— Revenue Increased 5.0% —
— Repurchased $400 Million of Shares —
KANSAS CITY, Mo., Nov. 06, 2025 (GLOBE NEWSWIRE) -- H&R Block, Inc. (NYSE: HRB) (the "Company") today released financial results1 for its fiscal 2026 first quarter ended September 30, 2025.
"Fiscal 2026 is off to a strong start, not only in the financial results we are reporting but also in the plans we are preparing to execute in the coming quarters," said Jeff Jones, president and chief executive officer. "Our team is excited to build on our momentum for the remainder of the year."
"Leading H&R Block for the last eight years has been an honor," Jones continued. "With Curtis Campbell's leadership and experience, H&R Block is well positioned to continue its transformation and deliver outstanding results for years to come."
Fiscal 2026 First Quarter Results and Key Financial Metrics
"We were pleased with our first quarter results and returned $455 million to shareholders through dividends and share repurchases," said Tiffany Mason, chief financial officer. "With confidence in our fiscal year plans, we are reaffirming our 2026 outlook and remain committed to delivering value for our shareholders."
The Company reminds readers that its business is highly seasonal, and first quarter results consistently reflect this pattern. Historically, this period contributes modestly to annual revenue and typically generates a net loss.
For the first quarter, the Company delivered total revenue of $203.6 million, an increase of $9.7 million, or 5.0%, versus the prior year. The increase was primarily the result of an increase in net average charge (NAC) and higher year-over-year volume in the Assisted category, and strong growth in Wave subscription revenue and payments volume.
Total operating expenses of $410.6 million decreased by $11.6 million or 2.7%, versus the prior year. The decrease is primarily due to lower legal fees and settlements.
Net loss from continuing operations improved $6.1 million, or 3.5% to ($165.4) million.
Loss per share from continuing operations2 increased 2.4% to ($1.26), and adjusted loss per share from continuing operations2 increased 2.6% to ($1.20), due to a decrease in net loss but fewer shares outstanding as a result of share repurchases.
Capital Allocation
The Company reported the following related to its capital structure:
As previously announced, a quarterly cash dividend of $0.42 per share will be paid on January 6, 2026 to shareholders of record as of December 4, 2025. H&R Block has paid quarterly dividends consecutively since the Company became public in 1962.
Repurchased and retired 7.9 million shares at an aggregate price of $400 million, or $50.90 per share, in the first quarter.
The Company has approximately $700 million remaining on its $1.5 billion share repurchase program.
Since 2016, the Company has returned nearly $5.0 billion to shareholders in the form of dividends and share repurchases, buying back 47% of its shares outstanding3.
Fiscal Year 2026 Outlook Reaffirmed
The Company continues to expect:
Revenue to be in the range of $3.875 to $3.895 billion.
EBITDA4 to be in the range of $1.015 billion to $1.035 billion.
Effective tax rate to be approximately 25%.
Adjusted Diluted Earnings Per Share4 to be in the range of $4.85 to $5.00.
Conference Call
The Company will host a conference call for analysts and investors to discuss first quarter 2026 results at 4:30 p.m. ET on Thursday, November 6, 2025. To join live, participants must register at https://register-conf.media-server.com/register/BI38277db3cc6d455fb5f9b3dda471ac3d. Once registered, the participant will receive a dial-in number and unique PIN to access the call. Please join approximately 5 minutes prior to the scheduled start time.
The call, along with a presentation for viewing, will also be webcast in a listen-only format for the media and general public. The webcast can be accessed directly at https://edge.media-server.com/mmc/p/rxcxh3vo/lan/en/ and will be available for replay 2 hours after the call is concluded and continuing for 90 days.
About H&R Block
H&R Block, Inc. (NYSE: HRB) provides help and inspires confidence in its clients and communities everywhere through global tax preparation services, financial products, and small-business solutions. The company blends digital innovation with human expertise and care as it helps people get the best outcome at tax time and also be better with money using its mobile banking app, Spruce. Through Block Advisors and Wave, the company helps small-business owners thrive with year-round bookkeeping, payroll, advisory, and payment processing solutions. For more information, visit H&R Block News.
About Non-GAAP Financial Information
This press release and the accompanying tables include non-GAAP financial information. 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 "Non-GAAP Financial Information."
