AMN HEALTHCARE SERVICES INC
For the period ended Jun 30, 2025. Filed Aug 8, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 8, 2025
AMN$36.19-23.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-09.
0001142750-25-000034
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-08.
0001142750-25-000052
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 91 previous paragraphs and 113 current paragraphs.
58 unchanged; 26 reworded; 19 added; 6 removed; 1 previous and 10 current paragraphs rearranged.
Tables are not compared: 6 previous and 10 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (19)
Current report
On July 1, 2025, we completed the sale of our Smart Square healthcare scheduling software, one of our workforce optimization service offerings. See additional information in Note (2), “Held For Sale” to the accompanying financial statements.
Current report
After the COVID-19 pandemic subsided, healthcare organizations began focusing on hiring permanent staff, implementing cost management strategies, and exploring alternative staffing models to decrease reliance on contingent labor. Through the second quarter, uncertainty about government policy impacts appeared to place the healthcare sector in a more conservative stance compared with the first quarter. In our travel nurse business, demand decreased in the second quarter compared to the first quarter due to regular seasonal fluctuations and lower overall market demand. Open orders declined through the second quarter, ultimately dropping below the previous year, with demand remaining below pre-pandemic levels. In allied staffing, our average number of open orders continued to surpass pre-pandemic levels and remained higher year over year, although the gap to prior year narrowed throughout the quarter.
Current report
In our technology and workforce solutions segment, growth in the language services business has slowed due to reduced minute growth and lower pricing compared to both the previous year and quarter. Ongoing pricing pressure for language services is a result of increased market competition. Volumes in our VMS business declined both sequentially and compared to prior year on lower staffing volume levels and the delayed impact from prior year client losses. VMS bill rates in the second quarter decreased both sequentially and on a year-over-year basis.
Current report
Nurse and allied solutions segment revenue decreased 14% to $381.9 million for the three months ended June 30, 2025 from $442.4 million for the same period in 2024. The $60.5 million decrease was primarily attributable to a $67.9 million decline driven by a 16% decrease in the average number of travelers on assignment, a $7.9 million decline driven by a 2% decrease in the average bill rate, and a $4.1 million decline driven by a 1% decrease in average billable hours. The overall decrease was partially offset by a $15.0 million increase in labor disruption revenue.
Current report
Goodwill Impairment Loss. A goodwill impairment loss of $109.5 million was recognized in the physician and leadership solutions segment during the three months ended June 30, 2025. See additional information in Note (6), “Goodwill and Identifiable Intangible Assets” to the accompanying financial statements.
Current report
Long-Lived Assets Impairment Loss. An impairment loss of $18.3 million was recognized for intangible assets during the three months ended June 30, 2025. See additional information in Note (6), “Goodwill and Identifiable Intangible Assets” to the accompanying financial statements.
Current report
Physician and leadership solutions segment revenue decreased 7% to $348.6 million for the six months ended June 30, 2025 from $374.9 million for the same period in 2024. The $26.3 million decrease was attributable to lower revenue across all businesses within the segment. Revenue in our locum tenens business declined $4.6 million (or 2%) due to a $26.5 million decline driven by a 9% decrease in the number of days filled, partially offset by a $22.0 million increase driven by an 8% increase in the revenue per day filled. Our interim leadership business experienced a decline of $14.0 million (or 23%) and our physician permanent placement and executive search businesses declined $7.7 million (or 29%) during the six months ended June 30, 2025, primarily due to lower demand.
Current report
Cost of Revenue. Cost of revenue decreased 11% to $953.2 million for the six months ended June 30, 2025 from $1,074.2 million for the same period in 2024. The $121.0 million decrease was primarily attributable to a decrease in our nurse and allied solutions segment. Cost of revenue broken down among the reportable segments is as follows:
Current report
Selling, General and Administrative Expenses. SG&A expenses were $302.3 million, representing 22.4% of revenue, for the six months ended June 30, 2025, as compared to $323.9 million, representing 20.7% of revenue, for the same period in 2024. The decrease in SG&A expenses was primarily due to $24.8 million of lower employee compensation and benefits (inclusive of share-based compensation) in response to the lower revenue. The year-over-year decrease was partially offset by a $9.0 million year-over-year increase due to a $5.4 million unfavorable actuarial-based increase in our professional liability reserves as compared to a $3.6 million favorable actuarial-based decrease in the same period in 2024. SG&A expenses broken down among the reportable segments, unallocated corporate overhead, and share-based compensation are as follows:
Current report
Goodwill Impairment Loss. A goodwill impairment loss of $109.5 million was recognized in the physician and leadership solutions segment during the six months ended June 30, 2025.
Current report
Long-Lived Assets Impairment Loss. An impairment loss of $18.3 million was recognized for intangible assets during the six months ended June 30, 2025.
Current report
Income Tax Expense (Benefit). Income tax expense (benefit) was $(17.6) million for the six months ended June 30, 2025 as compared to $11.7 million for the same period in 2024, reflecting effective income tax rates of 13% and 26% for the six months ended June 30, 2025 and 2024, respectively. The decrease in the effective income tax rate was primarily attributable to a significant decline in income (loss) before income taxes year over year, mostly related to a goodwill impairment loss.
Current report
Recognition of the impairment loss resulted in a $10.3 million tax expense which, due to the loss before income taxes, contributed to the year-over-year decline in the effective income tax rate.
