===== BLAD: Cover ===== Cover - shares 6 Months Ended Dec. 31, 2024 Jan. 31, 2025 Cover [Abstract] Document Type 10-Q Document Quarterly Report true Document Period End Date Dec. 31, 2024 Document Transition Report false Entity File Number 1-06089 Entity Registrant Name H&R Block, Inc. Entity Incorporation, State or Country Code MO 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 Title of 12(b) Security Common Stock, without par value Trading Symbol HRB Security Exchange Name NYSE Entity Current Reporting Status Yes Entity Interactive Data Current Yes Entity Filer Category Large Accelerated Filer Entity Small Business false Entity Emerging Growth Company false Entity Shell Company false Amendment Flag false Document Fiscal Year Focus 2025 Document Fiscal Period Focus Q2 Entity Central Index Key 0000012659 Current Fiscal Year End Date --06-30 Entity Common Stock, Shares Outstanding   133849262 ===== BLAD: CONSOLIDATED STATEMENTS OF OPER ===== CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands 3 Months Ended 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Dec. 31, 2024 Dec. 31, 2023 REVENUES: Total revenues 179070 179083 372880 362883 OPERATING EXPENSES: Costs of revenues 314209 299827 583790 559185 Selling, general and administrative 158152 146688 310712 277456 Total operating expenses 472361 446515 894502 836641 Other income (expense), net 2744 5922 14661 15758 Interest expense on borrowings -21752 -21364 -37599 -37234 Loss from continuing operations before income tax benefit -312299 -282874 -544560 -495234 Income tax benefit -69833 -93758 -130673 -143245 Net loss from continuing operations -242466 -189116 -413887 -351989 Net loss from discontinued operations, net of tax benefits of $286, $191, $631 and $373 -954 -639 -2109 -1248 NET LOSS -243420 -189755 -415996 -353237 BASIC AND DILUTED LOSS PER SHARE: Continuing operations -1.79 -1.33 -3.02 -2.44 Diluted -1.79 -1.33 -3.02 -2.44 Discontinued operations -0.01 0 -0.01 -0.01 Consolidated -1.8 -1.33 -3.03 -2.45 Dividends declared per share (in usd per share) 0.375 0.32 0.75 0.64 COMPREHENSIVE LOSS: Net loss -243420 -189755 -415996 -353237 Change in foreign currency translation adjustments -29034 11559 -22917 645 Other comprehensive income (loss) -29034 11559 -22917 645 Comprehensive loss -272454 -178196 -438913 -352592 Service revenues REVENUES: Total revenues 152968 149081 334739 320807 Royalty, product and other revenues REVENUES: Total revenues 26102 30002 38141 42076 ===== BLAD: CONSOLIDATED STATEMENTS OF OP_2 ===== CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Parenthetical) - USD ($) $ in Thousands 3 Months Ended 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Dec. 31, 2024 Dec. 31, 2023 Income Statement [Abstract] Discontinued Operation, Tax Effect of Discontinued Operation 286 191 631 373 ===== BLAD: CONSOLIDATED BALANCE SHEETS ===== CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands Dec. 31, 2024 Jun. 30, 2024 ASSETS Cash and cash equivalents 320051 1053326 Cash and cash equivalents - restricted 21473 21867 Receivables, less allowance for credit losses of $20,025 and $61,182 321171 69075 Prepaid expenses and other current assets 114658 95208 Total current assets 777353 1239476 Property and equipment, at cost, less accumulated depreciation and amortization of $849,691 and $838,814 143833 131319 Operating lease right of use assets 389629 461986 Intangible assets, net 270601 264102 Goodwill 783286 785226 Deferred tax assets and income taxes receivable 281694 271658 Other noncurrent assets 65924 65043 Total assets 2712320 3218810 LIABILITIES: Accounts payable and accrued expenses 136893 155830 Accrued salaries, wages and payroll taxes 64993 105548 Accrued income taxes and reserves for uncertain tax positions 149255 318830 Current portion of long-term debt 349611 0 Operating lease liabilities 170726 206070 Deferred revenue and other current liabilities 187885 191050 Total current liabilities 1059363 977328 Long-term debt and line of credit borrowings 1932545 1491095 Deferred tax liabilities and reserves for uncertain tax positions 292643 291063 Operating lease liabilities 228041 265373 Deferred revenue and other noncurrent liabilities 72188 103357 Total liabilities 3584780 3128216 COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY: Common stock, no par, stated value $0.01 per share, 800,000,000 shares authorized, shares issued of 164,367,434 and 170,915,771 1644 1709 Additional paid-in capital 752093 762583 Accumulated other comprehensive loss -71762 -48845 Retained earnings (deficit) -908785 12654 Less treasury shares, at cost, of 30,522,962 and 31,324,609 -645650 -637507 Total stockholders' equity (deficiency) -872460 90594 Total liabilities and stockholders' equity 2712320 3218810 Treasury stock, shares (in shares) 30522962 31324609 ===== BLAD: CONSOLIDATED BALANCE SHEETS (Pa ===== CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands Dec. 31, 2024 Jun. 30, 2024 Statement of Financial Position [Abstract] Allowance for doubtful accounts 20025 61182 Accumulated depreciation and amortization 849691 838814 Common stock, stated value per share (in usd per share) 0.01 0.01 Common stock, shares authorized (in shares) 800000000 800000000 Common stock, shares issued (in shares) 164367434 170915771 Treasury stock, shares (in shares) 30522962 31324609 ===== BLAD: CONSOLIDATED STATEMENTS OF CASH ===== CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Thousands 3 Months Ended 6 Months Ended Dec. 31, 2023 USD ($) Dec. 31, 2024 USD ($) Dec. 31, 2023 USD ($) CASH FLOWS FROM OPERATING ACTIVITIES: Net loss -189755 -415996 -353237 Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization   58026 60331 Provision for credit losses   20727 21536 Deferred taxes   -1531 -35525 Stock-based compensation   17945 17525 Changes in assets and liabilities, net of acquisitions: Receivables   -262348 -348833 Prepaid expenses, other current and noncurrent assets   2588 -7395 Accounts payable, accrued expenses, salaries, wages and payroll taxes   -76806 -58543 Deferred revenue, other current and noncurrent liabilities   -45170 -58520 Income tax receivables, accrued income taxes and income tax reserves   -192340 -180706 Other, net   -733 1201 Net cash used in operating activities   -895638 -942166 CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures   -49115 -32708 Payments made for business acquisitions, net of cash acquired   -28017 -27158 Franchise loans funded   -17442 -15491 Payments from franchisees   971 2747 Other, net   6110 1565 Net cash used in investing activities   -87493 -71045 CASH FLOWS FROM FINANCING ACTIVITIES: Repayments of Long-Term Lines of Credit   -100000 -25000 Proceeds from Long-Term Lines of Credit   890000 825000 Dividends paid   -96960 -89854 Repurchase of common stock, including shares surrendered   -436233 -378709 Other, net   1791 4011 Net cash provided by financing activities   258598 335448 Effects of exchange rate changes on cash   -9136 671 Net decrease in cash and cash equivalents, including restricted balances   -733669 -677092 Cash, cash equivalents and restricted cash, beginning of period   1075193 1015316 Cash, cash equivalents and restricted cash, end of period 338224 341524 338224 SUPPLEMENTARY CASH FLOW DATA: Income taxes paid, net (includes payments for purchased investment tax credits) 72160 62290 Interest paid on borrowings 35496 33412 Accrued additions to property and equipment 4036 3798 New operating right of use assets and related lease liabilities 70532 47135 Accrued dividends payable to common shareholders 45273 50176 45273 ===== BLAD: CONSOLIDATED STATEMENT OF STOCK ===== CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands Total Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss(1) Retained Earnings (Deficit) Treasury Stock, Common Beginning Balances, (in shares) at Jun. 30, 2023   178936000       32786000 Beginning Balances, Value at Jun. 30, 2023 32064 1789 770376 -37099 [1] -48677 -654325 Increase (Decrease) in Stockholders' Equity [Roll Forward] Net loss -163482       -163482 Other comprehensive income (loss) -10914     -10914 [1] Stock-based compensation 6211   6211 Stock-based awards exercised or vested -98   -34226   -3220 37348 Stock-based awards exercised or vested (in shares)           1867000 Acquisition of treasury shares (in shares) [2]           -823000 