What changed in this filing

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Item 1A. Risk Factors

2026-02-26 compared with 2025-02-27 · 91 added, 71 removed, 216 unchanged (43% of the section changed)

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Changes in the demand for dependent care services and workplace solutions, which may be negatively affected by demographic trends and economic conditions, may affect our operating results.

Our business strategy largely depends on employers recognizing the value of providing employees with child care, dependent care, workforce education, and other workplace solutions as an employee benefit.

The number of employers that view such services as cost-effective or beneficial to their workforces may not continue to grow at the levels we anticipate or may diminish.

Our business strategy largely depends on employers recognizing the value of providing employees with child care, dependent back-up care, workforce education, and other workplace solutions as a fundamental employee benefit strategy.

The number of employers that view such services as cost-effective or beneficial to their workforce may not continue to grow at the levels we anticipate or may diminish.

In addition, changes in workplace locations or workforce demographic trends, including the number of dual working parent or working single parent families in the workforce, and the number of children requiring care, may impact the demand for our services from parents and families.

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Even as employers recognize the value of our services, demand may be adversely affected by general economic conditions.

Uncertainty or a deterioration in economic conditions, including global inflationary pressures impacting our clients and customers, or increased business expenses arising from potential expansion of tariff regulation, could lead to reduced demand for our services as employer clients may reduce or eliminate their sponsorship of work and family services, and prospective clients may not commit resources to such services or families may decrease or discontinue the use of our child care services.

Uncertainty or a deterioration in economic conditions, including global inflationary pressures impacting our clients and customers, or increased business expenses, such as those relating to changes to trade policy, including tariff regulation, could lead to reduced demand for our services as employer clients may reduce or eliminate their sponsorship of work and family services due to budget priorities, and prospective clients may not commit resources to such services.

Families may also decrease or discontinue the use of our child care services due to cost, convenience, reputation or other external factors.

A reduction in the size of an employer’s workforce or an increase in the cost of employer subsidies could negatively impact the demand for our services and result in reduced enrollment, failure of our employer clients to renew their contracts or center closures.

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Adverse publicity concerning incidents or allegations of inappropriate, illegal or harmful acts to a child at any child care center or by a caregiver or through a third party provider, whether or not directly relating to or involving Bright Horizons, could result in decreased enrollment at our child care centers or use of back-up care, termination of existing corporate relationships, inability to attract new corporate relationships, or increased insurance costs, all of which could adversely affect our operations.

Brand value and our reputation can be severely damaged even by isolated incidents, particularly if the incidents receive considerable negative publicity or result in substantial litigation.

These incidents can arise from events that are beyond our ability to control, such as instances of abuse or actions taken (or not taken) by one or more center managers, teachers, or caregivers relating to the health, safety or welfare of children in our care.

Brand value and our reputation can be severely damaged even by isolated incidents, particularly if they receive considerable negative publicity, such as recent incidents in both the U.S.

involving allegations of mistreatment and abuse of children by former employees.

In addition, these incidents, including allegations of abuse or mistreatment, may undermine perceptions of the high-quality care that we aim to provide to children and families and have currently, and may in the future, lead to increased regulatory review and oversight, and clients seeking to curtail or terminate our services.

Such incidents have, and may in the future, result in substantial litigation or the suspension or revocation of child care licenses.

Despite safeguarding practices, including trainings and policies, background checks and screening, oversight and technology, we may not be effective in preventing or detecting incidents in our centers.

These incidents can arise from events that are beyond our ability to control (notwithstanding the safeguarding practices in place), such as instances of abuse or actions taken (or not taken) by one or more center managers, teachers, or caregivers relating to the health, safety or welfare of children in our care.

The proliferation of social media may increase the likelihood, speed, and magnitude of these negative brand and reputation events.

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Such demand could also diminish significantly if any such incidents or other matters erode general confidence in us or our services, which would likely result in lower sales, and could materially and adversely affect our business and operating results.

Any reputational damage could have a material adverse effect on our brand value and our business, which, in turn, could have a material adverse effect on our financial condition and results of operations.

Any reputational damage, including as a result of the foregoing, could have a material adverse effect on our brand value and our business, which, in turn, could have a material adverse effect on our financial condition and results of operations.

Our continued profitability depends on our ability to recover our increased costs, such as labor and related costs, through tuition increases and client contract terms and managing our real estate portfolio in a cost-effective manner.

Hiring and retaining key employees and qualified personnel, including teachers, is critical to our business and labor costs are our largest expense.

