SBC Medical Expands Franchise Network and Customer Visits Amid Strategic Restructuring

SBC Medical Group Holdings Inc. (NASDAQ: SBC), the Japanese owner and operator of a chain of cosmetic surgery clinics, continued to execute its strategic strategy shift during the first six months of 2025, including expanding the number of franchise locations and visits among customers. This restructuring includes the discontinuation of its staffing business, targeted divestitures to streamline operations, and a revision of its fee structure. While total revenue for the first half of 2025 was down 16% year-over-year to $91 million, and down 18% year-over-year in the second quarter to $43 million, that was due in large part to the restructuring and was expected according to company guidance.

Franchise locations grew 16% compared to last year, reaching 259 locations as of June 30, 2025, while repeat customer visits grew 14% and unique customer visits were 10% higher. The company reported 6.31 million visits over the last twelve months, demonstrating scale that management claims is unmatched in Japan. The repeat rate among existing customers stands at approximately 72%, with average revenue per visit at $279, up 13% year-over-year, indicating strong brand loyalty despite declining discretionary spending among Japanese consumers.

The company is pursuing two key strategies: expanding the market by making aesthetic medicine more accessible and appealing, and differentiating itself from competition by offering advanced treatments and better pricing while expanding internationally to the U.S. and Singapore. SBC Medical is continuing with key initiatives including the integration of its acquisition of MB Career Lounge Co. Ltd., a privately-held provider of management support services for medical institutions specializing in consulting, training and human resources solutions in Japan. The company is also moving ahead with plans to join JUN CLINIC, a network of medical and aesthetic clinics with high average spend per customer.

SBC Medical initiated and completed a share buyback program between May and July 22, purchasing up to $5 million worth of shares. Management launched the program because they believe the stock at current prices undervalues the company's business performance, growth potential, and leading position in Japan's aesthetic medical market. The company ended the second quarter with $153 million in cash and cash equivalents, providing sufficient resources to fund future growth initiatives. Additionally, SBC Medical was added to the broad-market Russell 3000® Index at the end of June, which may increase visibility and open the company to a broader investor base.

Despite near-term revenue challenges, the company's expansion of franchise locations, growing customer base, and increasing repeat visits position it well for long-term growth in the enduring beauty and aesthetics market. The strategic shifts undertaken during the first half of 2025 reflect management's confidence in the company's competitive positioning and scalability in both domestic and international markets.