Acquisition of treasury shares(2) [2] -28464         -28464 Repurchase and retirement of common shares (in shares)   -3265000 Repurchase and retirement of common shares -133300 -32 -1927   -131341 Cash dividends declared - $0.38 per share -46901       -46901 Ending Balances, (in shares) at Sep. 30, 2023   175671000       31742000 Ending Balances, Value at Sep. 30, 2023 -344884 1757 740434 -48013 [1] -393621 -645441 Increase (Decrease) in Stockholders' Equity [Roll Forward] Dividends declared per share (in usd per share) 0.32 Beginning Balances, (in shares) at Jun. 30, 2023   178936000       32786000 Beginning Balances, Value at Jun. 30, 2023 32064 1789 770376 -37099 [1] -48677 -654325 Increase (Decrease) in Stockholders' Equity [Roll Forward] Net loss -353237 Ending Balances, (in shares) at Dec. 31, 2023   170916000       31397000 Ending Balances, Value at Dec. 31, 2023 -772652 1709 746734 -36454 -846162 -638479 Increase (Decrease) in Stockholders' Equity [Roll Forward] Dividends declared per share (in usd per share) 0.64 Stock-based compensation 17500 Beginning Balances, (in shares) at Sep. 30, 2023   175671000       31742000 Beginning Balances, Value at Sep. 30, 2023 -344884 1757 740434 -48013 [1] -393621 -645441 Increase (Decrease) in Stockholders' Equity [Roll Forward] Net loss -189755       -189755 Other comprehensive income (loss) 11559     11559 Stock-based compensation 9270   9270 Stock-based awards exercised or vested 6876   -165   -46 7087 Stock-based awards exercised or vested (in shares)           348000 Acquisition of treasury shares (in shares)           -3000 Acquisition of treasury shares(2) -125         -125 Repurchase and retirement of common shares (in shares)   -4755000 Repurchase and retirement of common shares -220320 -48 -2805   -217467 Cash dividends declared - $0.38 per share -45273       -45273 Ending Balances, (in shares) at Dec. 31, 2023   170916000       31397000 Ending Balances, Value at Dec. 31, 2023 -772652 1709 746734 -36454 -846162 -638479 Increase (Decrease) in Stockholders' Equity [Roll Forward] Dividends declared per share (in usd per share) 0.32 Stock-based compensation 9900 Beginning Balances, (in shares) at Jun. 30, 2024   170916000       31325000 Beginning Balances, Value at Jun. 30, 2024 90594 1709 762583 -48845 [1] 12654 -637507 Increase (Decrease) in Stockholders' Equity [Roll Forward] Net loss -172576       -172576 Other comprehensive income (loss) 6117     6117 [1] Stock-based compensation 7463   7463 Stock-based awards exercised or vested 247   -23990   -2611 26848 Stock-based awards exercised or vested (in shares)           1319000 Acquisition of treasury shares (in shares) [2]           -567000 Acquisition of treasury shares(2) [2] -35882         -35882 Repurchase and retirement of common shares (in shares)   -3301000 Repurchase and retirement of common shares -211721 -33 -1980   -209708 Cash dividends declared - $0.38 per share -52307       -52307 Ending Balances, (in shares) at Sep. 30, 2024   167615000       30573000 Ending Balances, Value at Sep. 30, 2024 -368065 1676 744076 -42728 [1] -424548 -646541 Increase (Decrease) in Stockholders' Equity [Roll Forward] Dividends declared per share (in usd per share) 0.375 Beginning Balances, (in shares) at Jun. 30, 2024   170916000       31325000 Beginning Balances, Value at Jun. 30, 2024 90594 1709 762583 -48845 [1] 12654 -637507 Increase (Decrease) in Stockholders' Equity [Roll Forward] Net loss -415996 Ending Balances, (in shares) at Dec. 31, 2024   164367000       30523000 Ending Balances, Value at Dec. 31, 2024 -872460 1644 752093 -71762 [1] -908785 -645650 Increase (Decrease) in Stockholders' Equity [Roll Forward] Dividends declared per share (in usd per share) 0.75 Stock-based compensation 17900 Beginning Balances, (in shares) at Sep. 30, 2024   167615000       30573000 Beginning Balances, Value at Sep. 30, 2024 -368065 1676 744076 -42728 [1] -424548 -646541 Increase (Decrease) in Stockholders' Equity [Roll Forward] Net loss -243420       -243420 Other comprehensive income (loss) -29034     -29034 [1] Stock-based compensation 9156   9156 Stock-based awards exercised or vested 1709   810   -245 1144 Stock-based awards exercised or vested (in shares)           54000 Acquisition of treasury shares (in shares)           -4000 Acquisition of treasury shares(2) -253         -253 Repurchase and retirement of common shares (in shares)   -3248000 Repurchase and retirement of common shares -192377 -32 -1949   -190396 Cash dividends declared - $0.38 per share -50176       -50176 Ending Balances, (in shares) at Dec. 31, 2024   164367000       30523000 Ending Balances, Value at Dec. 31, 2024 -872460 1644 752093 -71762 [1] -908785 -645650 Increase (Decrease) in Stockholders' Equity [Roll Forward] Dividends declared per share (in usd per share) 0.375 Stock-based compensation 9200 [1] The balance of our accumulated other comprehensive loss consists of foreign currency translation adjustments. Represents shares swapped or surrendered to us in connection with the vesting or exercise of stock-based awards. ===== BLAD: CONSOLIDATED STATEMENT OF STO_2 ===== CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares 3 Months Ended 6 Months Ended Dec. 31, 2024 Sep. 30, 2024 Dec. 31, 2023 Sep. 30, 2023 Dec. 31, 2024 Dec. 31, 2023 Statement of Stockholders' Equity [Abstract] Cash dividends declared per share (in usd per share) 0.375 0.375 0.32 0.32 0.75 0.64 ===== BLAD: SUMMARY OF SIGNIFICANT ACCOUNTI ===== SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 6 Months Ended Dec. 31, 2024 Accounting Policies [Abstract] SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF PRESENTATION – The consolidated balance sheets as of December 31, 2024 and June 30, 2024, the consolidated statements of operations and comprehensive loss for the three and six months ended December 31, 2024 and 2023, the consolidated statements of cash flows for the six months ended December 31, 2024 and 2023, and the consolidated statements of stockholders' equity for the three and six months ended December 31, 2024 and 2023 have been prepared by the Company, without audit. In the opinion of management, all adjustments, which include only normal recurring adjustments, necessary to present fairly the financial position, results of operations, and cash flows as of December 31, 2024 and 2023 and for all periods presented, have been made. "H&R Block," "the Company," "we," "our," and "us" are used interchangeably to refer to H&R Block, Inc., to H&R Block, Inc. and its subsidiaries, or to H&R Block, Inc.'s operating subsidiaries, as appropriate to the context. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (GAAP) have been condensed or omitted. These consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in our June 30, 2024 Annual Report on Form 10-K. All amounts presented herein as of June 30, 2024 or for the year then ended are derived from our Annual Report on Form 10-K. MANAGEMENT ESTIMATES – The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates, assumptions and judgments are applied in the evaluation of contingent losses associated with pending claims and litigation, reserves for uncertain tax positions, and fair value of reporting units. Estimates have been prepared based on the best information available as of each balance sheet date. As such, actual results could differ materially from those estimates. SEASONALITY OF BUSINESS – Our operating revenues are seasonal in nature with peak revenues typically occurring in the months of February through April. Therefore, results for interim periods are not indicative of results to be expected for the full year. DISCONTINUED OPERATIONS – Our discontinued operations include the results of operations of Sand Canyon Corporation, previously known as Option One Mortgage Corporation, which exited its mortgage business in fiscal year 2008. ===== BLAD: REVENUE RECOGNITION ===== REVENUE RECOGNITION 6 Months Ended Dec. 31, 2024 Revenue from Contract with Customer [Abstract] REVENUE RECOGNITION NOTE 2: REVENUE RECOGNITION The majority of our revenues are from our United States (U.S.) tax services business. The following table disaggregates our U.S. revenues by major service line, with revenues from our international tax services businesses and from Wave included as separate lines: (in 000s) Three months ended December 31, Six months ended December 31, 2024 2023 2024 2023 Revenues: U.S. assisted tax preparation $ 48,380 $ 48,342 $ 91,343 $ 87,605 U.S. royalties 3,499 5,454 9,351 11,155 U.S. 