Because we are primarily a service business, inflationary factors and regulatory changes that contribute to wage and benefits cost increases result in significant increases in the cost of running our business.

We expect to pay employees above applicable minimum wage rates, and increases in the statutory minimum wage rates or statutory leave requirements could result in a corresponding increase in the wages and benefits we pay to our employees.

Additionally, competition for teachers and staff, and costs associated with hiring, compensating, retaining, and training employees could result in significant cost increases, including medical benefit costs and costs to enhance employee compensation and benefit programs as an incentive and retentive tool.

Our success depends on our ability to continue to pass along these costs and to control costs while meeting our changing labor needs.

In the event that we cannot increase the price for our services to cover these higher wage and benefit costs without reducing customer demand for our services, our margins could be adversely affected, which could have a material adverse effect on our financial condition and results of operations as well as our growth.

Real estate and related costs are our second largest expense.

If we are not able to negotiate or renew our existing center leases at attractive rental rates, we risk a significant increase in rental costs, impairment of asset values and/or closures of centers.

As a result of ongoing portfolio reviews to align our operations with evolving customer needs and demand, we may seek to further downsize, consolidate, reconfigure or close some of our locations, which in some cases requires the termination of or a modification to an existing center lease.

Failure to secure adequate new locations or successfully terminate or modify existing leases, or failure to effectively manage rent cost, could have a material adverse effect on our business, financial condition and results of operations.

Changes in our relationships with employer sponsors or failure to anticipate and respond to changing client and customer (families, adult learners or client employees) preferences and expectations or develop new customer-oriented services may affect our operating results.

We derive a significant portion of our business from early education and child care, back-up care, and other workplace solutions associated with employer sponsors for whom we provide these services pursuant to contractual arrangements.

Our contracts with employers for full service center-based child care typically have terms of 3 to 10 years, and our contracts related to back-up care and educational advisory services typically have terms of three years, with varying terms and renewal and termination options.

We have a history of consistent contract renewals, but we may not experience similar renewal rates in the future.

Failure to comply with or monitor contract terms or the termination or non-renewal of a significant number of contracts or the termination of multiple-site or multiple-service client relationships could have a material adverse effect on our business, results of operations, financial condition or cash flows.

Additionally, our continued success depends on our ability to convert and retain new and existing clients, cross-sell to existing clients, and our ability to develop new consumer-oriented strategies or services to accommodate changing client, learner, or parent expectations and preferences around our services or service delivery.

Our future success depends on our ability to meet the evolving needs and expectations of our customers, including enhancing our existing services and technology, and building and maintaining a high-quality experience across all lines of business and geographies.

Obsolete processes and/or skill gaps, a failure to innovate through technology or a failure to scale innovation could impede our ability to meet new or changing customer demands.

Additionally, client unwillingness to adopt new technology enhancements that we develop and adopt to support our service delivery, including AI-driven technology, could impact our return on investment.

Failure to meet these needs may result in client loss and reduced demand and could have a material impact on our financial results.

If we or our third-party vendors are subject to cyber-attacks, data breaches or other security incidents, or if there is a disruption or failure of our information technology systems or software, such events could expose us to liability and could adversely affect our financial condition and operating results.

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Our business relies on information technology networks and systems to store this data, process financial and personal information, manage a variety of business processes, and comply with regulatory, legal and tax requirements.

We are also highly dependent on information technology for the coordination and delivery of our back-up care and educational advisory services.

We are also highly dependent on information technology for the coordination and delivery of our services.

Additionally, we maintain other confidential, proprietary, or otherwise sensitive information relating to our business and from third parties.

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Security incidents are becoming increasingly prevalent and severe, as well as increasingly difficult to detect.

Any of these incidents could lead to interruptions or shutdowns of our platforms, disruptions in our ability to process service requests, limit our ability to access data, result in the loss or corruption of data, or unauthorized access to, or acquisition of, personal information or other sensitive information, such as our intellectual property.

As we have seen with such incidents in the past, any of these incidents could lead to interruptions or shutdowns of our platforms, disruptions in our ability to process service requests, limit our ability to access data, result in the loss or corruption of data, or unauthorized access to, or acquisition of, personal information or other sensitive information, such as our intellectual property.

While we and our vendors maintain policies and practices, operational safeguards, as well as measures and controls aimed at reducing our risks related to cybersecurity threats, none of our or our vendors’ security measures can provide absolute security.

