- Intuit – the company behind TurboTax, Mint, and QuickBooks – is buying credit score monitoring company Credit Karma for $7.1 billion.
- The deal was first reported over the weekend by The Wall Street Journal.
- UBS analyst Jennifer Swanson Lowe said the deal could help provide the boost Intuit needs to ramp up its artificial intelligence offerings.
- The news comes as Intuit reported quarterly earnings. Intuit shares were up some 2.5% at the time of writing.
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Intuit – the company behind TurboTax, Mint, and QuickBooks – is officially buying credit score monitoring company Credit Karma for $7.1 billion in cash and stock, the company announced on Monday after the market closed.
The deal is Intuit’s largest acquisition ever, and the first big deal since Sasan Goodarzi took over as CEO a little over a year ago. The Wall Street Journal first reported on Saturday that the two companies were in talks about a deal.
Intuit’s stock was up some 2.5% at the time of the news, which came as the company announced quarterly earnings.
An analyst said that the deal could provide the boost Intuit needs to ramp up its artificial intelligence offerings.
AI has been a focus for the bookkeeping-software company since its new CEO Sasan Goodarzi took over a little over a year ago. UBS analyst Jennifer Swanson Lowe noted that data is essential to creating AI, and said that Credit Karma is built on using customer data so it would greatly help Intuit’s efforts in the space.
Intuit and Credit Karma have actually been competing in some areas: Credit Karma already offers a free tax-filing service to compete with TurboTax, using a similar model to the one that Goodarzi has envisioned for Intuit. Meanwhile, Intuit has its own Turbo, a free credit score-checking service to compete with Credit Karma.
„By joining forces with Credit Karma, we can create a personalized financial assistant that will help consumers find the right financial products, put more money in their pockets and provide insights and advice,“ Goodarzi said in a press release announcing the deal.
On a call with analysts after the announcement, Goodarzi said after the deal closes Credit Karma will remain separate, and CEO Kenneth Lin will report to Goodarzi. Lin will continue to lead Credit Karma from its headquarters in San Francisco.
The news comes as Intuit released its Q2 results for fiscal year 2020. Here is what the tax filing software maker reported:
- Revenue of $1.7 billion for the quarter, higher than the $1.68 billion that Wall Street expected. That’s a 13 percent increase from a year prior.
- Adjusted earnings per share of $1.16, higher than the $1.02 adjusted earnings per share that analysts expected.
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