Bright Horizons Family Solutions (BFAM) Q1 2025 earnings summary

Executive summary

• Revenue grew 7% year-over-year to $666 million in Q1 2025, with adjusted EPS up 51% to $0.77 per share, driven by strong back-up care, enrollment gains, tuition increases, and improved service delivery.

• Net income rose 124% to $38 million, with diluted EPS up 128% to $0.66, reflecting higher operating income, lower interest expense, and a reduced effective tax rate.

• Adjusted EBITDA increased 23% to $92 million, and adjusted net income rose 51% to $45 million.

• The company operated 1,023 centers as of March 31, 2025, with improved occupancy rates and capacity for approximately 115,000 children.

• Management remains confident in its long-term strategy and liquidity, raising revenue growth guidance to 6.5%-8.5%.

Financial highlights

• Adjusted operating income rose 56% to $62 million; adjusted EBITDA margin improved to 13.9%-14% year-over-year.

• Full-service childcare revenue grew 6% to $511 million; operating margin expanded to 6.5%-7%.

• Backup care revenue increased 12% to $129 million, with a 21% operating margin.

• Education advisory revenue rose 8% to $26 million, with a 10% operating margin.

• Cash from operations was $86 million; cash and equivalents at quarter-end were $112 million.

Outlook and guidance

• Revenue guidance raised to $2.865-$2.915 billion for fiscal 2025, reflecting 6.5%-8.5% growth.

• Full-service revenue expected to grow 5%-7%; backup care revenue outlook increased to 12%-14% growth.

• Adjusted EPS guidance reaffirmed at $3.95-$4.15 for 2025.

• Q2 revenue expected at $720-$730 million (7.5%-9% growth); Q2 adjusted EPS forecasted at $0.99-$1.04.

• Enrollment growth assumption trimmed to 2%-3% for the year, down from 2.5%-3.5%.