KinderCare Learning Companies, Inc. (NYSE: KLC) experienced a significant pre-market plunge of 18.40% on Thursday, as investors reacted to the company's disappointing third-quarter 2025 financial results and reduced full-year guidance. The sharp decline follows an already tumultuous after-hours trading session on Wednesday, where the stock initially dropped 6.80%, and a subsequent 11.40% fall during Thursday's regular trading hours.
The childcare and early education provider reported adjusted earnings per share of $0.13 for Q3 2025, in line with analyst expectations and marking a substantial improvement from $0.05 in the same period last year. However, KinderCare's quarterly revenue of $676.8 million fell short of the consensus estimate of $682.609 million, representing only a modest 0.79% year-over-year increase. This revenue miss appears to have sparked initial concerns among investors.
Adding fuel to the sell-off, KinderCare significantly lowered its full-year 2025 outlook. The company now projects revenue between $2.72 billion and $2.74 billion, down from its previous guidance of $2.75 billion to $2.8 billion. Additionally, the adjusted EPS forecast was reduced to a range of $0.64 to $0.67, compared to the earlier projection of $0.77 to $0.82. This downward revision in guidance, coupled with the revenue miss, has led investors to reassess KinderCare's growth prospects in the competitive childcare market, resulting in the steep pre-market decline.
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