KinderCare Learning Companies (KLC) Company Report

Tom Wyatt is returning as Chief Executive Officer of KinderCare Learning Companies, effective December 2, 2025, succeeding Paul Thompson. Wyatt previously served as CEO from 2012 to June 2024, leading significant growth and acquisitions, and has been Chairman of the Board since 2021.
Despite revenue growth of 11.4% over the past three years, KinderCare faces ongoing losses with a negative EPS of -0.62 and a net margin of -2.57%.
The company exhibits liquidity concerns with a current and quick ratio of 0.71, a high debt-to-equity ratio of 2.7, and an Altman Z-Score of 0.84, placing it in the distress zone.

3 days ago

Morningstar

KinderCare Learning Companies Addresses First Year Challenges and Growth Strategies

KLC

Demand Weakening

Guidance Update

New Projects/Investments

KinderCare Learning Companies (KLC) experienced a "bumpy" first year as a public company due to the macroeconomic environment, leading to declines in new student enrollment despite strong retention.
The company is implementing strategies to improve occupancy, including focusing on underperforming centers (Opportunity Region, Quintile 5, which is up in occupancy through Q3) and rolling out new digital tools for inquiry-to-enrollment processes.
The subsidy business, representing about one-third of revenue, was impacted by unprecedented rate and spot cuts in Indiana, affecting 1,000 subsidy students by September, though temporary freezes in Arizona and Texas have lifted.
KLC anticipates benefiting from higher tuition rate increases in 2026 and expects to return to its medium-term revenue algorithm of 3%-5% tuition rate growth in the next couple of years.
While positive enrollment growth is a stretch for 2026, the company aims for it by 2027, driven by continued growth in its B2B business, greenfields, and tuck-in acquisitions, with the Champions brand expected to grow double-digits.

Nov 18, 2025, 8:20 PM

Transcript

KinderCare Learning Companies Addresses Bumpy First Year and Future Outlook

KLC

Demand Weakening

Guidance Update

New Projects/Investments

KinderCare Learning Companies (KLC) acknowledged a challenging first year as a public company, marked by macroeconomic headwinds and enrollment declines, but is implementing strategies to improve center-level performance.
The company's "Opportunity Region" (lowest performing centers) has shown occupancy growth in Q3 2025, and KLC is rolling out new tools to enhance the inquiry-to-enrollment process and retention across all centers.
The subsidy business faced significant impacts in Q3 2025, notably from unprecedented rate and spot cuts in Indiana and temporary freezes in Arizona and Texas, though these states have since unfrozen vouchers.
KLC anticipates incremental enrollment growth through May 2026, with a return to positive enrollment growth projected for 2027, and plans for higher tuition rate increases in 2026.
The company remains confident in its medium-term revenue algorithm, driven by B2B growth, greenfield expansion, tuck-in acquisitions, and expected improvements in pricing and occupancy.

Nov 18, 2025, 8:20 PM

Transcript

KinderCare Reports Q3 2025 Results and Updates Full-Year Guidance

KLC

Earnings

Guidance Update

Demand Weakening

KinderCare reported Q3 2025 revenue of $677,000,000, up nearly 1% from last year, with net income of $4,600,000, adjusted EBITDA of $66,000,000 (down 7% year-over-year), and adjusted EPS of $0.13.
Same center occupancy declined to 67% in Q3 2025, down 160 basis points from the prior year, attributed to a slower pace of enrollments and a cautious consumer backdrop that is expected to persist into 2026.
The company updated its full-year 2025 guidance, projecting revenue between $2,720,000,000 and $2,740,000,000, adjusted EBITDA between $290,000,000 and $295,000,000, and adjusted EPS between $0.64 and $0.67.
Growth levers like Champions revenue, which grew 11% in Q3, and tuck-in acquisitions continue to perform well, with the company expecting tuition increases to be a larger contributor to growth in 2026.

