Bright Horizons Family Solutions (BFAM) Q3 2025 earnings summary

Executive summary

• Revenue grew 12% year-over-year to $803 million in Q3 2025, driven by strong back-up care utilization (up 26%), enrollment gains, and tuition increases.

• Net income rose 43% to $79 million, with diluted EPS up 46% to $1.37, reflecting improved operating leverage and higher utilization.

• Adjusted EBITDA increased 29% to $156 million, with margin expansion to 19.4% of revenue.

• Operated 1,013 early education and child care centers as of September 30, 2025, with improved occupancy rates and capacity for 115,000 children.

• Upgraded full-year guidance: revenue expected at $2.925 billion (+9%) and Adjusted EPS at $4.48-$4.53.

Financial highlights

• Gross profit margin improved to 27% in Q3 2025 from 25% in Q3 2024.

• Adjusted operating income rose 39% to $124 million; operating margin up to 15.5%.

• Adjusted EBITDA margin was 19% in Q3 2025, up from 17% in Q3 2024.

• Net cash from operations YTD: $203 million; $59 million in fixed asset investments; $105 million in stock repurchases.

• Net leverage ratio reduced to 1.7x net debt to Adjusted EBITDA.

Outlook and guidance

• Fiscal year 2025 revenue expected at $2.925 billion (+9% YoY); Adjusted EPS $4.48-$4.53.

• Q4 revenue guidance: $720-$730 million; Adjusted EPS: $1.07-$1.12.

• Segment outlook: full-service revenue +6%, Back-Up Care +18%, education advisory high single digits for the year.

• Back-Up Care growth expected to normalize to 11%-13% in 2026.

• Tuition pricing for 2026 planned at ~4% average increase.