We and our vendors may not anticipate, detect, or implement fully effective preventative measures against all cybersecurity threats particularly because the techniques used are increasingly sophisticated tools and constantly evolving.

For example, as artificial intelligence continues to evolve, we expect cyber-attackers to also use artificial intelligence to develop malicious code and sophisticated phishing attempts.

For example, as artificial intelligence (AI) continues to evolve, cyber-attackers are increasingly using AI to develop malicious code and sophisticated phishing attempts.

As a result, there can be no assurance that we or our vendors will not suffer a cybersecurity incident, that hackers or other unauthorized parties will not gain access to or exfiltrate personal information or other sensitive data, or that any such data compromise or unauthorized access will be discovered in a timely fashion.

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Although the incident did not have a material impact on us, similar incidents or other cybersecurity-attacks against us or our third-party vendors could lead to operational disruptions that could have an adverse effect on our ability to provide services to clients and customers and on our results of operations and financial results.

Failure of our systems to operate effectively or a compromise in the security of our systems, or the systems of our affiliates or other third-party that results in unauthorized persons or entities obtaining personal information or other sensitive information, could materially and adversely affect our reputation, operations, operating results, and financial condition.

Actual or anticipated cybersecurity threats and attacks may cause us to incur costs, including costs to deploy additional personnel and protection technologies, train employees, pay higher insurance premiums, and engage third-party specialists for additional services.

Breaches in our data security, those of our affiliates or other third-parties, could expose us to risks of data loss, inappropriate disclosure of confidential or proprietary information, potential claims, investigations, regulatory proceedings, litigation penalties and liability, could impede our processing of transactions and our financial reporting, and could result in a disruption of our operations.

In addition, we may incur other substantial costs in connection with remediating and otherwise responding to any cybersecurity incident, including potential liability for stolen client, customer, or employee data, repairing system damage, or providing credit monitoring or other benefits to clients, customers, or employees affected by the incident.

Failure of our systems to operate effectively or a compromise in the security of our systems, or the systems of our affiliates or other third-party that results in unauthorized persons or entities obtaining personal data or other sensitive information, could materially and adversely affect our reputation, operations, operating results, and financial condition.

Actual or anticipated cybersecurity threats and attacks have and may cause us to incur costs, including costs to deploy additional personnel and protection technologies, train employees, pay higher insurance premiums, and engage third-party specialists for additional services.

Breaches in our data security, those of our affiliates or other third-parties, have and may expose us to risks of data loss, inappropriate disclosure of confidential or proprietary information, potential claims, investigations, regulatory proceedings, litigation penalties and liability, could impede our processing of transactions and our financial reporting, and could result in a disruption of our operations.

In addition, we have and may incur other substantial costs in connection with remediating and otherwise responding to any cybersecurity incident, including potential liability for stolen client, customer, or employee data, repairing system damage, or providing credit monitoring or other benefits to clients, customers, or employees affected by the incident.

Additionally, if we or our third-party service providers experience security incidents that result in a decline in the performance of our systems, availability problems, or the loss, corruption of, unauthorized access to, or disclosure of personal data or confidential information, clients or individuals may become unwilling to provide us the information necessary to receive our services, and our reputation and market position could be harmed.

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Our collection, use, storage, disclosure, transfer and other processing of personal information could give rise to significant costs and liabilities, including as a result of governmental regulations, uncertain or inconsistent interpretation and enforcement of legal requirements or differing views of personal privacy rights, which may have a material adverse effect on our reputation, business, financial condition and results of operation.

A variety of laws, regulations, industry self-regulatory principles, industry standards or codes of conduct and regulatory guidance relating to privacy, data protection, artificial intelligence, marketing and advertising, selling and sharing, and consumer protection apply to the collection, use, retention, protection, disclosure, transfer, and other processing of certain types of data.

As the regulatory environment related to privacy, data collection and protection, artificial intelligence, information security, marketing and advertising, selling and sharing, and consumer protection becomes increasingly rigorous, with new and changing requirements applicable to our business, compliance with such requirements could impose significant limitations, require changes to our business, or restrict our use or storage of personal information, which may increase our compliance expenses and make our business more costly or less efficient to conduct.

For example, we are subject to various privacy laws in the United States, United Kingdom, European Union, Australia and India, which give data privacy rights to their respective residents and/or impose significant obligations on controllers and processors of data.

