Intuit (NASDAQ:INTU) shares are stumbling on Tuesday, down about 9% so far on the day. Weighing on INTU stock are reports about a pause in hiring.
Specifically, the company will reportedly pause hiring at its Credit Karma unit. When Intuit acquired Credit Karma in 2020 for $8.1 billion, it was one of the largest fintech deals ever.
In any regard, the hiring pause comes amid “revenue challenges due to the uncertainty of the economic environment,” according to Chief People Officer Colleen McCreary.
She elaborated on these concerns in a letter to the company’s employees:
“Our partners worry about lending products among high inflation, potential for rising unemployment and the possibility of recession, which results in fewer opportunities for us to provide products for a broader range of members.”
Buy or Sell INTU Stock on the News?
Volume is already running heavy on INTU stock on Tuesday. 2.5 million shares have already traded against a one-month average of just 1.52 million shares.
The reports on hiring come about a month after the company reaffirmed its fiscal first-quarter and full-year outlook. Near the end of the month, we’ll get a quarterly update from the company. Until then we’ll have to rely on the information we already have.
Management reiterated its outlook for first-quarter 2023 revenue growth of 23% to 25% (vs. consensus estimates of 24.7% growth) and adjusted diluted earnings of $1.14 to $1.20 a share vs. estimates of $1.20 a share.
For the full year, management expects revenue of $1.485 billion to $14.7 billion vs. estimates of $14.6 billion. As for the bottom line, they expect adjusted diluted earnings per share of $13.59 to $13.89 vs. estimates of $13.78 a share.
In any regard, INTU stock is on track for its worst day since early May. Twice that month, shares fell hard, losing 8.5% in one session and 7.25% in another. We’ll see how this one closes, but so far the price action is surprising and discouraging.
On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.