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AMN Healthcare (NYSE: AMN) reported first-quarter 2026 revenue above its guidance range, citing unusually large labor disruption activity that contributed to results, while management said several core businesses showed signs of stabilization or renewed growth.
President and CEO Cary Grace said the quarter was “defined by unusually large labor disruption activity,” including five events—three large and two indefinite in duration. She said AMN supported the events while continuing normal operations, calling the quarter “a major milestone” for the company’s operating capabilities.
For the quarter, AMN reported revenue of $1.38 billion, including $722 million from labor disruption revenue and $656 million from all other businesses. Gross margin was 26.8%, and adjusted EBITDA was $166 million, or 12.1% of revenue. Net income was $62 million, compared with a net loss of $1 million in the prior-year period and a net loss of $8 million in the prior quarter.
Grace attributed part of the quarter’s execution to technology investments, including an event management system and AI recruitment tools. She said the company used its AI recruiter to deploy more than 10,000 clinicians in the first quarter.
AMN’s Nurse and Allied Solutions segment generated $1.13 billion in first-quarter revenue, the second-highest quarterly total for the segment in company history. Excluding labor disruption revenue, Nurse and Allied revenue was $405 million, up 8% year over year and 11% sequentially, according to CFO and COO Brian Scott.
Nurse revenue excluding labor disruption was $254 million, up 12% year over year and 16% sequentially. Allied revenue was $151 million, up 3% both year over year and sequentially. Scott said growth reflected strong rapid response volume, higher associated bill rates, and recovery in the international business.
Grace said Nurse and Allied staffing recorded year-over-year growth in traveler volume, excluding labor disruption travelers, for the first time since 2022. She said nurse demand had been muted, though recent demand improved to roughly flat year over year, while allied demand has been growing year over year since 2025.
Scott said the segment’s average bill rate rose 6% year over year, driven mostly by rapid response revenue that is not expected to recur in the second quarter. He said rapid response assignments are typically shorter, require quick deployment, and carry higher bill rates and pay rates.
For the second quarter, AMN expects Nurse and Allied Solutions revenue to be flat to down 2% year over year, including normalization of segment bill rates.
Physician and Leadership Solutions revenue was $164 million, down 6% year over year and 3% sequentially. Locum tenens revenue was $131 million, down 7% year over year and 4% sequentially. Interim leadership revenue was $23 million, down 4% year over year and 5% sequentially. Search revenue was $10 million, up 4% both year over year and sequentially.
Grace said locums clients remain focused on managing spending by centralizing program management and hiring permanent physicians. She said AMN has a “healthy pipeline” of locums managed service provider prospects and added a new locums MSP client during the quarter, while renewing and expanding its contract with its largest locums client.
She also said overall locums demand has been softer, with more demand in the third-party channel, which she described as more competitive and harder to fill. Grace said AMN is working to tech-enable and automate locums recruiting and add recruiters to improve fill rates.
For the second quarter, AMN expects Physician and Leadership Solutions revenue to decline approximately 6% to 8% year over year.
Technology and Workforce Solutions revenue was $87 million, down 15% year over year, or 10% excluding the Smart Square business AMN sold in July 2025. Language Services revenue was $69 million, down 8% year over year and 1% sequentially. Vendor management system revenue was $16 million, down 18% year over year and 2% sequentially.
Scott said Technology and Workforce Solutions gross margin was 50%, down 550 basis points year over year due to pricing pressure in language services and an unfavorable business mix. Sequentially, gross margin improved 190 basis points, including a 200-basis-point improvement in language services margin.
Grace said AMN is rolling out a tiered language services and pricing strategy, including a greater offshore mix, client use of their own devices, and more accommodating service-level agreements in some cases. Nishan Sivathasan, Division President of Technology and Workforce Solutions, said the competitive environment remains present but appears to be stabilizing.
Grace highlighted enhancements to AMN’s WorkWise workforce technology platform, including AI-driven candidate scoring, improved search across orders and staff, tools for job descriptions, and supplier performance analytics. She said AMN Passport users are up more than 30% year over year, with monthly active users up more than 50%.
Scott said operating cash flow was $562 million, with capital expenditures of $7 million. AMN ended the quarter with $561 million in cash and equivalents, though he said much of the increase came from excess client deposits tied to labor disruption events.
The company ended the quarter with $367 million in client deposits and had already refunded approximately $250 million during the second quarter. Assuming the remaining deposits are repaid in the quarter, Scott said AMN would expect to have approximately $175 million in cash at quarter end.
Total debt was $750 million at quarter end, and AMN’s leverage ratio under its credit agreement was 1.6 times. Scott said the company expects leverage to remain at 2 times or less through the remainder of the year.
For the second quarter, AMN guided for consolidated revenue of $620 million to $635 million, gross margin of 28% to 28.5%, and adjusted EBITDA margin of 6.7% to 7.2%. Reported SG&A is expected to be approximately 23% to 23.5% of revenue.
In response to analyst questions, Grace said hospital clients remain focused on cost management and ensuring sufficient staffing to support higher patient utilization. She said discussions have shifted away from reducing contract labor usage and toward broader workforce strategies, including predictive analytics, technology-enabled staffing, and total talent solutions.
Grace said contract labor utilization and bill rates have “really normalized,” with stability over the past few quarters. She said clients are more likely to increase bill rates when roles are not getting filled, and that any broader improvement would likely occur over time, varying by market and client.
Scott said AMN continues to view its long-term model as one in which adjusted EBITDA can grow at twice the rate of revenue growth once more businesses return to sustained growth, citing process changes, automation, AI deployment, and operating leverage as contributors to that goal.
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