A variety of laws, regulations, industry self-regulatory principles, industry standards or codes of conduct and regulatory guidance relating to privacy, data protection, AI, marketing and advertising, selling and sharing, and consumer protection apply to the collection, use, retention, protection, disclosure, transfer, and other processing of certain types of data.

As the regulatory environment related to privacy, data collection and protection, AI, information security, marketing and advertising, selling and sharing, and consumer protection becomes increasingly rigorous, with new and changing requirements applicable to our business, compliance with such requirements could impose significant limitations, require changes to our business, or restrict our use or storage of personal data, which may increase our compliance expenses and make our business more costly or less efficient to conduct.

Failure to comply with such regulations could result in enforcement actions, significant fines, penalties, and damages which could materially and adversely affect our business and financial condition.

We are also subject to evolving privacy laws on the use of artificial intelligence, certain categories of personal information (such as but not limited to child, medical, financial, and biometric), “cookies” and other similar tracking technologies.

We are also subject to evolving privacy laws on the use of AI, certain categories of personal data (such as but not limited to child, medical, financial, and biometric), “cookies” and other similar tracking technologies.

In relation to “cookies” and other similar tracking technologies, many countries have adopted, or are in the process of adopting, regulations governing the use of cookies and similar technologies, and requiring individuals to “opt-in” to the placement of cookies used for purposes of marketing.

In addition, some regulations and providers of consumer devices and web browsers have implemented, or announced plans to implement, means to make it easier for internet users to prevent the placement of cookies, to block other tracking technologies or to require new permissions from users for certain activities, which could if widely adopted significantly reduce the effectiveness of such practices and technologies.

The regulation of the use of cookies and other current online tracking and advertising practices or a loss in our ability to make effective use of services that employ such technologies could increase our costs of operations and limit our ability to acquire new customers on cost-effective terms and consequently, materially adversely affect our business, financial condition and operating results.

Hiring and retaining key employees and qualified personnel, including teachers, is critical to our business and labor costs are our largest expense.

Additionally, competition for teachers and staff, and costs associated with hiring, compensating, retaining, and training employees could result in significant cost increases, including costs to enhance employee compensation and benefit programs as an incentive and retentive tool.

Our success depends on our ability to continue to pass along these costs and to control costs while meeting our changing labor needs.

Real estate and related costs are our second largest expense.

If we are not able to negotiate or renew our existing center leases at attractive rental rates, we risk a significant increase in rental costs, impairment of asset values and/or closures of centers.

Under certain conditions, we may also seek to downsize, consolidate, reconfigure or close some of our locations, which in some cases requires a modification to an existing center lease.

Failure to secure adequate new locations or successfully modify existing leases, or failure to effectively manage rent cost, could have a material adverse effect on our business, financial condition and results of operations.

Changes in our relationships with employer sponsors or failure to anticipate and respond to changing client and customer (parents or client employees) preferences and expectations or develop new customer-oriented services may affect our operating results.

We have a history of consistent contract renewals, but we may not experience similar renewal rates in the future.

Obsolete processes and/or skill gaps, a failure to innovate through technology or a failure to scale innovation could impede our ability to meet new or changing customer demands.

Additionally, client unwillingness to adopt new technology enhancements, including artificial intelligence technology, could impact our return on investment.

Failure to meet these needs may result in client loss and reduced demand and could have a material impact on our financial results.

The regulation of the use of cookies and other online tracking and advertising practices or a loss in our ability to make effective use of services that employ such technologies could increase our costs of operations and limit our ability to acquire new customers on cost-effective terms and consequently, materially adversely affect our business, financial condition and operating results.

We depend on key management and key employees to manage our business and timing considerations.

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We may be unable to adjust our expenses on a short-term basis to minimize the effect of these fluctuations in revenue.

Our quarterly results of operations may also fluctuate based on the number and timing of child care center openings and/or closings, the timing of new client service launches, acquisitions, the performance of new and existing early education and child care centers, the contractual arrangements under which child care centers are operated, the change in the mix of such contractual arrangements, competitive factors and general economic conditions.

The inability of existing child care centers to maintain their current enrollment levels and profitability, the failure of newly opened child care centers to contribute to profitability, and the failure to maintain and grow our other services could result in additional fluctuations in our future operating results on a quarterly or annual basis.

Our quarterly results of operations may also fluctuate based on the number and timing of child care center openings and/or closings, the timing of new client service launches, increases and decreases in back-up care use, acquisitions, the performance of new and existing early education and child care centers, the contractual arrangements under which child care centers are operated and back-up care delivered, the change in the mix of such contractual arrangements, competitive factors and general economic conditions.

