Service Corporation International (SCI): BCG Matrix [Dec-2025 Updated]

Let's cut right to the chase on Service Corporation International's current standing using the BCG Matrix as of late 2025. You'll see the bedrock of the business-Traditional Funeral Services-is a powerful Cash Cow, driving 14.8% gross profit growth and reliably generating up to $940 million in operating cash flow guidance, but the real action is elsewhere. The future hinges on turning Stars like high-share Cremation Services and Digital Platforms into sustainable winners, while managing the volatility of the SCI Direct Preneed Insurance transition, a clear Question Mark that caused a temporary 14% sales dip. We need to know if they can divest the low-growth Dogs, like Traditional Burial Merchandise, fast enough to feed these crucial growth engines.

Background of Service Corporation International (SCI)

You're looking for the bedrock facts on Service Corporation International (SCI), the giant in the deathcare space. To be clear, Service Corporation International is the largest provider of funeral and cemetery services in North America, period. The company was founded way back in 1962 and keeps its corporate home base in Houston, Texas.

Service Corporation International operates a massive network, which, as of mid-2025, included over 1,485 funeral service locations and 498 cemeteries across 44 states, eight Canadian provinces, the District of Columbia, and Puerto Rico. They serve a huge number of families, estimated at over 600,000 annually, offering everything from simple cremations to full, personalized life celebrations.

The business is structured around two main functions: funeral services and cemetery operations. Their funeral segment covers all professional services, facilities use, merchandise like caskets and urns, and ancillary items like flowers. The cemetery side deals with property interment rights-think developed lots, niches, and mausoleum spaces-along with memorialization products.

Service Corporation International manages a portfolio of well-known brands to meet diverse family needs. You'll see names like Dignity Memorial, which is their flagship brand, alongside others such as National Cremation Society, Advantage Funeral and Cremation Services, and Funeraria del Angel, which specifically caters to Hispanic customers. They also conduct business internationally, owning facilities in eight European countries and operating in Singapore.

Looking at the very latest numbers as we approach the end of 2025, the company's trailing 12-month revenue, as of September 30, 2025, stood at $4.29B. The stock, trading on the NYSE, recently saw a price of $83.77 as of October 30, 2025, giving the firm a market capitalization of about $11.7B. Management confirmed its 2025 earnings guidance midpoint in late October, projecting normalized earnings per share between $3.80 and $3.90.

Service Corporation International (SCI) - BCG Matrix: Stars

You're analyzing the high-growth, high-market-share segment of Service Corporation International (SCI)'s portfolio, the Stars. These units are market leaders that require significant cash investment to maintain their growth trajectory, essentially breaking even on cash flow for now, but they are the future Cash Cows.

Cremation Services represents a core Star, capitalizing on the fastest-growing segment in North America. The comparable cremation rate for Service Corporation International (SCI) was reported at 63.8% in 2024, which is above the national average, indicating strong market penetration in a high-growth area. The overall U.S. cremation rate is projected to exceed 65%. Service Corporation International (SCI) reported its own cremation rate increased to 57.3% in the third quarter of 2025.

The performance metrics for this segment, which is consuming cash for expansion but holds a leading position, can be summarized:

• Comparable cremation rate in 2024: 63.8%
• Service Corporation International (SCI) Q3 2025 cremation rate: 57.3%
• U.S. national cremation rate forecast: Above 80% by 2035
• Funeral segment gross profit margin pressure: Fell 170 basis points to 17.5% in Q3 2025

Cemetery Preneed Sales Production is another area showing strong growth within a mature market, positioning it as a Star due to its high share and growth momentum. Service Corporation International (SCI) holds an estimated high market share in cemetery services at 28.8%. This segment demonstrated robust growth in the third quarter of 2025, with preneed sales production increasing by 9.6%. Comparable cemetery revenue grew by almost 7% in Q3 2025.

Here's a look at the recent financial performance driving this segment's Star status:

Digital Pre-planning Platforms are essential for maintaining market share in a modernizing industry, even if specific revenue figures are less clear than the core segments. Service Corporation International (SCI) is actively investing in this area to enhance customer experience and lead generation. For instance, in the first quarter of 2025, the company allocated $5 million toward digital investments. This investment supports the expansion of online tools, which is critical as the company focuses on an interconnected, omnichannel experience.