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 Emerald Card® and Spruce SM 10,148 11,700 18,974 20,333 Interest and fee income on Emerald Advance® 12,308 15,235 12,308 15,533 International 31,811 29,569 96,666 90,134 Wave 26,561 23,133 52,964 47,076 Other 11,824 9,592 25,633 20,572 Total revenues $ 179,070 $ 179,083 $ 372,880 $ 362,883 Changes in the balances of deferred revenue and wages for our Peace of Mind® Extended Service Plan (POM) are as follows: (in 000s) POM Deferred Revenue Deferred Wages Six months ended December 31, 2024 2023 2024 2023 Balance, beginning of the period $ 156,610 $ 167,257 $ 20,212 $ 21,828 Amounts deferred 3,209 3,601 15 8 Amounts recognized on previous deferrals (46,962) (48,995) (6,092) (5,590) Balance, end of the period $ 112,857 $ 121,863 $ 14,135 $ 16,246 As of December 31, 2024, deferred revenue related to POM was $112.9 million. We expect that $83.0 million will be recognized over the next twelve months, while the remaining balance will be recognized over the following five years. As of December 31, 2024 and 2023, Tax Identity Shield® (TIS) deferred revenue was $14.1 million and $16.5 million, respectively. Deferred revenue related to TIS was $21.4 million and $25.2 million as of June 30, 2024 and 2023, respectively. All deferred revenue related to TIS will be recognized by April 2025. ===== BLAD: EARNINGS PER SHARE AND STOCKHOL ===== EARNINGS PER SHARE AND STOCKHOLDERS' EQUITY 6 Months Ended Dec. 31, 2024 Earnings Per Share [Abstract] EARNINGS PER SHARE AND STOCKHOLDERS' EQUITY NOTE 3: EARNINGS PER SHARE AND STOCKHOLDERS' EQUITY EARNINGS PER SHARE – Basic and diluted earnings (loss) per share is computed using the two-class method. The two-class method is an earnings allocation formula that determines net income per share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. Per share amounts are computed by dividing net income (loss) from continuing operations attributable to common shareholders by the weighted average shares outstanding during each period. Diluted earnings per share excludes the impact of shares of common stock issuable upon the lapse of certain restrictions or the exercise of options to purchase 2.7 million shares for the three and six months ended December 31, 2024 and 3.2 million shares for the three and six months ended December 31, 2023, as the effect would be antidilutive due to the net loss from continuing operations during the periods. The computations of basic and diluted earnings (loss) per share from continuing operations are as follows: (in 000s, except per share amounts) Three months ended December 31, Six months ended December 31, 2024 2023 2024 2023 Net loss from continuing operations attributable to shareholders $ (242,466) $ (189,116) $ (413,887) $ (351,989) Amounts allocated to participating securities (240) (192) (469) (369) Net loss from continuing operations attributable to common shareholders $ (242,706) $ (189,308) $ (414,356) $ (352,358) Basic weighted average common shares 135,563 142,340 137,359 144,307 Potential dilutive shares — — — — Dilutive weighted average common shares 135,563 142,340 137,359 144,307 Loss per share from continuing operations attributable to common shareholders: Basic $ (1.79) $ (1.33) $ (3.02) $ (2.44) Diluted (1.79) (1.33) (3.02) (2.44) The decrease in the weighted average shares outstanding is due to share repurchases completed in the current and prior fiscal years. STOCK-BASED COMPENSATION ===== BLAD: RECEIVABLES ===== RECEIVABLES 6 Months Ended Dec. 31, 2024 Accounts, Notes, Loans and Financing Receivable, Unclassified [Abstract] RECEIVABLES NOTE 4: RECEIVABLES Receivables, net of their related allowance, consist of the following: (in 000s) As of December 31, 2024 June 30, 2024 Short-term Long-term Short-term Long-term Loans to franchisees $ 19,764 $ 20,861 $ 5,917 $ 16,498 Receivables for U.S. assisted and DIY tax preparation and related fees 9,823 5,440 18,440 5,332 H&R Block's Instant Refund® receivables 1,375 184 2,947 207 Emerald Advance® 266,110 23,643 17,867 21,360 Software receivables from retailers 2,073 — 1,029 — Royalties and other receivables from franchisees 6,955 — 5,808 — Wave payment processing receivables 693 — 1,078 — Other 14,378 659 15,989 427 Total $ 321,171 $ 50,787 $ 69,075 $ 43,824 Balances presented above as short-term are included in receivables, while the long-term portions are included in other noncurrent assets in the consolidated balance sheets. LOANS TO FRANCHISEES – Franchisee loan balances consist of term loans made primarily to finance the purchase of franchises and revolving lines of credit primarily for the purpose of funding working capital needs. As of December 31, 2024 and June 30, 2024, loans with a principal balance more than 90 days past due or on non-accrual status were $2.2 million and $1.1 million, respectively. H&R BLOCK'S INSTANT REFUND ® – H&R Block's Instant Refund® amounts are generally received from the Canada Revenue Agency within 60 days of filing the client's return, with the remaining balance collectible from the client. We review the credit quality of our Instant Refund receivables based on pools, which are segregated by the tax return year of origination, with older years being deemed more unlikely to be repaid. We establish an allowance for credit losses at an amount that we believe reflects the receivable at net realizable value. In December of each year, we charge-off the receivables and the related allowance to an amount we believe represents the net realizable value. Balances and amounts on non-accrual status, classified as impaired, or more than 60 days past due, by tax return year of origination, as of December 31, 2024 are as foll ows: (in 000s) Tax return year of origination Balance More Than 60 Days Past Due 2023 $ 375 $ 316 2022 and prior 1,184 1,184 1,559 $ 1,500 Allowance — Net balance $ 1,559 EMERALD ADVANCE ® – We review the credit quality of our purchased participation interests in Emerald Advance® (EA) receivables based on pools, which are segregated by the fiscal year of origination, with older years being deemed more unlikely to be repaid. We establish an allowance for credit losses at an amount that we believe reflects the receivable at net realizable value. Typically, in December of each year, we charge-off the receivables and the related allowance for EAs to an amount we believe represents the net realizable value. Balances and amounts on non-accrual status, classified as impaired, or more than 60 days past due, by fiscal year of origination, as of December 31, 2024 are as follows: (in 000s) Fiscal year of origination Balance Non-Accrual 2025 $ 270,393 $ — 2024 and prior 38,469 38,469 308,862 $ 38,469 Allowance (19,109) Net balance $ 289,753 ALLOWANCE FOR CREDIT LOSSES – Activity in the allowance for credit losses for EA and all other short-term and long-term receivables for the six months ended December 31, 2024 and 2023 is as follows: (in 000s) EAs All Other Total Balances as of July 1, 2024 $ 33,536 $ 45,327 $ 78,863 Provision for credit losses 19,109 1,618 20,727 Charge-offs, recoveries and other (33,536) (45,552) (79,088) Balances as of December 31, 2024 $ 19,109 $ 1,393 $ 20,502 Balances as of July 1, 2023 $ 27,386 $ 35,108 $ 62,494 Provision for credit losses 17,885 3,651 21,536 Charge-offs, recoveries and other (27,714) (37,613) (65,327) Balances as of December 31, 2023 $ 17,557 $ 1,146 $ 18,703 ===== BLAD: GOODWILL AND INTANGIBLE ASSETS ===== GOODWILL AND INTANGIBLE ASSETS 6 Months Ended Dec. 31, 2024 Goodwill and Intangible Assets Disclosure [Abstract] GOODWILL AND INTANGIBLE ASSETS NOTE 5: GOODWILL AND INTANGIBLE ASSETS Changes in the carrying amount of goodwill for the six months ended December 31, 2024 are as follows: (in 000s) Goodwill Accumulated Impairment Losses Net Balances as of July 1, 2024 $ 923,523 $ (138,297) $ 785,226 Acquisitions (1) 12,761 — 12,761 Disposals and foreign currency changes, net (14,701) — (14,701) Impairments — — — Balances as of December 31, 2024 $ 921,583 $ (138,297) $ 783,286 (1) All goodwill added during the period is expected to be tax-deductible for federal income tax reporting. We test