The inability of existing child care centers to maintain their current enrollment levels and profitability, the failure of newly opened child care centers to contribute to profitability, the failure of clients’ employees to adopt or utilize back-up care, and the failure to maintain and grow our other services could result in additional fluctuations in our future operating results on a quarterly or annual basis.

Our business could be adversely affected by events beyond our control, such as public health crises, climate-related and other natural disasters, sociopolitical and geopolitical events, other catastrophic events or a failure in our business interruption/continuity planning.

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If those systems are damaged, interrupted or cease to function properly or if our disaster recovery and business continuity plans fail, it may have a material adverse effect on our business or results of operations.

We may not successfully incorporate AI into our business or adapt to a rapidly changing marketplace to meet client needs and expectations and compete in our business sector.

As new advanced technologies become available in the market, we may look to make investments in AI technologies to, among other things, recommend relevant content across our products, enhance our advertising tools, develop new products, develop new and enhanced features for existing services or use AI within our classroom settings.

Our use, access and adoption of advanced technology, including AI, to deliver, market and enhance our suite of services remains in the early stages.

Our competitors may be able to innovate better and more quickly, to compete more effectively on quality and user experience, and we may be unable to effectively compete with the services offered by our competitors causing us to lose business and profitability.

There are significant risks involved in developing and deploying AI and there can be no assurance that the usage of AI will enhance our products or services or be beneficial to our business.

AI-related changes to our services may affect our customers’ expectations and requirements in ways we cannot adequately anticipate or adapt to, causing our business to lose market share or the ability to operate cost-effectively.

Our adoption and use of new technologies, including AI, will be subject to legal and regulatory requirements that will continue to evolve over the next several years, creating risk and uncertainties around how AI-based capabilities can be used to support our business practices and services.

Further, certain clients may choose to restrict the use of AI in our services, which would limit our ability to employ AI capabilities as intended.

Financing Related Risks

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A permanent shift in workforce demographics and office environments may result in decreased demand for center-based child care and have an adverse effect on our results of operations.

In recent years, a substantial portion of the workforce, including parents of children we serve at our centers, transitioned from working in traditional office environments to working in “virtual” or “home” offices, including in our primary markets of the United States, United Kingdom, Australia, and the Netherlands.

In recent years, a substantial portion of the workforce, including parents of children at our centers, transitioned from working in traditional office environments to working in “virtual” or “home” offices or in hybrid roles, including in our primary markets of the United States, United Kingdom, Australia, and the Netherlands.

While some employers have since required employees return to traditional office environments, this can vary by geography and some employers have permanently transitioned all or a portion of their workforce to a remote or to a hybrid model.

While working parents continue to need child care regardless of their work location, there are no assurances that parents who work from home or in a hybrid model will continue to use our centers or use our centers on a full-time basis.

A shift in workplace demographics where employees work from home on a part- or full-time basis, has in the past and may in the future reduce demand for center-based child care or demand for specific center locations and impact enrollment as well as other service offerings.

A shift in workplace demographics where employees work from home on a part- or full-time basis, has and may in the future, reduce demand for center-based child care or demand for specific center locations and impact enrollment as well as other service offerings and result in center closures.

We may be unable to successfully meet changed client and parent demands and needs around center locations or center availability on a cost effective basis, which may have a material adverse effect on our business or results of operations and result in future center closures or potential impairments.

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Additionally, our ability to grow in the future will depend on a number of factors, including the ability to develop and expand new and existing client relationships, to continue to provide and expand high-quality services, to hire and train qualified personnel, to expand and grow in existing and future markets, to develop and operationalize new service offerings, and to sustain operational excellence and efficiencies across all lines of business.

Achieving and sustaining growth requires the successful execution of our growth strategies, which may require the implementation of enhancements to customer-facing, operational and financial systems, expanded sales and marketing capacity, continuous updates to technology, such as those related to artificial intelligence, improvements to processes and systems, and additional or new organizational resources.

Given these challenges, we may be unable to manage our expanding operations effectively, or to maintain our growth, which could have a material adverse effect on our business or results of operations.

Achieving and sustaining growth requires the successful execution of our growth strategies, which may require the implementation of enhancements to customer-facing, operational and financial systems, expanded sales and marketing capacity, continuous updates to technology, such as those related to AI, improvements to processes and systems, and additional or new organizational resources.