Current report
Net cash provided by operating activities for the six months ended June 30, 2025 was $171.2 million, compared to $180.9 million for the same period in 2024. The year-over-year decrease was primarily driven by an increase in accounts receivable and subcontractor receivables between periods of $87.1 million, reflecting a smaller reduction in receivables as compared to the prior year. The reduction in receivables was more significant in the prior year due to larger declines in revenue and associate vendor usage, as well as the timing of collections. In addition, net income (loss) excluding non-cash items decreased year over year by $58.8 million primarily due to lower segment operating income across our business.
Current report
The overall decrease in net cash provided by operating activities was partially offset by increases in other liabilities and deferred revenue between periods of $65.1 million and $6.8 million, respectively, primarily related to receipts of client deposits and upfront consideration for labor disruption services. Additionally, accounts payable and accrued expenses increased between periods by $53.1 million primarily due to a smaller reduction in subcontractor payables in the current year as a result of a larger decline in associate vendor usage in the prior year and timing of payments.
Current report
Our Days Sales Outstanding (“DSO”) was 54 days as of June 30, 2025, 55 days as of December 31, 2024, and 63 days as of June 30, 2024.
Current report
•the decline in the size of the uninsured population as a result of enactment of the Patient Protection and Affordable Care Act;
Current report
•widespread use of AI;
Current report
•variable rate indebtedness; and
Removed paragraphs (6)
Previous report
Following the subsidence of the COVID-19 pandemic, healthcare organizations have prioritized hiring permanent staff and implementing cost containment measures, along with alternative staffing models to reduce utilization of contingent labor. As a result, demand in our travel nurse business has declined significantly and remains below pre-pandemic levels. During the first quarter, we saw a seasonal decrease in demand compared to the fourth quarter of last year as measured by open orders, which was generally in line with pre-pandemic normal seasonal trends. In addition, we have seen an increase in travel nurse open orders on a year-over-year basis, suggesting continued normalization in the industry. In our allied staffing business, demand continues to exceed pre-pandemic levels. In the first quarter, we saw an increase in demand compared to the previous quarter, with a significant increase year-over-year primarily driven by high demand in therapy and imaging specialties.
Previous report
In our technology and workforce solutions segment, minutes in our language services business in the first quarter grew from the prior year and was consistent with the prior quarter. Volumes in our VMS business followed similar trends in our travel nurse business as compared to the prior year, with the sequential decline higher than travel nurse due to winter order seasonality in the travel nurse business. VMS bill rates in the first quarter decreased both sequentially and year-over-year.
Previous report
Net cash provided by operating activities for the three months ended March 31, 2025 was $92.7 million, compared to $81.4 million for the same period in 2024. The increase in net cash provided by operating activities was primarily attributable to (1) an increase in accounts payable and accrued expenses between periods of $42.5 million primarily due to an increase in the subcontractor payable balance in the current year as compared to a decrease in the prior year primarily attributable to a decline in associate vendor usage and timing of payments, and (2) an increase in other liabilities between periods of $41.7 million primarily due to client deposits received for labor disruption services in the current year. The overall increase in net cash provided by operating activities was partially offset by (1) a decrease in net income excluding non-cash expenses of $16.1 million primarily due to a decline in segment operating income across our segments, (2) an increase in accounts receivable and subcontractor receivables between periods of $42.6 million primarily due to a larger decrease in the receivables balance in the prior year as compared to the current year, which was primarily attributable to larger decreases in revenue and associate vendor usage in the prior year, along with timing of collections, and (3) an increase in other current assets between periods of $11.0 million primarily due to subcontractor deposits related to labor disruption services in the current year. Our Days Sales Outstanding (“DSO”) was 55 days at March 31, 2025, 55 days at December 31, 2024, and 64 days at March 31, 2024.
Previous report
•the duration and extent to which hospitals and other healthcare entities adjust their utilization of temporary nurses and allied healthcare professionals, physicians, healthcare leaders and other healthcare professionals and workforce technology applications as a result of the labor market or economic conditions;
Previous report
•the severity and duration of any future pandemic or health crisis, economic downturns, inflation, recession or slow recoveries have on the financial condition and cash flow of many hospitals and healthcare systems such that it impairs their ability to make payments to us, timely or otherwise, for services rendered;
Previous report
•the extent to which a resurgence in the COVID-19 pandemic or any future pandemic or health crisis may disrupt our operations due to the unavailability of our employees or healthcare professionals because of illness, risk of illness, quarantines, travel restrictions, mandatory vaccination requirements, desire to travel and work on temporary assignments or other factors that limit our existing or potential workforce and pool of candidates;
Reworded paragraphs (26)
Previous wording
We provide technology-enabled healthcare workforce solutions and staffing services to healthcare organizations across the nation. The Company provides access to a comprehensive network of healthcare professionals through its recruitment strategies and breadth of career opportunities. We help providers optimize their workforce to reduce complexity and increase efficiency. Our total talent solutions include vendor neutral and managed services programs, clinical and interim healthcare leaders, temporary staffing, permanent placement, executive search, vendor management systems, recruitment process outsourcing, predictive modeling, language services, revenue cycle solutions, and other services. Our diverse client base includes acute-care hospitals, community health centers and clinics, physician practice groups, retail and urgent care centers, home health facilities, schools, inpatient/outpatient rehabilitation facilities, ambulatory care facilities, outpatient surgical facilities, and many other healthcare settings.
