Intuit reports third quarter results and raises total company full year guidance
Mountain view, calif.--(business wire)--intuit inc. (nasdaq: intu) the global financial technology platform that makes turbotax, credit karma, quickbooks, and mailchimp, announced financial results for the third quarter of fiscal 2023, which ended april 30. “we are raising our total company revenue, operating income, and earnings per share guidance for the fiscal year, demonstrating the strength and resiliency of our platform and portfolio in uncertain times,” said sasan goodarzi, intuit’s chief executive officer. “the benefits of our global financial technology platform are more mission-critical than ever to our customers.” financial highlights for the third quarter, intuit: grew total revenue to $6.0 billion, up 7 percent. increased small business and self-employed group revenue to $2.0 billion, up 21 percent; grew online ecosystem revenue to $1.5 billion, up 23 percent. increased consumer group revenue to $3.3 billion, up 3 percent. reported credit karma revenue of $410 million, down 12 percent. reported protax group revenue of $246 million, down 5 percent. 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. snapshot of third-quarter results gaap non-gaap q3 fy23 q3 fy22 change q3 fy23 q3 fy22 change revenue $6,018 $5,632 7% $6,018 $5,632 7% operating income $2,778 $2,395 16% $3,358 $2,904 16% earnings per share $7.38 $6.28 18% $8.92 $7.65 17% dollars are in millions, except earnings per share. see “about non-gaap financial measures” below for more information regarding financial measures not prepared in accordance with generally accepted accounting principles (gaap). business segment results consumer group third quarter consumer group revenue growth reflects intuit's expectations for the full fiscal year, including: a decline in total irs returns of 2 percent, and a decline in diy category share of nearly three quarters of a point. the company believes this was driven by taxpayers who filed in order to receive pandemic-era stimulus and tax credits during the past several years but did not file taxes this season. for the same reasons as above, turbotax share of total irs returns to decline approximately 80 basis points, total turbotax units to decline 5 percent, and turbotax online paying units to decline 1 percent. average revenue per return to increase approximately 12 percent, as the company expects turbotax live revenue to grow approximately 19 percent and turbotax live customers to grow approximately 13 percent. unless otherwise noted above, all growth rates refer to intuit's expectations for the tax filing season through july 31, 2023 compared to the prior season through july 31, 2022. intuit plans to provide a turbotax federal tax unit comparison in its fourth quarter 2023 earnings release. small business and self-employed group quickbooks online accounting revenue grew 25 percent in the quarter, driven primarily by customer growth, higher effective prices, and mix-shift. online services revenue grew 21 percent, driven by growth in mailchimp, quickbooks online payroll, and quickbooks online payments. total international online revenue grew 12 percent on a constant currency basis. credit karma the decline in credit karma revenue in the quarter was driven by headwinds in personal loans, home loans, auto loans and auto insurance, partially offset by growth in credit karma money and credit cards. capital allocation summary in the third quarter the company: reported a total cash and investments balance of approximately $4.3 billion and $6.6 billion in debt as of april 30, 2023. repurchased $483 million of shares, with $2.0 billion remaining on the company's share repurchase authorization. received board approval for a quarterly dividend of $0.78 per share, payable july 18, 2023. this represents a 15 percent increase compared to the same period last year. forward-looking guidance intuit raised total company guidance for the full fiscal year 2023. the company expects: revenue of $14.279 billion to $14.317 billion, growth of approximately 12 to 13 percent, up from previous guidance for growth of 10 to 12 percent. gaap operating income of $3.071 billion to $3.091 billion, growth of approximately 19 to 20 percent, up from previous guidance for growth of 9 to 13 percent. non-gaap operating income of $5.441 billion to $5.461 billion, growth of approximately 21 percent, up from previous guidance for growth of 17 to 19 percent. gaap diluted earnings per share of $7.78 to $7.83, growth of approximately 7 to 8 percent, up from previous