Given these challenges, we may be unable to manage our expanding operations, and the associated costs, effectively, or to maintain our growth, which could have a material adverse effect on our business or results of operations.

Acquisitions present many risks and may disrupt our operations.

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In our back-up care and educational advisory services segments, we face competition from existing providers and new entrants into the market.

We believe our ability to compete in these markets is dependent on prices for services, quality and timeliness of service delivery, and our digital platforms and offerings.

However, competitors may seek to provide alternative offerings or undercut pricing in these markets.

We believe our ability to compete in these markets is dependent on prices for services, quality and timeliness of service delivery, service offerings, our ability to fill back-up care requests and meet use demands, our digital platforms and overall user experience.

However, competitors are seeking to provide alternative offerings and pricing strategies in these markets that may be more attractive to current and potential clients.

If we are unable to maintain our competitive advantage, our growth could be adversely impacted and our future operating results negatively impacted.

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However, a broad-based benefit with governmentally mandated or funded child care or preschool, such as universal pre-K, could reduce the demand for early care services at our existing early education and child care centers due to the availability of lower cost care alternatives, or could place downward pressure on the tuition and fees we charge, which could adversely affect our revenues and results of operations.

Some states and local jurisdictions currently offer universal pre-K or preschool programs in which we may or may not participate as a service provider.

If these programs were to significantly expand, or our participation were constrained by program limitations or insufficient funding, it could have an adverse effect on our business, financial condition or results of operations.

Some states and local jurisdictions currently offer universal pre-K or preschool programs in which we may or may not participate as a service provider and are looking to expand these programs.

If these programs were to significantly expand in new or current markets, or our participation were constrained by access, program limitations or insufficient funding, it could have an adverse effect on our business, financial condition or results of operations.

While we receive limited government support, any reduction at the federal, state and local level, including as a result of changes in government policies, priorities or programs, such as grants and other subsidies, could further impact our results of operations.

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Litigation, Insurance, Tax and Regulatory Risks

Our business activities subject us to litigation risks that may lead to significant reputational damage, monetary damages and other remedies and increase our litigation expense.

Because of the nature of our business, we are subject to claims and litigation from time to time and may be subject to future claims, including unasserted claims and matters, alleging negligence, inadequate supervision, illegal, inappropriate or abusive behavior, health and safety failures, or other grounds for liability arising from injuries or other harm to the people we serve, primarily children.

We are, and in the future may be, subject to employee claims based on, among other things, discrimination, harassment or wrongful termination.

These claims and lawsuits could result in damages and other costs that our insurance may be inadequate to cover, may inhibit our ability to purchase adequate insurance coverages, may increase future insurance premium costs, or may result in licensing suspensions or revocation.

In addition to diverting our management resources, such allegations may result in publicity that may materially and adversely affect us, our brands and our reputation, regardless of the validity of any such allegations.

Any such claim or the publicity resulting from claims may have a material adverse effect on our business, reputation, results of operations and financial condition including, without limitation, adverse effects caused by increased cost or decreased availability of insurance and decreased demand for our services from employer sponsors and families.

Our business activities subject us to litigation and regulatory risks that may lead to significant reputational damage, monetary damages and other remedies and increase our litigation expense.

Because of the nature of our business, we are subject to claims and litigation and may be subject to future claims, including unasserted claims and matters, alleging negligence, inadequate supervision, illegal, inappropriate or abusive behavior, health and safety failures, or other grounds for liability arising from injuries or other harm to the people we serve, primarily children.

Such claims, allegations and lawsuits could result in increased licensing oversight and/or lead to regulatory investigation, such as the Child Safeguarding Practice Review, currently underway in the U.K.

related to recent incidents involving a former employee, and may negatively affect our insurance programs.

Additionally, we are, and in the future may be, subject to employee claims based on, among other things, discrimination, harassment or wrongful termination.

Any of the foregoing could result in damages and other costs that our insurance may be inadequate to cover, may inhibit our ability to purchase adequate insurance coverages, may increase future insurance premium costs, or may result in licensing suspensions or revocation.

In addition to diverting our management resources, such allegations have resulted and, in the future may result in publicity that may materially and adversely affect us, our brands, our reputation and client and family demand for our services, regardless of the validity of any such allegations.

Any such claims, allegations, lawsuits, regulatory action or the publicity resulting from these claims may have a material adverse effect on our business, reputation, results of operations and financial condition including, without limitation, adverse effects caused by increased cost or decreased availability of insurance and decreased demand for our services from employer sponsors and families.