Current wording
We provide technology-enabled healthcare workforce solutions and staffing services to healthcare organizations across the nation. The Company provides access to a comprehensive network of healthcare professionals through its recruitment strategies and breadth of career opportunities. We help providers optimize their workforce to reduce complexity and increase efficiency. Our total talent solutions include vendor neutral and managed services programs, clinical and interim healthcare leaders, temporary staffing, permanent placement, executive search, vendor management systems, recruitment process outsourcing, workforce optimization, language services, revenue cycle solutions, and other services. Our diverse client base includes acute-care hospitals, community health centers and clinics, physician practice groups, retail and urgent care centers, home health facilities, schools, inpatient/outpatient rehabilitation facilities, ambulatory care facilities, outpatient surgical facilities, and many other healthcare settings.
Previous wording
We conduct business through three reportable segments: (1) nurse and allied solutions, (2) physician and leadership solutions, and (3) technology and workforce solutions. For the three months ended March 31, 2025, we recorded revenue of $689.5 million, as compared to $820.9 million for the same period last year.
Current wording
We conduct business through three reportable segments: (1) nurse and allied solutions, (2) physician and leadership solutions, and (3) technology and workforce solutions. For the three months ended June 30, 2025, we recorded revenue of$658.2 million, as compared to $740.7 millionfor the same period last year. For the six months ended June 30, 2025, we recorded revenue of$1,347.7 million, as compared to$1,561.6 million for the same period last year.
Previous wording
Nurse and allied solutions segment revenue comprised 60% and 63% of total consolidated revenue for the three months ended March 31, 2025 and 2024, respectively. Through our nurse and allied solutions segment, we provide hospitals, other healthcare facilities, and schools with a comprehensive set of staffing solutions, including direct, vendor neutral, and managed services solutions in which we manage and staff all the temporary and permanent nursing and allied staffing needs, as well as the revenue cycle management needs, of a client. A majority of our placements in this segment are under our managed services solution.
Current wording
Nurse and allied solutions segment revenue comprised 59% and 62% of total consolidated revenue for the six months ended June 30, 2025 and 2024, respectively. Through our nurse and allied solutions segment, we provide hospitals, other healthcare facilities, and schools with a comprehensive set of staffing solutions, including direct, vendor neutral, and managed services solutions in which we manage and staff all the temporary and permanent nursing and allied staffing needs, as well as the revenue cycle management needs, of a client. A majority of our placements in this segment are under our managed services solution.
Previous wording
Physician and leadership solutions segment revenue comprised 25% and 23% of total consolidated revenue for the three months ended March 31, 2025 and 2024, respectively. Through our physician and leadership solutions segment, we place physicians of all specialties, as well as dentists and advanced practice providers, with clients on a temporary basis, generally as independent contractors. We also recruit physicians and healthcare leaders for permanent placement and place interim leaders and executives across all healthcare settings. The interim healthcare leaders and executives we place are typically placed on contracts with assignment lengths ranging from a few days to one year.
Current wording
Physician and leadership solutions segment revenue comprised 26% and 24% of total consolidated revenue for the six months ended June 30, 2025 and 2024, respectively. Through our physician and leadership solutions segment, we place physicians of all specialties, as well as dentists and advanced practice providers, with clients on a temporary basis, generally as independent contractors. We also recruit physicians and healthcare leaders for permanent placement and place interim leaders and executives on variable-length assignments across all healthcare settings.
Previous wording
Technology and workforce solutions segment revenue comprised 15% and 14% of total consolidated revenue for the three months ended March 31, 2025 and 2024, respectively. Through our technology and workforce solutions segment, we provide hospitals and other healthcare facilities with a range of workforce solutions, including: (1) language services, (2) software-as-a-service (“SaaS”)-based VMS technologies through which our clients can self-manage the procurement of contingent clinical labor and their internal float pool, (3) workforce optimization services that include consulting, data analytics, predictive modeling, and SaaS-based scheduling technology, and (4) recruitment process outsourcing services in which we recruit, hire and/or onboard permanent clinical and nonclinical positions on behalf of our clients.
Current wording
Technology and workforce solutions segment revenue comprised 15% and 14% of total consolidated revenue for the six months ended June 30, 2025 and 2024, respectively. Through our technology and workforce solutions segment, we provide hospitals and other healthcare facilities with a range of workforce solutions, including: (1) language services, (2) software-as-a-service (“SaaS”)-based VMS technologies through which our clients can self-manage the procurement of contingent clinical labor and their internal float pool, (3) workforce optimization services that include advisory, planning, and analytics, and (4) recruitment process outsourcing services in which we recruit, hire and/or onboard permanent clinical and nonclinical positions on behalf of our clients.
Previous wording
For our nurse and allied solutions segment, in the first quarter we saw a slight decrease in overall staffing volume from the prior quarter, largely due to visa retrogression affecting international nurse staffing. Compared to the prior year, the average number of travelers on assignment in the first quarter decreased due to the lower demand environment leading into the quarter. Bill rates in the first quarter increased slightly from the prior quarter, stabilizing over the past several quarters.
Current wording
For our nurse and allied solutions segment, in the second quarter we saw a decrease in overall staffing volume from the prior quarter, largely due to visa retrogression affecting international nurse staffing, along with lower demand in travel nurse staffing and seasonality. Compared to the prior year, the average number of travelers on assignment in the second quarter decreased due to visa retrogression and lower booking volume as a result of lower, hard-to-fill, bill rates and a highly competitive market. Bill rates in the second quarter were relatively flat to the prior quarter.