guidance for a decline of approximately 5 to 1 percent. non-gaap diluted earnings per share of $14.20 to $14.25, growth of approximately 20 percent, up from previous guidance for growth of 15 to 17 percent. the company also updated full fiscal year 2023 segment revenue guidance: small business and self-employed group: growth of 24 percent, up from previous guidance for growth of 19 to 20 percent. consumer group: growth of 5 to 6 percent, down from previous guidance for growth of 9 to 10 percent. protax group: growth of 2 to 3 percent, down from previous guidance for growth of 3 percent. credit karma: a decline of 11 percent, updated from previous guidance of a decline of 15 to 10 percent. intuit announced guidance for the fourth quarter of fiscal year 2023, which ends july 31. the company expects: revenue to grow approximately 9 to 10 percent. gaap loss per share of $0.34 to $0.29. non-gaap diluted earnings per share of $1.43 to $1.48. conference call details intuit executives will discuss the financial results on a conference call at 1:30 p.m. pt on may 23. the conference call can be heard live at http://investors.intuit.com/events/default.aspx. prepared remarks for the call will be available on intuit’s website after the call ends. replay information a replay of the conference call will be available for one week by calling 800-770-2030, or 609-800-9909 from international locations. the passcode is 5536655. the audio webcast will remain available on intuit’s website for one week after the conference call. about intuit intuit is the global financial technology platform that powers prosperity for the people and communities we serve. with more than 100 million customers worldwide using turbotax, credit karma, quickbooks, and mailchimp, we believe that everyone should have the opportunity to prosper. we never stop working to find new, innovative ways to make that possible. please visit us at intuit.com and find us on social for the latest information about intuit and our products and services. about non-gaap financial measures this press release and the accompanying tables include non-gaap financial measures. for a description of these non-gaap financial measures, including the reasons management uses each measure, and reconciliations of these non-gaap financial measures to the most directly comparable financial measures prepared in accordance with generally accepted accounting principles, please see the section of the accompanying tables titled "about non-gaap financial measures" as well as the related table b1, table b2, and table e. a copy of the press release issued by intuit today can be found on the investor relations page of intuit's website. cautions about forward-looking statements this press release contains forward-looking statements, including expectations regarding: the size, components and our share of the tax preparation software space; the timing of when individuals will file their tax returns; forecasts and timing of growth and future financial results of intuit and its reporting segments; the impact of macroeconomic conditions on our business, segments and products; intuit’s prospects for the business in fiscal 2023; timing and growth of revenue from current or future products and services; customer growth and average revenue per return; intuit's corporate tax rate; the amount and timing of any future dividends or share repurchases; and the impact of acquisitions and other strategic decisions on our business; as well as all of the statements under the heading “forward-looking guidance.” because these forward-looking statements involve risks and uncertainties, there are important factors that could cause our actual results to differ materially from the expectations expressed in the forward-looking statements. these risks and uncertainties may be amplified by the effects of global developments, conditions or events like inflationary pressure, the russia-ukraine war and the covid-19 pandemic, which have caused significant global economic instability and uncertainty. given these risks and uncertainties, persons regarding this communication are cautioned not to place any undue reliance on such forward-looking statements. these factors include, without limitation, the following: our ability to compete successfully; potential governmental encroachment in our tax businesses; our ability to adapt to technological change; our ability to predict consumer behavior; our reliance on third-party intellectual property; our ability to protect our intellectual property rights; any harm to our reputation; risks