Mayfield Childcare - which operates 45 long daycare centres in Victoria, Queensland and South Australia - has withdrawn earning guidance delivered in March, becoming the third ASX-listed chain to cite tough trading conditions in 2026.
"The operating environment across the early childhood education and care sector has been increasingly challenging, with further pressure from labour costs, occupancy volatility, wage increases and broader sector conditions," the operator said on Friday.
Government and regulatory reforms included unanticipated changes to the Child Care Subsidy settings, child safety requirements and workforce compliance obligations, Mayfield said.
G8 Education, Australia's largest ASX-listed day care provider, announced in April it was suspending the operation of 40 of its almost 400 early learning centres.
It said the sector was facing "unprecedented change and uncertainty," driven by falling demand, lower birth rates and changing operating conditions.
Families were facing sustained affordability pressures, birth rates had dropped and confidence in the sector was impacted by serious child safety incidents, the company said.
In 2025, one of G8's former workers was accused of dozens of sex crimes in Victoria involving babies and toddlers, leading the company to roll out CCTV cameras across all of its centres.
ASX-listed Embark Early Eduction, which runs 39 centres across Australia, said in May that the entire sector was facing challenges.
"This is largely a combination of subdued demand due primarily to lower birth rates after COVID, cost-of-living pressures, and the continued increase in the number of centres and licensed places," Embark said.
Between December 2022 and December 2025, 867 new daycare centres opened, a 9.7 per cent increase, Embark said.
But the number of enrolled children increased just one per cent during those three years.
Many of the new daycare centres were planned and under way before demand plateaued, and the rate of new centre builds has begun to ease.
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