Previous wording
In our physician and leadership solutions segment, demand for our locum tenens staffing business in the first quarter declined compared to both the prior year and prior quarter. Certified registered nurse anesthetists (CRNAs) remain the largest specialty within our locum tenens staffing business. Revenue per day filled increased in the first quarter relative to both the prior year and prior quarter. In the first quarter, demand for our interim leadership and search businesses was lower than the previous year, impacted by healthcare organizations deferring hiring decisions or increasing insourcing.
Current wording
In our physician and leadership solutions segment, second quarter demand for locum tenens staffing was slightly lower year over year but steady compared to the previous quarter. However, revenue per day filled rose relative to both the prior year and prior quarter. Certified registered nurse anesthetics (CRNAs) remain our largest locum tenens specialty. Demand for interim leadership and search services declined from last year and last quarter, due mainly to healthcare organizations delaying hiring, consolidating roles or increasing insourcing.
Previous wording
The preparation of our consolidated financial statements in conformity with United States generally accepted accounting principles (“U.S. GAAP”) requires us to make estimates and judgments that affect our reported amounts of assets and liabilities, revenue and expenses, and related disclosures of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to intangible assets purchased in a business combination, asset impairments, accruals for self-insurance, compensation and related benefits, accounts receivable, contingencies and litigation, contingent consideration (“earn-out”) liabilities associated with acquisitions, and income taxes. We base these estimates on the information that is currently available to us and on various other assumptions that we believe are reasonable under the circumstances. Actual results could vary from these estimates under different assumptions or conditions. If these estimates differ significantly from actual results, our consolidated financial statements and future results of operations may be materially impacted. There have been no material changes in our critical accounting policies and estimates, other than the adoption of the Accounting Standard Update (“ASU”) described in the accompanying Note (1), “Basis of Presentation,” as compared to the critical accounting policies and estimates described in our 2024 Annual Report.
Current wording
The preparation of our consolidated financial statements in conformity with United States generally accepted accounting principles (“U.S. GAAP”) requires us to make estimates and judgments that affect our reported amounts of assets and liabilities, revenue and expenses, and related disclosures of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to intangible assets purchased in a business combination, asset impairments, accruals for self-insurance, compensation and related benefits, accounts receivable, contingencies and litigation, contingent consideration (“earn-out”) liabilities associated with acquisitions, and income taxes. We base these estimates on the information that is currently available to us and on various other assumptions that we believe are reasonable under the circumstances. Actual results could vary from these estimates under different assumptions or conditions. If these estimates differ significantly from actual results, our consolidated financial statements and future results of operations may be materially impacted. There have been no material changes in our critical accounting policies and estimates as compared to the critical accounting policies and estimates described in our 2024 Annual Report.
Previous wording
Revenue. Revenue decreased 16% to $689.5 million for the three months ended March 31, 2025 from $820.9 million for the same period in 2024, attributable to a decline in organic revenue across our segments with the greatest decline in our nurse and allied solutions segment. Revenue broken down among the reportable segments is as follows:
Current wording
Revenue. Revenue decreased 11% to $658.2 million for the three months ended June 30, 2025 from $740.7 million for the same period in 2024, attributable to a decline in revenue across our segments with the greatest decline in our nurse and allied solutions segment. Revenue broken down among the reportable segments is as follows:
Previous wording
Physician and leadership solutions segment revenue decreased 8% to $174.1 million for the three months ended March 31, 2025 from $188.8 million for the same period in 2024. The $14.7 million decrease was attributable to declines in revenue of our businesses across the segment. Revenue in our locum tenens business declined $4.4 million (or 3%) during the three months ended March 31, 2025 primarily due to a $14.1 million decline driven by a 10% decrease in the number of days filled, partially offset by a $9.7 million increase driven by a 7% increase in the revenue per day filled. Our interim leadership business experienced a decline of $6.5 million (or 21%) and our physician permanent placement and executive search businesses declined $3.9 million (or 29%) during the three months ended March 31, 2025, primarily due to lower demand.
Current wording
Physician and leadership solutions segment revenue decreased 6% to $174.5 million for the three months ended June 30, 2025 from $186.1 million for the same period in 2024. The $11.6 million decrease was attributable to lower revenue across all businesses within the segment. Revenue in our locum tenens business declined slightly due to a $12.5 million decline driven by a 9% decrease in the number of days filled, partially offset by a $12.3 million increase driven by a 9% increase in the revenue per day filled. Our interim leadership business experienced a decline of $7.5 million (or 25%) and our physician permanent placement and executive search businesses declined $3.8 million (or 29%) during the three months ended June 30, 2025, primarily due to lower demand.
Previous wording
For the three months ended March 31, 2025 and 2024, revenue under our MSP arrangements comprised approximately 44% and 48% of our consolidated revenue, 65% and 70% of our nurse and allied solutions segment revenue, 18% and 13% of our physician and leadership solutions segment revenue, and 3% and 3% of our technology and workforce solutions segment revenue, respectively.
Current wording
For the three months ended June 30, 2025 and 2024, revenue under our MSP arrangements comprised approximately 44% and 45% of consolidated revenue, 68% and 69% of nurse and allied solutions segment revenue, 17% and 14% of physician and leadership solutions segment revenue, and 3% and 3% of technology and workforce solutions segment revenue, respectively.
