We also continued our share repurchase program, buying $132 million in the quarter. Let's go deeper into Block Horizons, beginning with small business, which includes small business tax and services and Wave. Assisted small business total revenue growth was 6% in the quarter, and we're pleased with the early signals we are seeing in bookkeeping and payroll services which are growing double digits. We see a long runway of opportunity and are focused on continuing our momentum, which includes growing clients in both tax and services and driving business formations, which we launched last year. Overall, we feel good about the trajectory of small business. Turning to Wave. Revenue growth was 6% in Q1, which was in line with our expectations. As we've shared, we underwent a strategic review of the business when the new leader was put in place.

We now have a plan to accelerate revenue growth and put us on a path to profitability. Before I share those plans, I want to recap Wave's current business model, which provides tremendous value for small business owners by offering free invoicing and accounting. Wave has monetized its platform primarily through payment processing as well as payroll and advisory services. We are now beginning a strategic shift to solve customer pain points that will deliver value and monetize more premium features. In the payment space, customers are wanting additional options beyond credit cards which Wave historically has not provided. Today, less than 30% of invoices sent by small businesses through Wave's platform are enabled for credit card or bank payments.

Thus, there's a significant opportunity to unlock value as we enable our customers to be paid via alternative methods and expand our share of wallet. We also see an opportunity to build other premium features that help our customers run their small business. Last quarter, we launched the mobile receipts feature, which is a monthly or annual subscription that generates additional recurring revenue. This product's uptake has been better than expected and is a good example of where we're heading. I am excited about the shifts we're making and the opportunities we see in this business. Now I'll move on to financial products. Regarding Spruce, recall that tax season '23 was the first time the product was introduced in the Assisted channel. Our learnings have informed our actions for the next tax season, and we are continuing to drive innovation for the customer experience.

We've made the account creation and sign-up process more seamless in all our channels and deposit trends from customers utilizing Spruce to receive their payroll direct deposit continue to improve. As of September 30, we surpassed 300,000 sign-ups and had almost $400 million in customer deposits. In fiscal '24, we are focused on efficiently acquiring clients at tax time, which includes the DIY flow and driving customer engagement within the app. Now let's turn to Block experience. This imperative is all about blending digital tools with human health to provide better experiences for clients while empowering them to be served; however, they choose, fully virtual to fully in-person and everything in between. We have made a number of enhancements to MyBlock this year.

Within the app, clients will now have visibility of where they are at each stage of the tax prep process through a status tracker on their home page. In addition, we'll be delivering a personalized checklist to help clients be better prepared for forms they will need and how to upload them ahead of time. The app will provide help at each stage with a call to action that recommends clients' next step, whether uploading new documents getting help from one of our expert tax professionals or notifying them that is time to review their return which was made easier and faster to approve and sign online. Clients also have the ability to access their tax documents and return digitally which aligns with our new print-less strategy to reduce paper consumption in our offices.

This is a benefit for our clients results in cost savings and is one of the many ways we live our commitment to environmental sustainability. Another priority within Block experience is leaning into GenAI. As we've shared, we are initially focused on two areas: first, enhancing the customer experience; and second, reducing expenses and increasing productivity. In the DIY channel, we're working on exciting innovations that will support our clients throughout the tax prep experience, and we are testing the ability to use AI to field customer calls. Over time, we believe these initiatives can result in meaningful cost savings but we are not assuming any this fiscal year as we are in initial testing phases. All in all, we're making tangible progress through our partnership with Microsoft.

In fact, they recently highlighted our work to thought leaders and industry experts during the Envision tour in New York. As you can see, our team continues to make progress, and we are well-positioned to deliver results this year. Before turning it to Tony, I want to mention that we recently published our fourth annual environmental, social and governance report for fiscal year '23, reflecting our ongoing commitment to transparency, sustainability and responsible business practices. I encourage you to visit our Investor Relations website to read it in full. With that, I will now pass things over to Tony to share more about our financial results.

Tony Bowen: Thanks, Jeff, and good afternoon, everyone. In Q1, we delivered $183.8 million of revenue, an increase of 2% or $3.8 million over the prior year. The increase was primarily due to higher U.S.-assisted tax preparation revenues driven by an increase in net average charge, partially offset by lower Emerald Card revenues. Total operating expenses were approximately $390 million, an increase of about 30 basis points or $1 million. Corporate wages and bad debt were higher and marketing and advertising as well as consulting expenses were lower than last year. EBITDA was a loss of approximately $166 million, an improvement of 3% or $6 million from the prior year. Interest expense was about $16 million, which is essentially unchanged to last year.

Pretax loss decreased by $9 million to $212.4 million, primarily due to higher revenues and interest income in the current year. Our effective tax rate was 23.3% compared to 24.4% last year. Loss per share from continuing operations was $1.11 compared to $1.05 last year, while adjusted loss per share from continuing operations was $1.05 compared to $0.99 last year due to fewer shares outstanding. As a reminder, in quarters with the loss, fewer shares outstanding increase loss per share but is accretive as we generate earnings for the full year. As Jeff shared, we had a good start to the year and are reaffirming our full year 2024 outlook and longer-term total shareholder return algorithm that calls for topline growth, EBITDA that outpaces revenue and EPS, it grows even faster.

Turning to Capital Allocation. Our practice remains robust. In Q1, we repurchased a total of 3.3 million shares for $132 million at an average price of $40.43. This retired another 2% of our float. Since 2016, we have reduced shares outstanding by over 38%. Additionally, last week, the Board of Directors declared our quarterly cash dividend. Since 2016, we have grown the dividend 60%, yet the total dollars paid out continue to decrease because of how quickly we are buying back shares. Given the macro environment and the expectation of high interest rates for the foreseeable future, I'd also like to share more about the strength of our balance sheet. We continue to feel great about our relatively low leverage with $1.5 billion of long-term debt against our over $900 million of EBITDA in the most recent year.

Our next debt maturity of $350 million isn't until October of 2025, which is our smallest tranche and we don't have another tranche maturing after that until 2028. As we've shared before, as interest rates rise, it benefits our P&L on a short-term basis, as our interest income from our cash position will exceed our short-term recurring interest expense for the full year. Overall, we feel very good about our balance sheet and how we are positioned in the current environment. In summary, our financial story is positive. We drive topline growth, EBITDA that outpaces revenue and EPS that grows even faster. We have strong capital allocation practices to reliably return value to shareholders, and our balance sheet positions us well for the macro trends.

With that, I will now hand it back over to Jeff for some closing remarks.

Jeff Jones: Thanks, Tony. I'm looking forward to all that we will accomplish this year. In closing, I'd like to extend a sincere thank you to our associates, franchisees and tax professionals for all they do year-round to deliver on our purpose of providing help and inspiring confidence in our clients and communities everywhere. Now operator, we will open the line for questions.

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