The investment in technology supports future growth, as seen in the overall 2025 guidance:

• 2025 Adjusted Operating Cash Flow Guidance Midpoint: $860 million
• Expected Adjusted Operating Free Cash Flow for 2025: Almost $550 million
• Digital Investments in Q1 2025: $5 million

Strategic Acquisitions are the mechanism Service Corporation International (SCI) uses to secure and expand its high market share in growing geographies. The company has a clear capital allocation target for this purpose in 2025. The target for acquisition investment for the full-year 2025 is set between $75 million and $125 million. During the third quarter of 2025 alone, Service Corporation International (SCI) invested $37 million in business acquisitions. This follows a significant deployment of capital in 2024, totaling $181 million for acquisitions.

The capital deployment strategy for growth is explicit:

• Target Acquisition Investment for Full-Year 2025: $75 million to $125 million
• Acquisitions Investment in Q3 2025: $37 million
• Acquisitions Investment in Q1 2025: $67 million (Total investment, including maintenance)

Finance: draft 13-week cash view by Friday.

Service Corporation International (SCI) - BCG Matrix: Cash Cows

You're looking at the bedrock of Service Corporation International (SCI)'s financial stability, the units that print cash with minimal need for heavy investment. These are the mature, high-market-share businesses that fund the rest of the portfolio.

Traditional Funeral Services represent this classic Cash Cow role. Effective fixed cost management in the second quarter of 2025 drove significant growth in comparable funeral gross profit of 14.8%. This is the margin expansion you want to see in a mature segment.

The scale of the Established Funeral Home Network provides the necessary market presence for this stability. As of June 30, 2025, Service Corporation International owned and operated 1,485 funeral service locations and 498 cemeteries across North America. This footprint ensures stable, predictable revenue streams, even as the market matures.

The financial output from these core operations is substantial. Service Corporation International raised its full-year 2025 Adjusted Operating Cash Flow guidance to a range of $910 million to $950 million following the third quarter results, reflecting stronger working capital trends and anticipated lower cash taxes. For context, year-to-date through Q3 2025, the normalized net cash provided by operating activities reached $866.1 million, a 19.5% increase over the prior year period.

Pricing power remains evident in the core service offering. The At-Need Funeral Average Revenue demonstrated steady performance, with the comparable total funeral sales average growing 3.1% in the third quarter of 2025 over the third quarter of 2024. Still, you have to watch the volume; the comparable core funeral services performed saw a 3.5% decrease in Q3 2025, which was offset by a 3% increase in the core average revenue per service.

Here's a quick look at the recent cash generation and operational metrics supporting this quadrant:

These cash cows are the engine that allows Service Corporation International to fund other areas of the portfolio. The company confirmed its 2025 adjusted diluted EPS guidance midpoint at $3.85, with a narrowed range of $3.80 to $3.90.

You can see the underlying strength in the key drivers for this segment:

• Net cash provided by operating activities (Q3 2025): $252.3 million
• Cemetery preneed sales production increase: 9.6% (Q3 2025)
• Core average revenue per service increase: 3% (Q3 2025)
• Total Revenue: $1,065.4 million (Q2 2025)
• Capital returned to shareholders (Q3 2025): $123 million

Finance: draft 13-week cash view by Friday.

Service Corporation International (SCI) - BCG Matrix: Dogs

Dogs are units or products with a low market share and low growth rates. They frequently break even, neither earning nor consuming much cash. Dogs are generally considered cash traps because businesses have money tied up in them, even though they bring back almost nothing in return. These business units are prime candidates for divestiture.

Traditional Burial Merchandise: Low-growth, high-cost inventory (caskets, vaults) being cannibalized by the national shift toward cremation. The U.S. cremation rate is projected to reach 82.3% by 2045, up from 63.4% in 2025, while the corresponding burial rate is expected to decline to 13.0% by 2045. This trend directly pressures the volume component of traditional burial services.

Underperforming Legacy Locations: Older, non-core funeral homes and cemeteries in stagnant markets that lack scale or high pre-need penetration. In the third quarter of 2025, Service Corporation International saw comparable core funeral revenue decline by almost 1% (a decrease of $3 million) over the third quarter of 2024. This decline was driven by a 3.5% decrease in core funeral services performed.