associated with our esg and dei practices; risks associated with acquisition and divestiture activity, including the integration of credit karma and mailchimp; the issuance of equity or incurrence of debt to fund an acquisition; cybersecurity incidents (including those affecting the third parties we rely on); customer concerns about privacy and cybersecurity incidents; fraudulent activities by third parties using our offerings; our failure to process transactions effectively; interruption or failure of our information technology; our ability to maintain critical third-party business relationships; our ability to attract and retain talent; any deficiency in the quality or accuracy of our offerings (including the advice given by experts on our platform); any delays in product launches; difficulties in processing or filing customer tax submissions; risks associated with international operations; risks associated with climate change; changes to public policy, laws or regulations affecting our businesses; legal proceedings in which we are involved; the seasonal nature of our tax business; changes in tax rates and tax reform legislation; global economic conditions (including, without limitation, inflation); exposure to credit, counterparty and other risks in providing capital to businesses; amortization of acquired intangible assets and impairment charges; our ability to repay or otherwise comply with the terms of our outstanding debt; our ability to repurchase shares or distribute dividends; volatility of our stock price; and our ability to successfully market our offerings. more details about these and other risks that may impact our business are included in our form 10-k for fiscal 2022 and in our other sec filings. you can locate these reports through our website at http://investors.intuit.com. fourth-quarter and full-year fiscal 2023 guidance speaks only as of the date it was publicly issued by intuit. other forward-looking statements represent the judgment of the management of intuit as of the date of this presentation. except as required by law, we do not undertake any duty to update any forward-looking statement or other information in this presentation. table a intuit inc. gaap consolidated statements of operations (in millions, except per share amounts) (unaudited) three months ended nine months ended april 30, 2023 april 30, 2022 april 30, 2023 april 30, 2022 net revenue: product $ 583 $ 554 $ 1,617 $ 1,476 service and other 5,435 5,078 10,039 8,836 total net revenue 6,018 5,632 11,656 10,312 costs and expenses: cost of revenue: cost of product revenue 17 18 55 53 cost of service and other revenue 924 764 2,253 1,654 amortization of acquired technology 40 42 122 99 selling and marketing 1,203 1,227 2,922 2,719 research and development 604 600 1,859 1,720 general and administrative 332 465 959 1,126 amortization of other acquired intangible assets 120 121 362 295 total costs and expenses [a] 3,240 3,237 8,532 7,666 operating income 2,778 2,395 3,124 2,646 interest expense (66 ) (21 ) (180 ) (49 ) interest and other income (loss), net 22 (1 ) 50 44 income before income taxes 2,734 2,373 2,994 2,641 income tax provision [b] 647 579 699 519 net income $ 2,087 $ 1,794 $ 2,295 $ 2,122 basic net income per share $ 7.44 $ 6.35 $ 8.17 $ 7.60 shares used in basic per share calculations 281 282 281 279 diluted net income per share $ 7.38 $ 6.28 $ 8.11 $ 7.48 shares used in diluted per share calculations 283 286 283 284 see accompanying notes. intuit inc. notes to table a [a] the following table summarizes the total share-based compensation expense that we recorded in operating income for the periods shown. three months ended nine months ended (in millions) april 30, 2023 april 30, 2022 april 30, 2023 april 30, 2022 cost of revenue $ 114 $ 40 $ 291 $ 105 selling and marketing 96 85 310 232 research and development 116 138 384 379 general and administrative 93 83 279 246 total share-based compensation expense $ 419 $ 346 $ 1,264 $ 962 [b] we compute our provision for or benefit from income taxes by applying the estimated annual effective tax rate to income or loss from recurring operations and adding the effects of any discrete income tax items specific to the period. for the three and nine months ended april 30, 2023, we recognized excess tax benefits on share-based compensation of $17 million and $15 million, respectively, in our provision for income taxes. for the three and nine months ended april 30, 2022, we recognized excess tax benefits on share-based compensation of $26 million and $135 million, respectively, in