Q3 2020 Earnings Call
Ladies and gentlemen, and welcome to you used to be 2020, you cannot block earning conference call.
At this time, all participants are in listen only mode.
Later, we'll conduct a question and answer session and instructions will follow at that time.
If anyone should be quite assistance during the one thing.
So star Didnt feel on your touched on telephone.
I'd now like to bring to conference. So we're going to your hope.
Sorry, Colby Brown, Vice President of Finance and Investor Relations, Sir the floor is yours.
Thank you add.
Good afternoon, everyone and thank you for joining us to discuss our fiscal 2023rd quarter results on the call today, our job Jones, our president and CEO and Tony Bowen our CFO.
Talking today's press release on the Investor Relations website, HR block Dot com.
Also on the website, you'll find a link for the webcast contained in todays presentation, which will be posted after this call.
Some of the figures that will discuss today are presented on a non-GAAP basis.
Reconciled the comparable GAAP and non-GAAP figures and schedules attached to our press release.
Before we begin our prepared remarks, I'll remind everyone that this call will include forward looking statements as defined under the securities laws such statements are based on current information. The managements expectation does have the state and are not guarantees of future performance forward looking statements involve certain risks uncertainties and assumptions that are difficult to predict.
Our actual outcomes and results could differ materially.
You can learn more about these risks in our form 10-K for fiscal 2019, and our other SEC filings HR block undertakes no obligation to publicly update these risk factors or forward looking statements.
At the conclusion of her prepared remarks, we'll have a Q and a recession drink jernej, yes. It participants limit themselves to one question what the follow up after which they may choose to jump back into the Q.
I'll now turn the call over to John.
Thank you called the good afternoon, everyone and thanks for joining us.
When we talk with you last quarter, we outlined our strategic objectives. The digitally enabled every aspect of our business to deliver our expertise to consumers in new and exciting ways and we're seeing some positive results.
We're focused on serving assisted clients with higher quality in better value and are on track to achieve our goal of holding share in the category.
We're seeing stronger demand for our virtual product tax pro go.
We continue to grow clients in D. I why.
Client satisfaction scores are up across all products following a year in which we saw unprecedented growth.
And we continue to make strides in small business, including another strong quarter from wave.
Well pleased with these early results we identified a couple of areas to improve the iwai performance in the second now that I will comment on later.
We have a lot to cover on todays call.
First I'll provide our perspective on what were what we've seen in the tax industry.
Then I'll review our tax season to date results discussed or expectations for the second half of the season and provide an update on small business.
Finally, Tony will review, our third quarter results and offer additional thoughts on our financial outlook for the fiscal year.
Starting with the industry.
Overall trends in filings are consistent with our expectation.
At this point the increase in D. I widen mix is that levels lower than last year.
So while there was speculation by some that the second year of the new tax law would cause more assisted filers to switch to D. I why.
We aren't seeing any evidence exists in either our data worthy industries and the change has actually moderated.
Turning to our performance I'd like to spend some time, providing an update on our progress in each of the key areas, we outlined last quarter.
Starting with the system.
We focused on leading the industry with upfront transparent pricing.
Hanting, our standard operating procedures and digitizing held tax pro serve clients through work center.
In pricing, we're bringing upfront and transparent to life in an even stronger way this year through a new price estimator tool to help our tax pros provide clients a better estimate at the outset.
Upfront transparent pricing is a key element of our recently launched no surprise guarantee which also provides three audit assistance and a mid year tax check in for clients across all of our product.
We've also improved work center, which digitizes, how our tax pro serve and communicate with clients.
Fighting them with the superior experience.
We're seeing results from these efforts with higher retention for both new and prior to clients as well as better conversion.
Client survey scores increased three point for price for value and two points for overall quality.
Considering the nine point improvement in these scores last season. These results are tremendous.
This has led to a significant improvement in client trajectory compared to this time last year.
With a lot of season left we're confident that we will achieve our goal of holding share in the assisted category.
Turning to virtual taxis and 20 marks the second year of tax Pro go.
And innovative product that provides clients with access to the unparalleled expertise to our tax proceeds from the convenience of their mobile device.
This year, we redesigned the client experience to improve the product flow simplified pricing and made it easier to connect with our expertise express.
We're also highlighting the advantages of this product in our marketing, which is driving an increase in tax pro go demand and mobile usage.
We're seeing the results of these efforts with improvements in key client service metrics and strong client growth.
