AMN Healthcare Services : Financial Reconciliations (AMN Non Gaap Financial Reconciliation Q226)

About this update from Amn Healthcare Services Inc

‌ Three Months Ended Six Months Ended June 30, March 31, June 30, (in thousands) 2026 2025 2026 2026 2025 Revenue Nurse and allied solutions $ 421,968 $ 381,871 $ 1,127,342 $ 1,549,310 $ 795,132 Physician and leadership solutions 164,582 174,531 163,924 328,506 348,596 Technology and workforce solutions 86,687 101,773 87,095 173,782 203,980 $ 673,237 $ 658,175 $ 1,378,361 $ 2,051,598 $ 1,347,708 Segment operating income (1) Nurse and allied solutions $ 58,239 $ 28,483 $ 153,330 $ 211,569 $ 60,721 Physician and leadership solutions 11,046 13,486 10,818 21,864 27,948 Technology and workforce solutions 24,621 35,209 25,270 49,891 70,459 93,906 77,178 189,418 283,324 159,128 Unallocated corporate overhead (2) 20,549 18,889 23,293 43,842 36,639 Adjusted EBITDA (3) $ 73,357 $ 58,289 $ 166,125 $ 239,482 $ 122,489 Adjusted EBITDA margin (4) 10.9 % 8.9 % 12.1 % 11.7 % 9.1 % Segment operating margin (5) Nurse and allied solutions 13.8 % 7.5 % 13.6 % 13.7 % 7.6 % Physician and leadership solutions 6.7 % 7.7 % 6.6 % 6.7 % 8.0 % Technology and workforce solutions 28.4 % 34.6 % 29.0 % 28.7 % 34.5 % As of June 30, As of December 31, 2026 2025 2025 Leverage ratio (6) 1.5 3.3 3.3 ‌Three Months Ended Six Months Ended June 30, March 31, June 30, (in thousands) 2026 2025 2026 2026 2025 Net income (loss) $ 21,160 $ (116,202) $ 62,166 $ 83,326 $ (117,294) Net income (loss) as a % of revenue 3.1 % (17.7)% 4.5 % 4.1 % (8.7)% Income tax expense (benefit) (1,261) (18,873) 48,293 47,032 (17,598) Income (loss) before income taxes 19,899 (135,075) 110,459 130,358 (134,892) Interest expense, net, and other 7,009 11,360 6,712 13,721 23,684 Income (loss) from operations 26,908 (123,715) 117,171 144,079 (111,208) Operating margin (7) 4.0 % (18.8)% 8.5 % 7.0 % (8.3)% Depreciation and amortization 31,583 37,753 33,240 64,823 75,635 Depreciation (included in cost of revenue) (8) 2,515 2,132 2,420 4,935 4,107 Goodwill impairment loss - 109,515 - - 109,515 Long-lived assets impairment loss - 18,262 - - 18,262 Share-based compensation 9,855 8,827 9,892 19,747 18,208 Acquisition, integration, and other costs (9) 2,496 5,515 3,402 5,898 7,970 Adjusted EBITDA (3) $ 73,357 $ 58,289 $ 166,125 $ 239,482 $ 122,489 Selling, general and administrative ("SG&A") expenses $ 147,391 $ 154,584 $ 218,425 $ 365,816 $ 302,315 SG&A margin (10) 21.9 % 23.5 % 15.8 % 17.8 % 22.4 % Share-based compensation 9,855 8,827 9,892 19,747 18,208 Acquisition, integration, and other costs (9) 2,496 5,515 3,402 5,898 7,970 Adjusted SG&A expenses (11) $ 135,040 $ 140,242 $ 205,131 $ 340,171 $ 276,137 Adjusted SG&A margin (12) 20.1 % 21.3 % 14.9 % 16.6 % 20.5 % ‌Three Months Ended Six Months Ended June 30, March 31, June 30, 2026 2025 2026 2026 2025 Net income (loss) $ 21,160 $ (116,202) $ 62,166 $ 83,326 $ (117,294) Adjustments: Amortization of intangible assets 17,500 19,608 17,945 35,445 39,035 Acquisition, integration, and other costs (9) 2,496 5,515 3,402 5,898 7,970 Goodwill impairment loss - 109,515 - - 109,515 Long-lived assets impairment loss - 18,262 - - 18,262 Tax effect of above adjustments (5,199) (26,011) (5,550) (10,749) (31,700) Tax effect of COLI fair value changes (13) (5,354) (2,779) 2,065 (3,289) (2,076) State tax audit reserve (14) - 2,889 - - 2,889 Tax deficiencies related to equity awards and ESPP (15) 65 764 2,151 2,216 2,287 Adjusted net income (16) $ 30,668 $ 11,561 $ 82,179 $ 112,847 $ 28,888 GAAP diluted net income (loss) per share (EPS) $ 0.53 $ (3.02) $ 1.59 $ 2.11 $ (3.06) Adjustments 0.24 3.32 0.51 0.75 3.81 Adjusted diluted EPS (17) (18) $ 0.77 $ 0.30 $ 2.10 $ 2.86 $ 0.75 ‌Segment operating income represents net income (loss) plus interest expense (net of interest income) and other, income tax expense (benefit), depreciation and amortization, depreciation (included in cost of revenue), unallocated corporate overhead, acquisition, integration, and other costs, legal settlement changes, share-based compensation, goodwill impairment loss and long-lived assets impairment loss. Unallocated corporate overhead (as presented in the tables above) consists of unallocated corporate overhead (as reflected in our quarterly and annual financial statements filed with the SEC) less acquisition, integration, and other costs. Adjusted EBITDA represents net income (loss) plus interest expense (net of interest income) and other, income tax expense (benefit), depreciation and amortization, depreciation (included in cost of revenue), goodwill impairment loss, long-lived assets impairment loss, share-based compensation, acquisition, integration, and other costs, restructuring expenses, and