our provision for income taxes. our effective tax rates for the three and nine months ended april 30, 2023 were approximately 24% and 23% respectively. excluding discrete tax items primarily related to share-based compensation tax benefits, including those mentioned above, our effective tax rate for both periods was approximately 24%. the difference from the federal statutory rate of 21% was primarily due to state income taxes and non-deductible share-based compensation, which were partially offset by the tax benefit we received from the federal research and experimentation credit. our effective tax rates for the three and nine months ended april 30, 2022 were approximately 24% and 20%, respectively. excluding discrete tax items primarily related to share-based compensation tax benefits, including those mentioned above, our effective tax rate for both periods was approximately 26%. the difference from the federal statutory rate of 21% was primarily due to state income taxes and non-deductible share-based compensation, which were partially offset by the tax benefit we received from the federal research and experimentation credit. 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. table b1 intuit inc. reconciliation of non-gaap financial measures to most directly comparable gaap financial measures (in millions, except per share amounts) (unaudited) fiscal 2023 q1 q2 q3 q4 year to date gaap operating income (loss) $ 76 $ 270 $ 2,778 $ — $ 3,124 amortization of acquired technology 41 41 40 — 122 amortization of other acquired intangible assets 121 121 120 — 362 professional fees for business combinations 2 1 1 — 4 share-based compensation expense 422 423 419 — 1,264 non-gaap operating income (loss) $ 662 $ 856 $ 3,358 $ — $ 4,876 gaap net income (loss) $ 40 $ 168 $ 2,087 $ — $ 2,295 amortization of acquired technology 41 41 40 — 122 amortization of other acquired intangible assets 121 121 120 — 362 professional fees for business combinations 2 1 1 — 4 share-based compensation expense 422 423 419 — 1,264 net (gain) loss on debt securities and other investments — 2 6 — 8 income tax effects and adjustments [a] (156 ) (136 ) (150 ) — (442 ) non-gaap net income (loss) $ 470 $ 620 $ 2,523 $ — $ 3,613 gaap diluted net income (loss) per share $ 0.14 $ 0.60 $ 7.38 $ — $ 8.11 amortization of acquired technology 0.14 0.14 0.14 — 0.43 amortization of other acquired intangible assets 0.43 0.43 0.43 — 1.28 professional fees for business combinations 0.01 — — — 0.01 share-based compensation expense 1.49 1.50 1.48 — 4.46 net (gain) loss on debt securities and other investments — 0.01 0.02 — 0.03 income tax effects and adjustments [a] (0.55 ) (0.48 ) (0.53 ) — (1.56 ) non-gaap diluted net income (loss) per share $ 1.66 $ 2.20 $ 8.92 $ — $ 12.76 shares used in gaap diluted per share calculation 284 282 283 — 283 shares used in non-gaap diluted per share calculation 284 282 283 — 283 [a] as discussed in “about non-gaap financial measures - income tax effects and adjustments” following table e, our long-term non-gaap tax rate eliminates the effects of non-recurring and period-specific items. income tax adjustments consist primarily of the tax impact of the non-gaap pre-tax adjustments and period specific gaap items related to share-based compensation tax effects. table b2 intuit inc. reconciliation of non-gaap financial measures to most directly comparable gaap financial measures (in millions, except per share amounts) (unaudited) fiscal 2022 q1 q2 q3 q4 full year gaap operating income (loss) $ 195 $ 56 $ 2,395 $ (75 ) $ 2,571 amortization of acquired technology 15 42 42 41 140 amortization of other acquired intangible assets 53 121 121 121 416 professional fees for business combinations 12 57 — — 69 share-based compensation expense 280 336 346 346 1,308 non-gaap operating income (loss) $ 555 $ 612 $ 2,904 $ 433 $ 4,504 gaap net income (loss) $ 228 $ 100 $ 1,794 $ (56 ) $ 2,066 amortization of acquired technology 15 42 42 41 140 amortization of other acquired intangible assets 53 121 121 121 416 professional fees for business combinations 12 57 — — 69 share-based compensation expense 280 336 346 346 1,308 net (gain) loss on debt securities and other investments [a] (42 ) — (7 ) — (49 ) income tax effects and adjustments [b] (123 ) (210 ) (111 ) (141 ) (585 ) non-gaap net income (loss) $ 423 $ 446 $ 2,185 $ 311 $ 3,365 gaap diluted net income (loss) per share $ 0.82 $ 0.35 $ 6.28 $ (0.20 ) $ 7.28 amortization of acquired technology 0.06 0.14 0.15 0.15 0.49 amortization of other acquired intangible assets 0.19 0.42 0.42 0.43 1.46 