KinderCare's Q2 2025: Navigating Enrollment Declines and Shifting Growth Expectations

Enrollment trends and local market issues, occupancy and enrollment growth expectations are the key contradictions discussed in KinderCare Learning Companies, Inc.'s latest 2025Q2 earnings call.



Occupancy and Enrollment Challenges:
- KinderCare reported a decline in average weekly full-time enrollments for Q2, with a 1.4% year-over-year decrease, leading to a 130 basis point decrease in same-center occupancy.
- The challenges were not attributed to a specific industry-wide factor but rather to center-level issues and local market dynamics.

Subsidy Enrollment and Funding Clarity:
- KinderCare highlighted strong support for early child education funding, with the Child Care and Development Block Grant (CCDBG) fully funded.
- The increased clarity in congressional support for child care funding, including changes to the Employer-Provided Childcare Credit (45F), is expected to accelerate the adoption of child care benefits by employers.

New Center and Acquisition Growth:
- The company opened 3 new centers in Q2 and acquired 9 centers, building on a total of 14 tuck-in acquisitions and 8 new center openings in the first half of the year.
- The growth is aligned with KinderCare's long-term targets, driven by strong forward visibility and a robust pipeline for both new centers and acquisitions.

Champions Program Expansion:
- Champions, KinderCare's before and after-school business, expanded its footprint with 5 new districts and 6 new sites, reflecting over 10% growth in the past 12 months.
- The expansion was supported by strong relationships with schools and districts, as well as the addition of new states, including Connecticut, Minnesota, and New Mexico.