Previous wording
Cost of Revenue. Cost of revenue, which consists predominantly of compensation, benefits, housing, travel and allowance costs for healthcare professionals and medically qualified interpreters, decreased 13% to $491.4 million for the three months ended March 31, 2025 from $563.4 million for the same period in 2024. The $72.0 million decrease was mainly attributable to decreases in our nurse and allied solutions and physician and leadership solutions segments. The decrease in our nurse and allied solutions segment was primarily attributable to a $67.2 million decrease in clinician pay package costs, including housing, travel and allowances, primarily due to the aforementioned decrease in the average number of travelers on assignment. The decrease in our physician and leadership solutions segment was driven by a $2.6 million decrease in clinician pay package costs, primarily due to declines in demand. The increase in our technology and workforce solutions segment was primarily attributable to $0.3 million of higher compensation and benefits primarily due to the aforementioned increase in minutes in our language services business. Cost of revenue broken down among the reportable segments is as follows:
Current wording
Cost of Revenue. Cost of revenue, which consists predominantly of compensation, benefits, housing, travel and allowance costs for healthcare professionals and medically qualified interpreters, decreased 10% to $461.8 million for the three months ended June 30, 2025 from $510.9 million for the same period in 2024. The $49.1 million decrease was mainly attributable to decreases in our nurse and allied solutions and physician and leadership solutions segments. Cost of revenue broken down among the reportable segments is as follows:
Previous wording
Selling, General and Administrative Expenses. Selling, general and administrative (“SG&A”) expenses consist predominantly of compensation and benefits costs for corporate employees, in addition to professional service fees, legal matter accruals and other overhead costs. SG&A expenses were $147.7 million, representing 21.4% of revenue, for the three months ended March 31, 2025, as compared to $174.8 million, representing 21.3% of revenue, for the same period in 2024. The decrease in SG&A expenses was primarily due to a $20.4 million decrease in employee compensation and benefits (inclusive of share-based compensation) in response to the lower revenue, a $2.9 million decrease in the provision for expected credit losses, and a $2.5 million decrease in other expenses associated with our revenue decline. SG&A expenses broken down among the reportable segments, unallocated corporate overhead, and share-based compensation are as follows:
Current wording
Selling, General and Administrative Expenses. Selling, general and administrative (“SG&A”) expenses consist predominantly of compensation and benefits costs for corporate employees, in addition to professional service fees, legal matter accruals and other overhead costs. SG&A expenses were $154.6 million, representing 23.5% of revenue, for the three months ended June 30, 2025, as compared to $149.0 million, representing 20.1% of revenue, for the same period in 2024. The increase in SG&A expenses was primarily due to a $9.0 million increase related to a $5.4 million unfavorable actuarial-based increase in our professional liability reserves during the three months ended June 30, 2025, as compared to a $3.6 million favorable actuarial-based decrease during the same period in 2024. The year-over-year increase in SG&A expenses was partially offset by a $4.5 million decrease in employee compensation and benefits (inclusive of share-based compensation) in response to the lower revenue. SG&A expenses broken down among the reportable segments, unallocated corporate overhead, and share-based compensation are as follows:
Previous wording
Depreciation and Amortization Expenses. Amortization expense decreased 22% to $19.4 million for the three months ended March 31, 2025 from $24.9 million for the same period in 2024, primarily attributable to having more intangible assets fully amortized during the three months ended March 31, 2025. Depreciation expense (exclusive of depreciation included in cost of revenue) increased 3% to $18.5 million for the three months ended March 31, 2025 from $17.8 million for the same period in 2024, primarily attributable to an increase in purchased and developed hardware and software placed in service for our ongoing technology investments to support our tech-centric total talent solutions initiatives and to optimize our internal front and back-office systems. Additionally, $2.0 million and $1.8 million of depreciation expense for our language services business is included in cost of revenue for the three months ended March 31, 2025 and 2024, respectively.
Current wording
Depreciation and Amortization Expenses. Amortization expense decreased 21% to $19.6 million for the three months ended June 30, 2025 from $24.7 million for the same period in 2024, primarily attributable to certain intangible assets becoming fully amortized during the three months ended June 30, 2025. Depreciation expense (exclusive of depreciation included in cost of revenue) decreased 1% to $18.1 million for the three months ended June 30, 2025 from $18.4 million for the same period in 2024, primarily attributable to the mix of depreciable assets. Additionally, $2.1 million and $1.6 million of depreciation expense for our language services business is included in cost of revenue for the three months ended June 30, 2025 and 2024, respectively.
Previous wording
Interest Expense, Net, and Other. Interest expense, net, and other was $12.3 million during the three months ended March 31, 2025 as compared to $16.6 million for the same period in 2024. The decrease was primarily due to a lower average debt outstanding balance during the three months ended March 31, 2025.
Current wording
Interest Expense, Net, and Other. Interest expense, net, and other was $11.4 million during the three months ended June 30, 2025 as compared to $15.7 million for the same period in 2024. The decrease was primarily due to a lower average debt outstanding balance during the three months ended June 30, 2025.
Previous wording
Income Tax Expense. Income tax expense was $1.3 million for the three months ended March 31, 2025 as compared to $6.0 million for the same period in 2024, reflecting effective income tax rates of 697% and 26% for these periods, respectively. The increase in the effective income tax rate was primarily attributable to the recognition of $1.3 million of net discrete tax expense during the three months ended March 31, 2025 compared to $2.4 million of net discrete tax benefit during the same period in 2024, in relation to income before income taxes of $0.2 million and $23.3 million for the three months ended March 31, 2025 and 2024, respectively. We currently estimate our annual effective tax rate to be approximately (11)% for 2025. The 697% effective tax rate for the three months ended March 31, 2025 differs from our estimated annual effective tax rate of (11)% primarily due to certain discrete tax expenses recognized during the three months ended March 31, 2025, in relation to income before income taxes.