professional fees for business combinations 0.04 0.20 — — 0.24 share-based compensation expense 1.01 1.17 1.21 1.22 4.61 net (gain) loss on debt securities and other investments [a] (0.15 ) — (0.02 ) — (0.17 ) income tax effects and adjustments [b] (0.44 ) (0.73 ) (0.39 ) (0.50 ) (2.06 ) non-gaap diluted net income (loss) per share $ 1.53 $ 1.55 $ 7.65 $ 1.10 $ 11.85 shares used in gaap diluted per share calculation 277 287 286 282 284 shares used in non-gaap diluted per share calculation 277 287 286 284 284 [a] during the three months ended october 31, 2021, we recognized $39 million of net gains on other long-term investments. [b] as discussed in "about non-gaap financial measures - income tax effects and adjustments" following table e, our long-term non-gaap tax rate eliminates the effects of non-recurring and period-specific items. income tax adjustments consist primarily of the tax impact of the non-gaap pre-tax adjustments and the excess tax benefits on share-based compensation. table c intuit inc. condensed consolidated balance sheets (in millions) (unaudited) april 30, 2023 july 31, 2022 assets current assets: cash and cash equivalents $ 3,745 $ 2,796 investments 523 485 accounts receivable, net 717 446 notes receivable 700 509 income taxes receivable 2 93 prepaid expenses and other current assets 574 287 current assets before funds receivable and amounts held for customers 6,261 4,616 funds receivable and amounts held for customers 388 431 total current assets 6,649 5,047 long-term investments 102 98 property and equipment, net 938 888 operating lease right-of-use assets 485 549 goodwill 13,778 13,736 acquired intangible assets, net 6,580 7,061 long-term deferred income tax assets 13 11 other assets 376 344 total assets $ 28,921 $ 27,734 liabilities and stockholders’ equity current liabilities: short-term debt $ 501 $ 499 accounts payable 921 737 accrued compensation and related liabilities 625 576 deferred revenue 829 808 income taxes payable 653 8 other current liabilities 498 571 current liabilities before funds payable and amounts due to customers 4,027 3,199 funds payable and amounts due to customers 388 431 total current liabilities 4,415 3,630 long-term debt 6,109 6,415 long-term deferred income tax liabilities 190 619 operating lease liabilities 499 542 other long-term obligations 116 87 total liabilities 11,329 11,293 stockholders’ equity 17,592 16,441 total liabilities and stockholders’ equity $ 28,921 $ 27,734 table d intuit inc. condensed consolidated statements of cash flows (in millions) (unaudited) nine months ended april 30, 2023 april 30, 2022 cash flows from operating activities: net income $ 2,295 $ 2,122 adjustments to reconcile net income to net cash provided by operating activities: depreciation 127 142 amortization of acquired intangible assets 484 396 non-cash operating lease cost 68 62 share-based compensation expense 1,264 962 deferred income taxes (389 ) 106 other 48 (21 ) total adjustments 1,602 1,647 changes in operating assets and liabilities: accounts receivable (269 ) (323 ) income taxes receivable 91 117 prepaid expenses and other assets (286 ) (88 ) accounts payable 212 86 accrued compensation and related liabilities 45 (392 ) deferred revenue 18 (2 ) income taxes payable 646 195 operating lease liabilities (59 ) (62 ) other liabilities (91 ) 250 total changes in operating assets and liabilities 307 (219 ) net cash provided by operating activities 4,204 3,550 cash flows from investing activities: purchases of corporate and customer fund investments (566 ) (583 ) sales of corporate and customer fund investments 196 1,448 maturities of corporate and customer fund investments 335 177 purchases of property and equipment (220 ) (168 ) acquisitions of businesses, net of cash acquired (33 ) (5,682 ) originations and purchases of loans (1,600 ) (613 ) principal repayments of loans 1,365 320 other (26 ) (9 ) net cash used in investing activities (549 ) (5,110 ) cash flows from financing activities: proceeds from issuance of long-term debt — 4,700 repayment of debt (509 ) — proceeds from borrowings under secured revolving credit facilities 212 122 repayments on borrowings under secured revolving credit facilities (22 ) — proceeds from issuance of stock under employee stock plans 150 116 payments for employee taxes withheld upon vesting of restricted stock units (376 ) (465 ) cash paid for purchases of treasury stock (1,495 ) (1,337 ) dividends and dividend rights paid (667 ) (580 ) net change in funds receivable and funds payable and amounts due to customers (196 ) 82 other (1 ) (9 ) net cash provided by (used in) financing activities (2,904 ) 2,629 effect of exchange rates on cash, cash equivalents, restricted cash, and restricted cash equivalents 2 (18 ) net increase in cash, cash equivalents, restricted cash, and restricted cash equivalents 753 1,051 cash, cash equivalents, restricted cash, and restricted cash equivalents at beginning of period 2,997 2,819 cash, cash equivalents, restricted cash, and restricted cash equivalents at end of period $ 3,750 $ 3,870 reconciliation of cash, cash equivalents, restricted cash, and restricted cash equivalents reported within the condensed consolidated balance sheets to the total amounts reported on the condensed consolidated statements of cash flows cash and cash equivalents $ 3,745 $ 3,531 restricted cash and restricted cash equivalents included in funds receivable and amounts held for customers 5 339 total cash, cash equivalents, restricted cash, and restricted cash equivalents at end of period $ 3,750 $ 3,870 supplemental schedule of non-cash investing activities: issuance of common stock in a business combination $ — $ 6,316 table e intuit inc. reconciliation of forward-looking guidance for non-gaap financial measures to projected gaap revenue, operating income (loss), and eps (in millions, except per share amounts) (unaudited) forward-looking guidance gaap range of estimate non-gaap range of estimate from to adjmts from to three months ending july 31, 2023 revenue $ 2,623 $ 2,661 $ — $ 2,623 $ 2,661 operating income (loss) $ (53 ) $ (33 ) $ 618 [a] $ 565 $ 585 diluted net income (loss) per share $ (0.34 ) $ (0.29 ) $ 1.77 [b] $ 1.43 $ 1.48 twelve months ending july 31, 2023 revenue $ 14,279 $ 14,317 $ — $ 14,279 $ 14,317 operating income $ 3,071 $ 3,091 $ 2,370 [c] $ 5,441 $ 5,461 diluted net income per share $ 7.78 $ 7.83 $ 6.42 [d] $ 14.20 $ 14.25 [a] reflects estimated adjustments for share-based compensation expense of approximately $457 million; amortization of other acquired intangible assets of approximately $121 million; and amortization of acquired technology of approximately $40 million. [b] reflects estimated adjustments in item [a], income taxes related to these adjustments, and other income tax effects related to the use of the non-gaap tax rate. [c] reflects estimated adjustments for share-based compensation expense of approximately $1.7 billion; amortization of other acquired intangibles of approximately $483 million; amortization of acquired technology of approximately $162 million; and professional fees for business combinations of approximately $4 million. [d] reflects estimated adjustments in item [c], income taxes related to these adjustments, other income tax effects related to the use of the non-gaap tax rate. intuit inc. about non-gaap financial measures the accompanying press release dated may 23, 2023 contains non-gaap financial measures. table b1, table b2, and table e reconcile the non-gaap financial measures in that press release to the most directly comparable financial measures prepared in accordance with generally accepted accounting principles (gaap). these non-gaap financial measures include non-gaap operating income (loss), non-gaap net income (loss), and non-gaap net income (loss) per share. non-gaap financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with gaap. these non-gaap financial measures do not reflect a comprehensive system of accounting, differ from gaap measures with the same names, and may differ from non-gaap financial measures with the same or similar names that are used by other companies. we compute non-gaap financial measures using the same consistent method from quarter to quarter and year to year. we may consider whether other significant items that arise in the future should be excluded from our non-gaap financial measures. we exclude the following items from all of our non-gaap financial measures: share-based compensation expense amortization of acquired technology amortization of other acquired intangible assets goodwill and intangible asset impairment charges gains and losses on disposals of businesses and long-lived assets professional fees and transaction costs for business combinations we also exclude the following items from non-gaap net income (loss) and diluted net income (loss) per share: gains and losses on debt and equity securities and other investments income tax effects and adjustments discontinued operations we believe these non-gaap financial measures provide meaningful supplemental information regarding intuit’s operating results primarily because they