H&R Block Inc. (HRB) saw its shares plummet 5.6% in pre-market trading on Wednesday following the release of its fiscal second-quarter earnings results. The tax preparation giant reported weaker-than-expected performance in its Emerald Advance loan product, along with higher operating costs, weighing on its outlook.

For the quarter ended January 31st, H&R Block posted a net loss of $312 million, wider than the $283 million loss recorded in the prior-year period. The company cited lower interest and fee income from Emerald Advance loans due to tighter underwriting standards, which impacted loan volume.

Operating expenses climbed 6% year-over-year to $472 million, primarily driven by increased tax professional and corporate wages, higher healthcare costs, and elevated occupancy and marketing expenses. While these factors were anticipated in the company's full-year guidance, the higher costs weighed on profitability during the seasonally slow second quarter.