The following table summarizes key financial metrics from the third quarter of 2025 that reflect the low-growth or declining nature of certain legacy or non-core operations within Service Corporation International:

Non-Strategic Asset Divestitures: The ongoing process of selling off smaller, non-core properties to focus capital. The prior year quarter (Q3 2024) was impacted by a pre-tax gain on divestitures of $0.4 million. Service Corporation International's 2025 outlook explicitly excludes gains or losses associated with asset divestitures, suggesting these non-core sales are treated as non-recurring or outside the core operating forecast for the year.

Low-Volume Cemetery Maintenance: High fixed-cost services in older cemetery plots where interment rights are largely sold out, offering minimal new revenue. While cemetery preneed sales production increased 9.6% in Q3 2025, capital allocated to cemetery development projects during the quarter was $45 million. This investment in development contrasts with the maintenance of older, fully utilized plots that generate low incremental revenue, tying up capital.

Service Corporation International (SCI) - BCG Matrix: Question Marks

You're looking at the areas within Service Corporation International (SCI) that are burning cash now but hold the potential for future dominance. These are the Question Marks: high-growth markets where SCI currently has a low market share, demanding heavy investment to avoid becoming Dogs.

SCI Direct Preneed Insurance Transition

The shift from trust-based to insurance-funded preneed contracts for SCI Direct is a classic Question Mark scenario. This strategic move, designed to capture higher commission revenue, caused immediate friction in sales execution. In the second quarter of 2025, non-funeral home preneed sales production dropped by 14%, equating to a $10,000,000 decrease, as sales counselors navigated new licensing and payment terms. To be fair, this transition is an investment in future revenue quality; general agency revenue growth was up $7.2 million year-over-year, benefiting from the new preferred preneed insurance provider. Still, the immediate impact was negative on recognized sales volume.

The pressure is on for rapid adoption of the new system. For context, core preneed funeral sales production decreased by $29,000,000, or about 9%, over the prior year, largely due to this transition, though cemetery preneed sales production actually increased by 5.3% in Q2 2025, building future recognized revenue.

• SCI Direct transition markets represent 95% of production as of the Q2 2025 update.
• Full year 2025 guidance for adjusted EPS is $3.70 to $4.00.
• The company expects year-over-year growth for SCI Direct as a whole in early twenty twenty six.

Undeveloped Cemetery Property

Cemetery property development is a long-term capital sink that fits the Question Mark profile perfectly. These are high-value assets in a market that still values memorialization, but they require significant upfront cash before revenue is recognized. In Q2 2025, Service Corporation International allocated $34.7 million specifically to the development of cemetery property as part of its total capital expenditures of $83.0 million.

This investment is meant to convert future sales production into recognized revenue. While cemetery preneed sales production increased 5.3% in Q2 2025, recognized preneed revenue lagged, with a $2,000,000 decline in recognized preneed revenue in the cemetery segment in Q2 2025, partially offset by a $3,000,000 increase in at-need revenue. Here's the quick math: you spend the cash now for the land and development, but the revenue only hits the books once construction and payment criteria are met later on.

International Operations (Canada)

While Service Corporation International's business is overwhelmingly North American, its presence in Canada represents a smaller, more volatile market segment compared to its dominant U.S. base. As of March 31, 2025, Service Corporation International operated in eight Canadian provinces.

Operating internationally introduces currency risk and exposure to different regulatory environments, which can affect the predictable cash flows seen in the core U.S. business. The financial reports provided focus on consolidated or U.S.-centric segment performance, suggesting Canadian results are either immaterial to the overall $1.065B revenue in Q2 2025 or are managed within the overall cemetery/funeral segment reporting structure.

Eco-Friendly/Green Burial Offerings

The push for sustainability is creating a high-growth niche in deathcare, but Service Corporation International is still establishing its footprint against specialized competitors. The broader Death Care Market shows that eco-friendly burials have grown by 25% in the industry, and green caskets have seen a 35% rise in popularity.

This market segment is valued at about 12% of global funeral spending in 2025. For Service Corporation International, this represents an area needing heavy investment to build share in a rapidly expanding, yet fragmented, market. The company is developing services to capture this growth, but the current market share is likely low relative to the segment's growth rate, fitting the Question Mark profile.

What this estimate hides is the exact percentage of Service Corporation International's total revenue derived from these specific green offerings as of 2025.

Finance: draft the required investment spend vs. expected return timeline for the SCI Direct transition by next Tuesday.