Our international operations may be subject to additional risks related to litigation, including difficulties enforcing contractual obligations governed by foreign law due to differing interpretations of rights and obligations, limitations on the availability of insurance coverage and limits, compliance with multiple and potentially conflicting laws, new and potentially untested laws and judicial systems, and reduced or diminished protection of intellectual property.

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There is no assurance that our insurance, particularly coverage for sexual and physical abuse, will adequately cover our claims or damages, or continue to be readily available to us in the form or amounts we have been able to obtain in the past.

As a consequence of our insurance claims experience, changes in the insurance or reinsurance markets, or other conditions affecting the availability of traditional insurance products to us, our insurance premiums could materially increase, we may need to increase or expand the coverages or limits purchased by our wholly-owned captive insurance company, or we may need to obtain other risk management or insurance program alternatives, all of which could increase costs and materially and adversely affect our business and operating results.

Changes in laws and regulations could impact the way we conduct business.

As a consequence of our insurance claims experience, changes in the insurance or reinsurance markets, or other conditions affecting the availability of traditional insurance products to us, our insurance premiums could materially increase, we may increase or expand the coverages or limits purchased by our wholly-owned captive insurance company, or we may obtain other risk management or insurance program alternatives, all of which could increase costs and materially and adversely affect our business and operating results.

Changes in laws and regulations could impact the way we conduct business and increased government and regulatory oversight of the child care and early education industry may result in operational and licensing changes that could adversely affect our results of operations.

Our early education and child care centers, back-up care, and educational advisory services are subject to numerous national, state and local regulations and licensing requirements.

Although these regulations vary greatly from jurisdiction to jurisdiction, government agencies generally review, among other areas, the adequacy of buildings and equipment, licensed capacity, teacher-to-child ratios, educational qualifications and training of staff, record keeping, dietary program, daily curriculum, hiring practices, and compliance with federal and local labor laws and regulations, health and safety standards and requirements, and data privacy statutes.

In addition to costs associated with compliance and changing laws and regulations in the United States and internationally, failure to comply with applicable regulations and requirements could subject us to governmental sanctions, which can include fines, corrective orders, probation or, in more serious cases, suspension or revocation of one or more of our child care centers’ licenses to operate, and require significant expenditures to bring those centers into compliance.

In addition to costs associated with compliance and changing laws and regulations in the jurisdictions in which we operate, failure to comply with applicable regulations and requirements could subject us to governmental sanctions, which can include fines, corrective orders, probation or, in more serious cases, suspension or revocation of one or more of our child care centers’ licenses to operate, and could require significant expenditures to bring those centers into compliance.

Additionally, in the U.K., our license to operate our child care centers is regulated nationally and therefore the risk of suspension or revocation exists at both a center and a country-wide level.

We are, and in the future may be, subject to statutory and regulatory review regarding child safety and safeguarding, such as the Child Safeguarding Practice Review underway in the U.K., which may result in increased inspections of our centers, impacts on client and family demand for our services, the suspension or revocation of our licenses to operate and negative publicity that could materially impact our business.

There is an increased focus in some of the jurisdictions in which we operate on safety and safeguarding in the child care industry which may result in new regulations and industry-wide operational changes impacting the broader sector as well as potential heightened scrutiny on government funding and support programs for the industry.

Additionally, changes in federal, state and local legislation or regulations regarding human capital management could increase compliance costs and obligations, impede our ability to recruit and retain talent, or our brand or reputation may be harmed.

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Our international operations may subject us to additional risks that differ in each country in which we operate, and such risks may negatively affect our results.

The factors impacting the international markets in which we operate may include changes in laws and regulations affecting the operation of child care centers, parent or tuition subsidies or other government financial support, the imposition of restrictions on currency conversion or the transfer of funds, or increases in the taxes paid and other changes in applicable tax laws.

The factors impacting the international markets in which we operate may include changes in laws and regulations affecting the operation of child care centers, increased regulatory oversight of the child care and early education industry, reduced, decreased or capped parent or tuition subsidies or other government financial support, the imposition of restrictions on currency conversion or the transfer of funds, or increases in the taxes paid and other changes in applicable tax laws.

Our business is exposed to fluctuations in foreign currency exchange rates, which could adversely impact our results.

As a multinational company, we conduct our business in a variety of markets and are therefore subject to market risk for changes in foreign currency exchange rates.

As a global company, we conduct our business in a variety of markets and are therefore subject to market risk for changes in foreign currency exchange rates.