Nov 12, 2025, 10:00 PM

Transcript

KLC Announces Q3 2025 Results and Updates FY25 Guidance

KLC

Earnings

Guidance Update

Demand Weakening

KinderCare Learning Companies reported Q3 2025 revenue of $676.830 million, net income of $4.550 million, and diluted EPS of $0.04. The company's Adjusted EBITDA for Q3 2025 was $66.395 million.
The company updated its FY25 guidance, projecting revenue between $2.72 billion and $2.74 billion, Adjusted EBITDA between $290 million and $295 million, and Adjusted EPS between $0.64 and $0.67.
Operationally, Champions added over 200 new sites year to date, and KinderCare opened 3 new employer on-site centers in Q3 2025, with average employer on-site portfolio occupancy exceeding 70%.
ECE same-center occupancy was 67.0% in Q3 2025, a decrease from 68.6% in Q3 2024, influenced by seasonal softness and a cautious economic environment.

Nov 12, 2025, 10:00 PM

Presentation

KinderCare Learning Companies Reports Q3 2025 Financial Results and Updates Full-Year Outlook

KLC

Earnings

Guidance Update

KinderCare Learning Companies, Inc. announced its financial results for the third quarter ended September 27, 2025, on November 12, 2025.
For Q3 2025, the company reported revenue of $676.8 million, an increase of 0.8% compared to Q3 2024, and net income of $4.6 million, or $0.04 per diluted common share.
Adjusted EBITDA for Q3 2025 was $66.4 million, and adjusted net income per diluted common share was $0.13.
The company updated its full-year 2025 guidance, expecting revenue between $2.72 billion and $2.74 billion, adjusted EBITDA between $290 million and $295 million, and adjusted net income per diluted common share between $0.64 and $0.67.

Nov 12, 2025, 9:30 PM

8-K

KinderCare Announces Third Quarter 2025 Financial Results

KLC

Earnings

Guidance Update

KinderCare Learning Companies reported revenue of $676.8 million for the third quarter ended September 27, 2025, an increase of 0.8% compared to the third quarter of 2024.
For the third quarter of 2025, the company achieved net income of $4.6 million and diluted net income per common share of $0.04. Adjusted EBITDA was $66.4 million, and adjusted diluted net income per common share was $0.13.
Revenue growth was primarily driven by strong performance in Champions and sustained employer engagement, with revenue from before- and after-school sites increasing by 10.7%.
The company updated its full-year 2025 guidance, now expecting revenue between $2.72 billion and $2.74 billion, adjusted EBITDA between $290 million and $295 million, and adjusted diluted net income per common share between $0.64 and $0.67.

Nov 12, 2025, 9:15 PM

Press Release

KinderCare Learning Companies Faces Securities Class Action Lawsuit

KLC

Legal Proceedings

A securities class action lawsuit has been filed against KinderCare Learning Companies, Inc. (KLC), alleging the company failed to disclose material information in its October 2024 initial public offering (IPO) Registration Statement and Prospectus.
The lawsuit claims KinderCare did not disclose numerous incidents of child abuse, neglect, and harm, and failed to provide adequate care, leading to undisclosed risks of lawsuits, adverse regulatory action, negative publicity, reputational damage, and business loss.
Investors who purchased KLC shares from the October 2024 IPO with losses over $100,000 have until October 13, 2025, to file lead plaintiff applications in the class action lawsuit.

Oct 10, 2025, 10:39 PM

Press Release

KinderCare Learning Companies Faces Class Action Lawsuit

KLC

Legal Proceedings

A class action lawsuit has been filed against KinderCare Learning Companies (KLC) on behalf of investors who purchased securities in or traceable to its October 2024 initial public offering (IPO).
The lawsuit stems from reports published in April and June 2025, alleging safety concerns and misconduct at KinderCare facilities.
Since its IPO price of $24 per share, KinderCare's stock has fallen to near $9 per share.
Investors have until October 14, 2025, to file a lead plaintiff motion.

Sep 30, 2025, 7:42 PM

Press Release

KinderCare Faces Investor Lawsuit Over October 2024 IPO

KLC

Legal Proceedings

A new securities class action lawsuit has been filed against KinderCare Learning Companies, Inc. (KLC) and its executives, alleging the company misled investors during its October 2024 Initial Public Offering (IPO).
The lawsuit claims KLC's IPO documents presented a false picture, concealing a documented history of serious safety and care failures that contradicted its claims of providing "highest quality care".
The complaint highlights that more than 30% of KinderCare’s revenues come from federal subsidies, making the undisclosed history of child neglect and harm a material, undisclosed risk to this major revenue source.
Since the IPO, KLC's stock has performed poorly, dropping from its offering price of $24 per share to lows near $9 per share.