Good afternoon. My name is Latif and I will be your conference facilitator. At this time, I would like to welcome everyone to Intuit's Second Quarter Fiscal 2016 Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer period. With that, I'll now turn the call over to Matt Rhodes, Intuit's Vice President of Investor Relations. Mr. Rhodes?

Thank you very much. I appreciate it. Good afternoon, everyone, and welcome to Intuit's second quarter fiscal 2016 conference call. I'm here with Brad Smith, our Chairman and CEO; and Neil Williams, our CFO. Before we start, I'd like to remind everyone that our remarks will include forward-looking statements. There are a number of factors that could cause Intuit's results to differ materially from our expectations. You can learn more about these risks in the press release we issued earlier this afternoon, our Form 10-K for fiscal 2015 and our other SEC filings. All of those documents are available on the Investor Relations page of Intuit's website at intuit.com. We assume no obligation to update any forward-looking statements. Some of the numbers in this report are presented on a non-GAAP basis. We've reconciled the comparable GAAP to non-GAAP numbers in today's press release. 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. Also, all reported results and guidance except GAAP, net income and EPS exclude Demandforce, QuickBase and Quicken, which have been declared held for sale and reclassified to discontinued operations. A copy of our prepared remarks and supplemental financial information will be available on our website after this call ends. And with that, I'll turn the call over to Brad. Brad D. Smith - Chairman & Chief Executive Officer: All right. Thank you, Matt, and thanks to all of you for joining us. We are out of the gates strong in the first half of fiscal 2016. We grew revenue 23% in the second quarter, exceeded our guidance across the board, and we're on pace to deliver against our full-year outlook. Now we know tax is on everybody's…

Thank you, sir. Our first question comes from the line of Raimo Lenschow of Barclays. Your line is open.

Hey. Thanks for taking my question, and congrats to your great second quarter. Two quick questions. First, you talked about the desktop numbers being better and driven by price and promotion, but we also saw better unit numbers there. Can you talk a little bit about the trends there? And then the second question was on the QuickBooks Online ARPU. If I do a calculation there, this was the second quarter where ARPU actually started to go a little bit higher. So the question is, are we on the trend back upwards again, or do I need to be aware about other drivers here? Thank you. Brad D. Smith - Chairman & Chief Executive Officer: Great. Thank you, Raimo. This is Brad. So let me start with desktop units. The good news is we've been able to continue to drive strong QBO subscribers, 49%, and over 80% of those are new to the franchise, while also growing our desktop units 14%. And what we basically learned is last year, we had tried to raise the price on desktop from $199 to $249 and we thought that might accelerate the migration to QBO. That didn't happen. In fact, we didn't see migraters accelerate. What we did see, though, is upgraders in those that were using existing desktop delaying their purchase. So throughout the balance of last year, we tested $199 price promotions, and we saw really strong results. What we saw was it had no impact at all on QBO. There was no cannibalization, but what it did do was it incented people to actually upgrade to the newer version. And so what you're seeing happen now is we have the ability to continue to accelerate QBO. Continue to get existing desktop customers to move up to the newest versions, and…

Perfect. Very clear. Thank you. Brad D. Smith - Chairman & Chief Executive Officer: All right. Thank you.

Thank you. Our next question comes from Brent Thill of UBS. Your question, please.

Good afternoon. Brad, you mentioned the share gains that you're seeing early out of the gate here. I'm just curious if you could help everyone understand where you're seeing those share gains, and perhaps maybe where you think there's more room where you feel that you could be doing better on tax? And for Neil, could you just talk maybe a little bit about the attach of payment and payroll? And it looked like on the payment side, was a little bit lower than some had thought. Can you give us a sense of what may be dragging that down? Thank you. R. Neil Williams - Chief Financial Officer & Senior Vice President: Sure. Brad D. Smith - Chairman & Chief Executive Officer: All right. Thanks, Brent. This is Brad. I'll take the first one on share gains. So with the IRS data being published through February 19, they are showing that total returns received were down about 1.3%. They're suggesting that the self-prepared returns, the do-it-yourself category is up about 3% season to-date and the assisted downside. If you do all the translation and machinations of that that would suggest that the do-it-yourself category has picked up a little more than two points of share from assisted so far. Now, in the back half of the season, we'll see assisted get a little bit stronger as more complex returns come in. But the good news is, the DIY category continues to take share from assisted. And then the question is, what about TurboTax share inside that category? And let me say, we have not seen this strong of market share advances at this time of the year in my recollection. And I've been here for a while. So right now, season to-date, we're a little over 3.5 points of…

Thank you.

