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AMN Healthcare Services(AMN) - 2025 Q2 - Quarterly Results

Executive Summary Q2 2025 Key Financial Highlights AMN Healthcare's Q2 2025 revenue was $658.2 million (down 11%), adjusted EBITDA $58.3 million (down 38%), and GAAP net loss $116.2 million from impairment | Metric | Q2 2025 (Millions USD) | YoY Change (%) | H1 2025 (Millions USD) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | $658.2 | (11%) | $1,347.7 | (14%) | | Gross Profit | $196.4 | (15%) | $394.5 | (19%) | | Net Loss | ($116.2) | nm | ($117.3) | nm | | Diluted EPS Loss | ($3.02) | nm | ($3.06) | nm | | Adjusted Diluted EPS* | $0.30 | (69%) | $0.75 | (62%) | | Adjusted EBITDA* | $58.3 | (38%) | $122.5 | (36%) | - GAAP loss includes $128 million in non-cash goodwill and intangible asset impairment charges, equivalent to $2.81 per share3 Business Highlights Q2 highlights include revenue and adjusted EBITDA margin exceeding guidance, strong operating cash flow, and a strategic divestiture - Q2 revenue was near the high end of guidance, and adjusted EBITDA margin exceeded guidance3 - Allied staffing revenue exceeded expectations3 - AMN Passport users surpassed 300,0003 - Smart Square was sold in July for $75 million, advancing the WorkWise technology platform partnership strategy3 - Operating cash flow reached $79 million, reducing debt by $80 million, with a net leverage ratio of 3.3:13 CEO Commentary CEO noted solid Q2 performance, market progress, stable July orders, and rebounding renewal rates despite policy uncertainties - The company demonstrated solid Q2 financial performance and continued progress in serving all market channels and being a preferred workforce partner4 - Third-party rankings confirmed AMN maintained market share in a competitive environment4 - Enhanced AI and technology services, broad solutions, and talent teams are expected to drive future market share gains4 - Uncertain healthcare policy slowed client decision-making in Q2, but July orders stabilized, and renewal rates rebounded4 Second Quarter 2025 Financial Results Consolidated Results AMN Healthcare's Q2 2025 consolidated revenue was $658 million (down 11%), resulting in a $116 million net loss and $0.30 adjusted diluted EPS | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Consolidated Revenue | $658 Million | $740 Million | -11% | | Net Loss | ($116) Million | $16 Million | nm | | Diluted EPS Loss | ($3.02) | $0.42 | nm | | Adjusted Diluted EPS | $0.30 | $0.98 | -69% | Segment Performance All segments experienced revenue declines, with Nurse and Allied Solutions down 14%, Physician and Leadership Solutions down 6%, and Technology and Workforce Solutions down 9% Nurse and Allied Solutions Nurse and Allied Solutions revenue decreased to $382 million (down 14%), driven by travel nurse and allied staffing declines, with $16 million from labor disruption | Metric | Q2 2025 (Millions USD) | YoY Change (%) | QoQ Change (%) | | :--- | :--- | :--- | :--- | | Nurse and Allied Solutions Revenue | $382 | (14%) | (8%) | | Travel Nurse Staffing Revenue | - | (25%) | (4%) | | Allied Staffing Revenue | - | (4%) | (1%) | | Labor Disruption Revenue Contribution | $16 | - | - | Physician and Leadership Solutions Physician and Leadership Solutions revenue was $175 million (down 6%), with flat locum tenens revenue but declines in interim leadership and search | Metric | Q2 2025 (Millions USD) | YoY Change (%) | QoQ Change (%) | | :--- | :--- | :--- | :--- | | Physician and Leadership Solutions Revenue | $175 | (6%) | 0% | | Locum Tenens Revenue | $143 | 0% | 1% | | Interim Leadership Revenue | - | (25%) | (5%) | | Physician and Leadership Search Revenue | - | (29%) | (2%) | Technology and Workforce Solutions Technology and Workforce Solutions revenue was $102 million (down 9%), with language services growing 1% while VMS revenue declined 31% | Metric | Q2 2025 (Millions USD) | YoY