns in under one hour [3]. - **AI Capabilities**: Enhanced AI capabilities guided customers to the right offerings, improving conversion rates and reducing preparation time for experts by approximately 20% [3][4]. Market Positioning - **Disruption of Assisted Tax Category**: The company is positioned to disrupt the $35 billion assisted tax category, with a focus on delivering done-for-you experiences [4][8]. - **Mid-Market Focus**: Intuit is targeting mid-market customers, representing an $89 billion total addressable market, with a strategy to provide integrated solutions that reduce complexity and costs [5][6]. Future Outlook - **Revenue Growth Guidance**: The company raised its fiscal 2025 revenue growth guidance to 15%, up from 12-13% previously [12]. - **Operating Income Growth**: Expected to grow faster than revenue, with a 100 basis point margin improvement anticipated [13][21]. - **AI and Automation**: Continued investment in AI and automation is expected to enhance operational efficiency and customer engagement [21][31]. Additional Insights - **Customer Retention**: The company is seeing a trend of former customers returning after experiencing the value of Intuit's integrated solutions [6][26]. - **Marketing Strategy**: Increased marketing spend has been effective in driving customer engagement and conversion, particularly in the consumer tax segment [30]. Conclusion - Intuit is experiencing robust growth driven by its AI-driven platform, strong performance in TurboTax and Credit Karma, and a strategic focus on mid-market customers. The company is well-positioned to continue its growth trajectory while enhancing customer experiences and operational efficiencies.