exclude amounts that we do not consider part of ongoing operating results when planning and forecasting and when assessing the performance of the organization, our individual operating segments, or our senior management. segment managers are not held accountable for share-based compensation expense, amortization, or the other excluded items and, accordingly, we exclude these amounts from our measures of segment performance. we believe our non-gaap financial measures also facilitate the comparison by management and investors of results for current periods and guidance for future periods with results for past periods. the following are descriptions of the items we exclude from our non-gaap financial measures. share-based compensation expenses. these consist of non-cash expenses for stock options, restricted stock units, and our employee stock purchase plan. when considering the impact of equity awards, we place greater emphasis on overall shareholder dilution rather than the accounting charges associated with those awards. amortization of acquired technology and amortization of other acquired intangible assets. when we acquire a business in a business combination, we are required by gaap to record the fair values of the intangible assets of the business and amortize them over their useful lives. amortization of acquired technology in cost of revenue includes amortization of software and other technology assets of acquired businesses. amortization of other acquired intangible assets in operating expenses includes amortization of assets such as customer lists, covenants not to compete, and trade names. goodwill and intangible asset impairment charges. we exclude from our non-gaap financial measures non-cash charges to adjust the carrying values of goodwill and other acquired intangible assets to their estimated fair values. gains and losses on disposals of businesses and long-lived assets. we exclude from our non-gaap financial measures gains and losses on disposals of businesses and long-lived assets because they are unrelated to our ongoing business operating results. professional fees and transaction costs for business combinations. we exclude from our non-gaap financial measures the professional fees we incur to complete business combinations. these include investment banking, legal, and accounting fees. gains and losses on debt securities and other investments. we exclude from our non-gaap financial measures credit losses on available-for-sale debt securities and gains and losses on other investments. income tax effects and adjustments. we use a long-term non-gaap tax rate for evaluating operating results and for planning, forecasting, and analyzing future periods. this long-term non-gaap tax rate excludes the income tax effects of the non-gaap pre-tax adjustments described above, and eliminates the effects of non-recurring and period specific items which can vary in size and frequency. based on our current long-term projections, we are using a long-term non-gaap tax rate of 24% for fiscal 2022 and fiscal 2023. this long-term non-gaap tax rate could be subject to change for various reasons including significant acquisitions, changes in our geographic earnings mix or fundamental tax law changes in major jurisdictions in which we operate. we will evaluate this long-term non-gaap tax rate on an annual basis and whenever any significant events occur which may materially affect this rate. operating results and gains and losses on the sale of discontinued operations. from time to time, we sell or otherwise dispose of selected operations as we adjust our portfolio of businesses to meet our strategic goals. in accordance with gaap, we segregate the operating results of discontinued operations as well as gains and losses on the sale of these discontinued operations from continuing operations on our gaap statements of operations but continue to include them in gaap net income or loss and net income or loss per share. we exclude these amounts from our non-gaap financial measures. the reconciliations of the forward-looking non-gaap financial measure to the most directly comparable gaap financial measures in table e include all information reasonably available to intuit at the date of this press release. these tables include adjustments that we can reasonably predict. events that could cause the reconciliation to change include acquisitions and divestitures of businesses, goodwill and other asset impairments, sales of available-for-sale debt securities and other investments, and disposals of business and long-lived assets.