Change (%) | QoQ Change (%) | | :--- | :--- | :--- | :--- | | Technology and Workforce Solutions Revenue | $102 | (9%) | 0% | | Language Services Revenue | $76 | 1% | 1% | | VMS Revenue | $19 | (31%) | (2%) | Key Financial Metrics Consolidated gross margin was 29.8% (down 120 bps), with an operating loss of $124 million due to impairment, and adjusted EBITDA of $58 million (down 38%) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Consolidated Gross Margin | 29.8% | 31.0% | -120 bps | | SG&A Expenses (% of Revenue) | 23.5% | 20.1% | +340 bps | | Operating Loss | ($124) Million | $38 Million | nm | | Operating Margin | (18.8%) | 5.1% | -2390 bps | | Adjusted EBITDA | $58 Million | $94 Million | -38% | | Adjusted EBITDA Margin | 8.9% | 12.7% | -380 bps | - The year-over-year increase in SG&A expenses was primarily due to unfavorable actuarial adjustments for professional liability insurance this year10 - Operating loss primarily resulted from $128 million in non-cash goodwill and intangible asset impairment charges11 Balance Sheet and Cash Flow Highlights As of June 30, 2025, the company held $42 million in cash, generated $79 million in Q2 operating cash flow, and had $920 million in total debt | Metric | As of June 30, 2025 (Millions USD) | | :--- | :--- | | Cash and Cash Equivalents | $42 | | Operating Cash Flow (Q2) | $79 | | Capital Expenditures (Q2) | $10 | | Total Debt | $920 | Strategic Transactions AMN Healthcare sold Smart Square for $75 million in July, projecting annual revenue and adjusted EBITDA reductions of $17 million and $6 million - Smart Square nurse scheduling software was sold to symplr in July for $65 million in cash and a $10 million 18-month note13 - The divestiture is expected to reduce Technology and Workforce Solutions and consolidated revenue by approximately $17 million annually, and adjusted EBITDA by approximately $6 million annually14 Third Quarter 2025 Outlook Consolidated Guidance Q3 2025 consolidated revenue is projected between $610-625 million, with gross margin 28.7-29.2% and adjusted EBITDA margin 7.7-8.2% | Metric | Guidance Range | | :--- | :--- | | Consolidated Revenue | $610 - $625 Million | | Gross Margin | 28.7% - 29.2% | | SG&A as % of Revenue | Approx 23.0% | | Operating Margin | 6.0% - 6.5% | | Adjusted EBITDA Margin | 7.7% - 8.2% | - Q3 2025 revenue is projected to decrease by 9-11% year-over-year and 5-7% sequentially16 Segment Revenue Projections Q3 segment revenues are expected to decline: Nurse and Allied Solutions down 11-14%, Physician and Leadership Solutions down 2-4%, and Technology and Workforce Solutions down 12-14% | Business Segment | Q3 2025 Revenue YoY Change | | :--- | :--- | | Nurse and Allied Solutions | Down 11-14% | | Physician and Leadership Solutions | Down 2-4% | | Technology and Workforce Solutions | Down 12-14% | - Guidance assumes $5 million in labor disruption revenue16 Other Financial Estimates Q3 financial estimates include $17 million depreciation, $21 million non-cash amortization, $7.5 million stock-based compensation, and $10.5 million interest expense | Item | Q3 2025 Estimate (Millions USD) | | :--- | :--- | | Depreciation | $17 | | Depreciation in Cost of Revenue | $2 | | Non-Cash Amortization Expense | $21 | | Stock-Based Compensation Expense | $7.5 | | Integration and Other Costs | $2.5 | | Interest Expense | $10.5 | | Adjusted Tax Rate | 28% | | Average Diluted Shares Outstanding | 38.7 Million Shares | | Smart Square Divestiture Gain (Assumed) | $40 | Company Information About AMN Healthcare AMN Healthcare is a leading US healthcare talent solutions innovator, serving over 2,100 systems and 15 million patients in 2024 with comprehensive staffing and technology - AMN Healthcare is a leader and innovator in healthcare talent solutions in the United States20 - In 2024, the company served over 2,100 healthcare systems, including 87% of the nation's top systems, and nearly 15 million