Bright Horizons Family Solutions Reports Financial Results for the Fourth Quarter and Full Year of 2025

NEWTON, Mass.--( BUSINESS WIRE)--Bright Horizons Family Solutions ® Inc. (NYSE: BFAM) today announced financial results for the fourth quarter and full year of 2025 and provided guidance for 2026. Bright Horizons is a leading provider of high-quality early education and child care, comprehensive back-up care solutions, and educational advisory services. Our offerings are designed to support both working families and employers’ workforce strategies by supporting their employees across life and career stages, and improve employee recruitment, engagement, productivity, retention, and career advancement.

Fourth Quarter 2025 Highlights (compared to Fourth Quarter 2024):

Non-GAAP financial measures:

Year Ended December 31, 2025 Highlights (compared to Year Ended December 31, 2024):

Non-GAAP financial measures:

“Our diversified, integrated education and care solutions supported by our broad client base drove a strong fourth quarter and a solid finish to the year,” said Stephen Kramer, Chief Executive Officer. “Back-Up Care remained a standout all year — generating more than $725 million in revenue in 2025. As we move into 2026, we remain focused on deepening our impact with the employers and families we serve, enhancing our services, and investing in people and technology to drive growth, support margin progress, and deliver the highest quality care and education.”

Fourth Quarter 2025 Results

Revenue increased by $59.6 million, or 9%, to $733.7 million in the fourth quarter of 2025, from the fourth quarter of 2024, due primarily to increased utilization of back-up care services as well as enrollment gains and tuition price increases at our centers.

Income from operations was $45.5 million for the fourth quarter of 2025 compared to $48.2 million for the fourth quarter of 2024, a decrease of 6%. The decrease in income from operations is primarily related to incremental impairment and net lease termination costs of $14.8 million, partially offset by incremental gross profit contributions resulting from higher utilization of back-up care services, as well as contributions from our full service center-based child care centers from enrollment growth and operating leverage. Net income was $21.7 million for the fourth quarter of 2025 compared to $29.1 million for the fourth quarter of 2024, a decrease of 25%, due to the decrease in income from operations noted above and a higher effective tax rate. Diluted earnings per common share was $0.38 for the fourth quarter of 2025 compared to $0.50 for the fourth quarter of 2024.

In the fourth quarter of 2025, adjusted EBITDA* increased by $12.8 million, or 12%, to $123.5 million, and adjusted income from operations* increased by $11.2 million, or 14%, to $90.6 million from the fourth quarter of 2024, due to increased contributions from both the back-up care and full service center-based child care segments. Adjusted net income* increased by $7.7 million, or 14%, to $65.1 million, as a result of the increase in adjusted income from operations noted above. Diluted adjusted earnings per common share* was $1.15 for the fourth quarter of 2025 compared to $0.98 for the fourth quarter of 2024.

As of December 31, 2025, the Company operated 1,010 early education and child care centers with the capacity to serve approximately 115,000 children and their families.

*Adjusted EBITDA, adjusted income from operations, adjusted net income and diluted adjusted earnings per common share are financial measures that are not calculated in accordance with generally accepted accounting principles in the United States (“GAAP”), which are commonly referred to as “non-GAAP financial measures.” Adjusted EBITDA represents EBITDA (which is net income, as determined in accordance with GAAP, before interest expense, income tax expense, depreciation and amortization) adjusted to exclude stock-based compensation expense and non-recurring costs, such as impairment and net lease termination costs, debt refinance costs, and at times, other non-recurring costs, such as transaction costs. Adjusted income from operations represents income from operations, as determined in accordance with GAAP, adjusted to exclude non-recurring costs, such as impairment and net lease termination costs, debt refinance costs, and at times, other non-recurring costs, such as transaction costs. Adjusted net income represents net income, as determined in accordance with GAAP, adjusted to exclude amortization, stock-based compensation expense, and non-recurring costs, such as impairment and net lease termination costs, debt refinance costs, interest incurred related to a pre-acquisition obligation, and the income tax provision (benefit) thereon, and at times, other non-recurring costs, such as transaction costs. Diluted adjusted earnings per common share is calculated using adjusted net income. These non-GAAP financial measures are more fully described and are reconciled from the respective measures determined under GAAP in “Presentation of Non-GAAP Financial Measures” and the attached table “Bright Horizons Family Solutions Inc. Non-GAAP Reconciliations,” respectively.