Thank you. Our next question comes from the line of Walter Pritchard of Citi. Your line is open.

Hey, guys. It's Steve Rogers on for Walter. Just wanted to see what you guys were seeing with the overall growth in the tax market with returns being down. Maybe if we could just start there. And then also, with fraud, just do you think that's playing a factor in the market growth year-to-date, or is it just seasonality? Brad D. Smith - Chairman & Chief Executive Officer: Yeah, thanks, Steve. It's Brad. So what we see every year is the tax business is always hard to predict in terms of total returns filed. There's macro trends that you can go back and look at over a decade where there's just more procrastination. As tools become easier to use, people's 1099s and W-2s tend to come out a little bit later, they tend to wait a little further into the season to file their taxes. And so that's been one thing that just continues, and it has been doing that for the last 10 years. The second is, the good news is with the IRS data that came out on through February 19, this past week, looks like returns actually went up about 3%. So even though we got out to a slow start, it brings the total season to date down to about 1.3%, below prior year. So I think you're starting to see momentum pick up. The question behind your question and I heard you ask it was fraud. I think collectively, we as an industry and the government are absolutely making an impact on fraud. Now whether or not that actually is correlated with the number of filings that have been filed so far, we won't know until the end of the year when the IRS and the states actually tell us how many of the returns were fraudulent. But I can tell you right now, we have collectively linked in, we've added 23 data schemas and protocols. We've strengthened the passwords, we've added opportunities to share information at a federal and state level between the private industry and the government, and we are starting to adopt a framework called Knit, and I think all of that is having an impact and that is good news for all of us. So, right now, I think the season is still playing out and I think it's just a combination of procrastination, and then we'll see how much of it ends up being having an impact on fraud.

Great. Thanks.

Thank you. Our next question comes from Keith Weiss of Morgan Stanley. Your line is open. Sanjit K. Singh - Morgan Stanley & Co. LLC: Hi. This is Sanjit Singh in for Keith. I wanted to toggle back to international QBO and get a sense of what's driving some of the deceleration there. It sounds like you guys took pulled back a little bit in India and Canada. I wanted to see what your thoughts were longer-term in those two countries, and what are you seeing outside of Canada and India? What's your traction in the UK, Australia, maybe Germany? Your sort of outlook on the international side? Brad D. Smith - Chairman & Chief Executive Officer: Okay. Sanjit, this is Brad. I would say first of all, overall, we feel very good about our global progress. And I mentioned the countries. the UK, Australia, Brazil where we made an acquisition last year of a company called Zero Paper and now we've just ported that under the QBO platform in February. And of course, we opened up France. And overall, it's up 80%. We have over a quarter of a million paying subs, a lot more in the pipeline in trial periods and kind of using the product, so that looks very healthy. I did mention the two countries you wanted me to drill deeper on, Canada and India. I'll start with Canada. Canada is about 30% of our global units today. And what really impacted its growth rate this quarter is, last year, we had tried a test of putting QuickBooks Online in retail stores. You would go and purchase it just like you would a box. You would come home and then you would activate it hopefully. And while that drove subs, we did not like the retention…

