On May 20, Intuit CEO Sasan Goodarzi sent an internal memo announcing the layoff of 3,000 employees—17% of the company's workforce.
The maker of TurboTax, QuickBooks, and Credit Karma had posted strong results just last year: FY2025 Q2 revenue of $4.65 billion, up 17% year-over-year, and net income of $693 million, up 48%. Goodarzi himself received a compensation package worth $36.8 million. By the logic of strong performance and a healthy balance sheet, few would have expected such a move. But the cuts came nonetheless.
Not Cost-Cutting, but an Engine Swap
Goodarzi's memo was blunt: "reduce complexity, simplify the company structure, and concentrate resources on AI." In other words, many of the 18,200 roles were deemed unnecessary under the new strategy. It's not that the business is failing—it's that the way the business operates is changing.
Intuit has been pushing to embed AI into every corner of its products: TurboTax users get AI-assisted tax filing, QuickBooks users get AI-driven bookkeeping, and Credit Karma users get AI-powered credit card management. To accelerate this, Intuit signed multi-year deals with OpenAI and Anthropic, integrating its tax, accounting, and marketing capabilities directly into ChatGPT and Claude. Users asking ChatGPT about tax filing may soon be powered by Intuit's engine.
If this path succeeds, the old workforce becomes less necessary—or at least, not as many are needed.
Another Cut in Tech's Ongoing Wave
Halfway through 2026, the U.S. tech industry has already laid off over 100,000 people. Major moves include:
- Meta: ~8,000 in May
- Microsoft: First large-scale buyout in 51 years in April
- Amazon: Thousands from March to May
- Cisco: 4,000 in February
- Intuit: 3,000 on May 20
The common script is nearly identical: "We need to be AI-first." Snap cut 1,000 people, with its CEO publicly stating that 65% of its code is now written by AI. Cisco cut 4,000 while announcing AI orders surged from $6 billion to $9 billion. The difference is only in the wording. Intuit's version is the most direct: it named its partners.
An Unusual Detail
Counterintuitively, Intuit's stock has underperformed the S&P 500 over the past 12 months. Despite rising revenue and profits, and a compelling AI narrative, the market remains skeptical. Investors have grown numb to SaaS companies touting "AI transformation." Talk is cheap; the real test is whether Intuit can generate cash flow from ChatGPT and Claude users.
Goodarzi's move is a bet: "I've streamlined the workforce, and all remaining resources are going into AI. We'll have results in six months." This contrasts sharply with what Cognizant's AI head said last year: that companies blaming layoffs on AI are using it as a scapegoat. CNBC calculated that among S&P 500 companies publicly citing AI as a reason for layoffs, 56% saw their stock prices drop, by an average of 25%. Fiverr fell 54%.
Intuit is gambling that it won't become part of that 56%.
Stuck in the Middle
Intuit's predicament is typical for mid-sized software companies in the AI era. On the high end, OpenAI, Anthropic, and Google are grabbing the entry point—ChatGPT already connects to 12,000 U.S. financial institutions and can read users' Robinhood holdings. Tax filing and bookkeeping are tasks AI will eventually handle on its own, cutting out middlemen like Intuit.
On the low end, a wave of AI-native fintech startups is rising from below: Nourish in nutrition, Rogo in investment banking, Manifest OS in legal. Every vertical has native AI startups raising funding.
Intuit is caught in the middle: not investing in AI is a death sentence, but investing too aggressively means cutting half the team. Goodarzi chose the latter.
What to Watch Next
After the 3,000 layoffs, the key quarter will be FY2026 Q1, when Intuit's modules within ChatGPT and Claude are expected to go live. If Intuit can tell investors how much revenue it's generating from ChatGPT users and how much ARR it's earning from Claude, the cuts will have paid off. If it's still talking about "AI strategy," the story gets interesting.
The next earnings report is due in November.
Sources: Intuit to lay off over 3,000 employees to refocus on AI (TechCrunch); CocoLoop; Intuit Cuts 3,000 Jobs, Putting Spotlight on Tech's AI Restructuring Wave (eWeek); Intuit Layoffs 2026: 3,000 Jobs Cut as AI Restructuring Hits TurboTax Parent (Swik Blog)