H&R Block, Inc.

Thank you for standing by and welcome to H&R Block's first quarter fiscal year 2024 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. To remove yourself from the queue, please press star 1-1 again. I would now like to hand the call over to Vice President, Investor Relations, Michela Galina. Please go ahead.

Thank you, Lateef. Good afternoon, everyone, and welcome to H&R Block's first quarter fiscal year 2024 financial results conference call. Joining me today are Jeff Jones, our President and Chief Executive Officer, and Tony Bowen, our Chief Financial Officer. Earlier today, we issued a press release and presentation, which can be downloaded or viewed live on our website at investors.hrblock.com. Our call is being broadcast and webcast live, and a replay of the webcast will be available for 90 days. Before we begin, I'd like to remind listeners that comments made by management may include forward-looking statements within the meaning of federal securities laws. These statements involve material risks and uncertainties, and actual results could differ from those projected in any forward-looking statement due to numerous factors. For a description of these risks and uncertainties, please see H&R Block's annual report on Form 10-K and quarterly reports on Form 10-Q, as updated periodically with our other SEC filings. Please note, some metrics we'll discuss today are presented on a non-GAAP basis. We've reconciled the comparable GAAP and non-GAAP figures in the appendix of our presentation. Finally, the content of this call contains time-sensitive information, accurate only as of today, November 7th, 2023. H&R Block undertakes no obligation to revise or otherwise update any statements to reflect events or circumstances after the date of this call. With that, I will now turn it over to Jeff.

Thank you, Michaela. Good afternoon, everyone, and thanks for joining us. Today, I will begin with a summary of our Q1 results and provide an update on our block horizon strategic imperatives. Then Tony will discuss our financials, including the strength of our capital allocation and balance sheet. While we are early in the year, and Q1 is a relatively small portion of our results, we had a good start and are reaffirming our fiscal 24 outlook. We were pleased given we lapped a very strong extended season last year, and our share in both DIY and assisted slightly improved throughout the year. With favorability in NAC, we grew revenue, continued to manage our expenses well, and demonstrated ongoing progress on our block horizon strategy, which I'll share more about in a moment. We also continued our share repurchase program, buying $132 million in the quarter. Let's go deeper into block horizons, beginning with small business, which includes small business tax and services and WAVE. Assisted small business total revenue growth was 6% in the quarter, and we're pleased with the early signals we're seeing in bookkeeping and payroll services, which are growing double digits. We see a long runway of opportunity and are focused on continuing our momentum which includes growing clients in both tax and services and driving business formations, which we launched last year. Overall, we feel good about the trajectory of small business. Turning to WAVE, revenue growth was 6% in Q1, which was in line with our expectations. As we've shared, we underwent a strategic review of the business when the new leader was put in place. We now have a plan to accelerate revenue growth and put us on a path to profitability. Before I share those plans, I want to recap Wave's current business model, which provides tremendous value for small business owners by offering free invoicing and accounting. Wave has monetized its platform primarily through payment processing, as well as payroll and advisory services. We are now beginning a strategic shift to solve customer pain points that will deliver value and monetize more premium features. In the payment space, customers are wanting additional options beyond credit cards, which Wave historically has not provided. Today, less than 30% of invoices sent by small businesses through Wave's platform are enabled for credit card or bank payments. Thus, there's significant opportunity to unlock value as we enable our customers to be paid via alternative methods and expand our share of wallet. We also see an opportunity to build other premium features that help our customers run their small business. Last quarter, we launched the mobile receipts feature, which is a monthly or annual subscription that generates additional recurring revenue. This product's uptake has been better than expected. and is a good example of where we're heading. I am excited about the shifts we're making and the opportunities we see in this business. Now I'll move on to financial products. Regarding Spruce, recall that tax season 23 was the first time the product was introduced in the assisted channel. Our learnings have informed our actions for the next tax season, and we are continuing to drive innovation for the customer experience. We've made the account creation and signup process more seamless in all our channels, and deposit trends from customers utilizing Spruce to receive their payroll direct deposit continue to improve. As of September 30, we surpassed 300,000 signups and had almost $400 million in customer deposits. In fiscal 24, we're focused on efficiently acquiring clients at tax time, which includes the DIY flow and driving customer engagement within the app. Now let's turn to block experience. This imperative is all about blending digital tools with human help to provide better experiences for clients while empowering them to be served however they choose. Fully virtual to fully in person and everything in between. We have made a number of enhancements to my block this year. Within the app, clients will now have visibility of where they are at each stage of the tax prep process through a status tracker on their homepage. In addition, we'll be delivering a personalized checklist to help clients be better prepared for forms they will need and how to upload them ahead of time. The app will provide help at each stage with a call to action that recommends clients' next step, whether uploading new documents, getting help from one of our expert tax professionals, or notifying them that it's time to review their return, which we've made easier and faster to approve and sign online. Clients also have the ability to access their tax documents and return digitally, which aligns with our new print-less strategy to reduce paper consumption in our offices. This is a benefit for our clients, results in cost savings, and is one of the many ways we live our commitment to environmental sustainability. Another priority within Block Experience is leaning into Gen AI. As we've shared, we are initially focused on two areas. First, enhancing the customer experience, and second, reducing expenses and increasing productivity. In the DIY channel, we're working on exciting innovation that will support our clients throughout the tax prep experience. and we are testing the ability to use AI to field customer calls. Over time, we believe these initiatives can result in meaningful cost savings, but we are not assuming any this fiscal year as we are in initial testing phases. All in all, we're making tangible progress through our partnership with Microsoft. In fact, they recently highlighted our work to thought leaders and industry experts during the Envision Tour in New York. As you can see, our team continues to make progress, and we are well positioned to deliver results this year. Before turning it to Tony, I want to mention that we recently published our fourth annual Environmental, Social, and Governance Report for Fiscal Year 23, reflecting our ongoing commitment to transparency, sustainability, and responsible business practices. I encourage you to visit our Investor Relations website to read it in full. With that, I will now pass things over to Tony to share more about our financial results.