Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (date of earliest event reported): February 4, 2025

H&R BLOCK, INC.

(Exact name of registrant as specified in charter)


Missouri	1-06089	44-0607856
(State or other jurisdiction of	(Commission File Number)	(I.R.S. Employer
incorporation or organization)		Identification No.)

One H&R Block Way, Kansas City, MO 64105

(Address of Principal Executive Offices) (Zip Code)

(816) 854-3000

(Registrant's telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, without par value	HRB	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02. Results of Operations and Financial Condition.

On February 4, 2025, H&R Block, Inc. (the "Company") issued a press release regarding the Company’s results of operations for the fiscal quarter ended December 31, 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number Description

99.1 Press Release Issued February 4, 2025.

104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


			H&R BLOCK, INC.

Date:	February 4, 2025	By:	/s/ Katharine M. Haynes
			Katharine M. Haynes
			Vice President and Corporate Secretary

Exhibit 99.1

News Release

For Immediate Release: February 4, 2025

H&R Block Reports Fiscal 2025 Second Quarter Results

— Repurchased $190 Million of Shares—

— Reaffirms Full Year Outlook —

KANSAS CITY, Mo. - H&R Block, Inc. (NYSE: HRB) (the "Company") today released financial results1 for its fiscal 2025 second quarter ended December 31, 2024.

"I am pleased with our performance in the first half of the year," said Jeff Jones, president and chief executive officer. "We are reaffirming our fiscal 2025 outlook, and are well prepared to deliver this tax season and in the second half of the fiscal year."

Fiscal 2025 Second Quarter Results and Key Financial Metrics

"We are on track for the year and we are well positioned to deliver strong results," said Tiffany Mason, chief financial officer. "During the second quarter, we repurchased 3.2 million shares for $190 million, reflecting our confidence in the long-term value of our stock and our commitment to delivering shareholder returns."

For the second quarter, the Company delivered total revenue of $179.1 million, which was flat to the prior year. Increases in revenue from Wave and international tax preparation were offset by lower interest and fee income on Emerald Advance® due to a decrease in loan originations.

Total operating expenses of $472.4 million increased by $25.8 million as expected, primarily due to higher tax professional and corporate wages, increased healthcare costs, an increase in occupancy costs and the timing of marketing expenses versus the prior year.

Pretax loss increased by $29.4 million to $312.3 million.

Loss per share from continuing operations2 increased to $(1.79) from $(1.33) and adjusted loss per share from continuing operations2 increased to $(1.73) from $(1.27), due to a higher net loss and fewer shares outstanding as a result of share repurchases, which are accretive to earnings per share on a full-year basis.

Capital Allocation

The Company reported the following related to its capital structure:

•Repurchased and retired 3.2 million shares at an aggregate price of $190.5 million, or $58.65 per share in the second quarter.

•The Company has approximately $1.1 billion remaining on its $1.5 billion share repurchase program.

Since 2016, the Company has returned more than $4.4 billion to shareholders in the form of dividends and share repurchases, buying back over 43% of its shares outstanding3.

1All amounts in this release are unaudited. Unless otherwise noted, all comparisons refer to the current period compared to the corresponding prior year period.

2All per share amounts are based on fully diluted shares at the end of the corresponding period. The Company reports non-GAAP financial measures of performance, including adjusted earnings per share (EPS), earnings before interest, tax, depreciation, and amortization (EBITDA) from continuing operations, free cash flow, and free cash flow yield, which it considers to be useful metrics for management and investors to evaluate and compare the ongoing operating performance of the Company. See "About Non-GAAP Financial Information" below for more information regarding financial measures not prepared in accordance with generally accepted accounting principles (GAAP).

3Shares outstanding calculated as of April 30, 2016.

Fiscal Year 2025 Outlook Reaffirmed

The Company continues to expect:

•Revenue to be in the range of $3.69 to $3.75 billion.

•EBITDA4 to be in the range of $975 million to $1.02 billion.

•Effective tax rate to be approximately 13%, resulting in a one-time benefit to EPS of approximately 50 cents.

•Adjusted Diluted Earnings Per Share4 to be in the range of $5.15 to $5.35.

Conference Call

The Company will host a conference call for analysts and investors to discuss second quarter 2025 results at 4:30 p.m. ET on Tuesday, February 4, 2025. To join live, participants must register at https://register.vevent.com/register/BI06a7e8ddc07544a6853995c1fe75ea2c. 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/qdeqpgfd 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 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

4Adjusted Diluted EPS and EBITDA from continuing operations are non-GAAP financial measures. Future period non-GAAP outlook includes adjustments for items not indicative of our core operations, which may include, without limitation, items described in the below section titled “Non-GAAP Financial Information” and in the accompanying tables. Such adjustments may be affected by changes in ongoing assumptions and judgments, as well as nonrecurring, unusual, or unanticipated charges, expenses or gains, or other items that may not directly correlate to the underlying performance of our business operations. The exact amounts of these adjustments are not currently determinable but may be significant. It is therefore not practicable to provide the comparable GAAP measures or reconcile this non-GAAP outlook to the most comparable GAAP measures.