Current wording
Income Tax Expense (Benefit). Income tax expense (benefit) was $(18.9) million for the three months ended June 30, 2025 as compared to $5.7 million for the same period in 2024, reflecting effective income tax rates of 14% and 26% for these periods, respectively. The decrease in the effective income tax rate was primarily attributable to a significant decline in income (loss) before income taxes year over year, mostly related to a goodwill impairment loss. Recognition of the impairment loss resulted in a $10.3 million tax expense which, due to the loss before income taxes, contributed to the year-over-year decline in the effective income tax rate. We currently estimate our annual effective tax rate to be approximately 13% for 2025. The 14% effective tax rate for the three months ended June 30, 2025 differs from our estimated annual effective tax rate of 13% primarily due to certain discrete tax benefits recognized during the three months ended June 30, 2025, in relation to loss before income taxes.
Previous wording
Nurse and allied solutions segment revenue decreased 20% to $413.3 million for the three months ended March 31, 2025 from $519.3 million for the same period in 2024. The $106.0 million decrease was primarily attributable to a $111.7 million decline driven by a 22% decrease in the average number of travelers on assignment, a $24.3 million decline driven by an approximately 5% decrease in the average bill rate, and a $5.7 million decline driven by a 1% decrease in average billable hours. The overall decrease was partially offset by a $39.0 million increase in labor disruption revenue.
Current wording
Nurse and allied solutions segment revenue decreased 17% to $795.1 million for the six months ended June 30, 2025 from $961.7 million for the same period in 2024. The $166.6 million decrease was primarily attributable to a $179.5 million decline driven by a 19% decrease in the average number of travelers on assignment, a $32.3 million decline driven by an approximately 3% decrease in the average bill rate, and a $9.8 million decline driven by a 1% decrease in average billable hours. The overall decrease was partially offset by a $54.0 million increase in labor disruption revenue.
Previous wording
Technology and workforce solutions segment revenue decreased 9% to $102.2 million for the three months ended March 31, 2025 from $112.8 million for the same period in 2024. The $10.6 million decrease was primarily attributable to a decline within our VMS and outsourced solutions businesses, partially offset by growth within our language services business. Revenue for our VMS business declined $9.7 million (or 33%) for similar reasons as nurse and allied solutions segment revenue and our outsourced solutions business experienced a decline of $3.5 million (or 54%) primarily due to lower demand, while our language services business grew $3.5 million (or 5%) primarily due to an 8% increase in minutes during the three months ended March 31, 2025.
Current wording
Technology and workforce solutions segment revenue decreased 9% to $204.0 million for the six months ended June 30, 2025 from $225.0 million for the same period in 2024. The $21.0 million decrease was primarily attributable to declines within our VMS and outsourced solutions businesses, partially offset by growth within our language services business. Revenue for our VMS business declined $18.2 million (or 32%) for similar reasons as nurse and allied solutions segment revenue and our outsourced solutions business experienced a decline of $5.4 million (or 51%) primarily due to lower demand, while our language services business grew $3.9 million (or 3%) primarily due to growth of $10.4 million as a result of a 7% increase in minutes.
Previous wording
Gross Profit. Gross profit decreased 23% to $198.1 million for the three months ended March 31, 2025 from $257.5 million for the same period in 2024, representing gross margins of 28.7% and 31.4%, respectively. The decline in consolidated gross margin for the three months ended March 31, 2025, as compared to the same period in 2024, was primarily due to (1) lower margins in our nurse and allied solutions and physician and leadership solutions segments driven by increased provider pay packages, including housing, travel and allowances and (2) a lower margin in our technology and workforce solutions segment primarily due to a shift in sales mix resulting from reduced revenue in our higher-margin VMS business and increased revenue in our lower-margin language services business. The overall decline in consolidated gross margin was partially offset by a change in sales mix resulting from reduced revenue in our lower-margin nurse and allied solutions segment. Gross margin by reportable segment for the three months ended March 31, 2025 and 2024 was 22.7% and 25.1% for nurse and allied solutions, 27.3% and 31.6% for physician and leadership solutions, and 55.5% and 59.9% for technology and workforce solutions, respectively. Gross profit broken down among the reportable segments is as follows:
Current wording
Gross Profit. Gross profit decreased 19% to $394.5 million for the six months ended June 30, 2025 from $487.3 million for the same period in 2024, representing gross margins of 29.3% and 31.2%, respectively. The decline in consolidated gross margin for the six months ended June 30, 2025, as compared to the same period in 2024, was primarily due to (1) lower margins in our nurse and allied solutions and physician and leadership solutions segments driven by compression in clinician pay packages, including housing and travel and (2) a lower margin in our technology and workforce solutions segment primarily due to a change in sales mix resulting from lower revenue in our higher-margin VMS business. The overall decline was partially offset by a change in sales mix resulting from reduced revenue in our lower-margin nurse and allied solutions segment. Gross margin by reportable segment for the six months ended June 30, 2025 and 2024 was 23.3% and 24.5% for nurse and allied solutions, 27.7% and 31.0% for physician and leadership solutions, and 55.3% and 60.0% for technology and workforce solutions, respectively. Gross profit broken down among the reportable segments is as follows:
Previous wording
As of March 31, 2025, (1) $150.0 million was drawn with $579.6 million of available credit under our $750.0 million secured revolving credit facility (the “Senior Credit Facility”), (2) the aggregate principal amount of our 4.625% senior notes due 2027 (the “2027 Notes”) outstanding was $500.0 million, and (3) the aggregate principal amount of our 4.000% senior notes due 2029 (the “2029 Notes”) outstanding was $350.0 million. We describe in further detail our Amended Credit Agreement (as defined below), under which the Senior Credit Facility is governed, the 2027 Notes, and the 2029 Notes in Part
Current wording
As of June 30, 2025, (1) $70.0 million was drawn with $659.6 million of available credit under our $750.0 million secured revolving credit facility (the “Senior Credit Facility”), (2) the aggregate principal amount of our 4.625% senior notes due 2027 (the “2027 Notes”) outstanding was $500.0 million, and (3) the aggregate principal amount of our 4.000% senior notes due 2029 (the “2029 Notes”) outstanding was $350.0 million. We describe in further detail our Amended Credit Agreement (as defined below), under which the Senior Credit Facility is governed, the 2027 Notes, and the 2029 Notes in Part II, Item 8, “Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—Note (8), Notes Payable and Credit Agreement” of our 2024 Annual Report.