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the securities laws. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words or variation of words such as "expects," "anticipates," "intends," "plans," "believes," "commits," "seeks," "estimates," "projects," "forecasts," "targets," "would," "will," "should," "goal," "could" or "may" or other similar expressions. Forward-looking statements provide management's current expectations or predictions of future conditions, events or results. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future are forward-looking statements. They may include estimates of revenues, client trajectory, income, effective tax rate, earnings per share, cost savings, capital expenditures, dividends, share repurchases, liquidity, capital structure, market share, industry volumes or other financial items, descriptions of management’s plans or objectives for future operations, products or services, or descriptions of assumptions underlying any of the above. They may also include the expected impact of external events beyond the Company’s control, such as outbreaks of infectious disease, severe weather events, natural or manmade disasters, or changes in the regulatory environment in which we operate. All forward-looking statements speak only as of the date they are made and reflect the Company's good faith beliefs, assumptions and expectations, but they are not guarantees of future performance or events. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions, factors, or expectations, new information, data or methods, future events or other changes, except as required by law. By their nature, forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Factors that might cause such differences include, but are not limited to a variety of economic, competitive and regulatory factors, many of which are beyond the Company's control, that are described in our Annual Report on Form 10-K for the most recently completed fiscal year in the section entitled "Risk Factors" and additional factors we may describe from time to time in other filings with the Securities and Exchange Commission. You may get such filings for free at our website at https://investors.hrblock.com. In addition, factors that may cause the Company’s actual estimated effective tax rate to differ from estimates include the Company’s actual results from operations compared to current estimates, future discrete items, changes in interpretations and assumptions the Company has made, future actions of the Company, or increases in applicable tax rates in jurisdictions where the Company operates. You should understand that it is not possible to predict or identify all such factors and, consequently, you should not consider any such list to be a complete set of all potential risks or uncertainties.
1All amounts in this release are unaudited. Unless otherwise noted, all comparisons refer to the current period compared to the corresponding prior year period. |
FINANCIAL RESULTS | (unaudited, in 000s - except per share amounts) | ||||||||
Three months ended September 30, | |||||||||
2025 | 2024 | ||||||||
REVENUES: | |||||||||
U.S. tax preparation and related services: | |||||||||
Assisted tax preparation | $ | 48,644 | $ | 42,963 | |||||
Royalties | 5,849 | 5,852 | |||||||
DIY tax preparation | 3,745 | 3,236 | |||||||
Refund Transfers | 843 | 860 | |||||||
Peace of Mind® Extended Service Plan | 23,509 | 23,097 | |||||||
Tax Identity Shield® | 4,122 | 3,909 | |||||||
Other | 13,476 | 13,809 | |||||||
Total U.S. tax preparation and related services | 100,188 | 93,726 | |||||||
Financial services: | |||||||||
Emerald Card® and SpruceSM | 7,852 | 8,826 | |||||||
Interest and fee income on Emerald Advance® | — | — | |||||||
Total financial services | 7,852 | 8,826 | |||||||
International | 65,661 | 64,855 | |||||||
Wave | 29,850 | 26,403 | |||||||
Total revenues | $ | 203,551 | $ | 193,810 | |||||
Compensation and benefits: | |||||||||
Field wages | 69,715 | 68,094 | |||||||
Other wages | 79,279 | 77,335 | |||||||
Benefits and other compensation | 36,662 | 38,754 | |||||||
185,656 | 184,183 | ||||||||
Occupancy | 102,796 | 101,318 | |||||||
Marketing and advertising | 8,342 | 9,972 | |||||||
Depreciation and amortization | 28,922 | 28,831 | |||||||
Bad debt | 2,205 | 2,730 | |||||||
Other | 82,661 | 95,107 | |||||||
Total operating expenses | 410,582 | 422,141 | |||||||
Other income (expense), net | 8,102 | 11,917 | |||||||
Interest expense on borrowings | (17,402 | ) | (15,847 | ) | |||||
Pretax loss | (216,331 | ) | (232,261 | ) | |||||
Income tax benefit | (50,963 | ) | (60,840 | ) | |||||
Net loss from continuing operations | (165,368 | ) | (171,421 | ) | |||||
Net loss from discontinued operations | (451 | ) | (1,155 | ) | |||||
Net loss | $ | (165,819 | ) | $ | (172,576 | ) | |||
BASIC AND DILUTED LOSS PER SHARE: | |||||||||
Continuing operations | $ | (1.26 | ) | $ | (1.23 | ) | |||
Discontinued operations | — | (0.01 | ) | ||||||
Consolidated | $ | (1.26 | ) | $ | (1.24 | ) | |||
WEIGHTED AVERAGE DILUTED SHARES | 131,387 | 139,154 | |||||||
Adjusted diluted EPS (1) | $ | (1.20 | ) | $ | (1.17 | ) | |||
EBITDA (1) | $ | (170,007 | ) | $ | (187,583 | ) | |||
(1) All non-GAAP measures are results from continuing operations. See "Non-GAAP Financial Information" for a reconciliation of non-GAAP measures.