Thank you. Our next question comes from the line of Scott Schneeberger of Oppenheimer. Your line is open. Scott Schneeberger - Oppenheimer & Co., Inc. (Broker): Thanks. Good afternoon, guys. Brad, a couple of tax questions up-front. This delay in the IRS start, looking at what you would deem ACA returns versus non-ACA returns, are you seeing that as anything characteristic in just one of these procrastination years and maybe late forms? Brad D. Smith - Chairman & Chief Executive Officer: Scott, we honestly just don't see any impact of ACA on any customers' decisions, whether it's which way they choose to file their taxes, or when they choose to file their taxes. It continues to be a very high converting area for us on TurboTax.com. This year, as you know, about 90% of tax filers, whether they last year qualified for a 1095-A, and this year they got a 1095-B or C form, which is a form that they need to have to basically say that they have insurance, it hasn't had any impact. You can see we came out of the gate strong. And so, we're seeing on the ProTax side of the business, where we have an assisted method, similar trends. We see good healthy start to the season. So, we don't see any impact from ACA, and we don't think that that's what's causing any sort of IRS delays from our perspective. Scott Schneeberger - Oppenheimer & Co., Inc. (Broker): Thanks. And then, just a follow-up still on the TurboTax category. Two separate questions, the desktop strength in TurboTax, if you could elaborate that? And then one additional, the volume and revenue relationship for Consumer Tax growth this year. Obviously you're trending quite well in volume right now; maintain the guidance for the year. If you…

Thank you. Our next question comes from Ross MacMillan of RBC Capital. Your question, please.

Thanks. Brad, I had a question just on the QBO adds. So it was a good number, ahead of your plan. When I do the mix, I think the kind of core domestic, ex self-employed were actually down a little bit year-over-year in terms of net adds. That's the net you – and I was just curious, you run different promotions, there's different ways for you to manage that. How do you think about that net add number? And there's, I guess, the real question is, is there anything that we're bumping up against in terms of a limit on how many domestic, what I call core non-self-employed adds that you could add each quarter? I'd love your thoughts. Thanks. Brad D. Smith - Chairman & Chief Executive Officer: Yeah. Thanks, Ross. We'll start with – we feel good about the overall QBO adds. We certainly had a couple of countries outside the U.S., Canada and India, that I just spoke to, but by and large the international businesses are doing really well. And we like our momentum in the U.S. In fact, we just crossed one million active paying customers in the United States, which is a major milestone. In terms of opportunity ahead in total addressable market, there's about 29 million small businesses in the U.S. If you back out the self-employed, you're still looking at the neighborhood of between eight million and 12 million, and we currently have one million that are using QuickBooks Online. So we aren't running out of any sort of opportunities to grow. It's just a matter of us continuing to lean in and execute. And we're seeing improvements in our Net Promoter Scores. We're seeing a lot of good traffic coming to QuickBooks Online, and we're seeing improved conversion rates. So I – from a quarter-to-quarter perspective, as Neil said, you have some seasonality that kicks in. Sometimes small businesses come in one quarter and then the next quarter you may see a little bit of ebb and flow. But overall we feel good, which is why we've raised the low end of our guidance and we're reaffirming our 2017 outlook. We really like the momentum.

Great. And one follow-up just on the desktop side. Has anything changed in terms of how you think the desktop business will play out over the past to 2017 and 2018 given that you're starting to see unit growth again? I know there's a sort of price dynamic, but I'd love your thoughts around how you think that plays out medium-term. Brad D. Smith - Chairman & Chief Executive Officer: Yeah. Ross, I think we started to get wiser about our multi-year outlook last year, and we shared it with you as, the good news is, we're getting more of our QuickBooks Online users that are new to the franchise, which means we're expanding the category. We were getting fewer customers from desktop to migrate over, but since we're talking about lifetime values and profitability that are pretty equivalent in both sides, we just want to make sure they stay with us; they don't go anywhere else. But one of the things we learned last year is by raising the price to $249, we basically had customers staying but not renewing on their desktop and they weren't moving to QBO and that was actually a lose for us. And so our promotional pricing now basically says, we're going to keep those people who want to stay on desktop at least active, continuing to buy from us and use the newest version and get the best product, and we're going to continue to lean into QBO. And I think what you see happening overall is the best of both worlds. I think ultimately you're going to see a portion of customers still on desktop in 2017, 2018, and I would go all the way out to 2020 and further. There's just a group of people that are going to want to stay on desktop. We want to make sure they're using the most recent version and continuing to buy from us while we continue to open up the category with QBO. And so I think that's the only difference to our outlook as we hope to have more active customers on desktop while we continue to add new users in QBO.

Great. Thanks again. And congrats on the strong start to the tax season. Brad D. Smith - Chairman & Chief Executive Officer: Hey. Thanks, Ross. I appreciate it.

Thank you. Our final question for the session comes from Michael Millman of Millman Research. Your line is open.

Thank you. So, more on tax, to what extent do you think that the reduced growth industry numbers on do-it-yourself is caused by the slow pick-up in returns? Also, kind of following up on Scott's numbers questions, has there been a change, and to what extent in the ratio, yours now, free versus paid? And maybe you can give us some idea of where the California suits on racks stand, if they're still going on? Brad D. Smith - Chairman & Chief Executive Officer: Okay. Mike, I'm going to ask you to repeat your first question because I'm not sure I got the essence of it, which was you said reduced growth due to slow pickup...

Yeah. IRS numbers show reduced growth, as you said it was up 3% this year, last year, was up 6.7%. So there's been reduced growth. Do you think that early on was a consequence of the slower refund pick-up early in the year? That was the first question. Brad D. Smith - Chairman & Chief Executive Officer: Got it. I got it. And I got the other two. Thank you for clarifying, Michael. I appreciate it. So, right now, it's hard to describe because none of us really know. It's only conjecture is why are the number of returns being filed with the IRS down 1.3 season to-date? And we all have hypothesis, but the good news is we know that come April 18, and yes, there actually is an emancipation day this year. So instead of April 15 being the day, since it happens over the weekend, everyone has until Monday, April 18. And so the good news is people are going to have to file their taxes by the end. So what we look at is the ratio with how many you're shooting to send the taxes then through a self-prepared method versus assisted. And we really like the fact that right now, season to-date, 2% of the total market are leaning more to self-prepared than they are assisted. So I think it's probably a safe assumption to say any year-over-year comparisons are probably driven by the fact that just fewer people so far have filed their returns versus last year. But the good news is the ratio of people leaning into do-it-yourself versus assisted continues the trend we've seen for the last 10, which is more people are filing taxes on their own now than going to somebody to do it for them. In terms of changes in free and paid, we have had a really strong campaign for two years in a row in Absolute Zero. And as you saw last year, not only did it drive unit growth and share gains, we actually exceeded our revenue guidance last year. So there's a monetization model behind that that we're super excited about. This year in terms of mix, free is up a couple of points more than it was last year and that's in alignment with our guidance. And so we feel very good about the free to paid mix. And honestly, we feel even better about our monetization this year because we've learned a lot from last year's program. So I'm feeling good overall about free to pay. On California racks, I actually – good news is we have our General Counsel sitting here. So Laura Fennell, is there any update we have on the California situation? Laura A. Fennell - Secretary, Executive VP & General Counsel: We don't, right now. Brad D. Smith - Chairman & Chief Executive Officer: Okay. I guess that was a clear attorney answer. We don't. So I don't have anything to share for you there, Michael.

Do you have any target dates as to when something will occur? Brad D. Smith - Chairman & Chief Executive Officer: On that last question, on the California situation?

Yes. Brad D. Smith - Chairman & Chief Executive Officer: No. We haven't been notified by anyone in the industry, and so we don't have any knowledge of what's going on there. No.

Appreciate it. Thanks, Brad. Brad D. Smith - Chairman & Chief Executive Officer: All right. Thank you, Michael. Appreciate it.

Gentlemen, as there are no further questions, would you like to close with any additional remarks? Brad D. Smith - Chairman & Chief Executive Officer: Yeah, Latif, thank you. I want to thank everybody for your questions today. As you can tell, we're encouraged by the strong start and momentum we've built up. I have to say we're really competitive, so we're looking forward to the remainder of tax season and our fiscal year. But we are feeling quite confident in our full year outlook. And so I want to thank everybody and we look forward to speaking with you soon. Take care and have a great afternoon.

Ladies and gentlemen, thank you for participating. This concludes today's conference call.