Good day, and thank you for standing by. Welcome to AMN Healthcare second quarter 2021 earnings call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question- and- answer session. To ask a question during the session, you will need to press star one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to your speaker today, