H&R Block (HRB) investor relations material

Executive summary

• Fiscal 2026 delivered strong results with revenue up 4.9% to $3.95 billion, EBITDA up 8.3%, and adjusted EPS up 13.9% year-over-year, marking the best financial performance in five years and reflecting progress on long-term strategic priorities.

• Net income from continuing operations rose 20.8% to $736.3 million, with reported EPS up 28.7% to $5.69.

• Strategic focus on converting and retaining higher-value, more complex clients, supported by technology and expert-led services, drove improved business quality, client outcomes, and a 200 bps improvement in conversion.

• Enhanced client retention (+190 bps overall, +600 bps for Second Look clients) and nearly doubled engagement in AI Tax Assist compared to FY25.

• $714 million was returned to shareholders via dividends and share repurchases, including a 10% increase in the quarterly dividend.

Financial highlights

• Revenue reached $3.95 billion, up 4.9% year-over-year, driven by higher net average charge, U.S. assisted tax prep volume, international growth, and small business momentum at Wave.

• EBITDA was $1.06 billion, up 8.3% year-over-year, with margin expansion to 26.8%.

• Net income from continuing operations was $736 million; adjusted net income was $688 million.

• Adjusted EPS was $5.31, up 13.9% year-over-year, aided by share repurchases and higher adjusted net income.

• Free cash flow was $756 million, and operating cash flow increased 23% to $838.7 million.

Outlook and guidance

• Fiscal 2027 revenue is projected at $4.11–$4.16 billion, adjusted EBITDA at $1.11–$1.14 billion, and adjusted EPS at $6.04–$6.24.

• Effective tax rate expected to rise to approximately 23%.

• $400 million in share repurchases planned for fiscal 2027; quarterly dividend increased by 10% to $0.46 per share.

• Industry growth expected to moderate, but company expects to maintain or grow assisted category market share and continue small business services expansion.

• Increased investments in consultative services, automation, and small business expansion are planned.