Previous wording
As of March 31, 2025, the total of our contractual obligations under operating leases with initial terms in excess of one year was $48.6 million. We describe in further detail our operating lease arrangements in Part II, Item 8, “Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—Note (5), Leases” of our 2024 Annual Report. We also have various obligations and working capital requirements, such as certain tax and legal matters, contingent consideration and other liabilities, that are recorded on our consolidated balance sheets. See additional information in the accompanying Note (6), “Fair Value Measurement,” Note (7), “Income Taxes,” Note (8), “Commitments and Contingencies,” and Note (9), “Balance Sheet Details.”
Current wording
As of June 30, 2025, the total of our contractual obligations under operating leases with initial terms in excess of one year was $46.4 million. We describe in further detail our operating lease arrangements in Part II, Item 8, “Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—Note (5), Leases” of our 2024 Annual Report. We also have various obligations and working capital requirements, such as certain tax and legal matters, contingent consideration and other liabilities, that are recorded on our consolidated balance sheets. See additional information in the accompanying Note (7), “Fair Value Measurement,” Note (8), “Income Taxes,” Note (9), “Commitments and Contingencies,” and Note (10), “Balance Sheet Details.”
Previous wording
Net cash used in investing activities for the three months ended March 31, 2025 was $26.0 million, compared to net cash used in investing activities of $21.4 million for the same period in 2024. The increase was primarily due to (1) a net purchase of investments of $14.5 million during the three months ended March 31, 2025, as compared to net proceeds of $1.2 million during the three months ended March 31, 2024, and (2) $1.6 million of payments to fund the deferred compensation plan during the three months ended March 31, 2025, as compared to $4.5 million of payments during the three months ended March 31, 2024. In addition, capital expenditures were $10.0 million and $18.1 million for the three months ended March 31, 2025 and 2024, respectively.
Current wording
Net cash used in investing activities for the six months ended June 30, 2025 was $46.6 million, compared to net cash used in investing activities of $43.7 million for the same period in 2024. The increase was primarily due to (1) a net purchase of investments of $26.9 million during the six months ended June 30, 2025, as compared to net proceeds of $4.5 million during the six months ended June 30, 2024, (2) capital expenditures of $19.8 million for the six months ended June 30, 2025, as compared to $45.4 million for the six months ended June 30, 2024, and (3) $3.3 million of payments to fund the deferred compensation plan that were offset with $3.3 million of proceeds from settlements of company-owned life insurance policies during the six months ended June 30, 2025, as compared to $4.5 million of payments during the six months ended June 30, 2024.
Previous wording
Net cash used in financing activities during the three months ended March 31, 2025 was $61.2 million, due to repayments of $95.0 million under the Senior Credit Facility and $1.2 million in cash paid for shares withheld for payroll taxes resulting from the vesting of employee equity awards, partially offset by borrowings of $35.0 million under the Senior Credit Facility. Net cash used in financing activities during the three months ended March 31, 2024 was $39.0 million, due to repayments of $50.0 million under the Senior Credit Facility and $4.0 million in cash paid for shares withheld for payroll taxes resulting from the vesting of employee equity awards, partially offset by borrowings of $15.0 million under the Senior Credit Facility.
Current wording
Net cash used in financing activities during the six months ended June 30, 2025 was $141.4 million, due to repayments of $185.0 million under the Senior Credit Facility and $1.4 million in cash paid for shares withheld for payroll taxes resulting from the vesting of employee equity awards, partially offset by borrowings of $45.0 million under the Senior Credit Facility. Net cash used in financing activities during the six months ended June 30, 2024 was $119.1 million, due to repayments of $140.0 million under the Senior Credit Facility and $4.1 million in cash paid for shares withheld for payroll taxes resulting from the vesting of employee equity awards, partially offset by borrowings of $25.0 million under the Senior Credit Facility.
