H&R Block increased its market share with do-it-yourself filers but that was offset by a decline in market share with its assisted tax preparation, the company said in discussing its results for the first quarter ended March 31.CEO Jeff Jones said during the company’s recent earnings webcast that paid volumes in DIY grew about 6 percent. On the assisted side, while Block performed well with higher-income taxpayers with the fastest growing segment those who earn $100,000 or more a year, “We still have work to do in lower-income segments,” Jones said. He noted Block halted the loss of files claiming the Earned Income Tax Credit.
Overall, revenue from DIY filers rose 18.9 percent to $198.6 million for the most recently ended period, up from $167 million a year earlier. Assisted preparation revenue reached $1.53 billion an increase of 5.6 percent from $1.45 for last year’s corresponding period.
Total revenue was $2.55 billion, up 4.4 percent from $2.44 billion. Net income jumped 34.2 percent to $337.5 million from $251.4 million.
Jones said its AI Tax Assist product performed well in its first year. ‘Feedback indicated that the tool was easy to use and helpful in the tax prep process, and clients found value in it,” he said. “Importantly, we saw greater conversion among new clients who leveraged AI Tax Assist.” J
Block also piloted GenAI for improving call center performance and Jones claimed the accuracy of the AI system was higher than competing systems.
In addition, the number of customers using assisted services virtually increased by more than 25 percent year-over-year. “We expect this number to continue to grow in thefuture,” Jones said.
Jones also pointed to a wide range of changes in the company, including a new tax platform and new telephone system. Block also changed its tax professional compensation model and introduced a new system for measuring performance to the individual preparer.