Balance Sheet and Liquidity

At December 31, 2025, the Company had $140.1 million of cash and cash equivalents and $383.7 million available for borrowing under our revolving credit facility. In the year ended December 31, 2025, we generated approximately $350.7 million of cash from operations, compared to $337.5 million for the same period in 2024, and made net investments totaling $103.8 million, compared to $117.8 million for the same period in the prior year.

2026 Outlook

Based on current trends and expectations, we currently expect fiscal year 2026 revenue to be in the range of $3.075 billion to $3.125 billion and diluted adjusted earnings per common share to be in the range of $4.90 to $5.10. The Company will provide additional information on its outlook during its earnings conference call.

Conference Call

Bright Horizons Family Solutions will host an investor conference call today at 5:00 pm ET to discuss the results for the fourth quarter and full year of 2025, as well as the Company’s updated business outlook and strategy. Interested parties are invited to listen to the conference call by dialing 1-844-539-3703 or, for international callers, 1-412-652-1273, and asking for the Bright Horizons Family Solutions conference call moderated by Chief Executive Officer Stephen Kramer. Replays of the entire call will be available through February 26, 2026 at 1-844-512-2921 or, for international callers, at 1-412-317-6671, conference ID #13752643. A link to the audio webcast of the conference call and a copy of this press release are also available through the Investor Relations section of the Company’s web site, investors.brighthorizons.com.

Forward-Looking Statements

This press release includes forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company’s actual results may vary significantly from the results anticipated in these forward-looking statements, which can generally be identified by the use of forward-looking terminology, including the terms “believes,” “expects,” “may,” “will,” “should,” “seeks,” “projects,” “approximately,” “intends,” “plans,” “estimates” or “anticipates,” or, in each case, their negatives or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts, including statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, our results of operations, financial condition, liquidity, operating expectations, execution and delivery of our services and solutions, business trends, value of our model, our offerings, our future growth opportunities, enrollment levels, margins, back-up care, our investments, long-term growth strategy, estimated effective tax rate, tax expense, our future business and financial performance, client partners and relationships, use and impact of our services, share repurchase activity and our 2026 financial guidance. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The Company believes that these risks and uncertainties include, but are not limited to, changes in the demand for child care, dependent care and other workplace solutions, including variations in enrollment trends and lower than expected demand from employer sponsor clients as well as variations in workforce demographics and work environments; the constrained labor market for teachers and staff and ability to hire and retain talent, including the impact of increased compensation and labor costs; the availability or lack of government support programs, and the impact of available government child care benefit programs; our ability to respond to changing client and customer needs; competition in our industry; the possibility that acquisitions may disrupt our operations and expose us to additional risk; our ability to pass on our increased costs; our indebtedness and the terms of such indebtedness; our ability to withstand seasonal fluctuations in the demand for our services; our ability to implement our growth strategies successfully; changes in general economic, political, business and financial market conditions and other macroeconomic events and uncertainty, including the impact of inflation and interest rate fluctuations; fluctuations in currency exchange rates; the effects of a cyber-attack, data breach or other security incident on our information technology system or software or those of our third party vendors; changes in tax rates or policies; damage or harm to our brand or reputation, including as a result of recent incidents and media coverage; litigation and insurance risks; changes in laws and regulations; and other risks and uncertainties more fully described in the “Risk Factors” section of our Annual Report on Form 10-K filed on February 27, 2025, and other factors disclosed from time to time in our other filings with the Securities and Exchange Commission. These forward-looking statements speak only as of the time of this release and we do not undertake to publicly update or revise them, whether as a result of new information, future events or otherwise, except as required by law.

Presentation of Non-GAAP Financial Measures

In addition to the results provided in accordance with GAAP throughout this press release, the Company has provided certain non-GAAP financial measures that present operating results on a basis adjusted for certain items. The Company uses these non-GAAP financial measures as key performance indicators for the purpose of evaluating performance internally, and in connection with determining incentive compensation for Company management, including executive officers. Adjusted EBITDA is also used in connection with the determination of certain ratio requirements under our credit agreement. We believe that these non-GAAP financial measures provide investors with useful information with respect to our historical operations. These non-GAAP financial measures are not intended to replace, and should not be considered superior to, the presentation of our financial results in accordance with GAAP. The use of the terms adjusted EBITDA, adjusted income from operations, adjusted net income and diluted adjusted earnings per common share may differ from similar measures reported by other companies and may not be comparable to other similarly titled measures.

With respect to our outlook for diluted adjusted earnings per common share, we do not provide the most directly comparable GAAP financial measure or corresponding reconciliation to such GAAP financial measure on a forward-looking basis. We are unable to predict with reasonable certainty and without unreasonable effort certain items such as the timing and amount of net excess income tax benefits or shortfalls, future impairments, lease termination costs, transaction costs, and other non-recurring costs, as well as gains or losses from the early retirement of debt and the outcome from legal proceedings. These items are uncertain, depend on various factors outside our management’s control, and could significantly impact, either individually or in the aggregate, our future period earnings per common share as calculated and presented in accordance with GAAP.

For more information regarding adjusted EBITDA, adjusted income from operations, adjusted net income and diluted adjusted earnings per common share, refer to the reconciliation of GAAP financial measures to the non-GAAP financial measures in the attached table “Bright Horizons Family Solutions Inc. Non-GAAP Reconciliations.”

About Bright Horizons Family Solutions Inc.

Bright Horizons ® is a leading provider of high-quality early education and child care, comprehensive back-up care solutions, and educational advisory services. For 40 years, we have partnered with employers to support workforces by providing services that help working families and employees thrive personally and professionally. Bright Horizons operates more than 1,000 early education and child care centers in the United States, the United Kingdom, the Netherlands, Australia and India, and serves more than 1,450 of the world’s leading employers. For more information, go to www.brighthorizons.com.

BRIGHT HORIZONS FAMILY SOLUTIONS INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except share data)

(Unaudited)

Three Months Ended December 31,

2025

2024

Revenue

733,698

100.0

674,146

100.0

Cost of services

591,847

80.7

533,615

79.2

Gross profit

141,851

19.3

140,531

20.8

Selling, general and administrative expenses

94,962

12.9

90,101

13.4

Amortization of intangible assets

1,394

0.2

2,203

0.2

Income from operations

45,495

6.2

48,227

7.2

Interest expense — net

(11,640

)

(1.6

(11,454

)

(1.7

Income before income tax

33,855

4.6

36,773

5.5

Income tax expense

(12,115

)

(1.6

(7,650

)

(1.2

Net income

21,740

3.0

29,123

4.3

Earnings per common share:

Common stock — basic

0.39

0.50

Common stock — diluted

0.38

0.50

Weighted average common shares outstanding:

Common stock — basic

56,216,156

57,814,529

Common stock — diluted

56,648,372

58,436,055

BRIGHT HORIZONS FAMILY SOLUTIONS INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except share data)

(Unaudited)

Years Ended December 31,

2025

2024

Revenue

2,933,607

100.0

2,686,013

100.0

Cost of services

2,236,420

76.2

2,066,407

76.9

Gross profit

697,187

23.8

619,606

23.1

Selling, general and administrative expenses

376,383

12.8

354,645

13.2

Amortization of intangible assets

6,139

0.3

18,342

0.7

Income from operations

314,665

10.7

246,619

9.2

Interest expense — net

(44,758

)

(1.5

(48,761

)

(1.8

Income before income tax

269,907

9.2

197,858

7.4

Income tax expense

(76,791

)

(2.6

(57,667

)

(2.2

Net income

193,116

6.6

140,191

5.2

Earnings per common share:

Common stock — basic

3.39

2.42

Common stock — diluted

3.36

2.40

Weighted average common shares outstanding:

Common stock — basic

56,945,743

57,931,572

Common stock — diluted

57,422,501

58,471,566

BRIGHT HORIZONS FAMILY SOLUTIONS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

December 31,

2025

2024

ASSETS

Current assets:

Cash and cash equivalents

140,091

110,327

Accounts receivable — net

293,983

283,336

Prepaid expenses and other current assets

69,899

102,368

Total current assets

503,973

496,031

Fixed assets — net

574,200

572,939

Goodwill

1,824,175

1,762,683

Other intangible assets — net

193,452

197,575

Operating lease right-of-use assets

682,069

725,897

Other assets

111,734

95,194

Total assets

3,889,603

3,850,319

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Current portion of long-term debt