goodwill for impairment annually as of February 1, or more frequently if events occur or circumstances change which would, more likely than not, reduce the fair value of a reporting unit below its carrying value. Components of intangible assets are as follows: (in 000s) Gross Carrying Amount Accumulated Net As of December 31, 2024: Reacquired franchise rights $ 413,752 $ (235,650) $ 178,102 Customer relationships 350,700 (280,481) 70,219 Internally-developed software 123,495 (122,332) 1,163 Noncompete agreements 22,807 (19,857) 2,950 Purchased technology 70,100 (54,543) 15,557 Trade name 5,800 (3,190) 2,610 $ 986,654 $ (716,053) $ 270,601 As of June 30, 2024: Reacquired franchise rights $ 403,955 $ (228,157) $ 175,798 Customer relationships 331,435 (270,245) 61,190 Internally-developed software 122,673 (119,610) 3,063 Noncompete agreements 21,977 (19,494) 2,483 Purchased technology 70,100 (51,432) 18,668 Trade name 5,800 (2,900) 2,900 $ 955,940 $ (691,838) $ 264,102 We made payments to acquire businesses totaling $28.0 million and $27.2 million during the six months ended December 31, 2024 and 2023, respectively. The amounts and weighted-average lives of intangible assets acquired during the six months e nded December 31, 2024, including amounts capitalized related to internally-developed software, a re as follows: (dollars in 000s) Amount Weighted-Average Life (in years) Customer relationships $ 19,705 5 Reacquired franchise rights 9,983 6 Internally-developed software 1,027 3 Noncompete agreements 871 5 Total $ 31,586 5 Amortization of intangible assets for the three and six months ended December 31, 2024 was $12.1 million and $25.0 million, respectively, compared to $15.4 million and $31.2 million for the three and six months ended December 31, 2023. Estimated amortization of intangible assets for fiscal years ending June 30, 2025, 2026, 2027, 2028, and 2029 is $47.0 million, $39.9 million, $33.1 million, $24.9 million and $16.5 million, respectively. ===== BLAD: LONG-TERM DEBT ===== LONG-TERM DEBT 6 Months Ended Dec. 31, 2024 Debt Disclosure [Abstract] LONG-TERM DEBT NOTE 6: LONG-TERM DEBT The components of long-term debt are as follows: (in 000s) As of December 31, 2024 June 30, 2024 Senior Notes, 5.250%, due October 2025 $ 350,000 $ 350,000 Senior Notes, 2.500%, due July 2028 500,000 500,000 Senior Notes, 3.875%, due August 2030 650,000 650,000 Committed line of credit borrowings 790,000 — Debt issuance costs and discounts (7,844) (8,905) Total long-term debt 2,282,156 1,491,095 Less: Current portion (349,611) — Long-term portion $ 1,932,545 $ 1,491,095 Estimated fair value of long-term debt $ 2,193,000 $ 1,391,000 Our unsecured committed line of credit (CLOC) provides for an unsecured senior revolving credit facility in the aggregate principal amount of $1.5 billion, which includes a $175.0 million sublimit for swingline loans and a $50.0 million sublimit for standby letters of credit. We may request increases in the aggregate principal amount of the revolving credit facility of up to $500.0 million, subject to obtaining commitments from lenders and meeting certain other conditions. The CLOC will mature on June 11, 2026, unless extended pursuant to the terms of the CLOC, at which time all outstanding amounts thereunder will be due and payable. Our CLOC includes an annual facility fee, which will vary depending on our then current credit ratings. The CLOC is subject to various conditions, triggers, events or occurrences that could result in earlier termination and contains customary representations, warranties, covenants and events of default, including, without limitation: (1) a covenant requiring the Company to maintain a debt-to-EBITDA ratio, as defined by the CLOC agreement, calculated on a consolidated basis of no greater than (a) 3.50 to 1.00 as of the last day of each fiscal quarter ending on March 31, June 30, and September 30 of each year and (b) 4.50 to 1.00 as of the last day of each fiscal quarter ending on December 31 of each year; (2) a covenant requiring us to maintain an interest coverage ratio (EBITDA-to-interest expense) calculated on a consolidated basis of not less than 2.50 to 1.00 as of the last date of any fiscal quarter; and (3) covenants restricting our ability to incur certain additional debt, incur liens, merge or consolidate with other companies, sell or dispose of assets (including equity interests), liquidate or dissolve, engage in certain transactions with affiliates or enter into certain restrictive agreements. The CLOC includes provisions for an equity cure which could potentially allow us to independently cure certain defaults. Proceeds under the CLOC may be used for working capital needs or for other general corporate pu rposes. We were in compliance with these requirements as of December 31, 2024. We had an outst anding balance of $790.0 million u ===== BLAD: INCOME TAXES ===== INCOME TAXES 6 Months Ended Dec. 31, 2024 Income Tax Disclosure [Abstract] INCOME TAXES NOTE 7: INCOME TAXES We file a consolidated federal income tax return in the U.S. with the Internal Revenue Service (IRS) and file tax returns in various state, local, and foreign jurisdictions. We had gross unrecognized tax benefits of $244.1 million and $251.8 million as of December 31, 2024 and June 30, 2024, respectively. The gross unrecognized tax benefits decreased by $7.7 million during the six months ended December 31, 2024. We believe it is reasonably possible that the balance of unrecognized tax benefits could decrease by approximately $148.4 million within the next twelve months. The anticipated decrease is due to the expiration of statutes of limitations, anticipated closure of various tax matters currently under examination, and settlements with tax authorities. For such matters where a change in the balance of unrecognized tax benefits is not yet deemed reasonably possible, no estimate has been included. Our effective tax rate for continuing operations, including the effects of discrete tax items, was 24.0% and 28.9% for the six months ended December 31, 2024 and 2023, respectively. Discrete items increased the effective tax rate by 0.3% and 5.4% for the six months ended December 31, 2024, and 2023, respectively. Discrete income tax benefits of $1.5 million and $26.6 million were recorded in the six months ended December 31, 2024 and 2023, respectively. The discrete tax benefit recorded in the current period primarily resulted from investment tax credit purchases. The discrete tax benefit recorded in the prior period primarily resulted from settlements with taxing authorities and state statute of limitations expirations. The impact of discrete tax items combined with the seasonal nature of our business can cause the effective tax rate in our second quarter to be significantly different than the rate for our full fiscal year. ===== BLAD: COMMITMENTS AND CONTINGENCIES ===== COMMITMENTS AND CONTINGENCIES 6 Months Ended Dec. 31, 2024 Commitments and Contingencies Disclosure [Abstract] COMMITMENTS AND CONTINGENCIES NOTE 8: COMMITMENTS AND CONTINGENCIES Our U.S. and Canadian businesses offer our 100% accuracy guarantee. Assisted tax returns are covered by our 100% accuracy guarantee, whereby we will reimburse a client for penalties and interest attributable to an H&R Block error on a return. DIY tax returns are covered by our 100% accuracy guarantee, whereby we will reimburse a client up to a maximum of $10,000 if our software makes an arithmetic error that results in payment of penalties and/or interest to the respective taxing authority that a client would otherwise not have been required to pay. Our liability related to estimated losses under the 100% accuracy guarantee was $9.7 million and $14.1 million as of December 31, 2024 and June 30, 2024, respectively. The short-term and long-term portions of this liability are included in deferred revenue and other liabilities in the consolidated balance sheets. Liabilities related to acquisitions for (1) estimated contingent consideration based on expected financial performance of the acquired business and economic conditions at the time of acquisition and (2) estimated accrued compensation related to continued employment of key employees were $38.3 million and $26.9 million as of December 31, 2024 and June 30, 2024 respectively, with amounts recorded in