H&R Block reported that for the fiscal year ended last June 30, its revenue, net income and earnings per share increased.
Total revenue of $3.8 billion increased $150.6 million, or 4.2%, primarily due to an increase in overall net average charge and higher company-owned return volumes in the U.S., partially offset by lower interest and fee income on the Emerald Advance line-of-credit product.
Full-year revenue for the tax prep giant was $3.5 billion (0.3% growth). In addition:
Block’s net income from continuing operations increased $11.5 million, or 1.9%, to $609.5 million.Earnings per share from continuing operations of $4.42 increased 28 cents (6.8%).Adjusted earnings per share from continuing operations of $4.66 increased 25 cents (5.7%), due to fewer shares outstanding from share repurchases and higher net income.Total operating expenses of $2.9 billion increased $128 million, or 4.6%, primarily due to higher compensation and benefits, marketing, consulting, technology and legal costs, partially offset by lower bad debt.
During Q4 of FY25, Block expected to recognize a one-time tax benefit related to the closure of various matters under examination that would have increased earnings per share some 50 cents. Due to external factors, the completion of these matters was delayed beyond FY25. (In January, the Federal Trade Commission finalized an order requiring H&R Block to make a number of changes for the 2025 filing season, as well as longer-term changes.)
Block increased its quarterly dividend 12% to 42 cents per share. In FY25, the tax prep giant repurchased and retired some 6.5 million shares (4.7% of shares outstanding), at an aggregate price of $400.1 million, or $61.10 per share. The company has approximately $1.1 billion remaining on its $1.5 billion share repurchase program.
For FY26, Block expects its revenue will be between $3.875 and $3.895 billion; its EBITDA will be between $1.015 and $1.035 billion; its effective tax rate will be about 25%; and adjusted diluted earnings per share will be $4.85 to $5.