And what we're still the early stages of this product just continued growth gives us confidence that we can satisfy unmet needs and attract new client store brand.
In D. I, why we've maintained our challenger strategy of investing to improve the product and user experience.
Pricing at a level that is competitive and provides value to clients.
And communicating this value to grow awareness and compelled d. I why consumers to switched H. Norwalk.
We continue to utilize AI and machine learning to improve eve speed and personalization in our product.
We've also increased the prominence of online assist which provides the iwai clients with on demand access to a tax pro food Chad phone in screen sharing.
This product is price competitively in the supported by the unmatched expertise of our extensive tax pro network.
And our versus our service levels have been tremendous this season with most clients able to access the tax bro within one minute.
Collectively these efforts have led to strong results in our net promoter scores increasing over three point.
This is the Signets this a significant considering the nine point increase we saw last year.
And our product has received the number of third party accolades, including number one in the street Dot Coms rankings of the best online tax software and Nerdwallet best software for simple returns.
Well, we're excited about the progress, we're making in our products and into value we're delivering for our clients. We believe we can improve both our volume and net average charted result in the second half and have already taken the appropriate steps.
First we made changes to optimize their marketing investment to drive greater new client demand.
And second we've corrected in issue with a key online page that didn't allow clients to choose the different products, resulting in a lots of monetization.
Since weve remedy the issue we have seen a 4% improvement in net average charge in DIY why.
We're confident that we've made the appropriate changes and believed that our second half will be stronger.
We expect to end the year growing d. I white clients in line with the category.
Finally in small business starting with that.
We've highlighted our expertise through new tools and a redesigned experience.
We are beginning to see traction from these new initiatives, but believe it will take some time to increase awareness of our small business expertise.
With the way, we continue to innovate to simplify the financial lives the small business owners.
During the quarter, we've continued to make progress on its strategic roadmap in a number of areas.
We're seeing demand growth for wave advisors for clients can get personalized help from our in house bookkeepers.
In payroll, we're adding full service capabilities and more state to automatically file client state and federal payroll taxes.
And in payments, we've made key changes to streamline the client onboarding process to assist clients in getting the right product and together key information earlier in the process.
All of these improvements are fueling waves impressive performance, which continued this quarter with year over year revenue growth of over 40%.
To summarize we're on track to deliver our financial outlook for the year by digital enabling our business driving improved client trajectory in assisted.
Innovating in virtual enhancing our award winning DIY product and expanding in small business.
We have clear visibility into areas for improvement and are focused on executing in the second half to deliver stronger results by seasons and.
With that I'll now hand, the call over to Tony.
Thanks, Jeff Good afternoon, everyone.
Before I get into the details of our results as a reminder, we typically reported a loss during the fiscal third quarter due to the seasonality of our tax business.
Therefore third quarter results are not representative of our full year performance.
Starting with revenues, we saw year over year growth of $51 million for 11% to $519 million.
This increase was primarily due to higher tax preparation fees due to volume growth and assisted and DIY Y and the acquisition of just over 200 franchise offices. This year, which continues to be a good use of capital.
The volume growth also resulted in higher royalties as well as increased revenues related to our tax plus products.
In addition to increases in our tax business wave contributed $11 million, which represents our year over year increase of more than 40%.
Turning to expense total operating expenses increased $65 million or 11% to $672 million.
The majority of this increase was anticipated as it was driven by Wade.
Increased compensation due to higher assisted volumes and planned investments related to our technology roadmap.
We also recorded $19 million of incremental marketing expense during the quarter. There was entirely due to a pull forward a recognition from Q4 Q3.
And was not due to an increase in spend.
Because of this timing shift, we expect marketing expense to be lower in Q4.
Ill discuss our full year outlook, including expectations for operating expenses later in the call.
Interest expense was $26 million, which reflects an increase from the prior year due to higher draws on our line of credit.
The changes in revenue and expenses, resulting in an increase in pre tax loss from continuing operations of $18 million.
GAAP loss per share increase eight cents to 66 cents.
As we shared last quarter, we're now reporting GAAP and non-GAAP EPS.
Adjusted loss per share increased seven cents to 59 cents driven by the increase in pre tax loss and lower shares outstanding.
Partially offset by an increase tax benefit.
As a reminder, while beneficial on a full year basis lower share count negatively impacts EPS in quarters in which we reported a loss.
In discontinued operations, there were no changes to accrued contingent liabilities related to sand canyon during the quarter.
For additional information on sand Canyon, please refer to disclosures in the company's reports on forms 10-K and 10-Q.
