KinderCare Learning Companies (KLC) Q4 2025 earnings summary

Executive summary

• Revenue for Q4 2025 was $688.1 million, up 6.4% year-over-year, aided by an extra week; full-year revenue reached $2.73 billion, up 2.6% including the extra week.

• Adjusted EBITDA for Q4 2025 was $68 million; full-year Adjusted EBITDA was $300 million, with margin at 11%.

• Net loss for Q4 2025 was $177 million due to a non-cash goodwill impairment; full-year net loss was $113 million.

• Same-center occupancy declined to 64.5% in Q4, down 340 basis points year-over-year; full-year occupancy was 67.8%, down 200 basis points.

• Served approximately 219,000 children daily at the end of 2025 across 2,754 centers and sites in 41 states and D.C.

Financial highlights

• Q4 revenue growth was primarily driven by a 53rd week, contributing $45 million; on a comparable basis, revenue was flat.

• Tuition contributed 2% growth; Champions brand delivered double-digit revenue expansion.

• Adjusted EPS for Q4 was $0.12, up $0.03 year-over-year; full-year Adjusted EPS was $0.70, up from $0.40 in 2024.

• SG&A to revenue ratio improved to 10.7% in Q4, reflecting cost discipline and lower IPO-related expenses.

• Free cash flow for FY2025 was $110.3 million, up from $(16.4) million in FY2024.

Outlook and guidance

• 2026 revenue expected at $2.7–$2.75 billion, with Adjusted EBITDA of $210–$230 million and Adjusted EPS of $0.10–$0.20.

• Guidance assumes 3% tuition-driven revenue growth offset by a 3% decline in same-center occupancy.

• Free cash flow projected at $35–$40 million; CapEx to be about 5% of revenue, focused on growth.

• Q1 2026 revenue expected at $664–$674 million, Adjusted EBITDA at $45–$48 million, and Adjusted EPS near breakeven.

• Enrollment improvement anticipated in the second half of 2026, but not expected to surpass first-half 2025 growth rates.