IGV is down roughly 25% from its September 2025 peak. Salesforce is down about 40% this year, with Workday in a similar range. Around $2 trillion of software market value has disappeared, and software’s forward P/E has fallen below the S&P 500’s for the first time: from roughly 84x at the 2020–22 peak to 22.7x by March 2026.
The dominant bear thesis is seat compression.
Enterprise software was built around a simple model: sell more licenses as customers add employees. But if one AI agent can do the work of five people, customers need fewer seats. Salesforce, Workday and Atlassian all benefited from expanding corporate headcount. AI weakens that link.
If that sell-off looks overdone, the opportunity is not simply “cheap software.” It is companies being punished under the seat-compression thesis even though their revenue does not depend on seats.
Intuit is more interesting than it first appears. The market seems to be pricing it as another seat-based software company, but the AI risk here is different.
# Intuit is now primarily a QuickBooks company
Over the first nine months of fiscal 2026, Global Business Solutions (QuickBooks, payments, payroll, Mailchimp and Intuit Enterprise Suite) generated $9.44 billion of revenue. Consumer (TurboTax, Credit Karma and ProTax) generated $7.65 billion.
GBS grew 17%. Consumer grew 10%.
None of these businesses is primarily driven by per-seat enterprise licensing. TurboTax is a transactional consumer product. Credit Karma is monetized through advertising and referrals. QuickBooks is largely self-serve software for small-medium businesses. Its customer is usually a business owner, not a CIO cutting headcount-linked software contracts.
# The numbers
The filings support the basic story. Growth remains solid, cash generation is strong and valuation has compressed with the sector.
* Revenue was $17.1 billion, up 14% from $15.0 billion.
* Full-year revenue guidance was raised to $21.34 - 21.37 billion.
* Operating cash flow increased from $5.83 billion to $7.51 billion, up 29%.
* Intuit spent $3.37 billion on buybacks and $1.02 billion on dividends, both covered by operating cash flow.
* Share count fell from roughly 279.1 million to 273.5 million.
* Cash and investments totaled $6.78 billion against $6.16 billion of debt.
* Consolidated operating margin was 31.6%.
Enterprise value is roughly $77.2 billion. Against guided full-year GAAP EPS of $15.79 - 15.84, implying about $4.3 billion of net income, that is approximately 18x earnings. Against non-GAAP EPS guidance of $23.80 - 23.85, implying about $6.5 billion, it is closer to 12x.
I prefer the 18x GAAP multiple. Most of the gap to non-GAAP comes from recurring stock compensation, acquired-intangible amortization and the restructuring charge. Stock comp alone is roughly $2.1 billion this year, with another $3.6 billion of unrecognized RSU expense. Those are real shareholder costs, so the 12x non-GAAP multiple flatters the valuation.
One other number needs care. Intuit reports a 77% operating margin for GBS, but that segment figure excludes substantial shared costs held at the consolidated level. It overstates the economics of GBS as a standalone business. The more meaningful company-wide margin is the consolidated 31.6%.
# What the filings do not disclose
Intuit does not disclose net revenue retention, churn or customer cohorts.
For a subscription business facing a potential substitution threat, those metrics would super helpful. Instead, we have to infer customer behavior from the operating metrics.
A good example is TurboTax.
For fiscal 2026:
* Total TurboTax Online units are guided down about 2%.
* Paying units are guided up about 2%.
* ARPU is guided up about 11%.
* Pay-nothing customers are expected to fall from 8 million to about 7 million.
* TurboTax Live revenue is guided to grow 36% to $2.8 billion, or roughly 53% of total TurboTax revenue.
The figures seem to indicate the free tier is getting smaller, the paying base is growing, and more revenue is coming from TurboTax Live.
Total e-file share is guided down about a point, but Intuit seems happy to lose free returns if it can keep people who actually pay.
If AI substitution were happening at scale, Global Business Solutions is where I think you would see it the most. It grew 17%.
# Where it all lands
If the broad software sell-off is about seat compression, Intuit doesn't fit particularly well.
AI may not reduce the number of QuickBooks licenses a customer buys, but it could reduce the need for the product itself, OR alternatively, make QuickBooks more valuable as the underlying financial system used by AI agents.
At roughly 18x guided GAAP earnings, Intuit is a mid-teens grower with a near-net-cash balance sheet, sold off alongside a software sector whose specific problem it may not share.
Whether Intuit is cheap depends less on AI reducing headcount than on AI replacing bookkeeping itself. I think that's the real question investors need to answer.
Not financial advice. Please do your own DD.
Sources used: SEC filings via [getfactd.io/report/us/INTU](http://getfactd.io/report/us/INTU)