Shares of H&R Block (NYSE:HRB) dropped 5% on Friday, following the release of the tax preparation company's fiscal third-quarter results.
Revenue rose 11% year over year to $519 million, topping Wall Street's expectations for revenue of $485.6 million. Acquisitions and higher demand for its assisted and do-it-yourself tax prep offerings contributed to the gains.
But Block's losses were larger than many analysts anticipated. The company produced an adjusted loss per share from continuing operations of $0.59, compared with a loss of $0.52 in the prior-year period. Consensus estimates had been for a loss of $0.55. Higher operating and interest expenses contributed to the decline.
Despite the larger losses, H&R Block said that it expects to achieve its full-year EBITDA margin target of 24% to 26%.
"We're making progress on our strategy to transform our business by connecting human expertise with technology to drive transparency and value for consumers and small business owners," CEO Jeff Jones said in a press release. "We're seeing the positive results of these efforts in our Assisted business and will apply learnings from the first half to deliver on our outlook for the fiscal year."