certain legal expenses. Management believes that adjusted EBITDA provides an effective measure of the Company's results, as it excludes certain items that management believes are not indicative of the Company's operating performance. Adjusted EBITDA is not intended to represent cash flows for the period, nor has it been presented as an alternative to income from operations or net income (loss) as an indicator of operating performance. Although management believes that some of the items excluded from adjusted EBITDA are not indicative of the Company's operating performance, these items do impact the statement of comprehensive income (loss), and management therefore utilizes adjusted EBITDA as an operating performance measure in conjunction with GAAP measures such as net income (loss). Adjusted EBITDA margin represents adjusted EBITDA divided by revenue. Segment operating margin represents segment operating income divided by revenue. Leverage ratio represents the ratio of the consolidated funded indebtedness (as calculated per the Company's credit agreement) at the end of the subject period to the consolidated adjusted EBITDA (as calculated per the Company's credit agreement) for the twelve-month period ended at the end of the subject period. Operating margin represents income (loss) from operations divided by revenue. A portion of depreciation expense for AMN Language Services is included in cost of revenue. We exclude the impact of depreciation included in cost of revenue from the calculation of adjusted EBITDA. Acquisition, integration, and other costs include acquisition and integration costs, net changes in the fair value of contingent consideration liabilities for recently acquired companies, certain legal expenses, restructuring expenses and other costs associated with exit or disposal activities, and certain nonrecurring expenses, which we exclude from the calculation of adjusted EBITDA, adjusted net income, and adjusted diluted EPS because we believe that these expenses are not indicative of the Company's operating performance. For the three and six months ended June 30, 2026, acquisition and integration costs were approximately $0.4 million and $1.3 million, respectively, and restructuring expenses and other costs associated with exit or disposal activities were approximately $2.0 million and $2.6 million, respectively. For six months ended June 30, 2026, certain legal expenses were approximately $1.0 million, expenses related to the closures of certain office leases were approximately $0.1 million, and other nonrecurring expenses were approximately $0.9 million. For the three and six months ended June 30, 2025, acquisition and integration costs were approximately $0.7 million and $1.0 million, respectively, certain legal expenses were approximately $3.2 million and $4.3 million, respectively, restructuring expenses and other costs associated with exit or disposal activities were approximately $0.3 million and $0.7 million, respectively,and other nonrecurring expenses were approximately $1.2 million and $1.6 million, respectively. ‌SG&A margin represents selling, general and administrative ("SG&A") expenses divided by revenue. Adjusted SG&A expenses represent SG&A expenses excluding the impact of share-based compensation, acquisition, integration, and other costs and legal settlement accrual changes. Management included this non-GAAP measure to provide investors and prospective investors with an alternative method for assessing the Company's operating results in a manner that is focused on its operating performance and to provide a more consistent basis for comparison between periods. However, investors and prospective investors should note that this non-GAAP measure involves judgment by management (in particular, judgment as to what is classified as a special item to be excluded in the calculation of adjusted SG&A expenses). Although management believes the items in the calculation of adjusted SG&A expenses are not indicative of the Company's operating performance, these items do impact the consolidated statements of comprehensive income (loss), and management therefore utilizes adjusted SG&A expenses as an operating performance measure in conjunction with GAAP measures such as GAAP SG&A expenses. Adjusted SG&A margin represents adjusted SG&A expenses divided by revenue. The Company records net tax expense (benefit) related to the income tax treatment of the fair value changes in the cash surrender value of its company owned life insurance ("COLI"). Since this change in fair value is unrelated to the Company's operating performance, we excluded the impact on adjusted net income and adjusted diluted EPS. The Company recorded a reserve related to a state tax audit