The resi SEC filings.
Regarding capital our priorities remain unchanged at the top list is maintaining adequate liquidity for our operational needs to account for our seasonality.
We came into this year with a strong financial position after generating over $500 million or free cash flow in fiscal 19.
We didn't make strategic investments back into business that we believe deliver value to our clients ultimately benefiting our shareholders.
Making prudent investments to drive sustainable growth remains a key element of our capital allocation.
Last we'll deploy excess capital through quarterly dividends and share repurchases.
We've increased our quarterly dividend each of the last four years, resulting in a 30% increase over that time.
Regarding share repurchases in the third quarter, we repurchased 2.8 million shares for $66 million at an average price of $23.35.
Year to date, we have repurchased a total of 10.1 million shares for $247 million at an average price of $24.36.
Going forward, we will continue to be opportunistic in our share repurchase approach.
I'd now like to provide thoughts on our financial outlook for the remainder of the year.
Starting with the tax industry, we continue to expect overall return growth of around 1%.
With assistant volume flat to slightly up in DIY growing around 3%.
This is consistent with the trends we've seen over the last several years.
Right and our block as Jeff shared we expect growth in DIY client inline with the category.
And an improvement in client trajectory in assisted as we hold market share in that category.
Combine this would be the third consecutive year of overall client growth.
Regarding pricing in assisted we expect net average charge remain consistent with last year following a year in which we reset price.
In D. iwai during the first half of the season, we saw a decrease in net average charge due to the product issue that Jeff discussed.
Weve remedied this and combined with anticipated growth in online assist we expect mix to improve in the second half, resulting in net average charge similar to last year.
Consistent with the outlook, we provided last quarter, we expect these client growth and net ever shards expectations, along with wave to result in revenue growth of 1.5% to 3.5%.
Turning to earnings for the full year, we expect to grow revenue faster than EBITDA result in any decline in EBITDA margin compared to fiscal 19.
This year, we realized approximately $15 million of unplanned onetime expenses onetime expense increases due to legal cost and refund advance fees, which will also impact our margin.
Despite these expense increases.
We continue to expect EBITDA margin to be within our previously provided range of 24% to 26%.
Given our year to date results. This full year outlook in birds eye significant increase in EBITDA in the fourth quarter.
This will be achieved through continued revenue growth as well as a reduction of certain expenses in the fourth quarter related to the timing of marketing expense recognition that I mentioned earlier and lower compensation related to accrued bonuses.
As we indicated last quarter, we expect the tax rate of 19% to 21% due to favorable settlements with tax authorities during the second quarter.
The rest of our financial outlook also remains unchanged with total depreciation and amortization of $165 million to $175 million.
Of which $70 million to $80 million will be amortization of intangibles related to acquisitions.
This amortization expense reflects both wave and tax office acquisitions and is excluded from S or non-GAAP reporting.
We continue to expect interest expense of $90 million to $100 million and capital expenditures of $70 million to $80 million.
To conclude I'm confident in our plans for the second half of the tax season, and we are on track to deliver our financial objectives for the fiscal year with that I'll now turn the call back over to Jeff.
Thanks, Tony.
Before Q1 day I'd, just like to take a moment to think our franchisees tax pros and associates, who continued to deliver on our strategic objectives each day.
Their dedication to providing help and inspiring confidence in our clients in communities is what makes HR block the great company. It is today.
Overall I'm excited about the progress, we're making toward our long term goals and I'm confident we're taking the steps necessary to deliver on our objectives for the fiscal year.
Look forward to sharing more with you when we report our full year results in June.
With that we'll now open the line for questions operator.
Thank you ladies and gentlemen, if you have a question at this time. Please press Star then the number one on your touched on telephone. If my question has it been answered are you wish to we moved yourself from me can you. Please press the pound.
First question comes from the line as Kartik Mehta from Northcoast research.
Okay.
Hey, Jeff and Tony I apologize for the background noise, if you're hearing I'd.
But I wanted to ask a jump a little bit about that net average charge at least on the retail side.
And what do you think might drive that into second half.
Especially for the company owned operations.
If I if I heard your right you're talking about NAC in retail and company in the second half did I get that right.
Jeff I apologize for all that the noise.
That's all right no so.
Every year, when we look at our pricing and it was no different this year coming off our reset we've made a few little tweaks around the edges to our pricing model was knowing that over the course of the year flatten NAC was the goal we see that playing out a little bit in the company offices in the first half, but we are comp.
And it will be back to flatten back in the second house.
And franchisees as you know they have adopted our model they get to make their own pricing decision. So you're seeing a little different movement with franchisees and that explains the difference.
And then Jeff just as a follow up I was wondering if you could just talk about your word virtual attacks products, what the demands been life for both of 'em and now what you would anticipate for the rest of this season.
Yeah, so on virtual.
Remember we have three products in virtual tax Pro go tax program review went online assist and when you put all those together. This is obviously, we're really new idea in the market, where we're able to take the network of tax pros added digital layer and enable people access to help on their terms.
All three products are showing significant growth over last year, albeit on small bases.
But the things that we're paying close attention to that we're very excited about or our service delivery. So I highlighted in my prepared remarks with online assist clients are able to access a tax grow in about one minute.
So we know delivering really quick answers to questions is important we're seeing very strong client satisfaction scores in each product.
And importantly in each one's a little bit different but we're seeing anywhere from 30 to 50 plus percent of new clients choosing those products to the brand.
So you know digital product innovation early in its lifecycle, but a lot a really good signs that we're fulfilling an unmet need.
Thank you.
Thanks Kartik.
Thank you next question comes from the line of George Tong of Goldman Sachs. Your line is open.
Thanks, Good afternoon.
Earlier, Intuit announced its intention to acquire credit Karma can you discuss how you expect us to impact the industry and competitive background for the positive or the negative and changes to your internal strategy in response to this consolidation.
Hey, George it's Jeff. So you know as we continue to transform HR block the the competitive landscape will obviously be very dynamic.
And we pay close attention to what our competitors do.
There are two good competitors independently, obviously, but we are way more focused on executing our own strategy and serving our own clients.
And it's you know we don't really know how the proposed merger will play out so beyond that it's too early to really speculate on what exactly they may do.
Got it that's helpful. Early you'd indicated that you're making appropriate changes in DIY is such that the second half will grow faster and it should grow in line with the category by year end can you discuss how your expected performance with market share in DIY has evolved if any if you had previously expected market share gains in the category.
Now looking for in mine performance with the with the industry.
Yes, George Tony I'll take this war.
So at the beginning the year, we share that we expected to outpace the category in DIY, which we had done in each of the three previous years.
We did have a little bit of a somewhat began the year as we made a couple of adjustments Jeff alluded to in his opening comments that was had been put in place. We're starting to see performance improve which will result in us holding share with the category by the end.
Got it helpful. Thank you.
Thanks George.
Thank you next question comes from the line of Scott Schneeberger from Oppenheimer. Your line is open.
Thanks, very much good afternoon.
Following up on the on that last question 'cause used to elaborate a little bit more on what the.
With the Snafu was in D. I why and.
How long there was an issue before you made the adjustments just to get a feel for for what type of what type of impact that was thanks.
Yes, Scott this is Jeff. So there were two things one was in the product flow in D. iwai, when the consumers going through the flow. If we recognize that they would be better served into different product, we offered them that choice for upgrade.
And we had a technical glitch in that form that was preventing that from happening.
We caught it quickly, but you know every hour in everyday matters, especially in the early part of the season. So once we got that back on track as I mentioned, we've seen.
You know not changing growing about 4% since the change that was one thing and the second thing was marketing dollar allocation.
Within the what we call the performing the performance marketing channels, and we had allocated some dollars to a channel that weren't working as well and we recognize that and we immediately shifted those dollars and we see the changes happening from that but those were two things on top of each other a that definitely got us off.
To a slower start that we want than we wanted at the beginning of the year.
Hi, Thanks for that coverage.
I guess as my follow up.
On on I missed the number on how many franchise is converted and if you could share that again and then discuss what type of impact that will have on revenue growth on a year over year basis over the full season. Thanks.
So all of a.
Talk about in the first and Tony May chime in too, but it was up about a couple of hundred locations just a I think about two or five.
Which was definitely more than last year.
You know every year, we look at the footprint what do we relocating is there an opportunity at a market to buy back is there a franchisee that wants to sell the combination of all those things resulted in a more this year than last year and I believe it was about a 40 million dollar.
Increase in revenue as a result of that incremental by that.
Okay. Thanks, very much I'm.
Sorry, yes.
Thanks, Scott Thanks.
Thank you next question comes from the line of Jeff Goldstein of Morgan Stanley. Your line is open.