deferred revenue and other liabilities. Should actual results differ from our estimates, future payments made will differ from the above estimate and any differences will be recorded in results from continuing operations. We have contractual commitments to fund certain franchises with approved short-term lines of credit for the purpose of meeting their seasonal working capital needs. Our total obligation under these lines of credit was $20.9 million at December 31, 2024, and net of amounts drawn and outstanding, our remaining commitment to fund totaled $5.8 million. ===== BLAD: LITIGATION AND OTHER RELATED CO ===== LITIGATION AND OTHER RELATED CONTINGENCIES 6 Months Ended Dec. 31, 2024 Commitments and Contingencies Disclosure [Abstract] LITIGATION AND OTHER RELATED CONTINGENCIES NOTE 9: LITIGATION AND OTHER RELATED CONTINGENCIES We are a defendant in numerous litigation and arbitration matters, arising both in the ordinary course of business and otherwise, including as described below. The matters described below are not all of the lawsuits or arbitrations to which we are subject. In some of the matters, very large or indeterminate amounts, including punitive damages, may be sought. U.S. jurisdictions permit considerable variation in the assertion of monetary damages or other relief. Jurisdictions may permit claimants not to specify the monetary damages sought or may permit claimants to state only that the amount sought is sufficient to invoke the jurisdiction. In addition, jurisdictions may permit plaintiffs to allege monetary damages in amounts well exceeding reasonably possible verdicts in the jurisdiction for similar matters. We believe that the monetary relief which may be specified in a lawsuit or claim bears little relevance to its merits or disposition value due to this variability in pleadings and our experience in handling and resolving numerous claims over an extended period of time. The outcome of a matter and the amount or range of potential loss at particular points in time may be difficult to ascertain. Among other things, uncertainties can include how fact finders will evaluate documentary evidence and the credibility and effectiveness of witness testimony, and how courts and arbitrators will apply the law. Disposition valuations are also subject to the uncertainty of how opposing parties and their counsel will view the relevant evidence and applicable law. In addition to litigation and arbitration matters, we are also subject to other loss contingencies arising out of our business activities, including as described below. We accrue liabilities for litigation, arbitration and other related loss contingencies and any related settlements when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. If a range of loss is estimated, and some amount within that range appears to be a better estimate than any other amount within that range, then that amount is accrued. If no amount within the range can be identified as a better estimate than any other amount, we accrue the minimum amount in the range. For such matters where a loss is believed to be reasonably possible, but not probable, or the loss cannot be reasonably estimated, no accrual has been made. It is possible that such matters could require us to pay damages or make other expenditures or accrue liabilities in amounts that could not be reasonably estimated as of December 31, 2024. While the potential future liabilities could be material in the particular quarterly or annual periods in which they are recorded, based on information currently known, we do not believe any such liabilities are likely to have a material adverse effect on our business and our consolidated financial position, results of operations, and cash flows. Our accrued liabilities were $11.1 million and $7.2 million as of December 31, 2024 and June 30, 2024, respectively. Our estimate of the aggregate range of reasonably possible losses includes (1) matters where a liability has been accrued and there is a reasonably possible loss in excess of the amount accrued for that liability, and (2) matters where a liability has not been accrued but we believe a loss is reasonably possible. This aggregate range only represents those losses as to which we are currently able to estimate a reasonably possible loss or range of loss. It does not represent our maximum loss exposure. Matters for which we are not currently able to estimate the reasonably possible loss or range of loss are not included in this range. We are often unable to estimate the possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of the reasonably possible loss or range of loss, such as precise information about the amount of damages or other remedies being asserted, the defenses to the claims being asserted, discovery from other parties and investigation of factual allegations, rulings by courts or arbitrators on motions or appeals, analyses by experts, or the status or terms of any settlement negotiations. The estimated range of reasonably possible loss is based upon currently available information and is subject to significant judgment and a variety of assumptions, as well as known and unknown uncertainties. The matters underlying the estimated range will change from time to time, and actual results may vary significantly from the current estimate. As of December 31, 2024, we believe the estimate of the aggregate range of reasonably possible losses in excess of amounts accrued, where the range of loss can be estimated, is not material. At the end of each reporting period, we review relevant information with respect to litigation, arbitration and other related loss contingencies and update our accruals, disclosures, and estimates of reasonably possible loss or range of loss based on such reviews. Costs incurred with defending matters are expensed as incurred. Any receivable for insurance recoveries is recorded separately from the corresponding liability, and only if recovery is determined to be probable and reasonably estimable. We believe we have meritorious defenses to the claims asserted in the various matters described in this note, and we intend to defend them vigorously. The amounts claimed in the matters are substantial, however, and there can be no assurances as to their outcomes. In the event of unfavorable outcomes, it could require modifications to our operations; in addition, the amounts that may be required to be paid to discharge or settle the matters could be substantial and could have a material adverse impact on our business and our consolidated financial position, results of operations, and cash flows. We have received and are responding to certain governmental inquiries, class actions and mass arbitrations relating to the IRS Free File Program and other aspects of our DIY tax preparation services, including the use of pixels. Related to one of these matters, on February 23, 2024, the Federal Trade Commission (FTC) filed an administrative complaint before the FTC alleging unfair or deceptive business acts or practices in connection with certain aspects of our DIY tax preparation services. A hearing before an administrative law judge (ALJ) of the FTC was scheduled to begin on October 23, 2024. We filed a complaint in federal court in the Western District of Missouri challenging the constitutionality of the ALJ’s removal protections and seeking to enjoin the ALJ’s participation in the adjudication of the matter. The federal court denied our motion for a preliminary injunction on August 1, 2024. We filed an appeal with the Eighth Circuit Court of Appeals. On October 21, 2024, we entered into a Consent Agreement to resolve the allegations of the complaint through a Decision and Order, which became final and effective on January 8, 2025. The complaint filed in the Missouri federal court and the corresponding appeal were subsequently dismissed by consent of the parties. An accrual related to these matters is included in our loss contingency accrual. ===== BLAD: Pay vs Performance Disclosure ===== Pay vs Performance Disclosure - USD ($) $ in Thousands 3 Months Ended 6 Months Ended Dec. 31, 2024 Sep. 30, 2024 Dec. 31, 2023 Sep. 30, 2023 Dec. 31, 2024 Dec. 31, 2023 Pay vs Performance Disclosure Net loss -243420 -172576 -189755 -163482 -415996 -353237 ===== BLAD: Insider Trading Arrangements ===== Insider Trading Arrangements 3 Months Ended Dec. 31, 2024 Trading Arrangements, by Individual Non-Rule 10b5-1 Arrangement Adopted false Non-Rule 10b5-1 Arrangement Terminated false ===== BLAD: SUMMARY OF SIGNIFICANT ACCOUN_2 ===== SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policy) 6 Months Ended Dec. 31, 2024 Accounting Policies [Abstract] Basis of Presentation The consolidated balance sheets as of December 31, 2024 and June 30, 2024, the consolidated statements of operations and comprehensive loss for the three and six months ended December 31, 2024 and 2023, the consolidated statements of cash flows for the six months ended December 31, 2024 and 2023, and the consolidated statements of stockholders' equity for the three and six months ended December 31, 2024 and 2023 have been prepared by the Company, without audit. In the opinion of management, all adjustments, which include only normal recurring adjustments, necessary to present fairly the financial position, results of operations, and cash flows as of December 31, 2024 and 2023 and for all periods presented, have been made. "H&R Block," "the Company," "we," "our," and "us" are used interchangeably to refer to H&R Block, Inc., to H&R Block, Inc. and its subsidiaries, or to H&R Block, Inc.'s operating subsidiaries, as appropriate to the context. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (GAAP) have been condensed or omitted. These consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in our June 30, 2024 Annual Report on Form 10-K. All amounts presented herein as of June 30, 2024 or for the year then ended are derived from our Annual Report on Form 10-K. Management Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates, assumptions and judgments are applied in the evaluation of contingent losses associated with pending claims and litigation, reserves for uncertain tax positions, and fair value of reporting units. Estimates have been prepared based on the best information available as of each balance sheet date. As such, actual results could differ materially from those estimates. Discontinued Operations Our discontinued operations include the results of operations of Sand Canyon Corporation, previously known as Option One Mortgage Corporation, which exited its mortgage business in fiscal year 2008. ===== BLAD: REVENUE RECOGNITION (Tables) ===== REVENUE RECOGNITION (Tables) 6 Months Ended Dec. 31, 2024 Revenue from Contract with Customer [Abstract] Disaggregation of Revenue by Major Service Line The majority of our revenues are from our United States (U.S.) tax services business. The following table disaggregates our U.S. revenues by major service line, with revenues from our international tax services businesses and from Wave included as separate lines: (in 000s) Three months ended December 31, Six months ended December 31, 2024 2023 2024 2023 Revenues: U.S. assisted tax preparation $ 48,380 $ 48,342 $ 91,343 $ 87,605 U.S. royalties 3,499 5,454 9,351 11,155 U.S. 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 Emerald Card® and Spruce SM 10,148 11,700 18,974 20,333 Interest and fee income on Emerald Advance® 12,308 15,235 12,308 15,533 International 31,811 29,569 96,666 90,134 Wave 26,561 23,133 52,964 47,076 Other 11,824 9,592 25,633 20,572 Total revenues $ 179,070 $ 179,083 $ 372,880 $ 362,883 Schedule of Deferred Revenue Related To The Peace of Mind Program Changes in the balances of deferred revenue and wages for our Peace of Mind® Extended Service Plan (POM) are as follows: (in 000s) POM Deferred Revenue Deferred Wages Six months ended December 31, 2024 2023 2024 2023 Balance, beginning of the period $ 156,610 $ 167,257 $ 20,212 $ 21,828 Amounts deferred 3,209 3,601 15 8 Amounts recognized on previous deferrals (46,962) (48,995) (6,092) (5,590) Balance, end of the period $ 112,857 $ 121,863 $ 14,135 $ 16,246 ===== BLAD: EARNINGS PER SHARE AND STOCKH_2 ===== EARNINGS PER SHARE AND STOCKHOLDERS' EQUITY (Tables) 6 Months Ended Dec. 31, 2024 Earnings Per Share [Abstract] Computations of Basic And Diluted Earnings Per Share The computations of basic and diluted earnings (loss) per share from continuing operations are as follows: (in 000s, except per share amounts) Three months ended December 31, Six months ended December 31, 2024 2023 2024 2023 Net loss from continuing operations attributable to shareholders $ (242,466) $ (189,116) $ (413,887) $ (351,989) Amounts allocated to participating securities (240) (192) (469) (369) Net loss from continuing operations attributable to common shareholders $ (242,706) $ (189,308) $ (414,356) $ (352,358) Basic weighted average common shares 135,563 142,340 137,359 144,307 Potential dilutive shares — — — — Dilutive weighted average common shares 135,563 142,340 137,359 144,307 Loss per share from continuing operations attributable to common shareholders: Basic $ (1.79) $ (1.33) $ (3.02) $ (2.44) Diluted (1.79) (1.33) (3.02) (2.44) ===== BLAD: RECEIVABLES (Tables) ===== RECEIVABLES (Tables) 6 Months Ended Dec. 31, 2024 Accounts, Notes, Loans and Financing Receivable, Unclassified [Abstract] Schedule of Short-Term Receivables Receivables, net of their related allowance, consist of the following: (in 000s) As of December 31, 2024 June 30, 2024 Short-term Long-term Short-term Long-term Loans to franchisees $ 19,764 $ 20,861 $ 5,917 $ 16,498 Receivables for U.S. assisted and DIY tax preparation and related fees 9,823 5,440 18,440 5,332 H&R Block's Instant Refund® receivables 1,375 184 2,947 207 Emerald Advance® 266,110 23,643 17,867 21,360 Software receivables from retailers 2,073 — 1,029 — Royalties and other receivables from franchisees 6,955 — 5,808 — Wave payment processing receivables 693 — 1,078 — Other 14,378 659 15,989 427 Total $ 321,171 $ 50,787 $ 69,075 $ 43,824 Schedule of Receivables Based On Year of Origination alances and amounts on non-accrual status, classified as impaired, or more than 60 days past due, by tax return year of origination, as of December 31, 2024 are as foll ows: (in 000s) Tax return year of origination Balance More Than 60 Days Past Due 2023 $ 375 $ 316 2022 and prior 1,184 1,184 1,559 $ 1,500 Allowance — Net balance $ 1,559 Balances and amounts on non-accrual status, classified as impaired, or more than 60 days past due, by fiscal year of origination, as of December 31, 2024 are as follows: (in 000s) Fiscal year of origination Balance Non-Accrual 2025 $ 270,393 $ — 2024 and prior 38,469 38,469 308,862 $ 38,469 Allowance (19,109) Net balance $ 289,753 Schedule of Activity in Allowance For Credit Losses Activity in the allowance for credit losses for EA and all other short-term and long-term receivables for the six months ended December 31, 2024 and 2023 is as follows: (in 000s) EAs All Other Total Balances as of July 1, 2024 $ 33,536 $ 45,327 $ 78,863 Provision for credit losses 19,109 1,618 20,727 Charge-offs, recoveries and other (33,536) (45,552) (79,088) Balances as of December 31, 2024 $ 19,109 $ 1,393 $ 20,502 Balances as of July 1, 2023 $ 27,386 $ 35,108 $ 62,494 Provision for credit losses 17,885 3,651 21,536 Charge-offs, recoveries and other (27,714) (37,613) (65,327) Balances as of December 31, 2023 $ 17,557 $ 1,146 $ 18,703 ===== BLAD: GOODWILL AND INTANGIBLE ASSETS ===== GOODWILL AND INTANGIBLE ASSETS (Tables) 6 Months Ended Dec. 31, 2024 Goodwill and Intangible Assets Disclosure [Abstract] Schedule of Goodwill Changes in the carrying amount of goodwill for the six months ended December 31, 2024 are as follows: (in 000s) Goodwill Accumulated Impairment Losses Net Balances as of July 1, 2024 $ 923,523 $ (138,297) $ 785,226 Acquisitions (1) 12,761 — 12,761 Disposals and foreign currency changes, net (14,701) — (14,701) Impairments — — — Balances as of December 31, 2024 $ 921,583 $ (138,297) $ 783,286 (1) All goodwill added during the period is expected to be tax-deductible for federal income tax reporting. Schedule of Intangible Assets Components of intangible assets are as follows: (in 000s) Gross Carrying Amount Accumulated Net As of December 31, 2024: Reacquired franchise rights $ 413,752 $ (235,650) $ 178,102 Customer relationships 350,700 (280,481) 70,219 Internally-developed software 123,495 (122,332) 1,163 Noncompete agreements 22,807 (19,857) 2,950 Purchased technology 70,100 (54,543) 15,557 Trade name 5,800 (3,190) 2,610 $ 986,654 $ (716,053) $ 270,601 