during the three and six months ended June 30, 2025. Since this reserve is largely unrelated to our loss before taxes and is unrepresentative of our normal effective tax rate, we excluded its impact in the calculation of adjusted net income and adjusted diluted EPS. The consolidated effective tax rate is affected by the recording of tax benefits and tax deficiencies related to equity awards vested during the period and tax benefits recognized for disqualifying dispositions related to our employee stock purchase plan ("ESPP"). The magnitude of the impact of tax benefits and tax deficiencies generated in the future related to equity awards and ESPP is dependent upon the Company's future grants of share-based compensation, the Company's future stock price on the date equity awards vest in relation to the fair value of the awards on the grant date, the Company's future stock price on either the ESPP's offering date or purchase date, whichever is lower, and the length of time the shares issued under the ESPP are held by employees. Since these tax benefits and tax deficiencies related to equity awards and ESPP are largely unrelated to our income (loss) before income taxes and are unrepresentative of our normal effective tax rate, we excluded their impact in the calculation of adjusted net income and adjusted diluted EPS. Adjusted net income represents GAAP net income (loss) excluding the impact of the (A) amortization of intangible assets, (B) acquisition, integration, and other costs, (C) goodwill impairment loss, (D) long-lived assets impairment loss, (E) tax effect, if any, of the foregoing adjustments, (F) net tax expense (benefit) related to the income tax treatment of fair value changes in the cash surrender value of its COLI, (G) tax deficiencies related to equity awards vested and ESPP, and (H) state tax audit reserve. Management included this non-GAAP measure to provide investors and prospective investors with an alternative method for assessing the Company's operating results in a manner that is focused on its operating performance and to provide a more consistent basis for comparison between periods. However, investors and prospective investors should note that this non-GAAP measure involves judgment by management (in particular, judgment as to what is classified as a special item to be excluded in the calculation of adjusted net income). Although management believes the items in the calculation of adjusted net income are not indicative of the Company's operating performance, these items do impact the statement of comprehensive income (loss), and management therefore utilizes adjusted net income as an operating performance measure in conjunction with GAAP measures such as GAAP net income (loss). ‌Adjusted diluted EPS represents adjusted net income divided by diluted weighted average common shares outstanding. Management included this non-GAAP measure to provide investors and prospective investors with an alternative method for assessing the Company's operating results in a manner that is focused on its operating performance and to provide a more consistent basis for comparison between periods. However, investors and prospective investors should note that this non-GAAP measure involves judgment by management (in particular, judgment as to what is classified as a special item to be excluded in the calculation of adjusted net income). Although management believes the items in the calculation of adjusted net income are not indicative of the Company's operating performance, these items do impact the statement of comprehensive income (loss), and management therefore utilizes adjusted diluted EPS as an operating performance measure in conjunction with GAAP measures such as GAAP diluted EPS. As GAAP net loss is reported for the three and six months ended June 30, 2025, basic weighted average common shares outstanding was used to calculate GAAP diluted EPS for those periods because the dilutive potential common shares have an anti-dilutive effect (i.e., result in a lower loss per share). As adjusted net income is reported for the three and six months ended June 30, 2025, diluted weighted average common shares outstanding (including dilutive potential common shares) of 38,571 and 38,473, respectively, were used to calculate adjusted diluted EPS. ‌Reconciliation of Guidance Operating Margin to Guidance Adjusted EBITDA Margin Three Months Ending September 30, 2026 Low (1) High (1) perating margin 0.2% 0.8% Depreciation and amortization (total) 5.0% 4.9% O EBITDA margin 5.2% 5.7% Share-based compensation 1.1% 1.1% Integration and other costs 0.2% 0.2% Adjusted EBITDA margin 6.5% 7.0% (1) Guidance percentage metrics are approximate.

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