Cannae Holdings Reports $115M Net Loss in Q1 2025, Plans D&B Divestiture

Cannae Holdings, Inc. reported a net loss of $115.0 million for the first quarter of 2025, compared to a net loss of $91.8 million in the same period of 2024. The company's total operating revenues decreased to $103.2 million from $110.7 million year-over-year, primarily driven by a decline in restaurant revenue, which fell to $99.1 million from $106.5 million. The decrease in revenue was attributed to a reduction in guest counts at its restaurant brands, O'Charley's and 99 Restaurants, despite an increase in average spending per visit.

Operating expenses for the quarter were $124.6 million, down from $151.3 million in the prior year, reflecting a significant reduction in personnel costs and other operating expenses. The company reported an operating loss of $21.4 million, an improvement from the $40.6 million loss recorded in the first quarter of 2024. Cannae's effective tax rate for the quarter was -121.7%, influenced by a valuation allowance recorded against its deferred tax assets, which totaled $55.0 million as of March 31, 2025.

Strategically, Cannae is in the process of divesting its investment in Dun & Bradstreet (D&B), which has been classified as a discontinued operation. The company expects to receive approximately $631.8 million in cash proceeds from the sale, anticipated to close in the third quarter of 2025. This transaction has led to a reclassification of D&B's assets as held for sale, with a recorded impairment of $68.1 million in the current quarter. Additionally, Cannae has entered into a Voting and Support Agreement to facilitate the sale and has sold 9.0 million shares of D&B for $80.5 million since the end of the quarter.

Cannae's investment strategy continues to evolve, with recent investments including $25.0 million in Black Knight Football Club (BKFC) and a planned acquisition of an additional 30% interest in JANA Partners for $67.5 million. The company has also initiated a new stock repurchase program, allowing for the buyback of up to 10 million shares. As of March 31, 2025, Cannae had cash and cash equivalents of $126.2 million, with expectations of increased liquidity following the D&B sale.

Looking ahead, Cannae anticipates that macroeconomic factors, including inflation and consumer spending trends, will continue to impact its operations. The company remains focused on optimizing its capital allocation strategy, which includes potential debt reduction, share repurchases, and strategic acquisitions. The management is committed to navigating the current economic landscape while positioning the company for long-term growth and profitability.