patients20 - The company provides a comprehensive network of healthcare professionals and an integrated suite of customized workforce technologies20 - The company's common stock is listed on the New York Stock Exchange under the ticker symbol “AMN”21 Conference Call Details AMN Healthcare will host a conference call on August 7, 2025, at 5:00 PM ET to discuss Q2 2025 results and Q3 outlook - The conference call will be held on August 7, 2025, at 5:00 PM ET19 - Discussion will cover Q2 2025 financial results and the Q3 outlook19 Non-GAAP Measures Explanation and Reconciliation This report includes non-GAAP financial measures like adjusted EBITDA and diluted EPS, provided as supplemental information to assess operational performance - Non-GAAP financial measures include Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, and Adjusted Diluted EPS22 - Management believes these metrics aid in evaluating the company's operating performance and serve as industry-wide financial measures23 - Non-GAAP metrics should not be used in isolation, and their reconciliation tables and detailed explanations are available in the “Non-GAAP Reconciliation Tables”23 Forward-Looking Statements & Risk Factors Forward-Looking Statements Disclaimer This press release contains forward-looking statements regarding future demand, market share, AI investments, and Q3 2025 projections, with actual results potentially differing materially - This press release contains “forward-looking statements” concerning future demand, market share, AI and technology investments, revenue diversification, healthcare policy impacts, and Q3 2025 financial projections24 - Actual results may differ materially from forward-looking statements24 - The company undertakes no obligation to update or revise any forward-looking statements28 Key Risk Factors Forward-looking statements depend on factors like client staffing efficiency, hospital temporary staff utilization, post-pandemic impacts, and talent retention - Risk factors include clients' ability to improve staffing efficiency, hospitals' adjustment to temporary staff utilization, post-pandemic effects, and the ability to attract and retain healthcare professionals26 - Ability to adapt to market changes, impact of economic downturns and inflation, technology product development, regulatory compliance, M&A integration, and negative impacts from intermediaries26 - Labor market disruptions, cybersecurity incidents, and hospitals' ability to pay2627 Financial Statements Condensed Consolidated Statements of Comprehensive Income (Loss) This section presents AMN Healthcare Services, Inc.'s unaudited condensed consolidated statements of comprehensive income (loss) for Q2 and H1 2025 and 2024 | Metric (Thousands USD) | Q2 2025 | Q2 2024 | Q1 2025 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | $658,175 | $740,685 | $689,533 | $1,347,708 | $1,561,563 | | Cost of Revenue | $461,776 | $510,858 | $491,413 | $953,189 | $1,074,230 | | Gross Profit | $196,399 | $229,827 | $198,120 | $394,519 | $487,333 | | Operating Loss | ($123,715) | $37,682 | $12,507 | ($111,208) | $77,627 | | Net Income (Loss) | ($116,202) | $16,237 | ($1,092) | ($117,294) | $33,565 | | Diluted EPS Loss | ($3.02) | $0.42 | ($0.03) | ($3.06) | $0.88 | Condensed Consolidated Balance Sheets This section presents AMN Healthcare Services, Inc.'s unaudited condensed consolidated balance sheets as of June 30, 2025, December 31, 2024, and June 30, 2024 | Metric (Thousands USD) | June 30, 2025 | December 31, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | $41,503 | $10,649 | $48,038 | | Total Current Assets | $571,351 | $594,915 | $704,757 | | Goodwill | $755,809 | $897,456 | $1,116,307 | | Intangible Assets, Net | $322,518 | $381,364 | $424,504 | | Total Assets | $2,212,221 | $2,415,727 | $2,771,327 | | Total Current Liabilities | $573,643 | $545,785 | $573,890 | | Revolving Credit Facility | $70,000 | $210,000 | $345,000 | | Notes Payable, Net | $846,463 | $845,872 | $845,280 | | Total Liabilities | $1,604,625 | $1,709,107 | $1,894,468 | | Stockholders' Equity | $607,596 | $706,620 | $876,859 | Summary Condensed Consolidated Statements of Cash Flows This section provides AMN Healthcare Services, Inc.'s unaudited summary condensed consolidated statements of cash flows for Q2 and H1 2025 and 2024 | Metric (Thousands USD) | Q2 2025 | Q2 2024 | Q1 2025 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $78,548 | $99,515 | $92,671 | $171,219 | $180,901 | | Net Cash Used in Investing Activities | ($20,591) | ($22,332) | ($26,046) | ($46,637) | ($43,731) | | Net Cash Used in Financing Activities | ($80,226) | ($80,108) | ($61,211) | ($141,437) | ($119,081) | | Cash, Cash Equivalents, and Restricted Cash, End of Period | $72,450 | $126,362 | $94,719 | $72,450 | $126,362 | Supplemental Financial Data & Reconciliations Non-GAAP Reconciliation Tables This section provides detailed reconciliation tables for non-GAAP financial measures like adjusted EBITDA, net income, and diluted EPS to their GAAP equivalents | Metric (Thousands USD) | Q2 2025 | Q2 2024 | Q1 2025 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Net Income (Loss) | ($116,202) | $16,237 | ($1,092) | ($117,294) | $33,565 | | Adjusted EBITDA | $58,289 | $94,087 | $64,200 | $122,489 | $191,753 | | Adjusted EBITDA Margin | 8.9% | 12.7% | 9.3% | 9.1% | 12.3% | | Adjusted Net Income | $11,561 | $37,332 | $17,327 | $28,888 | $74,560 | | Adjusted Diluted EPS | $0.30 | $0.98 | $0.45 | $0.75 | $1.95 | Supplemental Segment Operating Data This section provides supplemental operating data for each business segment, including average travelers, fill days, revenue per fill day, and leverage ratio | Business Segment | Q2 2025 | Q2 2024 | Q1 2025 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Nurse and Allied Solutions Revenue (Thousands USD) | $381,871 | $442,399 | $413,261 | $795,132 | $961,696 | | Physician and Leadership Solutions Revenue (Thousands USD) | $174,531 | $186,065 | $174,065 | $348,596 | $374,862 | | Technology and Workforce Solutions Revenue (Thousands USD) | $101,773 | $112,221 | $102,207 | $203,980 | $225,005 | | Average Travelers on Assignment | 8,700 | 10,302 | 8,981 | 8,841 | 10,913 | | Fill Days | 51,325 | 56,244 | 51,342 | 102,667 | 113,093 | | Revenue per Fill Day | $2,777 | $2,538 | $2,743 | $2,760 | $2,546 | | Metric | June 30, 2025 | December 31, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Leverage Ratio | 3.3 | 3.0 | 2.6 | Reconciliation of Guidance Operating Margin to Guidance Adjusted EBITDA Margin This section reconciles Q3 2025 guidance for operating margin to adjusted EBITDA margin, detailing adjustments for depreciation, amortization, and other costs | Metric | September 30, 2025 (Low) | September 30, 2025 (High) | | :--- | :--- | :--- | | Operating Margin | 6.0% | 6.5% | | Depreciation and Amortization (Total) | 6.6% | 6.5% | | EBITDA Margin | 12.6% | 13.0% | | Smart Square Divestiture Gain | (6.5%) | (6.4%) | | Stock-Based Compensation Expense | 1.2% | 1.2% | | Integration and Other Costs | 0.4% | 0.4% | | Adjusted EBITDA Margin | 7.7% | 8.2% | Notes to Non-GAAP Measures This section provides detailed notes on non-GAAP measures, explaining definitions, calculation methods, management's rationale for exclusions, and their limitations - Operating margin is defined as operating income (loss) divided by revenue43 - Adjusted EBITDA excludes non-operating items such as depreciation, amortization, goodwill impairment, stock-based compensation, and M&A integration costs43 - Adjusted Net Income and Adjusted Diluted EPS exclude intangible asset amortization, M&A integration costs, goodwill impairment, and tax impacts43 - These non-GAAP metrics aim to provide a more consistent basis for period-over-period comparisons but involve management judgment and should not replace GAAP measures44