AMN Healthcare Services’ second quarter results received a positive market reaction, supported by performance that exceeded Wall Street’s revenue and non-GAAP profit expectations. Management attributed the quarter’s outcome to a combination of persistent softness in healthcare staffing orders, especially among academic medical centers, and ongoing cost control initiatives. CEO Cary Grace noted, “Uncertainty about government policy impact placed the healthcare sector in a more cautious stance... directly impacting our industry.” Notably, stabilization in gross margins and operational improvements helped counterbalance lower sales volumes and sector-wide demand challenges.
Is now the time to buy AMN? Find out in our full research report (it’s free).
AMN Healthcare Services (AMN) Q2 CY2025 Highlights:
- Revenue: $658.2 million vs analyst estimates of $652.8 million (11.1% year-on-year decline, 0.8% beat)
- Adjusted EPS: $0.30 vs analyst estimates of $0.19 (60.9% beat)
- Adjusted EBITDA: $58.29 million vs analyst estimates of $52.14 million (8.9% margin, 11.8% beat)
- Revenue Guidance for Q3 CY2025 is $617.5 million at the midpoint, below analyst estimates of $641.5 million
- Operating Margin: -18.8%, down from 5.1% in the same quarter last year
- Sales Volumes fell 15.6% year on year (-24.2% in the same quarter last year)
- Market Capitalization: $714.4 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From AMN Healthcare Services’s Q2 Earnings Call
- John Trevor Romeo (William Blair) asked about trends in client demand for contingent labor. CEO Cary Grace explained that while uncertainty delayed decisions in Q2, stabilization and modest improvements were seen in July, especially in Allied and locum tenens segments.
- Kevin Mark Fischbeck (Bank of America) questioned when volumes might bottom and return to growth. CFO Brian Scott said declines were concentrated among a small set of academic clients and that stabilization was emerging, but recovery would likely become visible in Q4 or later.
- Albert J. William Rice (UBS) probed supply and demand dynamics for nurse and allied assignments. Grace clarified that supply remains healthy and the main challenge is finding attractive packages for clinicians, not a shortage of applicants.
- Tobey O'Brien Sommer (Truist) inquired about SG&A trends amid lower revenue and margin guidance. Scott described ongoing cost control, with automation and the Smart Square sale helping to lower SG&A, while some unique items affected Q2 expenses.
- Jack Slevin (Jefferies) asked about winning market share as competitors struggle. Grace highlighted a focus on expanding strategic client relationships, leveraging operational advantages, and benefiting from industry consolidation.
Catalysts in Upcoming Quarters
In the coming quarters, StockStory analysts will be monitoring (1) the pace of recovery in staffing volumes, especially among academic medical centers and international nurse placements, (2) stabilization or improvement in extension rates and new order activity for nurse and allied staffing, and (3) the impact of technology investments like Passport and AI automation on operational efficiency and fill rates. Execution on pipeline opportunities and further industry consolidation will also be critical signposts.
AMN Healthcare Services currently trades at $18.64, up from $16.89 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free).
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