SBC Medical Group Holdings Reports Q2 and First Half 2025 Financial Results Amid Strategic Business Transition
SBC Medical Group Holdings Incorporated (NASDAQ: SBC), a leading global operator and management services provider for cosmetic treatment centers, today announced its financial results for the second quarter of fiscal year 2025, which covered the three-month period ended June 30, 2025, as well as the first half of the year ended June 30, 2025.
The company, best known for operating the Shonan Beauty Clinic (SBC) brand, reported a challenging second quarter, reflecting its ongoing restructuring efforts and a strategic pivot designed to strengthen its long-term growth trajectory. While revenues and earnings declined sharply compared to the prior year, management emphasized that the results were in line with expectations and consistent with SBC Medical’s transformation plan.
Second Quarter 2025 Highlight
For the second quarter, SBC Medical Group delivered mixed financial and operational performance. Key highlights included:
- Total revenues of $43 million, representing an 18% year-over-year decrease.
- Income from operations of $15 million, a 47% decline from the same quarter in 2024.
- Net income attributable to SBC Medical Group of $2.5 million, down 87% year-over-year.
- Earnings per share (EPS) of $0.02, compared to $0.20 in the prior-year quarter.
- EBITDA of $15 million, a 46% year-over-year decline, with an EBITDA margin of 35%, down from 53% in Q2 2024.
- Return on equity (ROE) of 4%, reflecting a 44-point decline compared to last year.
- 259 franchise locations, an increase of 36 locations compared to June 30, 2024.
- 6.31 million customers served in the past twelve months, a 14% increase year-over-year.
- Customer repeat rate of 72%, underscoring loyalty and brand strength.
First Half 2025 Highlights
In addition to quarterly performance, SBC Medical also disclosed results for the first half of fiscal 2025. The company highlighted the following key metrics:
- Total revenues of $91 million, a 16% decline year-over-year.
- Income from operations of $39 million, down 25% from the prior year.
- Net income attributable to SBC Medical Group of $24 million, representing a 36% decline compared to the first half of 2024.
- Earnings per share (EPS) of $0.23, compared to $0.40 for the same period last year.
- EBITDA of $40 million, a 25% year-over-year decrease, with an EBITDA margin of 44%, compared to 50% in the first half of 2024.
CEO Commentary: Strategic Realignment Underway
Yoshiyuki Aikawa, Chairman and Chief Executive Officer of SBC Medical, provided insight into the quarter’s results and emphasized the company’s focus on long-term positioning.
“As anticipated and signaled in our prior guidance, Q2 2025 reflected strategic shifts aimed to position SBC Medical for long-term competitiveness and scalability,” said Aikawa. “Total revenue declined 18% year-over-year to $43 million, primarily due to the completed discontinuation of our staffing business, targeted divestitures to streamline our operations, and revision of fee structure.”
Aikawa highlighted the company’s operational resilience despite financial headwinds, pointing to the continued expansion of its franchise network and customer base. “We are executing our strategic plan with precision, as evidenced by our network of 259 Franchise Locations as of June 30, 2025, and 6.31 million visits over the last twelve months, demonstrating a scale that is unmatched in Japan. Our high repeat rate underscores the strength of our Shonan Beauty Clinic brand.”
He acknowledged the macroeconomic challenges facing Japan’s discretionary consumer market, including restrained growth caused by trade restrictions and consumer caution. Nevertheless, he reaffirmed confidence in SBC Medical’s long-term outlook.
“Despite these headwinds, we are successfully advancing key initiatives, including the acquisition of MB Career Lounge to enhance our management support services and the addition of JUN CLINIC to our network, which boasts a high average spend per customer. Looking ahead, we remain confident in our strategic roadmap, focused on optimizing our franchise model, capturing growth opportunities, transitioning to higher-margin models, and delivering lasting value to our shareholders,” Aikawa concluded.
Second Quarter 2025 Financial Results in Detail
Revenue Performance
Total revenues for the second quarter were $43 million, marking an 18% decrease compared to the same quarter last year. Management attributed the decline to multiple strategic actions:
- The termination of the staffing services business, which removed a revenue stream.
- Divestitures of SNA and Kijimadaira, as part of a streamlining initiative.
- A revised fee structure for franchising services, effective April 2025, which temporarily reduced income.
These declines were partially offset by growth in procurement services, rental services, and other ancillary revenue streams.
Profitability
Net income attributable to SBC Medical Group for the second quarter was $2.5 million, compared to $18.5 million in Q2 2024. The steep decline was largely due to unfavorable changes in other income and expenses, including higher foreign exchange losses.
Operating income also decreased significantly, falling to $15 million, a 47% year-over-year drop.
EBITDA and Margins
EBITDA for Q2 stood at $15 million, a 46% decrease year-over-year, primarily due to the revenue shortfalls following divestitures, the discontinued staffing segment, and the adjusted fee structure. The EBITDA margin contracted to 35%, down from 53% in the prior-year period, reflecting weaker operating leverage.
Customer Metrics
Despite financial headwinds, SBC Medical achieved solid operational metrics. Customer visits in the past twelve months reached 6.31 million, representing a 14% year-over-year increase, demonstrating sustained demand for cosmetic treatments under the SBC brand. Additionally, the 72% repeat rate reflects strong customer loyalty, a key competitive advantage.
