AMN Healthcare Services’ first quarter results received a positive market reaction, driven by revenue and non-GAAP profit that surpassed Wall Street’s expectations. Management attributed this performance to stronger-than-anticipated contributions from labor disruption projects, the Locum Tenens segment, and ongoing demand in the Allied staffing business. CEO Cary Grace highlighted that “labor disruption has become a differentiated solution” and pointed to robust execution across several service lines as key to offsetting year-over-year volume declines. The company also reported progress in stabilizing gross margins through internal process improvements and new technology rollouts.
Is now the time to buy AMN? Find out in our full research report (it’s free).
AMN Healthcare Services (AMN) Q1 CY2025 Highlights:
- Revenue: $689.5 million vs analyst estimates of $670.1 million (16% year-on-year decline, 2.9% beat)
- Adjusted EPS: $0.45 vs analyst estimates of $0.21 (significant beat)
- Adjusted EBITDA: $64.2 million vs analyst estimates of $53.21 million (9.3% margin, 20.6% beat)
- Revenue Guidance for Q2 CY2025 is $652.5 million at the midpoint, roughly in line with what analysts were expecting
- Operating Margin: 1.8%, down from 4.9% in the same quarter last year
- Sales Volumes fell 22.1% year on year (-23.8% in the same quarter last year)
- Market Capitalization: $839.2 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 AMN Healthcare Services’s Q1 Earnings Call
- Mark Marcon (Baird) asked about the nature and potential size of recent VMS and MSP wins; CEO Cary Grace explained they were small to medium in size but represented strategic competitive victories with healthy pipeline growth.
- Trevor Romeo (William Blair) inquired about unfilled orders and whether low-margin assignments were being avoided; Grace and CFO Brian Scott noted increased rationality in the market, with both AMN and competitors declining to fill inadequately priced orders.
- A.J. Rice (UBS) questioned the impact of labor disruption on core nurse staffing bill rates; Scott clarified that labor disruption revenues are excluded from reported bill rates, and core bill rates have shown stabilization separate from labor disruption effects.
- Meghan Holtz (Jefferies) asked about client hiring hesitation given macro and policy uncertainty; Grace said decision-making has slowed in some cases, but demand remains healthy, especially for contingent staffing as a flexible alternative.
- Joanna Gajuk (Bank of America Securities) requested details on gross margin drivers in Q1 and expectations for Q2; Scott cited a combination of favorable actuarial adjustments, improved VMS performance, and stable underlying margins, with Q2 margins expected to be steady barring one-time items.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will be monitoring (1) the cadence and scale of labor disruption events as a key swing factor for revenue, (2) the impact of technology rollouts on recruiter productivity and gross margin stabilization, and (3) competitive developments in language services and international staffing. Progress in driving client adoption of new platforms and maintaining client retention rates will also be critical to assessing AMN’s execution.
AMN Healthcare Services currently trades at $21.81, up from $20.30 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free).
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