Hey, guys can you talk about the makeup so far of what you're seeing in your assisted customer base. For instance are you seeing more returning customers or new customers than you were expecting or anything around the customer demographics for instance, more or less itemizers than maybe you saw last year, just just any more color there would be helpful.
Yeah. So this is Jeff I'll kick us off again.
So you know several reasons why we're feeling good about our continued improvement in the assisted business.
Obviously this is several years in a row now we're continuing to.
Prove performance and I think there's a couple of things I would highlight.
One is the focus on price transparency.
And operational excellence and what we did last year. We hope we saw really big improvements in client satisfaction, we thought that that would translate into retention. This year Retentions, obviously tricky at this point in the year to call because of the dynamics of filing sooner or later.
Pull forwards and different things, but.
We think we're seeing some risk retention gains year to date and will summarize that once we get two years and.
In terms of demographics.
So about 50% of all of our new clients to assisted our millennials.
We see great new client acquisition coming through our virtual products.
Tax program review and tax Pro go count as assisted volume as you may recall.
And so from that standpoint, we see some changes in the composition you know last year in the second half.
We saw a really nice improvement in new client acquisition and that's why we're confident as we get into the second half of this season, we'll continue to build that momentum.
What's your plan down essentially it out there.
Okay, I guess that the next one for me then was just any impact to your business than we should be thinking about from the Corona virus I'd imagine, it's not much but could this possibly drive more of a shift to DIY from assist.
So Jeff just anything to call out.
Yeah. It's a great question. Obviously this is a really really dynamic topic. We're we're following it closely we're been contact with many other U.S. retailers that have physical footprint.
Communicating with our associates were following all the CDC recommended approaches.
At this point, we havent seen any impacted the business.
We will continue to remind clients of the variety of ways that they can engage with HR block drop off tax pro go et cetera.
But we though we're following it closely and we'll respond as we need to as things unfold.
Thank you.
Thank you next question comes from the line of Jeff Silber BMO capital markets line is open.
Thanks, so much in your prepared remarks, you're talking about a pull forward of marketing from.
For Q into Threeq, you I didn't know if you gave out the number if you can give us in the number that would be granted if you could explain exactly what that was for that would be helpful. As well. Thanks.
Hey, Jeff This is Tony.
So that was it related to how we're recognizing marketing expenses and it was about $19 million and it was a movement from what had been reported in Q4 that was recorded in Q3.
And as a result will have lower marketing expenses in Q4, it was not due to a change in an overall spend it was purely due to how we're recognizing some online marketing expenses and those being more recognized in Q3.
Okay, great. If I remember correctly. There was also going to be a planned roll off of a marketing promotion I think was called send a friend.
That you might thought would help your fourth quarter EBITDA dollars as well as that also still the plan.
It is there some that we recorded in Q4 last year, you remember correctly that that will be a roll off this year. The other thing that's a roll off.
In Q4, or some bonus accruals that we had last year in the quarter that we don't expect to recur. This year. So that's why we think EBITDA dollars will be what we really strong going into the fourth quarter.
Okay, Great. That's helpful. Thanks, so much.
Thanks, Jeff.
Thank you next question comes from the line that much Army of Jefferies. Your line is open.
Hi, guys. This is Mario portal actually filling in for Hamzah.
Could you just update us on wave in any of the work that's being that's been done in the quarter with the EPA has any more progress being made or is there anything else to call out regarding the.
Mario It's Jeff absolutely a lot of things to comment on just just real quickly you know the shopify integration, we talked about last quarter, it's too soon to called any meaningful changes to that but obviously that.
That decision really has a lot of potential benefit for small business owners that have ecommerce businesses et cetera, but if I just take a step back from that you know the team continues to make improvements across the board and their product offering.
I commented on wave advisors.
Which is a great way that small business owners can get lives help as they struggle or have questions with their book keeping on top of the way that.
Adding more states in the payroll business getting smarter about flows and how we onboarded people into payments, so really a number of things happening in the core business.
This year, we took some minor steps in terms of the block integration with wave.
For example for the first time, we built a site on HR block Dot com about our small business offering and incorporated wave. We've done some light E mail marketing regarding tax for will go to waive clients things that we thought this year, we're just simple easy additions as we work toward.
A much different level of integration for fiscal 21.
Got you appreciate it and then just kind of a follow up on the Corona virus question, just could you remind us if there is larger than the normal shifts.
To to digital or to de Iwai did just this year.
Assuming that that's how long it lasts and assuming that it is much larger.