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.


For Further Information

Investor Relations:						Colby Brown, (816) 854-4559, colby.brown@hrblock.com
						Jordyn Eskijian, (816) 854-5674, jordyn.eskijian@hrblock.com
Media Relations:						Teri Daley, (816) 854-3787, teri.daley@hrblock.com
						Media Desk, mediadesk@hrblock.com

TABLES FOLLOW


FINANCIAL RESULTS	(unaudited, in 000s - except per share amounts)
	Three months ended December 31,				Six months ended December 31,
	2024		2023		2024		2023
REVENUES:
U.S. tax preparation and related services:
Assisted tax preparation	$	48,380	$	48,342	$	91,343	$	87,605
Royalties	3,499		5,454		9,351		11,155
DIY tax preparation	13,744		13,111		16,980		16,959
Refund Transfers	637		813		1,497		1,955
Peace of Mind® Extended Service Plan	16,145		17,440		39,242		42,287
Tax Identity Shield®	4,013		4,694		7,922		9,274
Other	11,824		9,592		25,633		20,572
Total U.S. tax preparation and related services	98,242		99,446		191,968		189,807
Financial services:
Emerald Card® and SpruceSM	10,148		11,700		18,974		20,333
Interest and fee income on Emerald Advance®	12,308		15,235		12,308		15,533
Total financial services	22,456		26,935		31,282		35,866
International	31,811		29,569		96,666		90,134
Wave	26,561		23,133		52,964		47,076
Total revenues	$	179,070	$	179,083	$	372,880	$	362,883
Compensation and benefits:
Field wages	81,565		77,795		149,659		140,230
Other wages	78,731		74,671		156,066		146,769
Benefits and other compensation	38,402		36,063		77,156		71,311
	198,698		188,529		382,881		358,310
Occupancy	104,999		101,194		206,317		200,479
Marketing and advertising	14,863		11,305		24,835		16,786
Depreciation and amortization	29,195		30,107		58,026		60,332
Bad debt	19,416		21,754		22,146		26,552
Other	105,190		93,626		200,297		174,182
Total operating expenses	472,361		446,515		894,502		836,641
Other income (expense), net	2,744		5,922		14,661		15,758
Interest expense on borrowings	(21,752)		(21,364)		(37,599)		(37,234)
Pretax loss	(312,299)		(282,874)		(544,560)		(495,234)
Income tax benefit	(69,833)		(93,758)		(130,673)		(143,245)
Net loss from continuing operations	(242,466)		(189,116)		(413,887)		(351,989)
Net loss from discontinued operations	(954)		(639)		(2,109)		(1,248)
Net loss	$	(243,420)	$	(189,755)	$	(415,996)	$	(353,237)
BASIC AND DILUTED LOSS PER SHARE:
Continuing operations	$	(1.79)	$	(1.33)	$	(3.02)	$	(2.44)
Discontinued operations	(0.01)		—		(0.01)		(0.01)
Consolidated	$	(1.80)	$	(1.33)	$	(3.03)	$	(2.45)
WEIGHTED AVERAGE DILUTED SHARES	135,563		142,340		137,359		144,307
Adjusted diluted EPS (1)	$	(1.73)	$	(1.27)	$	(2.89)	$	(2.31)
EBITDA (1)	$	(261,352)	$	(231,403)	$	(448,935)	$	(397,668)

(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	December 31, 2024		June 30, 2024

ASSETS
Cash and cash equivalents	$	320,051	$	1,053,326
Cash and cash equivalents - restricted	21,473		21,867
Receivables, net	321,171		69,075

Prepaid expenses and other current assets	114,658		95,208
Total current assets	777,353		1,239,476
Property and equipment, net	143,833		131,319
Operating lease right of use assets	389,629		461,986
Intangible assets, net	270,601		264,102
Goodwill	783,286		785,226
Deferred tax assets and income taxes receivable	281,694		271,658
Other noncurrent assets	65,924		65,043
Total assets	$	2,712,320	$	3,218,810
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES:
Accounts payable and accrued expenses	$	136,893	$	155,830
Accrued salaries, wages and payroll taxes	64,993		105,548
Accrued income taxes and reserves for uncertain tax positions	149,255		318,830
Current portion of long-term debt	349,611		—
Operating lease liabilities	170,726		206,070
Deferred revenue and other current liabilities	187,885		191,050
Total current liabilities	1,059,363		977,328
Long-term debt and line of credit borrowings	1,932,545		1,491,095
Deferred tax liabilities and reserves for uncertain tax positions	292,643		291,063
Operating lease liabilities	228,041		265,373
Deferred revenue and other noncurrent liabilities	72,188		103,357
Total liabilities	3,584,780		3,128,216
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY:
Common stock, no par, stated value $.01 per share	1,644		1,709
Additional paid-in capital	752,093		762,583
Accumulated other comprehensive loss	(71,762)		(48,845)
Retained earnings (deficit)	(908,785)		12,654
Less treasury shares, at cost	(645,650)		(637,507)
Total stockholders' equity (deficiency)	(872,460)		90,594
Total liabilities and stockholders' equity	$	2,712,320	$	3,218,810


CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS	(unaudited, in 000s)
Six months ended December 31,	2024		2023

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(415,996)	$	(353,237)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	58,026		60,331
Provision for credit losses	20,727		21,536
Deferred taxes	(1,531)		(35,525)
Stock-based compensation	17,945		17,525
Changes in assets and liabilities, net of acquisitions:
Receivables	(262,348)		(348,833)
Prepaid expenses, other current and noncurrent assets	2,588		(7,395)
Accounts payable, accrued expenses, salaries, wages and payroll taxes	(76,806)		(58,543)
Deferred revenue, other current and noncurrent liabilities	(45,170)		(58,520)
Income tax receivables, accrued income taxes and income tax reserves	(192,340)		(180,706)
Other, net	(733)		1,201
Net cash used in operating activities	(895,638)		(942,166)
CASH FLOWS FROM INVESTING ACTIVITIES:



Capital expenditures	(49,115)		(32,708)
Payments made for business acquisitions, net of cash acquired	(28,017)		(27,158)



Franchise loans funded	(17,442)		(15,491)
Payments from franchisees	971		2,747

Other, net	6,110		1,565
Net cash used in investing activities	(87,493)		(71,045)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of line of credit borrowings	(100,000)		(25,000)
Proceeds from line of credit borrowings	890,000		825,000




Dividends paid	(96,960)		(89,854)
Repurchase of common stock, including shares surrendered	(436,233)		(378,709)

Other, net	1,791		4,011
Net cash provided by financing activities	258,598		335,448
Effects of exchange rate changes on cash	(9,136)		671
Net decrease in cash and cash equivalents, including restricted balances	(733,669)		(677,092)
Cash, cash equivalents and restricted cash, beginning of period	1,075,193		1,015,316
Cash, cash equivalents and restricted cash, end of period	$	341,524	$	338,224
SUPPLEMENTARY CASH FLOW DATA:
Income taxes paid, net (includes payments for purchased investment tax credits)	$	62,290	$	72,160
Interest paid on borrowings	33,412		35,496
Accrued additions to property and equipment	3,798		4,036
New operating right of use assets and related lease liabilities	47,135		70,532
Accrued dividends payable to common shareholders	50,176		45,273


(in 000s)
	Three months ended December 31,				Six months ended December 31,
NON-GAAP FINANCIAL MEASURE - EBITDA	2024		2023		2024		2023

Net loss - as reported	$	(243,420)	$	(189,755)	$	(415,996)	$	(353,237)
Discontinued operations, net	954		639		2,109		1,248
Net loss from continuing operations - as reported	(242,466)		(189,116)		(413,887)		(351,989)
Add back:
Income tax benefit	(69,833)		(93,758)		(130,673)		(143,245)
Interest expense	21,752		21,364		37,599		37,234
Depreciation and amortization	29,195		30,107		58,026		60,332
	(18,886)		(42,287)		(35,048)		(45,679)
EBITDA from continuing operations	$	(261,352)	$	(231,403)	$	(448,935)	$	(397,668)


(in 000s, except per share amounts)
	Three months ended December 31,				Six months ended December 31,
NON-GAAP FINANCIAL MEASURE - ADJUSTED EPS	2024		2023		2024		2023

Net loss from continuing operations - as reported	$	(242,466)	$	(189,116)	$	(413,887)	$	(351,989)
Adjustments:
Amortization of intangibles related to acquisitions (pretax)	10,910		12,269		22,038		24,824
Tax effect of adjustments (1)	(2,539)		(3,087)		(5,184)		(6,022)
Adjusted net loss from continuing operations	$	(234,095)	$	(179,934)	$	(397,033)	$	(333,187)
Diluted loss per share from continuing operations - as reported	$	(1.79)	$	(1.33)	$	(3.02)	$	(2.44)
Adjustments, net of tax	0.06		0.06		0.13		0.13
Adjusted diluted loss per share from continuing operations	$	(1.73)	$	(1.27)	$	(2.89)	$	(2.31)

(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, free cash flow, and free cash flow yield. 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.

Cover Page	Feb. 04, 2025
Cover [Abstract]
Document Type	8-K
Document Period End Date	Feb. 04, 2025
Entity Registrant Name	H&R BLOCK, INC.
Entity Incorporation, State or Country Code	MO
Entity File Number	1-06089
Entity Tax Identification Number	44-0607856
Entity Address, Address Line One	One H&R Block Way
Entity Address, City or Town	Kansas City
Entity Address, State or Province	MO
Entity Address, Postal Zip Code	64105
City Area Code	816
Local Phone Number	854-3000
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, without par value
Trading Symbol	HRB
Security Exchange Name	NYSE
Entity Emerging Growth Company	false
Entity Central Index Key	0000012659
Amendment Flag	false