Back-Up Care Revenue Surges 19%: A Wake-Up Call for HR Leaders

With back-up care usage hitting record levels, HR leaders need to view child care benefits not as a perk but as a strategic tool for workforce stability. Bright Horizons' latest numbers show that employers are increasingly investing in these services, directly addressing absenteeism and boosting employee satisfaction.

Bright Horizons Family Solutions reported a robust second quarter of 2026, with total revenue reaching $779 million, a 7% year-over-year increase that underscores the continued recovery and expansion of the employer-sponsored child care market. The standout performer was the Back-Up Care segment, which surged 19% to $194 million, driven by a combination of new client adoption and higher utilization among existing users. This segment’s adjusted operating income jumped 23% to $50 million, and its operating margin expanded 80 basis points to 26%, reflecting strong operating leverage. The Full Service center-based business grew a more modest 3% to $557 million, as tuition rate increases outpaced wage growth, leading to a 10% rise in adjusted operating income to $44 million and a 50-basis-point margin improvement to 7.9%. While enrollment in mature centers inched up just 1% — and would have been higher without a 100 basis point drag from Australia — occupancy levels reached the high 60% range, or 70% excluding Australia, signaling continued recovery in a sector still normalizing after pandemic disruptions.

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The Full Service center-based business grew a more modest 3% to $557 million, as tuition rate increases outpaced wage growth, leading to a 10% rise in adjusted operating income to $44 million and a 50-basis-point margin improvement to 7.9%.

The company’s bottom line benefited from these operational improvements, with adjusted earnings per share rising 20% to $1.28. Management’s confidence is reflected in a narrowed full-year revenue guidance of $3.085 billion to $3.115 billion and, more notably, a raised adjusted EPS outlook of $5.05 to $5.15, up from prior expectations. This guidance implies continued momentum in the back half of the year, with third-quarter revenue projected at $835 million. The back-up care segment, which provides last-minute child and elder care services to employees of corporate clients, has become a critical growth engine, benefiting from tight labor markets where employers seek to differentiate their benefits packages to attract and retain talent. Bright Horizons’ integrated model, combining full-service centers with on-demand back-up care and educational advisory services, creates a sticky ecosystem that drives revenue per client.

However, the recovery is not without frictions. The Australia operations remain a notable headwind, reducing total enrollment growth by 100 basis points and dragging full-service margins by roughly 150 basis points. Management is actively addressing these challenges, but the geographic concentration highlights risks tied to regional economic conditions and regulatory changes. The Education Advisory segment was flat year-over-year at $28 million, as growth in College Coach was offset by lower engagement in EdAssist, suggesting some softness in employer tuition assistance programs that could bear watching.