Key Highlights

  • Third quarter Revenue climbed 5% to $841.5 million, with back-up care up 13%.
  • The company recorded a net loss of $231 million, or $4.76 per diluted share.
  • Impairment losses of $294.0 million struck international full service operations.
  • Adjusted EPS came to $1.80, up 15%, and adjusted EBITDA was $163.3 million, up 5%.
  • 2026 adjusted EPS guidance stands at $4.98 to $5.03 on revenue of about $3.07 billion.

Revenue rises 5% on back-up care growth

Bright Horizons (NYSE:BFAM), based in Newton, Massachusetts, offers early education and child care, back-up care solutions and educational advisory services. It operated 979 centers at September 30, 2026, with capacity for about 112,500 children. The company reported third quarter 2026 results on October 29, 2026.

Revenue grew $38.7 million, or 5%, to $841.5 million. CEO Stephen Kramer credited the quarter's strength to a diversified portfolio, including 13% growth in back-up care. Lower revenue from full service centers closed over the past twelve months partly offset that growth.

The company also marked 40 years of partnering with employers to support working families.

Impairments push the GAAP result into a loss

Loss from operations totaled $187.1 million, compared with income from operations of $120.8 million a year earlier. The swing was mainly caused by Impairment losses of $294.0 million within the international full service operations, partly offset by higher service levels and back-up care contributions.

The net loss was $231 million, and the diluted loss per common share was $4.76, a sharp contrast to positive Earnings in the prior year quarter.

The size of that impairment relative to operating results shows how much of the GAAP loss stems from a single non-cash item. Excluding it, the company reported higher adjusted measures.

Adjusted measures show steady growth

Adjusted EBITDA rose $7.2 million, or 5%, to $163.3 million, while adjusted income from operations grew $5.7 million, or 5%, to $130.2 million. The company tied that growth to higher service levels and back-up care contributions.

Adjusted Net Income was $87.5 million, down 3%, but diluted adjusted EPS of $1.80 was up 15%. The faster per-share growth reflects a lower share count after repurchases.

The company defines adjusted figures as non-GAAP measures that exclude items such as impairment, and the release includes reconciliations to GAAP.

Calculated margins and the scale of the impairment

On a calculated basis, adjusted EBITDA of $163.3 million equals about 19.4% of revenue, and adjusted income from operations of $130.2 million equals about 15.5%. The $294.0 million impairment is equivalent to roughly 35% of the quarter's revenue.

The swing from income from operations of $120.8 million to a loss of $187.1 million is about $307.9 million, most of which the impairment accounts for. Liquidity of $119.2 million in cash plus $436.0 million of revolver availability totals about $555.2 million, and the 7.7 million shares repurchased for $557.7 million imply an average price near $72 per share.

Cash, Buybacks and the revised 2026 outlook

At September 30, 2026, the company held $119.2 million of cash and cash equivalents, with $436.0 million available under its revolving Credit facility. Operating Cash Flow for the nine months reached $208.1 million, compared with $202.8 million a year earlier.

Over the nine months, the company repurchased about 7.7 million shares for $557.7 million.

The updated 2026 outlook calls for revenue of approximately $3.07 billion and diluted adjusted EPS of $4.98 to $5.03. A conference call was scheduled for 5:00 p.m. Eastern Time on October 29, 2026.

Investors following the stock will likely watch back-up care growth, the pace of international center closures, and further buybacks.