—

28,500

Current portion of revolving credit facility

199,552

—

Accounts payable and accrued expenses

292,812

304,541

Current portion of operating lease liabilities

110,229

102,090

Deferred revenue

330,647

305,098

Other current liabilities

32,925

39,170

Total current liabilities

966,165

779,399

Long-term debt — net

747,614

918,449

Operating lease liabilities

702,845

743,562

Other long-term liabilities

118,815

110,214

Deferred income taxes

14,873

20,299

Total liabilities

2,550,312

2,571,923

Total stockholders’ equity

1,339,291

1,278,396

Total liabilities and stockholders’ equity

3,889,603

3,850,319

BRIGHT HORIZONS FAMILY SOLUTIONS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Years Ended December 31,

2025

2024

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income

193,116

140,191

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

93,402

97,918

Stock-based compensation expense

30,614

33,615

Deferred income taxes

(2,281

)

(9,929

)

Impairment losses and other non-cash items — net

50,673

41,379

Changes in assets and liabilities

(14,798

)

34,288

Net cash provided by operating activities

350,726

337,462

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of fixed assets — net

(91,317

)

(95,275

)

Purchases of debt securities and other investments

(19,737

)

(52,597

)

Proceeds from debt securities and other investments

14,035

38,375

Payments and settlements for acquisitions — net of cash acquired

(6,775

)

(8,267

)

Net cash used in investing activities

(103,794

)

(117,764

)

CASH FLOWS FROM FINANCING ACTIVITIES:

Revolving credit facility — net

499,446

—

Principal payments of long-term debt

(501,000

)

(17,000

)

Payments of debt issuance costs

(3,046

)

—

Purchase of treasury stock

(225,411

)

(84,597

)

Proceeds from issuance of common stock upon exercise of options

12,057

27,005

Taxes paid related to the net share settlement of stock options and restricted stock

(15,474

)

(5,350

)

Payments of deferred and contingent consideration for acquisitions

—

(103,872

)

Net cash used in financing activities

(233,428

)

(183,814

)

Effect of exchange rates on cash, cash equivalents and restricted cash

5,939

(1,620

)

Net increase in cash, cash equivalents and restricted cash

19,443

34,264

Cash, cash equivalents and restricted cash — beginning of year

123,715

89,451

Cash, cash equivalents and restricted cash — end of year

143,158

123,715

BRIGHT HORIZONS FAMILY SOLUTIONS INC.

SEGMENT INFORMATION

(In thousands)

(Unaudited)

Full service

center-based

child care

Back-up care

Educational

advisory services

Total

Three months ended December 31, 2025

Revenue

514,798

183,334

35,566

733,698

Income (loss) from operations

(24,191

)

58,971

10,715

45,495

Adjusted income from operations (1)

20,419

59,472

10,715

90,606

As a percentage of revenue

Three months ended December 31, 2024

Revenue

484,501

157,167

32,478

674,146

Income (loss) from operations

(12,854

)

51,548

9,533

48,227

Adjusted income from operations (2)

17,198

52,630

9,533

79,361

As a percentage of revenue

For the three months ended December 31, 2025, adjusted income from operations represents income from operations excluding impairment and net lease termination costs of $45.1 million, of which $44.6 million related to the full service center-based child care segment and $0.5 million related to the back-up care segment.

For the three months ended December 31, 2024, adjusted income from operations represents income from operations excluding impairment losses associated with our annual impairment assessment of $30.3 million, of which $29.2 million related to the full service center-based child care segment and $1.1 million related to the back-up care segment, and costs incurred in connection with the December 2024 debt refinancing of $0.8 million allocated to the full service center-based child care segment.

Full service

center-based

child care

Back-up care

Educational

advisory services

Total

Year ended December 31, 2025

Revenue

2,081,119

727,988

124,500

2,933,607

Income from operations

66,093

221,610

26,962

314,665

Adjusted income from operations (1)

114,353

222,111

26,962

363,426

As a percentage of revenue

Year ended December 31, 2024

Revenue

1,961,785

610,112

114,116

2,686,013

Income from operations

53,699

169,611

23,309

246,619

Adjusted income from operations (2)

83,751

170,693

23,309

277,753

As a percentage of revenue

(1)

For the year ended December 31, 2025, adjusted income from operations represents income from operations excluding impairment and net lease termination costs of $47.5 million, of which $47.0 million related to the full service center-based child care segment and $0.5 million related to the back-up care segment, and other costs incurred in connection with the August 2025 debt refinancing of $1.3 million allocated to the full service center-based child care segment.

