KinderCare Stock Plunges 23%, Weak 2026 Outlook

2026-03-12 21:20:27

Lake Oswego, Oregon - KinderCare Learning Companies, Inc. (NYSE:KLC) reported fourth-quarter results that exceeded analyst expectations, but shares fell 23% due to weak guidance for fiscal 2026.

The early childhood education provider posted an adjusted earnings per share of $0.12 for the quarter, beating the consensus estimate of $0.09. Revenue reached $688.1 million, slightly above the expected $685.3 million, up 6.4% from $647 million in the same period last year.

However, the company’s guidance for fiscal 2026 disappointed investors. KinderCare expects an adjusted EPS of $0.10 to $0.20. Revenue guidance is between $2.7 billion and $2.75 billion, also at the low end of the consensus of $2.75 billion, with a midpoint of $2.725 billion, slightly below analyst estimates.

The fourth quarter included 14 weeks, compared to 13 weeks in the same period last year, with the extra week contributing approximately $45.1 million in revenue and an estimated $12 million in adjusted EBITDA. On a comparable 13-week basis, revenue declined 1.6%, mainly due to a 3.6% decrease in enrollment, partially offset by a 2.0% increase in tuition.

CEO Tom Wyatt stated, “We made progress across our brands at the end of the year, despite mixed performance across the entire portfolio. Our focus for 2026 is simple. We need to execute better, advancing one center and one market at a time.”

The company reported GAAP net loss of $177.2 million, or $1.50 per share, compared to a loss of $133.6 million, or $1.17 per share, in the same period last year. The increased loss was mainly due to impairment charges of $196.997 million related to goodwill and long-term assets, primarily driven by declining stock prices and deteriorating market value.

For fiscal 2025, KinderCare achieved revenue of $2.73 billion and an adjusted EBITDA of $300.1 million. As of January 3, 2026, the company operated 1,601 early childhood education centers and 1,153 before- and after-school care locations.

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