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September 25, 2024
Jeffrey R. Knudson
Chief Financial Officer
AMN Healthcare Services, Inc.
2999 Olympus Boulevard, Suite 500
Dallas, TX 75019
Re: AMN Healthcare Services, Inc.
Form 10-K for Fiscal Year Ended December 31, 2023
Form 10-Q for Fiscal Quarter Ended June 20, 2024
File No. 001-16753
Dear Jeffrey R. Knudson:
We have limited our review of your filing to the financial statements
and related
disclosures and have the following comments.
Please respond to this letter within ten business days by providing the
requested
information or advise us as soon as possible when you will respond. If you do
not believe a
comment applies to your facts and circumstances, please tell us why in your
response.
After reviewing your response to this letter, we may have additional
comments.
Form 10-K for Fiscal Year Ended December 31, 2023
Item 1 - Business
Our Services, page 4
1. We note your disclosure of your service offerings, as enumerated in this
section. We also
note your disclosure of disaggregated revenue by service type on page 49
of the notes to
the financial statements. While most of the enumerated offerings
correspond to the
categories on page 49, it is not clear where certain offerings are
classified for revenue
purposes. For example, it is not apparent how international nurse
staffing, crisis nurse
staffing, revenue cycle solutions, executive search and academic
leadership, and
recruitment solutions correspond to the categories on page 49. Please
advise and revise as
appropriate.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Results of Operations, page 26
2. Please revise to provide a discussion and analysis of cost of revenue
directly on a stand-
September 25, 2024
Page 2
alone basis, rather than solely in the context of gross profit. Please
quantify and discuss
the impact of each significant component of costs comprising cost of
revenue that caused
cost of revenue to materially vary (or not vary when expected to). This
disclosure should
be presented in a manner so as to allow investors to discern the
relative contribution of
each of multiple components cited to the total change in cost of
revenue. In addition, the
impacts of material variances in components of cost of revenue that
offset each other
should be separately disclosed, quantified, and discussed (and not
netted). Please also
ensure that your revised disclosure provides appropriate explanation of
underlying reasons
for changes (for example, in addition to quantifying the impacts of
changes in price,
volume, and acquisitions in absolute amounts, explain the underlying
reasons "why" for
these changes). Given the potential for differing or offsetting results
in your various
segments, we encourage you to provide the above disclosures at the
segment level (which
may make disclosure at the consolidated level not needed). In any event,
you should
revise to provide discussion and analysis of cost of revenue at the
segment level when a
change in a segment s cost of revenue materially impacts the segment
s measure of
profit. Please provide us with a copy of your intended revised
disclosure.
Please revise to provide similar disclosure for selling, general, and
administrative
expenses. Please also explain the nature of components of your SG&A
expenses, such
that these costs are able to vary significantly with changes in business
volume.
3. We note your revenue disclosure quantifying percentage changes in
metrics, such as the
17% decrease in the average number of travelers on assignment and the
15% decrease in
average bill rate. Providing these percentages without the underlying
metrics does not
provide sufficient context as to the significance of these factors on
changes in your
results. Please revise to quantify, in absolute dollars, the impact of
factors to which
changes are attributed, including changes in price, volume, and
acquisitions.
Notes to Consolidated Financial Statements
Note 1 - Summary of Significant Accounting Policies, page 43
4. Please tell us and revise to disclose the nature of costs included in
cost of revenue and
selling, general and administrative expenses (including unallocated
corporate overhead).
(j) Insurance Reserves, page 45
5. We note you provide professional liability coverage for staff. Please
tell us why you
provide this coverage.
(k) Revenue Recognition, page 45
6. You state revenue and the related direct costs under MSP arrangements
are recorded in
accordance with the accounting guidance on reporting revenue gross as a
principal versus
net as an agent and that when the Company uses subcontractors and acts
as an agent,
revenue is recorded net of the related subcontractor s expense. Please
clarify whether this
means you recognize staffing revenue under MSP arrangements gross except
for staffing
provided by third-party subcontractors. Please also revise to disclose
any other revenue
you recognize net as an agent. For example, we note your disclosure on
page 2 that your
employee counts do not include independent contractors, such as locum
tenens and
contract interpreters, who were not your employees. Please provide us
with a copy of
September 25, 2024
Page 3
your intended, revised disclosure.
(l) Accounts Receivable, page 46
7. You disclose that the increase in the provision for expected credit
losses for the year
ended December 31, 2022 was primarily the result of developments that
raised concern
with a specific customer s ability to meet its financial obligations,
and uncertainty
regarding the collectability of cash flows from other customers due
primarily to the
macroeconomic outlook. We note that you continued to maintain a similar
provision as of
both December 31, 2023 and June 30, 2024. Please tell us the current
status of
receivables with that specific customer and of your views with regard to
uncertainty
regarding other customers due to the macroeconomic outlook.
Form 10-Q for Fiscal Quarter Ended June 30, 2024
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Results of Operations
Selling, General and Administrative Expenses, page 20
8. We note disclosure in your June 30, 2024 earnings release on Form 8-K
attributing the
decrease in SG&A expenses to lower bonus and incentive compensation,
reduced
corporate headcount, a favorable adjustment to accrued professional
liability insurance
expense, seasonally lower payroll tax expense, and prudent expense
management. Please
revise your results of operations disclosure in your Form 10-Q to
discuss and quantify
underlying reasons for changes in results, such as these.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
Please contact Stephen Kim at 202-551-3291 or Lyn Shenk at 202-551-3380
with any
questions.
Sincerely,
Division of
Corporation Finance
Office of Trade &
Services