CONSOLIDATED BALANCE SHEETS | (unaudited, in 000s - except per share data) | |||||||
As of | September 30, 2025 | June 30, 2025 | ||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 376,410 | $ | 983,277 | ||||
Cash and cash equivalents - restricted | 20,991 | 19,862 | ||||||
Receivables, net | 64,145 | 63,621 | ||||||
Prepaid expenses and other current assets | 102,692 | 95,788 | ||||||
Total current assets | 564,238 | 1,162,548 | ||||||
Property and equipment, net | 137,623 | 135,068 | ||||||
Operating lease right of use assets | 499,910 | 521,215 | ||||||
Intangible assets, net | 254,136 | 259,412 | ||||||
Goodwill | 797,739 | 802,053 | ||||||
Deferred tax assets and income taxes receivable | 300,251 | 317,691 | ||||||
Other noncurrent assets | 67,425 | 65,911 | ||||||
Total assets | $ | 2,621,322 | $ | 3,263,898 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
LIABILITIES: | ||||||||
Accounts payable and accrued expenses | $ | 145,574 | $ | 144,046 | ||||
Accrued salaries, wages and payroll taxes | 62,231 | 107,375 | ||||||
Accrued income taxes and reserves for uncertain tax positions | 156,449 | 296,244 | ||||||
Current portion of long-term debt | — | 349,893 | ||||||
Operating lease liabilities | 205,152 | 209,203 | ||||||
Deferred revenue and other current liabilities | 170,145 | 191,849 | ||||||
Total current liabilities | 739,551 | 1,298,610 | ||||||
Long-term debt and line of credit borrowings | 1,734,962 | 1,143,305 | ||||||
Deferred tax liabilities and reserves for uncertain tax positions | 310,722 | 306,134 | ||||||
Operating lease liabilities | 306,000 | 322,847 | ||||||
Deferred revenue and other noncurrent liabilities | 80,997 | 104,106 | ||||||
Total liabilities | 3,172,232 | 3,175,002 | ||||||
COMMITMENTS AND CONTINGENCIES | ||||||||
STOCKHOLDERS’ EQUITY: | ||||||||
Common stock, no par, stated value $.01 per share | 1,565 | 1,644 | ||||||
Additional paid-in capital | 757,981 | 766,998 | ||||||
Accumulated other comprehensive loss | (57,063 | ) | (47,755 | ) | ||||
Retained earnings (deficit) | (609,299 | ) | 12,061 | |||||
Less treasury shares, at cost | (644,094 | ) | (644,052 | ) | ||||
Total stockholders' equity (deficiency) | (550,910 | ) | 88,896 | |||||
Total liabilities and stockholders' equity | $ | 2,621,322 | $ | 3,263,898 | ||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | (unaudited, in 000s) | |||||||
Three months ended September 30, | 2025 | 2024 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net loss | $ | (165,819 | ) | $ | (172,576 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | 28,922 | 28,831 | ||||||
Provision for credit losses | 975 | 1,024 | ||||||
Deferred taxes | 17,800 | 19,006 | ||||||
Stock-based compensation | 6,173 | 8,727 | ||||||
Changes in assets and liabilities, net of acquisitions: | ||||||||
Receivables | 262 | 1,029 | ||||||
Prepaid expenses, other current and noncurrent assets | 7,530 | 8,836 | ||||||
Accounts payable, accrued expenses, salaries, wages and payroll taxes | (59,094 | ) | (66,017 | ) | ||||
Deferred revenue, other current and noncurrent liabilities | (46,118 | ) | (27,025 | ) | ||||
Income tax receivables, accrued income taxes and income tax reserves | (147,233 | ) | (129,397 | ) | ||||
Other, net | (236 | ) | (1,019 | ) | ||||
Net cash used in operating activities | (356,838 | ) | (328,581 | ) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Capital expenditures | (13,188 | ) | (18,735 | ) | ||||
Payments made for business acquisitions, net of cash acquired | (5,069 | ) | (5,901 | ) | ||||
Franchise loans funded | (3,667 | ) | (7,109 | ) | ||||
Payments from franchisees | 731 | 211 | ||||||
Other, net | 267 | 5,140 | ||||||
Net cash used in investing activities | (20,926 | ) | (26,394 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Proceeds from line of credit borrowings | 245,000 | — | ||||||
Repayments of long-term debt | (350,000 | ) | — | |||||
Proceeds from issuance of long-term debt | 346,980 | — | ||||||
Dividends paid | (50,208 | ) | (44,653 | ) | ||||
