AMN Healthcare (AMN) Q2 Earnings Beat Estimates, Margins Down

Core Viewpoint - AMN Healthcare Services, Inc. reported a significant decline in both adjusted earnings per share (EPS) and revenues for the second quarter of 2024, although adjusted EPS exceeded consensus estimates. The company anticipates continued revenue declines in the upcoming quarter, raising concerns about its financial performance and market position [1][2][7][9]. Revenue Performance - AMN Healthcare's revenues for Q2 2024 were $740.7 million, reflecting a 25.3% decrease year over year, but slightly above the Zacks Consensus Estimate by 0.3% [2]. - The Nurse and Allied Solutions segment generated revenues of $442.4 million, down 35.8% year over year, with travel nurse staffing revenues declining by 42% [3]. - The Physician and Leadership Solutions segment saw revenues of $186.1 million, an increase of 5.6% year over year, driven by a 17% rise in locum tenens revenues [4]. - The Technology and Workforce Solutions segment reported revenues of $112.2 million, down 10.9% year over year, with language interpretation services growing by 18% [4]. Margin Analysis - Gross profit for AMN Healthcare fell by 30.4% to $229.8 million, with gross margin contracting by 229 basis points to 31% [5]. - Adjusted operating profit decreased by 37.1% to $80.8 million, and the adjusted operating margin contracted by 206 basis points to 10.9% [5]. Financial Position - At the end of Q2 2024, AMN Healthcare had cash and cash equivalents of $48 million, down from $50.6 million at the end of Q1 2024. Total debt decreased to $1.195 billion from $1.275 billion [6]. - Cumulative net cash provided by operating activities was $99.5 million, a decline from $197.7 million a year ago [6]. Guidance - For Q3 2024, AMN Healthcare expects revenues to be in the range of $660 million to $680 million, indicating a decline of 20-23% compared to the previous year [7]. - The company anticipates a 32-34% decline in revenues for the Nurse and Allied Solutions segment and a 10-12% decline for the Technology and Workforce Solutions segment, while projecting a 12-14% increase for the Physician and Leadership Solutions segment [8]. Market Outlook - Despite disappointing overall performance, there are positive signs in the Physician and Leadership Solutions segment and improvements in the travel nurse market, which may provide some optimism for future growth [9].