Previous wording
•the ability of our clients to increase the efficiency and effectiveness of their staffing management and recruiting efforts, through predictive analytics, online recruiting, telemedicine or otherwise, and successfully hire and retain permanent staff, which may negatively affect our revenue, results of operations, and cash flows;
Current wording
•the ability of our clients to increase the efficiency and effectiveness of their staffing management and recruiting efforts, through predictive analytics, automation, machine learning, artificial intelligence (“AI”) or other advanced technologies or otherwise, and successfully hire and retain permanent staff, which may negatively affect our revenue, results of operations, and cash flows;
Previous wording
•the effects of economic downturns, inflation, recession or slow recoveries, which could result in less demand for our services, increased client initiatives designed to contain costs, including reevaluating their approach as it pertains to contingent labor and managed services programs;
Current wording
•the effects of economic downturns, inflation, recession or slow recoveries, or additional changes in or continued uncertainty with respect to governmental policies, which could result in less demand for our services, increased client initiatives designed to contain costs, including reevaluating their approach as it pertains to contingent labor and managed services programs;
Previous wording
•the terms of our debt instruments that impose restrictions on us that may affect our ability to successfully operate our business; and
Current wording
•the terms of our debt instruments that impose restrictions on us that may affect our ability to successfully operate our business;
Rearranged current paragraphs (10)
Current report — wording carried from elsewhere
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Current report — wording carried from elsewhere
Technology and workforce solutions segment revenue decreased 9% to $101.8 million for the three months ended June 30, 2025 from $112.2 million for the same period in 2024. The $10.4 million decrease was primarily attributable to declines within our VMS and outsourced solutions businesses. Revenue for our VMS business declined $8.6 million (or 31%) for similar reasons as nurse and allied solutions segment revenue, and our outsourced solutions business experienced a decline of $1.9 million (or 46%) primarily due to lower demand.
Current report — wording carried from elsewhere
The decrease in our nurse and allied solutions segment was primarily attributable to a $44.4 million decrease in clinician pay package costs, including housing, travel and allowances, primarily due to the aforementioned decrease in the average number of travelers on assignment. The decrease in our physician and leadership solutions segment was driven by a $5.3 million decrease in pay package costs in our interim leadership business, primarily due to the aforementioned decline in demand.
Current report — wording carried from elsewhere
Gross Profit. Gross profit decreased 15% to $196.4 million for the three months ended June 30, 2025 from $229.8 million for the same period in 2024, representing gross margins of 29.8% and 31.0%, respectively. The decline in consolidated gross margin for the three months ended June 30, 2025, as compared to the same period in 2024, was primarily due to (1) lower margins in our physician and leadership solutions segment driven by increased provider pay packages, including housing, travel and allowances and (2) a lower margin in our technology and workforce solutions segment primarily due to a shift in sales mix resulting from reduced revenue in our higher-margin VMS business. The overall decline in consolidated gross margin was partially offset by higher margin in our nurse and allied solutions segment driven by a revenue mix shift within the segment. Gross margin by reportable segment for the three months ended June 30, 2025 and 2024 was 23.9% and 23.8% for nurse and allied solutions, 28.2% and 30.5% for physician and leadership solutions, and 55.1% and 60.2% for technology and workforce solutions, respectively. Gross profit broken down among the reportable segments is as follows:
Current report — wording carried from elsewhere
Comparison of Results for the Six Months Ended June 30, 2025 to the Six Months Ended June 30, 2024
Current report — wording carried from elsewhere
Revenue. Revenue decreased 14% to $1,347.7 million for the six months ended June 30, 2025 from $1,561.6 million for the same period in 2024, attributable to a decline in revenue across our segments with the greatest decline in our nurse and allied solutions segment. Revenue broken down among the reportable segments is as follows:
Current report — wording carried from elsewhere
For the six months ended June 30, 2025 and 2024, revenue under our MSP arrangements comprised approximately 46% and 47% of consolidated revenue, 69% and 70% of nurse and allied solutions segment revenue, 18% and 13% of physician and leadership solutions segment revenue, and 4% and 3% of technology and workforce solutions segment revenue, respectively.
Current report — wording carried from elsewhere
The decrease in our nurse and allied solutions segment was primarily attributable to a $111.7 million decrease in clinician pay package costs, including housing, travel and allowances, primarily due to the aforementioned decrease in the average number of travelers on assignment. The decrease in our physician and leadership solutions segment was driven by a $9.8 million decrease in pay package costs in our interim leadership business, primarily due to the aforementioned decline in demand.
Current report — wording carried from elsewhere
Depreciation and Amortization Expenses. Amortization expense decreased 21% to $39.0 million for the six months ended June 30, 2025 from $49.6 million for the same period in 2024, primarily attributable to certain intangible assets becoming fully amortized during the six months ended June 30, 2025. Depreciation expense (exclusive of depreciation included in cost of revenue) increased 1% to $36.6 million for the six months ended June 30, 2025 from $36.2 million for the same period in 2024, primarily attributable to the mix of depreciable assets. Additionally, $4.1 million and $3.4 million of depreciation expense for our language services business is included in cost of revenue for the six months ended June 30, 2025 and 2024, respectively.
Current report — wording carried from elsewhere
Interest Expense, Net, and Other. Interest expense, net, and other was $23.7 million during the six months ended June 30, 2025 as compared to $32.3 million for the same period in 2024. The decrease was primarily due to a lower average debt outstanding balance during the six months ended June 30, 2025.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
II, Item 8, “Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—Note (8), Notes Payable and Credit Agreement” of our 2024 Annual Report.