Repurchase of common stock, including shares surrendered | (412,415 | ) | (238,376 | ) | ||||
Other, net | (4,382 | ) | (1,421 | ) | ||||
Net cash used in financing activities | (225,025 | ) | (284,450 | ) | ||||
Effects of exchange rate changes on cash | (2,949 | ) | 3,249 | |||||
Net decrease in cash and cash equivalents, including restricted balances | (605,738 | ) | (636,176 | ) | ||||
Cash, cash equivalents and restricted cash, beginning of period | 1,003,139 | 1,075,193 | ||||||
Cash, cash equivalents and restricted cash, end of period | $ | 397,401 | $ | 439,017 | ||||
SUPPLEMENTARY CASH FLOW DATA: | ||||||||
Income taxes paid, net (includes payments for purchased investment tax credits) | $ | 78,339 | $ | 48,343 | ||||
Interest paid on borrowings | 28,471 | 19,792 | ||||||
Accrued additions to property and equipment | 7,734 | 6,341 | ||||||
New operating right of use assets and related lease liabilities | 37,885 | 21,861 | ||||||
Accrued dividends payable to common shareholders | 54,343 | 52,307 | ||||||
Accrued purchase of common stock | — | 7,131 | ||||||
(in 000s) | |||||||||
Three months ended September 30, | |||||||||
NON-GAAP FINANCIAL MEASURE - EBITDA | 2025 | 2024 | |||||||
Net loss - as reported | $ | (165,819 | ) | $ | (172,576 | ) | |||
Discontinued operations, net | 451 | 1,155 | |||||||
Net loss from continuing operations - as reported | (165,368 | ) | (171,421 | ) | |||||
Add back: | |||||||||
Income tax benefit | (50,963 | ) | (60,840 | ) | |||||
Interest expense | 17,402 | 15,847 | |||||||
Depreciation and amortization | 28,922 | 28,831 | |||||||
(4,639 | ) | (16,162 | ) | ||||||
EBITDA from continuing operations | $ | (170,007 | ) | $ | (187,583 | ) | |||
(in 000s, except per share amounts) | |||||||||
Three months ended September 30, | |||||||||
NON-GAAP FINANCIAL MEASURE - ADJUSTED EPS | 2025 | 2024 | |||||||
Net loss from continuing operations - as reported | $ | (165,368 | ) | $ | (171,421 | ) | |||
Adjustments: | |||||||||
Amortization of intangibles related to acquisitions (pretax) | 10,979 | 11,128 | |||||||
Tax effect of adjustments (1) | (2,792 | ) | (2,645 | ) | |||||
Adjusted net loss from continuing operations | $ | (157,181 | ) | $ | (162,938 | ) | |||
Diluted loss per share from continuing operations - as reported | $ | (1.26 | ) | $ | (1.23 | ) | |||
Adjustments, net of tax | 0.06 | 0.06 | |||||||
Adjusted diluted loss per share from continuing operations | $ | (1.20 | ) | $ | (1.17 | ) | |||
(1)Tax effect of adjustments is the difference between the tax provision calculated on a GAAP basis and on an adjusted non-GAAP basis.
Non-GAAP Financial Information
Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. Because these measures are not measures of financial performance under GAAP and are susceptible to varying calculations, they may not be comparable to similarly titled measures for other companies.
We consider our non-GAAP financial measures to be performance measures and a useful metric for management and investors to evaluate and compare the ongoing operating performance of our business. We make adjustments for certain non-GAAP financial measures related to amortization of intangibles from acquisitions and goodwill impairments. We may consider whether other significant items that arise in the future should be excluded from our non-GAAP financial measures.
We measure the performance of our business using a variety of metrics, including earnings before interest, taxes, depreciation and amortization (EBITDA) from continuing operations, adjusted EBITDA from continuing operations, adjusted diluted earnings per share from continuing operations, and free cash flow. We also use EBITDA from continuing operations and pretax income from continuing operations, each subject to permitted adjustments, as performance metrics in incentive compensation calculations for our employees.
CONTACT: For Further Information Investor Relations: Jessica Hazel, (816) 854-4214, jessica.hazel@hrblock.com Media Relations: Media Desk, mediadesk@hrblock.com