Instability in European and other financial markets, or other geopolitical events, such as adverse global economic conditions, could cause fluctuations in exchange rates that may adversely affect our revenues and net earnings.

Approximately 28% of our revenue was generated outside the United States in 2024.

Approximately 29% of our revenue was generated outside North America in 2025.

While most of our revenues, costs and debts are denominated in U.S.

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Market Related Risks

We cannot guarantee that we will repurchase our common stock pursuant to our stock repurchase program or that our stock repurchase program will enhance long-term stockholder value.

Stock repurchases could also increase the volatility of the price of our common stock and could diminish our cash reserves.

On December 16, 2021, our board of directors authorized a share repurchase program under which up to $400 million of our outstanding common stock may be repurchased, of which $113.7 million remained available as of December 31, 2024.

Although our board of directors has authorized the stock repurchase program, the stock repurchase program does not obligate us to repurchase any specific dollar amount or to acquire any specific number of shares and may be suspended or terminated at any time.

Stock may be purchased from time to time, in the open market at prevailing market prices, in private transactions, under Rule 10b5-1 plans, or by other means, subject to market conditions, in compliance with applicable state and federal securities laws.

We cannot guarantee that we will repurchase our common stock pursuant to our share repurchase program or that our share repurchase program will enhance long-term stockholder value.

Share repurchases could also increase the volatility of the price of our common stock and could diminish our cash reserves.

On June 3, 2025, our board of directors authorized a share repurchase program under which up to $500 million of our outstanding common stock may be repurchased, of which $329.4 million remained available as of December 31, 2025.

Although our board of directors has authorized the share repurchase program, the share repurchase program does not obligate us to repurchase any specific dollar amount or to acquire any specific number of shares and may be suspended or terminated at any time.

Stock may be purchased from time to time, in open market transactions at prevailing market prices, in privately negotiated transactions, or by other means in accordance with federal securities law, including under Rule 10b5-1 plans or accelerated share repurchase programs.

The timing and amount of repurchases, if any, will depend upon several factors, including market and business conditions, restrictions in our debt agreements, the trading price of our common stock and the nature of other investment opportunities.

In addition, repurchases of our common stock pursuant to our stock repurchase program could affect the market price of our common stock or increase its volatility.

The existence of a stock repurchase program could cause our stock price to be higher than it would be in the absence of such a program and could potentially reduce the market liquidity for our stock.

Additionally, our stock repurchase program could diminish our cash reserves, which may impact our ability to finance future growth and to pursue possible future strategic opportunities and acquisitions.

There can be no assurance that any stock repurchases will enhance stockholder value because the market price of our common stock may decline below the levels at which we determine to repurchase our stock and short-term stock price fluctuations could reduce the program’s effectiveness.

In addition, repurchases of our common stock pursuant to our share repurchase program could affect the market price of our common stock or increase its volatility.

The existence of a share repurchase program could cause our stock price to be higher than it would be in the absence of such a program and could potentially reduce the market liquidity for our stock.

Additionally, our share repurchase program could diminish our cash reserves, which may impact our ability to finance future growth and to pursue possible future strategic opportunities and acquisitions.

There can be no assurance that any share repurchases will enhance stockholder value because the market price of our common stock may decline below the levels at which we determine to repurchase our stock and short-term stock price fluctuations could reduce the program’s effectiveness.

The price of our common stock could be volatile, and, as a result, you may not be able to resell your shares at or above the price you paid for them.

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• impairments;

• suspension or revocation of child care center licenses;

• negative publicity resulting from allegations or claims;

• impact from cyber events;

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Your percentage ownership may be diluted by future issuances of capital stock, which could reduce your influence over matters on which stockholders vote.

Pursuant to our certificate of incorporation, our board of directors has the authority, without action or vote of our stockholders, to issue all or any part of our authorized but unissued shares of common stock, including shares issuable upon the exercise of options, or shares of our authorized but unissued preferred stock.

Pursuant to our certificate of incorporation, our board of directors has the authority, without action or vote of our stockholders, to issue all or any part of our authorized but unissued shares of common stock, including shares issuable upon the exercise of options or vesting of restricted stock units, or shares of our authorized but unissued preferred stock.

Issuances of common stock or voting preferred stock would reduce your influence over matters on which our stockholders vote and, in the case of issuances of preferred stock, would likely result in your interest in us being subject to the prior rights of holders of that preferred stock.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors