HRB - Earnings call transcript Q1 2020

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Operator

Good day, ladies and gentlemen, and thank you for your patience.

You've joined H&R Block's First Quarter Fiscal 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions]. conference recorded. this reminder, a may be as

I to and your like to Investor call over turn the host, Colby would Brown. now Relations, VP of Finance

You begin. may

Colby Brown

joining everyone. Thank Good XXXX And us results. to thank first you, quarter discuss afternoon, you Ladip. fiscal our for

Bowen, call Tony are CEO, today the Jones, our CFO. On and President Jeff and our

containing will posted press release a at posted the on Also will call. today's on find website which We've website, for link today's after this webcast the hrblock.com. be the Investor presentation, you Relations

of discuss Some reconciled today presented on attached non-GAAP the GAAP figures schedules release. comparable press We've basis. are to figures that our the in we'll a the and non-GAAP

defined our remind this Such remarks, I'll laws. of begin current call statements everyone are we based will are and and prepared future of the statements as under performance. management's expectations on securities this Before guarantees as not information date that include forward-looking

to statements involve risks, assumptions uncertainties and Forward-looking are certain predict. difficult that

actual As differ outcomes materially. such, and our could results

You Block can and filings. statements. factors in forward-looking SEC our our to other more fiscal H&R risks XX-K or for Form no update these XXXX obligation publicly risk about undertakes learn these

remarks, At our have of prepared session. will the Q&A conclusion a we

question ask limit we into back that may During Q&A, choose jump follow-up themselves with to participants after one a to they which the queue.

With the over that, turn Jeff. now I'll to call

Jeffrey Jones II

afternoon, thanks joining for Good us. and Colby. everyone, you, Thank

tremendous high tax through progress trajectory and As you end of our outlook our may financial achieved our acquisition Wave. remember our strengthened in from the made last we of year. call, business last We the growth

journey. will reporting year for provide our then of discuss to results, on full-year our first Wave's like quarter our financial plans I'd we're fiscal fiscal and outlook. XXXX, Today, thoughts how the second Tony our strategic initial

the June on transaction with delighted have a to later. and acquisition the We the announced team closed Wave officially few Starting weeks XXth We're Wave. onboard.

the combined excited are for value entity have small how ever together can post-acquisition, business than teams about two the we owners. deliver come more As

cadence for to prioritizing growth Wave the been team We've ahead with sustained also the and working their numerous that enable the appropriate innovate. monetization lie opportunities business as growth. operational to continues We're to establish the

launch one example the Managing the payouts. most day-to-day recent critical this of is flow face, resulting significant is instant issues cash of fail. stress to small causing An entrepreneurs of in businesses and

cards When leaving or process, up their third credit ACH it a for longer entrepreneurs them party, payments accept typically two from through cash. business days waiting to takes to

the receive needs get one Wave's they constantly payouts, funds is reducing it takes in flow. ways of to it to Wave This entrepreneurs. serve significantly easier the With instant and, to how example can of ultimately, seconds, time on cash simple making is their innovating cash manage

same year. several compared generated consecutive quarterly the continued XX% Wave than quarter XX% revenue quarter last of by trends Through years. greater historic its when and growth year-over-year innovation growth, revenue over in organic to the product prior the this posting Wave has growth

that It's about excited value. Wave brings them H&R class Wave simplify and developing the can additional will drive the this the on team for increase improving monetization By clear results path. user is challenges capabilities solutions these lives its base. And solving Wave world delivering accelerate new Block entrepreneurs from that is entrepreneurs, offering financial its of that and and that

growth we will and shareholder term. that invest a in Wave is for strong driving serving enhancing overall small value. a fit allow the our of is strategic long our key efforts us businesses, accelerate to acquisition This element as strategy

assisted, virtual, achieved long results overall. range objectives. coming strong made tax the against taking in business, and DIY the In multi-year we're first year excellent progress of We off our strategy. We our share

we the on made industry improvements and roadmap. led pricing and our clients. significant delivered upfront We've tremendous in we our Our progress serve franchisees how technology transparent associates with

enter service continue to and providing our innovating we all across enhancing second clients we're our better As platforms, learnings year, to our on our building the brand relevance.

By In operating excellence matter remain concentrating most, efforts by clients. procedures our pros proposition. assisted, we'll offices improving was focused approach and pricing, leverage and we're upfront driving that both well on further we'll within our the standard value the on in simplifying which operational our tax our received transparent and consistency extremely

which gains. our advance independent accolades from and we'll investing continue the share DIY, user In to enhancements We're growth reviews. strategy experience, our is to in challenger earning

better help confidence throughout effectively and expectations drive and and to personalize on conversion, experience, upfront price. AI includes within consumer This setting the the leveraging product to

consumers be aggressive pricing complemented These product. award-winning our enhancements by know and competitive ensure will about marketing to

on And in we building in virtual, segment, clients year we the to lead brand products. of through the emerging in past to innovative this which our attracted success will new continue

in improve This year, taking better we expertise care from and feedback offerings our we're received new clients provide ways. Tax the Pro and network to as we our leverage

in enhance which elevates We're All consumers demonstrating proposition, ways very H&R to turn relevance. efforts these Block. brand value of switch in our why tangible our should

our up, we're years. the building on last momentum few To from wrap

have great and start our to the season. to success. in excited closer strategy share tax more plans us We of for I'm the with place position details that align

call the Tony. I'll to over that, With now hand

Tony Bowen

Thanks, Good Jeff. afternoon, everyone.

Wave's Wave to table. growth as MD&A will our These financial largely table. to our be separate I'd of into expenses and in details how related most like in people companies, Wave a we're consist technology. be reported technology of MD&A results. primarily within line compensation revenue expenses in investments expenses will get I and reporting Like Before included discuss QX, high technology-related

provide relevant each we'll be Additionally, will investors. commentary helpful believe to we that regarding Wave quarter

to a Wave business. given our overall separate as will report its not size segment, We relative

reporting as business We our to our segment continue evaluate will evolves.

purchase we're the Additionally, in of the completing process price allocation.

work for update to quarter second fiscal amortization complete We expected we'll provide and expect year. an the our this of on end the by

the not of due of full-year business. our to performance. quarter are quarter report we typically Therefore, as results, our fiscal to Turning seasonality QX the our during representative first loss first reminder, a a results

revenues, activity. million Starting of increase $X $X.X one $XXX to year-over-year million. we contributed with Wave or X% month million, representing saw of

increased tax assisted and US strong, been tax have resulting in in Additionally in business revenues pre-season the DIY. prep results

Our revenues part reduction has results of first international These were revenue. Australia by of a deferred from season. reported the results how in also increased our Peace its tax seen related positive revenues offset Mind timing we in as recognize partially to the of product

million. Turning in as to expenses $XXX and increases Wave. expense, increased or to planned well total was to million due $XX expenses operating technology-related as compensation X% This

the continuing loss outstanding, and discrete expenses The per due $X favorable an to offset was driven increased in lower million. changes and of tax share Loss at $X.XX, increase resulted by pre-tax in shares in increase revenue from loss by in operations pre-tax items. an benefit unchanged

share the basis, in As a on beneficial in which while a loss. report quarters count full EPS impacts a negatively reminder, we year lower

related during In contingent the quarter. Sand discontinued operations, Canyon to changes there liabilities to accrued were no

Sand Canyon, refer For in the on and company's XX-K information SEC Forms additional filings. please disclosures reports on XX-Q to other and

Turning sheet. to balance the

This accounting quarter, classified assets as standard, requires liabilities the implemented which and of recognition for operating. lease new we leases previously

flows we change lease $XXX on and income As have impact a have right-of-use This will million totaling or assets $XXX recognized our going no liability cash million. statement of of July forward. XXst,

ended maintaining liquidity the the after list cash Regarding last generation. our account with another of flow capital, is year operational our position for strong remain priorities top year adequate unchanged. seasonality. cash solid to for needs At a We our

investments believe key the to our our sustainable strategic allocation. Making ultimately made of capital value then to growth drive prudent a deliver our business We into benefiting element back that shareholders. clients, investments we remains

and through dividends capital past quarterly four excess has our future increased business With quarterly deploy the has we'll Last, dividends, share the time, dividend and XX%. respect years. that dividend allowed over outlook for our for to health Over increases of repurchases. our the

perform review fiscal each of after will annual We an year. dividend the

Regarding from minimum, to, share we repurchases, dilution offset to at equity shares committed grants. remain repurchasing a

a repurchased at the $XX During shares of average X.X million for an first million total of we $XX.XX. price quarter,

We will be share to approach. in opportunistic continue our repurchase

from than call to in and anticipated, which change remains the Wave during company and like we expectations outlook immaterial total outlook resulting our The transaction June. margin. on for closed an provided impact year, now I'd on thoughts to what earlier slightly no provide unchanged our in to our revenue

of addition to XXXX, by recent EBITDA following in continue to driven dollars and growth slightly the business we to to For growth be of the Wave. fiscal return anticipate X.X% fiscal the than total respect earnings, With as we revenue, X.X% year in tax we higher revenue expect to XXXX growth.

level. will with the losses from the to cost We EBITDA strong reductions operating Wave maintain other offset

outpace result, As growth margin. revenue will our impact we will EBITDA growth, a expect which

Therefore, for to XX% of to we anticipate margin fiscal XXXX. continue EBITDA XX%

the expect our discrete This XX%. be items to also effective to tax may unanticipated should fluctuate during rate XX% year. fiscal occur We

plans season details additional look the our with updating outlook forward progress call provide on December. QX on financial tax on We in to year. fiscal our our our you along throughout We'll

call to over With that, Jeff. turn I the will back now

Jeffrey Jones II

Thanks, Tony.

momentum in We added strong track profile, year and December. look coming the with asset more of driving enhances the great We're a a on with our forward making we've right focused year strategy. have great in And sharing prudent key on committed business, strategic are which areas. growth Wave, to to our results. to another tax I strong And off improve investments executing

that, for Ladip? With we'll the line open now questions.

Operator

[Operator you, Instructions]. Thank sir.

Our line of Schneeberger of first Scott comes Oppenheimer. the from question

please. question Your

Scott Schneeberger

going price in volume you thinking of it guess, some be for year, Just season. of well forward? next to share with to aspiration speak positive balancing high to this past in thoughts Thanks. assisted, drive season. you in And that Good you're channel could Thanks. of afternoon, and now everyone. Jeff, coming we're advance at I that I and assisted know season volume last regarding anything to us the well just the be how might time the level an seems able company growth about

Jeffrey Jones II

multi-year we're our Thank That's goal growth our Scott. to you. doubt, in return No assisted absolutely is to aspiration a headed. and on where in improvement business. our Absolutely, We're the trajectory.

we that that doing and And year value want in we it had not again. do keeping volume, We from the the to a thing high. reset knew just first was We conversation really price I office. the prices the to gotten reset intend is ago. took happening reiterate, Price was what was too

we And made look pricing lot different nice progress. block. factors, really Pro. we we've from in what in their from it both At levels difference the consumer, the feel the we're of Tax at, a of at good we choice cases, We a big that hear hear what made

at value. the We talked tips. delivering year the at expertise, to the convince have the for to about was, of Pro, in our tax price people the don't now is. end spend what focus what value, about consumer, With of saw the we end we we to From heard the can providing Tax improvements the delivering time time event price try on we

price our where about And so, good we is. feel

is, intention are Our lower. going we not

we've As we're get improve in proposition, prices be not the said, we we and trust want the believe we value We can credibility increases we that's what rebuild the doing back into flat that, essentially XXXX. going going to keep in future, but believe brand, as to price to XXXX. level continue inflationary to of the

Scott Schneeberger

I Thanks. appreciate that.

Wave. two-part For I'll turn of my follow-up, to And question. a just kind it

initial to and see then, H&R And Your Wave? you the what there what impressions, at Block potential? comment and you growth, you of on of Wave pairing opportunities juncture, you can just the any organic see cross-selling extent this Thanks. see strategic as

Jeffrey Jones II

questions. Two great Yeah.

excited the we continue. were they to have So, performance years. revenue kind saw year seeing for several in quarterly of growth the that see growth been year-over-year We this is what

If a brand that fact step business, is is we a this that unknown. the we from still take back the love

using So, remembering small using this are owners Shoe They're on value Box nothing. is using deliver that business proposition Wave who more people, we Excel. focused see opportunity currently still to are or to

that of the one know upside, excited so, strength yet value the we the the believe the fact them, people the we opportunity combined And were things there's about not about with in on enough of prop, deal. and

product doing We on nice also pipeline. see them really job a the

that sure their to really revenue But innovation When owner small have from offering, we've place clients the in and we're continuing the can benefit product support We do that make as time they also or taking their Block's the begun did my to any cost and think in the over we businesses. not clients can economics shared we we more. can given offering deal, view everything that. remarks, So, there but business about how prepared serve the they in long-term synergy. more but new deal did conversation Block's know between how how absolutely synergies can benefit about all pipeline, want pipeline our already on two that products, I assume is a of to from

Scott Schneeberger

Appreciate Thanks. that.

Jeffrey Jones II

Thank you.

Operator

Thank you.

Morgan Our of from next comes question Goldstein Stanley. Jeff

open. is line Your

Jeff Goldstein

Hey, good afternoon.

on reductions Can to to upside those about see you could implementing Wave coming year. reductions or where dilution from this maybe exactly expected talked expand are you offset the and cost You've downside savings? these where

Jeffrey Jones II

up I'll out. you that things Tony are Jeff. in tee And things is the by talk go-dos to are not share and to just about Hey, plans those I'll all place that saying it plays are what are. about you with Tony year to that exactly what let identified as

Tony Bowen

Yeah, in bunch of recurring this not which The to operating us one-time we've the that that office going allow year. That's, resulted it's the a biggest last is year, items that's bucket identified we smaller obviously, Wave. closures loss expense. did offset from a to

$X are Jeff's that To strong actions us last That rest going million and smaller number. that's allow from $XX rolling are $X That million, year. that in they into would already $XX identified. was million XXXX. a that's about that place The So, maintain kind going off. loss or of it be to million point, million, we've EBITDA $X of fiscal items the largest to probably put offset level

Jeff Goldstein

less right. the you thinking of for stock of given the year. know, year, just we million That's bought $XX be than how about All in which just is, the the XQ back And should of in then, remainder quarter, last you that pacing did helpful. I

the Wave repurchases from all your So, to inhibit does accelerate here. at ability acquisition

about that? should how we Just be thinking

Tony Bowen

Yeah.

still million but have believe capital repurchases. of Wave opportunistically acquisition, for we So, the deploy to we we share deployed excess for $XXX about capital

And of out, days all that be that or a do think buy number share do in we you of million into volatility, and and pointed it guide in when makes a I share shares come when deciding number a factors how on repurchase. when last Obviously, there's take we of As that QX. did of will quarter, we've particular opportunistic will in during $XX factors play. trading proven, trading several take account We into to repurchases. years, advantage the we don't much But typically we number sense. volatility

Jeff Goldstein

for color. All right. the Thanks

Jeffrey Jones II

Thanks, Jeff.

Operator

you. Thank

Kartik question next comes of Research. Our Mehta from Northcoast

open. line Your is

Kartik Mehta

move share, are product. product, wanted of Hey, pricing And on DIY about next improved pricing Obviously, – arrangement the TurboTax. your wanted than for lower to price you gap get gain this – trying Jeff. to you talk thoughts understand you're the between do competitor? anticipate But I'm be to maintain type strategy the a I tax of tax season, a strategy wondering, I won't gap season. similar where you you as you to and forward, a market you seemed between your gap a at somewhat least you

Jeffrey Jones II

Kartik. Hey,

and is of it easier but terms all the of especially team is more first and business about roadmap good feel product about. making easier. The results, the on in completely focused So, multi-year progress all, personalization in both I in and That's DIY of the the I really think more product terms improvements. what important the

product fact recognized remains is that accolades think intact. parties. about great the now third broad We're And do the being love by I improvements. strategy getting I those the

product test We and better maintain have to advantage. constantly to We we have we that a is great competitors the that and price-value that all great a pricing market will time. relationship have believe the relative to and getting

which market be do, puzzle, the that the third is of you've And in aggressive how piece we then, seen proposition. us value

talked believe As business. in people don't know we before, that we've enough we're even still

puzzle. we in And three still see of all that upside so, pieces

Kartik Mehta

Wave on then you've revenue with would in just client a fiscal that growth is, maybe, the margin quoted? Tony, the One bit XXXX? And to then you, in become accretive you understanding growth Wave. little And anticipate line is for

Tony Bowen

clients a faster little ways is. approximately say shared figuring June also that base, breaking a at they're and first, rate monetization. client in will they're through out So, growth not incremental But revenue but their announced additional we when because grow overall their shared client the is we number the growing growing on side, is We out We're point to that's what their than this XXX,XXX. that incremental client at specifically I client transaction. revenue

accretion, secondary As focus the line top job I future. plan is the to to the overall to And far said, profitability as we is a continue base. focus growing the in profitability one to kind That's get But near-term pipeline, the continue is top goal. growing main goal the the line and believe to they and invest grow and on grow the the base. growth in of like new and the user awareness products, grow have

Kartik Mehta

Appreciate Thank you very much. it.

Jeffrey Jones II

Thanks, Kartik.

Operator

you. Thank

Alex Paris comes Barrington of from Our Research. next question

please. question Your

Chris Howe

sitting everyone. Howe Chris afternoon, Good for is in This Alex.

Jeffrey Jones II

Hey, Chris.

Chris Howe

Hey. pertains product follow-up to question My and then my is Wave improvements. first question on

it saw growth revenue growth the quarter, to out of growth revenue XX% Wave, of year-over-year consecutive XX% that you to outside North in attributable Can revenue relates what over As parse was America? you're you America that North and the seeing. versus the quarter of year-over-year portion the mentioned you in

Tony Bowen

in North organically North Yeah. the finding America. in those is of revenue North Almost of are being it the growth today. all clients in very the America, almost monetization majority is United of and They have outside of little States. Most of product with all that America the

Chris Howe

my Okay. to curiosity. And this then, is satisfy

product and talked making different each about you're the investments a phase. lot within improvements You

how As seeing external versus out would you portion observations come I environment? internal dig the competitive deeper improvements, you're into that these within break from observations what

Jeffrey Jones II

it, consumer the to add is he feedback. put tee trying Tony on I'll percentages majority So, wants. precise if based can on user say I in and overwhelming it up Without and would

really net surveys, really promoter listening product unmet do consumer digital to a for primary then in-home scores, across creating solves the our tracking all things those the of always of number to attention pay problems. of and we . is We of That's needs observations, source verbatim. competition So, the products, especially improvement, products,

You what consumers have hear time aware on to than from but of way we competitors, anything your we be smart more be to focusing spend else.

Chris Howe

hop Okay. questions. Thanks in my for back now. the I'll queue taking for

Jeffrey Jones II

Thanks, Chris.

Operator

you. Thank

comes of Our Michael Research. next Millman question Millman from

open. is line Your

Michael Millman

Thank you.

like question, to for to year? the actually first do So, you expectation for Scott's what and returns regard next assisted your year I'd assisting in question what's returns see follow-up ending

Tony Bowen

clarification. just Michael, one

the to H&R specific Block? for mean You industry or

Michael Millman

you meant I I I'd industry, on but Well, latter? have the think the add

Tony Bowen

unusual the with several fees, belief, lot those being obviously, if that believe off industry, our year in to, you things A a think levels little category of in and to the had DIY X% season, then, starting up growing X% government an tax is will. reform converted anomaly. historical was overall we last no to more of being of shutdown now led going But for we being have occur, bit to Yeah, and lot seen to The tax the of a lot filed. we the the extensions are flat extension last won't next reason growth of years. over we've X%, what slightly return into approximately which extensions assisted

and of years several DIY specifically, grown business, improvement on business multi-year trajectory been taken for the we've the Block and client a in H&R assisted obviously, we've, share. For market

term, We on whether trajectory or the We're business growing be seen. we've expect business. assisted means with over that along long we slight improve. But assisted the improvement specifically positive guiding growth trajectory that continue DIY the to to definitely to expect the not in

Michael Millman

same sort of of the Intuit, terms and has with their be seem and of growth. in other small to moving question. it in direction in And business One, areas. discussion question do you was sort Okay. business Two the small Wave to

assisted it this pros do-it-yourself Maybe way using pros pros, ways? in are seem discuss is assisted. indeed look hold we of to in at move be to a or terms to way you using on take at to then secondly, using appropriate look should And or and you an it and different can if to it they to

Jeffrey Jones II

all we actually, serve they pros I'll And what that they tee our is platform taxes. consumers because team I'll is that And do way one second first, of building know XX,XXX we're choose. that think to any is up. answer one the tax the we doing a of advantages have I

they average, on hours As you they may through years experience of go taxes. doing only Every taxes. recall have from XX prior, on training year, of XX-ish

So, our great in base we really part expertise. scale know people down pros to important And a or strategy. we ability asset of up serve the how tax that is those have a

and they Obviously, giving choice the essentially in assisted offer, do multiple want want we're much in we the business, products expertise in on the receive to business how people they and virtual how it.

in our taxes we DIY are Tax that, to many Pro because that's Tax saw these the right of what DIY and themselves there in method. are Keep Review. doing two very DIY, really business, that And Pro is call we consumers and add-ons Go are that confident mind products

the We of also itself, didn't but like know there assisted. choice are many that alternative that didn't full by love also

extra for on terms. So, them, get they help their

really how how about of options. consumer this range the expertise to and their thinking of how So that's tax expertise the can our we we're with pros match it wants

we On did the our business serve small owners. currently know people million X that current first franchisees, one bookkeeping business tax we business of We they are of for under range things your at that business question, in a in in business small owners. today services know we do just today our was and first look our

from place strategy, know think we small of starting the our serving as a businesses. about where that we're So, evolution we already we're

by really owners offering, to is small a it doing really a the that business chance not Wave specifically, So, different digitally and targeting add to accountant.

own decision fact from that's business our already asset was really we have and we today and there came can that more upside more So, and do. is we looking base that inside this that believe where the

Michael Millman

you. that. appreciate I Thank

Jeffrey Jones II

you. Thank

Operator

you. Thank

Our next Sachs. of comes question George from Tong Goldman

Your question please.

George Tong

to you well provide year last will work year, can promotions like worked marketing you'd so like how thoughts year Good last approach to didn't what you afternoon. season. you'd from still quarters specifically for some Hi, to and be different several change? that your away tax this thanks. well to and We're that on But keep compared what

Jeffrey Jones II

George. Hi, Yeah.

all yet, but that things the saw very, few broadest there give in worked and continue. play customer that that was is incredibly television know relatable well year, I'll advertising our she would quite she we The start this serving. won't highlight introduced the I I is to incredibly improve we're metrics macro, play advertising. by is spokesperson you that effective. very we'll which we We So, that a the the

a we in Lisa. success think we So, great have

And to mix micro and if capability the watch end we we go in marketing, finding grow also continues the opposite very messages was that performance I this test our that micro of spectrum, year, shifted a of against our very, successful. with That into targets company consumers to could more investment really really their behavior the and at level. quite

individual in could everyone. it very messages targeting the So, big those we television to to don't to lot and say us deliver things marketing to a switch things the consumers, continue are knowing help have of performance broadly Block two why people to do, see Lisa say, use deliver micro you will understand there's to individual use that we and to they messages that to broad should but

George Tong

That's it. Got helpful.

won't decreasing pricing excellence levers prices year? year versus you share you that a to can elaborate no driver, market hope operational lean assisted,. the With on indicated next performance to that you this You've improve be last longer on year in

Jeffrey Jones II

For sure.

incredibly person to need work do they leave reason, of an refer we they about the to visit operational some the right served, that to for better when making want to job that schedule think part, of expertise the as one office we a like what are an important pro and, consumers matching lever in readiness, that come can is things continue be There which at back. all really to office We the about lot process. level call important they leave, a when sure we and

in lot the the a first there's So, very the to we work right in. impression but somebody get retail is important process. answer to when This how very tactical, around appointment of come part protocols a serve they made operational of phone,

it So, up five operating those of we standard but the wrap are procedures, examples. few all into

Tony Bowen

a is the business transparent leveraged. the for that do change. for think that momentum year and one And on we we upfront would big rolled that from lot there's George, more change I thing industry, big had pricing think add, don't completely year I as is Yeah. a and that two out year the can I the change We in last building year of a this last

George Tong

thank you. Great,

Tony Bowen

George. Thanks,

Jeffrey Jones II

Thanks, George.

Operator

you. Thank

Our next Silber from question Capital BMO of of Jeff comes Markets. the line

line Your is open.

Jeff Silber

– want year the so, I little just might to shift year, more be forgive much. question do a season back but think this more lot that Thanks you tax comfortable? these if this I'm if last to before go a just and fewer folks me so past to the filers if asked relative I – saw curious that reform see we of year. year might to next tax now prior And and post you we'll a DIY in two bit itemized be

Tony Bowen

saw definitely Yeah. fewer It's We itemizing. Tony. Thanks, Jeff. people

well as that Block, across industry. at true the H&R entire as was think I

the IRS provided some that the itemizing. in change there people the stats deduction increase that were and tax that, think a lot I the fewer on given reform standard

switching and always DIY. There's, assisted between obviously,

may vice they Some taxes or own people, their their comfortable life situation feel changes doing versa. and more

that be has this for stuck, I needed that always year reform, know clients tax year. true So, that, clients help because out, at comfortable assisted they got will feel no have several more the net the way, along migration is shakes all How expectation seen from and base the last we've as the that wanted, assisted somewhat to years. maybe DIY be tax outcome could some doubt we DIY that there'll taking a that own true in shot will there last there's also and what be been upcoming taxes, over will didn't of but be migration to well. our doing that so get with their line

Jeff Silber

extensions on more much? and Okay, I that And saw Do reported? so, great. I focus just past year you the revenue That's July the lot in how think were than is we there quarter think quarter a know roughly And prior. this this helpful. season minor, but boost the tax you to if reported, just in helped you that

Tony Bowen

strong in offset at end been was season filers pre-season. both now The and charge, made last now has season I definitely net lower are the tax especially Client the converting to assisted that business. in extension the Yeah, pre-season. though, due volume filed carrying had in assisted into that's the last of are over think partly average by It the tax an changes and DIY pricing impact. that we

model pricing We have pre-season, the upfront same calling extension what we're transparent season. the in

had season saw is in filing season. into clients, the carrying we extension offset forward the there is at but the an doubt that that So, to the last activity tax of increase no extension end

Jeff Silber

should And quarter you October, help well, probably Great. ending in the current that in correct? as

Tony Bowen

into would continue QX I that Yeah, expect well. as to

Jeff Silber

Okay, so much. great. Thanks

Jeffrey Jones II

Thanks, Jeff.

Operator

Thank time, to turn the you. over back remarks. Sir? I'd for like any At this call Brown closing to Colby

Colby Brown

joining everyone, this you, us Thank conclude will and call. today's for

Operator

Thank this Ladies gentlemen, and the concludes call. you, sir.

your You time. may a wonderful this lines disconnect day. Have at

H&R Block (HRB) 28 Aug 192020 Q1 Earnings call transcript