(2)

For the year ended December 31, 2024, adjusted income from operations represents income from operations excluding impairment losses associated with our annual impairment assessment of $30.3 million, of which $29.2 million related to the full service center-based child care segment and $1.1 million related to the back-up care segment, and costs incurred in connection with the December 2024 debt refinancing of $0.8 million allocated to the full service center-based child care segment.

BRIGHT HORIZONS FAMILY SOLUTIONS INC.

NON-GAAP RECONCILIATIONS

(In thousands, except share data)

(Unaudited)

Three Months Ended

December 31,

Years Ended

December 31,

2025

2024

2025

2024

Net income

21,740

29,123

193,116

140,191

Interest expense — net

11,640

11,454

44,758

48,761

Income tax expense

12,115

7,650

76,791

57,667

Depreciation

23,353

20,114

87,263

79,576

Amortization of intangible assets (a)

1,394

2,203

6,139

18,342

EBITDA

70,242

70,544

408,067

344,537

As a percentage of revenue

Additional adjustments:

Impairment and net lease termination costs (b)

45,111

30,299

47,467

30,299

Stock-based compensation expense (c)

8,102

9,008

30,614

33,615

Other costs (d)

—

835

1,294

835

Total adjustments

53,213

40,142

79,375

64,749

Adjusted EBITDA

123,455

110,686

487,442

409,286

As a percentage of revenue

Income from operations

45,495

48,227

314,665

246,619

Impairment and net lease termination costs (b)

45,111

30,299

47,467

30,299

Other costs (d)

—

835

1,294

835

Adjusted income from operations

90,606

79,361

363,426

277,753

As a percentage of revenue

Net income

21,740

29,123

193,116

140,191

Income tax expense

12,115

7,650

76,791

57,667

Income before income tax

33,855

36,773

269,907

197,858

Amortization of intangible assets (a)

1,394

2,203

6,139

18,342

Impairment and net lease termination costs (b)

45,111

30,299

47,467

30,299

Stock-based compensation expense (c)

8,102

9,008

30,614

33,615

Other costs (d)

—

835

1,294

835

Other interest costs (e)

—

2,737

—

Adjusted income before income tax

88,462

79,118

358,158

280,949

Adjusted income tax expense (f)

(23,354

)

(21,757

)

(96,692

)

(77,765

)

Adjusted net income

65,108

57,361

261,466

203,184

As a percentage of revenue

Weighted average common shares outstanding — diluted

56,648,372

58,436,055

57,422,501

58,471,566

Diluted adjusted earnings per common share

1.15

0.98

4.55

3.47

Amortization of intangible assets represents total amortization expense, including $0.1 million and $8.5 million for the three and twelve months ended December 31, 2024, respectively, associated with intangible assets recorded in connection with our going private transaction in May 2008.

Impairment and net lease termination costs represent impairment costs, primarily for long-lived assets, arising from center closures, changes in market assumptions and reduced operating performance at certain centers. For the three months ended December 31, 2025, impairment and net lease termination costs totaled $45.1 million, of which $44.6 million related to the full service center-based child care segment and $0.5 million related to the back-up care segment. For the twelve months ended December 31, 2025, impairment and net lease termination costs totaled $47.5 million, of which $47.0 million related to the full service center-based child care segment and $0.5 million related to the back-up care segment. For the three and twelve months ended December 31, 2024, impairment and net lease termination costs totaled $30.3 million, of which $29.2 million related to the full service center-based child care segment and $1.1 million related to the back-up care segment.

Stock-based compensation expense represents non-cash stock-based compensation expense in accordance with Accounting Standards Codification Topic 718, Compensation-Stock Compensation.

Other costs in the twelve months ended December 31, 2025 consist of $1.3 million related to the August 2025 debt refinancing recorded to selling, general and administrative expenses and allocated to the full service center-based child care segment. Other costs in the three and twelve months ended December 31, 2024 consist of costs incurred in connection with the December 2024 debt refinancing of $0.8 million recorded to selling, general and administrative expenses and allocated to the full service center-based child care segment.

Other interest costs in the twelve months ended December 31, 2025 consist of $1.6 million in interest incurred related to a pre-acquisition obligation, as well as $1.1 million of debt refinancing costs related to the April 2025 and August 2025 debt refinancings, which were recorded to interest expense.

Adjusted income tax expense represents income tax expense calculated on adjusted income before income tax at an effective tax rate of approximately 26% and 27% for the three and twelve months ended December 31, 2025, respectively, and approximately 28% for the three and twelve months ended December 31, 2024.