KinderCare Learning Companies (NYSE:KLC) Issues Quarterly Earnings Results, Misses Expectations By $0.02 EPS

KinderCare Learning Companies (NYSE:KLC) released its quarterly earnings data on Thursday. The company reported $0.08 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.10 by ($0.02), FiscalAI reports. KinderCare Learning Companies had a positive return on equity of 8.22% and a negative net margin of 15.48%.The company had revenue of $697.52 million for the quarter, compared to the consensus estimate of $697.94 million. During the same period last year, the company earned $0.22 EPS. KinderCare Learning Companies’s revenue for the quarter was down .4% compared to the same quarter last year. KinderCare Learning Companies updated its FY 2026 guidance to 0.050-0.150 EPS.

Here are the key takeaways from KinderCare Learning Companies’ conference call:

• Negative Sentiment: Second-quarter revenue declined slightly to $698 million, while total enrollment fell 4% year over year, same-center occupancy dropped to 68.6%, and Adjusted EBITDA declined to $63 million from $82 million.
• Negative Sentiment: KinderCare is accelerating footprint optimization, with 49 centers closed in Q2 and 80–85 expected to be closed by year-end. The closures are expected to create an annualized $57 million revenue headwind, while remaining lease exits may require $20–$25 million in cash payments and could extend into 2027.
• Negative Sentiment: Full-year guidance was reduced to revenue of $2.66–$2.70 billion, Adjusted EBITDA of $200–$220 million, Adjusted EPS of $0.05–$0.15, and free cash flow below $10 million. Management also lowered its expected tuition contribution to revenue growth to 2.5% from 3% due to slower state subsidy reimbursement increases.
• Positive Sentiment: The company reported continued momentum in its growth businesses: Champions revenue rose 13% year over year, supported by 85 net new sites since Q2 2025, while KinderCare for Employers, Learning Adventures, and newer centers broadened the revenue mix.
• Positive Sentiment: Management said marketing, simplified center-director responsibilities, and a new AI-assisted enrollment program are improving inquiries and tour quality. Crème de la Crème summer-camp enrollment increased approximately 26%, and the company opened its first California location in Irvine shortly after quarter-end.

KinderCare Learning Companies Stock Down 29.3%

Shares of NYSE KLC opened at $3.42 on Friday. The company has a current ratio of 0.74, a quick ratio of 0.73 and a debt-to-equity ratio of 1.95. The business has a 50-day moving average of $4.73 and a 200-day moving average of $3.96. The firm has a market capitalization of $404.44 million, a price-to-earnings ratio of -0.95 and a beta of 4.00. KinderCare Learning Companies has a 12 month low of $1.75 and a 12 month high of $7.77.

Analyst Upgrades and Downgrades

KLC has been the subject of several recent analyst reports. JPMorgan Chase & Co. lowered KinderCare Learning Companies from a “neutral” rating to an “underweight” rating in a report on Friday. Barclays lifted their price objective on shares of KinderCare Learning Companies from $2.00 to $3.00 and gave the company an “underweight” rating in a research note on Monday, May 18th. Deutsche Bank Aktiengesellschaft restated a “hold” rating and set a $5.00 target price on shares of KinderCare Learning Companies in a research report on Friday, May 15th. BMO Capital Markets boosted their price objective on KinderCare Learning Companies from $4.00 to $6.00 and gave the company an “outperform” rating in a research note on Monday, May 18th. Finally, UBS Group raised their target price on KinderCare Learning Companies from $3.00 to $5.00 and gave the stock a “neutral” rating in a research note on Friday, May 15th. One research analyst has rated the stock with a Buy rating, five have issued a Hold rating and four have issued a Sell rating to the company. Based on data from MarketBeat.com, the company presently has a consensus rating of “Reduce” and an average target price of $4.06.

Hedge Funds Weigh In On KinderCare Learning Companies

A number of hedge funds and other institutional investors have recently bought and sold shares of KLC. Caitong International Asset Management Co. Ltd lifted its holdings in shares of KinderCare Learning Companies by 350.8% during the 4th quarter. Caitong International Asset Management Co. Ltd now owns 6,600 shares of the company’s stock worth $29,000 after acquiring an additional 5,136 shares during the last quarter. Tower Research Capital LLC TRC boosted its holdings in shares of KinderCare Learning Companies by 62.4% in the 2nd quarter. Tower Research Capital LLC TRC now owns 5,128 shares of the company’s stock worth $52,000 after purchasing an additional 1,971 shares in the last quarter. PharVision Advisers LLC bought a new position in shares of KinderCare Learning Companies during the 3rd quarter valued at about $68,000. Sherbrooke Park Advisers LLC purchased a new position in shares of KinderCare Learning Companies during the 3rd quarter valued at about $70,000. Finally, American Trust purchased a new position in shares of KinderCare Learning Companies during the 3rd quarter valued at about $71,000.

Key Stories Impacting KinderCare Learning Companies

Here are the key news stories impacting KinderCare Learning Companies this week:

• Positive Sentiment: Second-quarter revenue was approximately $697.5 million, essentially in line with the $697.9 million consensus estimate. Management continues to target full-year revenue of roughly $2.66 billion to $2.70 billion. KinderCare expects revenue and adjusted EPS targets
• Neutral Sentiment: KinderCare plans to close approximately 80 to 85 centers in 2026. The closures could improve operating efficiency and profitability over time, but they also indicate portfolio challenges and may reduce near-term revenue capacity. KinderCare center closure and outlook report
• Negative Sentiment: KinderCare reported second-quarter adjusted earnings of $0.08 per share, below the $0.10 analyst consensus and down from $0.22 a year earlier. Revenue declined 0.4% year over year, reinforcing concerns about slowing growth and profitability. KinderCare misses second-quarter earnings estimates
• Negative Sentiment: Fiscal 2026 adjusted EPS guidance of $0.05 to $0.15 is well below the $0.20 consensus estimate. The trimmed revenue outlook also suggests limited growth, while the company continues to report a negative net margin. KinderCare trims 2026 revenue outlook
• Negative Sentiment: JPMorgan downgraded KLC from “neutral” to “underweight,” adding to pressure following the earnings miss and weaker guidance. Finviz analyst rating report

About KinderCare Learning Companies

KinderCare Learning Companies Inc is a provider of high-quality early childhood education by center capacity. KinderCare Learning Companies Inc is based in PORTLAND, Ore.