As of June 30, 2024: Reacquired franchise rights $ 403,955 $ (228,157) $ 175,798 Customer relationships 331,435 (270,245) 61,190 Internally-developed software 122,673 (119,610) 3,063 Noncompete agreements 21,977 (19,494) 2,483 Purchased technology 70,100 (51,432) 18,668 Trade name 5,800 (2,900) 2,900 $ 955,940 $ (691,838) $ 264,102 Schedule of Acquired Finite-Lived Intangible Assets by Major Class The amounts and weighted-average lives of intangible assets acquired during the six months e nded December 31, 2024, including amounts capitalized related to internally-developed software, a re as follows: (dollars in 000s) Amount Weighted-Average Life (in years) Customer relationships $ 19,705 5 Reacquired franchise rights 9,983 6 Internally-developed software 1,027 3 Noncompete agreements 871 5 Total $ 31,586 5 ===== BLAD: LONG-TERM DEBT LONG-TERM DEBT ( ===== LONG-TERM DEBT LONG-TERM DEBT (Tables) 6 Months Ended Dec. 31, 2024 Debt Disclosure [Abstract] Components of Long-Term Debt The components of long-term debt are as follows: (in 000s) As of December 31, 2024 June 30, 2024 Senior Notes, 5.250%, due October 2025 $ 350,000 $ 350,000 Senior Notes, 2.500%, due July 2028 500,000 500,000 Senior Notes, 3.875%, due August 2030 650,000 650,000 Committed line of credit borrowings 790,000 — Debt issuance costs and discounts (7,844) (8,905) Total long-term debt 2,282,156 1,491,095 Less: Current portion (349,611) — Long-term portion $ 1,932,545 $ 1,491,095 Estimated fair value of long-term debt $ 2,193,000 $ 1,391,000 ===== BLAD: REVENUE RECOGNITION (Disaggrega ===== REVENUE RECOGNITION (Disaggregation of Revenue by Major Service Line) (Details) - USD ($) $ in Thousands 3 Months Ended 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Dec. 31, 2024 Dec. 31, 2023 Disaggregation of Revenue [Line Items] Total revenues 179070 179083 372880 362883 Assisted tax preparation Disaggregation of Revenue [Line Items] Total revenues 48380 48342 91343 87605 Royalties Disaggregation of Revenue [Line Items] Total revenues 3499 5454 9351 11155 DIY tax preparation Disaggregation of Revenue [Line Items] Total revenues 13744 13111 16980 16959 International Disaggregation of Revenue [Line Items] Total revenues 31811 29569 96666 90134 Refund Transfers Disaggregation of Revenue [Line Items] Total revenues 637 813 1497 1955 Emerald Card® and SpruceSM Disaggregation of Revenue [Line Items] Total revenues 10148 11700 18974 20333 Peace of Mind® Extended Service Plan Disaggregation of Revenue [Line Items] Total revenues 16145 17440 39242 42287 Tax Identity Shield® Disaggregation of Revenue [Line Items] Total revenues 4013 4694 7922 9274 Interest and fee income on Emerald Advance® Disaggregation of Revenue [Line Items] Total revenues 12308 15235 12308 15533 Wave Disaggregation of Revenue [Line Items] Total revenues 26561 23133 52964 47076 Other Disaggregation of Revenue [Line Items] Total revenues 11824 9592 25633 20572 ===== BLAD: REVENUE RECOGNITION (Deferred R ===== REVENUE RECOGNITION (Deferred Revenue) (Details) - POM - USD ($) $ in Thousands 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Movement in Deferred Revenue [Roll Forward] Contract with Customer, Liability 112900 Deferred Revenue Movement in Deferred Revenue [Roll Forward] Contract with Customer, Liability 156610 167257 Amounts deferred 3209 3601 Amounts recognized on previous deferrals -46962 -48995 Contract with Customer, Liability 112857 121863 Deferred Wages Movement in Deferred Revenue [Roll Forward] Contract with Customer, Liability 20212 21828 Amounts deferred 15 8 Amounts recognized on previous deferrals -6092 -5590 Contract with Customer, Liability 14135 16246 ===== BLAD: REVENUE RECOGNITION (Narrative) ===== REVENUE RECOGNITION (Narrative) (Details) - USD ($) $ in Millions Dec. 31, 2024 Jun. 30, 2024 Dec. 31, 2023 Jun. 30, 2023 POM Disaggregation of Revenue [Line Items] Deferred revenue 112.9 Current deferred revenue 83 TIS Disaggregation of Revenue [Line Items] Current deferred revenue 14.1 21.4 16.5 25.2 ===== BLAD: REVENUE RECOGNITION (Remaining ===== REVENUE RECOGNITION (Remaining Performance Obligation) (Details) Dec. 31, 2024 POM | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-11-01 Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] Remaining performance obligation, expected timing of satisfaction, period 12 months POM | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-12-01 Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] Remaining performance obligation, expected timing of satisfaction, period 5 years TIS Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Year 2025 ===== BLAD: EARNINGS PER SHARE AND STOCKH_3 ===== EARNINGS PER SHARE AND STOCKHOLDERS' EQUITY (Narrative) (Details) - USD ($) $ in Millions 3 Months Ended 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Dec. 31, 2024 Dec. 31, 2023 Earnings Per Share [Abstract] Antidilutive securities excluded from computation of earnings per share, amount (in shares)     2700000 3200000 Basic weighted average common shares (in shares) 135563000 142340000 137359000 144307000 Nonvested units granted (in shares)     1100000 1700000 Stock-based compensation 9.2 9.9 17.9 17.5 Unrecognized compensation costs, nonvested shares and units 59.5   59.5 ===== BLAD: EARNINGS PER SHARE AND STOCKH_4 ===== EARNINGS PER SHARE AND STOCKHOLDERS' EQUITY (Computations of Basic and Diluted Earnings Per Share) (Details) - USD ($) shares in Thousands, $ in Thousands 3 Months Ended 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Dec. 31, 2024 Dec. 31, 2023 Earnings Per Share [Abstract] Net loss from continuing operations attributable to shareholders -242466 -189116 -413887 -351989 Amounts allocated to participating securities -240 -192 -469 -369 Net loss from continuing operations attributable to common shareholders -242706 -189308 -414356 -352358 Basic weighted average common shares (in shares) 135563 142340 137359 144307 Potential dilutive shares (in shares) 0 0 0 0 Dilutive weighted average common shares (in shares) 135563 142340 137359 144307 ===== BLAD: RECEIVABLES (Schedule of Short- ===== RECEIVABLES (Schedule of Short-Term Receivables) (Details) - USD ($) $ in Thousands Dec. 31, 2024 Jun. 30, 2024 Accounts, Notes, Loans and Financing Receivable [Line Items] Short-term 321171 69075 Long-term 50787 43824 Loans to franchisees Accounts, Notes, Loans and Financing Receivable [Line Items] Short-term 19764 5917 Long-term 20861 16498 Receivables for U.S. assisted and DIY tax preparation and related fees Accounts, Notes, Loans and Financing Receivable [Line Items] Short-term 9823 18440 Long-term 5440 5332 H&R Block's Instant Refund® receivables Accounts, Notes, Loans and Financing Receivable [Line Items] Short-term 1375 2947 Long-term 184 207 Emerald Advance® Accounts, Notes, Loans and Financing Receivable [Line Items] Short-term 266110 17867 Long-term 23643 21360 Software receivables from retailers Accounts, Notes, Loans and Financing Receivable [Line Items] Short-term 2073 1029 Long-term 0 0 Royalties and other receivables from franchisees Accounts, Notes, Loans and Financing Receivable [Line Items] Short-term 6955 5808 Long-term 0 0 Wave payment processing receivables Accounts, Notes, Loans and Financing Receivable [Line Items] Short-term 693 1078 Long-term 0 0 Other Accounts, Notes, Loans and Financing Receivable [Line Items] Short-term 14378 15989 Long-term 659 427 ===== BLAD: RECEIVABLES (Narrative) (Detail ===== RECEIVABLES (Narrative) (Details) - USD ($) 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Jun. 30, 2024 Accounts, Notes, Loans and Financing Receivable [Line Items] Financing receivable 2200000   1100000 Accounts Receivable, Allowance for Credit Loss, Writeoff -79088000 -65327000 H&R Block's Instant Refund® receivables Accounts, Notes, Loans and Financing Receivable [Line Items] Impaired, non-accrual status term 60 days Financing receivable 1559000 Emerald Advance® Accounts, Notes, Loans and Financing Receivable [Line Items] Impaired, non-accrual status term 60 days Financing receivable 308862000 Accounts Receivable, Allowance for Credit Loss, Writeoff -33536000 -27714000 Emerald Advance Lines of Credit Write Offs Accounts, Notes, Loans and Financing Receivable [Line Items] Accounts Receivable, Allowance for Credit Loss, Writeoff -33500000 ===== BLAD: RECEIVABLES (Schedule of Receiv ===== RECEIVABLES (Schedule of Receivables Based on Year of Origination) (Details) - USD ($) 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Jun. 30, 2024 Accounts, Notes, Loans and Financing Receivable [Line Items] Balance 2200000   1100000 Accounts Receivable, Allowance for Credit Loss, Writeoff -79088000 -65327000 H&R Block's Instant Refund® receivables Accounts, Notes, Loans and Financing Receivable [Line Items] Balance 1559000 Allowance 0 Net balance 1559000 Non-Accrual 1500000 Emerald Advance® Accounts, Notes, Loans and Financing Receivable [Line Items] Balance 308862000 Allowance -19109000 Net balance 289753000 Non-Accrual 38469000 Accounts Receivable, Allowance for Credit Loss, Writeoff -33536000 -27714000 Current year of origination | H&R Block's Instant Refund® receivables Accounts, Notes, Loans and Financing Receivable [Line Items] Balance 375000 Non-Accrual 316000 Current year of origination | Emerald Advance® Accounts, Notes, Loans and Financing Receivable [Line Items] Balance 270393000 Non-Accrual 0 Prior year and before | H&R Block's Instant Refund® receivables Accounts, Notes, Loans and Financing Receivable [Line Items] Balance 1184000 Non-Accrual 1184000 Prior year and before | Emerald Advance® Accounts, Notes, Loans and Financing Receivable [Line Items] Balance 38469000 Non-Accrual 38469000 ===== BLAD: RECEIVABLES (Schedule of Activi ===== RECEIVABLES (Schedule of Activity in the Allowance For Doubtful Accounts) (Details) - USD ($) 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Allowance for Doubtful Accounts [Roll Forward] Beginning balance 78863000 62494000 Provision for credit losses 20727000 21536000 Charge-offs, recoveries and other 79088000 65327000 Ending balance 20502000 18703000 EAs Allowance for Doubtful Accounts [Roll Forward] Beginning balance 33536000 27386000 Provision for credit losses 19109000 17885000 Charge-offs, recoveries and other 33536000 27714000 Ending balance 19109000 17557000 All Other Allowance for Doubtful Accounts [Roll Forward] Beginning balance 45327000 35108000 Provision for credit losses 1618000 3651000 Charge-offs, recoveries and other 45552000 37613000 Ending balance 1393000 1146000 Emerald Advance Lines of Credit Write Offs Allowance for Doubtful Accounts [Roll Forward] Charge-offs, recoveries and other 33500000 ===== BLAD: GOODWILL AND INTANGIBLE ASSET_2 ===== GOODWILL AND INTANGIBLE ASSETS (Schedule of Goodwill) (Details) $ in Thousands 6 Months Ended Dec. 31, 2024 USD ($) Goodwill [Roll Forward] Goodwill before impairment losses, beginning balance 923523 Accumulated impairment losses, beginning balance -138297 Goodwill, beginning balance 785226 Acquisitions(1) 12761 Disposals and foreign currency changes, net -14701 Impairments 0 Goodwill before impairment losses, ending balance 921583 Accumulated impairment losses, ending balance -138297 Goodwill, ending balance 783286 ===== BLAD: GOODWILL AND INTANGIBLE ASSET_3 ===== GOODWILL AND INTANGIBLE ASSETS (Schedule of Intangible Assets) (Details) - USD ($) $ in Thousands Dec. 31, 2024 Jun. 30, 2024 Goodwill and Intangible Assets [Line Items] Gross Carrying Amount 986654 955940 Accumulated Amortization -716053 -691838 Net 270601 264102 Reacquired franchise rights Goodwill and Intangible Assets [Line Items] Gross Carrying Amount 413752 403955 Accumulated Amortization -235650 -228157 Net 178102 175798 Customer relationships Goodwill and Intangible Assets [Line Items] Gross Carrying Amount 350700 331435 Accumulated Amortization -280481 -270245 Net 70219 61190 Internally-developed software Goodwill and Intangible Assets [Line Items] Gross Carrying Amount 123495 122673 Accumulated Amortization -122332 -119610 Net 1163 3063 Noncompete agreements Goodwill and Intangible Assets [Line Items] Gross Carrying Amount 22807 21977 Accumulated Amortization -19857 -19494 Net 2950 2483 Purchased technology Goodwill and Intangible Assets [Line Items] Gross Carrying Amount 70100 70100 Accumulated Amortization -54543 -51432 Net 15557 18668 Trade name Goodwill and Intangible Assets [Line Items] Gross Carrying Amount 5800 5800 Accumulated Amortization -3190 -2900 Net 2610 2900 ===== BLAD: GOODWILL AND INTANGIBLE ASSET_4 ===== GOODWILL AND INTANGIBLE ASSETS (Intangible Assets Acquired) (Details) $ in Thousands 6 Months Ended Dec. 31, 2024 USD ($) Business Acquisition [Line Items] Amount 31586 Weighted-Average Life (in years) 5 years Customer Relationships Business Acquisition [Line Items] Amount 19705 Weighted-Average Life (in years) 5 years Reacquired Franchise Rights Business Acquisition [Line Items] Amount 9983 Weighted-Average Life (in years) 6 years Noncompete Agreements Business Acquisition [Line Items] Amount 871 Weighted-Average Life (in years) 5 years Capitalized software Business Acquisition [Line Items] Amount 1027 Weighted-Average Life (in years) 3 years ===== BLAD: GOODWILL AND INTANGIBLE ASSET_5 ===== GOODWILL AND INTANGIBLE ASSETS (Narrative) (Details) - USD ($) $ in Thousands 3 Months Ended 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Dec. 31, 2024 Dec. 31, 2023 Business Acquisition [Line Items] Payments made for business acquisitions, net of cash acquired     28017 27158 Amortization 12100 15400 25000 31200 Estimated amortization, 2022 47000   47000 Estimated amortization, 2023 39900   39900 Estimated amortization, 2024 33100   33100 Estimated amortization, 2025 24900   24900 Estimated amortization, 2026 16500   16500 Franchisee and competitor businesses Business Acquisition [Line Items] Payments made for business acquisitions, net of cash acquired     28000 27200 ===== BLAD: LONG-TERM DEBT (Components of L ===== LONG-TERM DEBT (Components of Long-Term Debt) (Details) - USD ($) $ in Thousands Dec. 31, 2024 Jun. 30, 2024 Debt Instrument [Line Items] Long-term Line of Credit 790000 0 Debt issuance costs and discounts -7844 -8905 Long-Term Debt -2282156 -1491095 Long-term Debt, Current Maturities -349611 0 Long-Term Debt and Lease Obligation 1932545 1491095 Estimated fair value of long-term debt 2193000 1391000 Senior Notes | Senior Notes, 5.250%, due October 2025 Debt Instrument [Line Items] Interest rate 0.0525 Senior notes 350000 350000 Senior Notes | Senior Notes, 2.500%, due July 2028 Debt Instrument [Line Items] Interest rate 0.025 Senior notes 500000 500000 Senior Notes | Senior Notes, 3.875%, due August 2030 Debt Instrument [Line Items] Interest rate 0.03875 Senior notes 650000 650000 ===== BLAD: LONG-TERM DEBT (Narrative) (Det ===== LONG-TERM DEBT (Narrative) (Details) Dec. 31, 2024 USD ($) Revolving credit facility Line of Credit Facility [Line Items] Maximum annual debt-to-EBITDA ratio 4.5 Maximum quarterly debt-to-EBITDA ratio 3.5 Minimum interest coverage ratio 2.5 Aggregate principal amount 1500000000 Line Of Credit Facility, Available Increase In Borrowing Capacity 500000000 Swingline Loans Line of Credit Facility [Line Items] Maximum borrowing capacity 175000000 Standby Letters of Credit Line of Credit Facility [Line Items] Maximum borrowing capacity 50000000 ===== BLAD: INCOME TAXES (Narrative) (Detai ===== INCOME TAXES (Narrative) (Details) - USD ($) $ in Millions 6 Months Ended Dec. 31, 2024 Dec. 31, 2023 Jun. 30, 2024 Income Tax Disclosure [Abstract] Unrecognized tax benefits 244.1   251.8 Change in tax benefits that are reasonably possible 148.4 Effective tax rate 0.24 0.289 Gross unrecognized tax benefits increase (decrease) 7.7 Increase in effective tax rate from discrete item, percent 0.003 0.054 Discrete income tax expense (benefit) 1.5 26.6 ===== BLAD: LITIGATION AND OTHER RELATED _2 ===== LITIGATION AND OTHER RELATED CONTINGENCIES (Details) - USD ($) $ in Millions Dec. 31, 2024 Jun. 30, 2024 Loss Contingencies [Line Items] Loss contingency accrual 11.1 7.2 ===== BLAD: Commitment and Contingencies (D ===== Commitment and Contingencies (Details) - USD ($) 6 Months Ended Dec. 31, 2024 Jun. 30, 2024 Other Commitments [Line Items] POM maximum per tax return 10000 Standard guarantee accrual amount 9700000 14100000 Contingent business acquisition obligations 38300000 26900000 Lines of credit, total obligation 20900000 Remaining franchise equity lines of credit-undrawn commitment 5800000 Loss contingency accrual 11100000 7200000 Investment Tax Credit 22900000 Purchase Commitment, Remaining Minimum Amount Committed 80000000 Customer Advance, Line Of Credit, Outstanding Amount 257900000