Throughout the coming months could you just give us a sense for what the revenue or margin impact could be just from a an outsize shift in one year.
Yeah. This is Tony I mean, the way I would think about as probably on a net average charge basis. So net average charge in assisted is no 200 and change and DIY why is around $35 on hybrid. So obviously is a significant revenue change.
Margin percentage on D., I wise is higher but margin dollars, obviously much much lower given the lower net average charge. The other thing I would say is customers typically don't switch that quickly.
Or issues like that I think people do it based more on their confidence and obviously I think there would be up to be a lot of extenuating circumstances to cause clients to completely switch how they filed their taxes based on that in.
My personal speculation, but if that were to happen with something that significant there maybe changes in the IRS extending the tax season or other things that that would ultimately play out. So it's obviously impossible to speculate at this point as Jeff said, we're not seeing anything.
Abnormal we aren't hearing anything about changes to the tax season, and we aren't seeing any change in client behavior as a result.
Great. Thanks, so much.
Thank you.
Thank you next question comes from the line of Alixpartners of Barrington Research line is open.
This is Chris how sitting in for Alex.
First question I know, it's still early.
You talked about it briefly on another question in regard to retention.
But if we take the market share gains you made in the last tax season, and kind of broke apart that sub piece or that.
Part.
Anything you can tell so far in this tax season as to their customer behavior and their ability to upgrade and increase their oh.
Value.
Yeah, I mean, I don't know if I completely follow the question I think it's around.
Growth that we had last year and maybe that the growth that we did see what the what that kind of retention of those clients would be.
It's a little bit hard to answer and that that kind of bucket.
Obviously, a lot of fungibility and clients on a year over year basis every single year.
As Jeff said, we're seeing nice retention gains in both assisted and DIY why at the early part of the season.
We typically like to measure retention on a full year basis, because early season, we know we've got pull forward this year because as a delay in the tax season last year, we had the government shutdown and other things going on so we're seeing clients come in earlier.
I always want to make your retention at the early part of the season with the grain of Salt once we get to the end of the year, while obviously provide more data.
Do you guys on what we're saying for the full year.
Okay. That's helpful and just going back to the technical glitch that you saw.
On the product.
These customers who are unable to upgrade.
They were lost or they.
Chose.
A product set with a lower neck.
The latter they they were not lost they just shows a product that was a lower now yeah, okay and it just want a directly in fact it directly impacted net average charge for the first part of the season, which is why we wanted to highlight it.
Got it got it okay. Thank you for taking my questions. Thanks, Chris.
Thank you next question comes for into line of Michael Millman of Millman Research Associates line is open.
Two questions first.
Could you give so the IRS as you know.
Reported today that they were down 2.2% assisted.
Could you give us your comparable numbers in other words day to day and also exclude the extensions.
And.
My other question.
On the credit common.
Common deal.
Into its paying about one of the half time.
Total value.
All of agent on block least market value.
Are you, saying.
What we see in the future as money is going to be made by offering.
Our clientele.
Two.
Marketers, which is something you tried in the past Didnt work.
And therefore, we are willing to.
Spent a lot of money and give a wave of returns.
Thank you.
Unlike all I'll take the first one on kind of what the IRS reported today and as you said I think that literally came out 20 minutes ago. So I. Unfortunately don't have the an apples to apples comparison, but what I will say and I don't think the results are probably change that much.
Is when we look at on a comparable basis for data they reported a week or so ago.
We were down slightly in share and the assisted category compared to the IRS on a comparable basis.
And that's why we believe we're going to do better in the second half you may remember that we did fairly well in the second half last year. We also had our price reductions for the reset we did last year rolling out upfront transparent pricing that were more targeted towards second half filers. We've also had really strong client satisfaction scores in the second half of last.
Last year. So there's a lot of things that we think are going to be a nice tailwind going in the second half that's going to allow us to achieve category share or the full taxis and now I don't know, Jeff If you want to comment on credit Karma well I mean, just said just build on what I said earlier I mean, it's it's who knows it's hard to say what the competitions thinking by the.
Decisions are making and.
We're not really going to comment on what they may or may not be thinking we're just focused on serving our clients.
Okay. Thank you.
Thank you I am showing no further questions at this time I would like to turn it back to Mr. Colby Brown for any further comments.
Thanks, and thanks again, everyone for joining this concludes todays call.
Thank you presenters, ladies and gentlemen. This concludes today's conference. Thank you for participating and have a wonderful day any all disconnect.
[music].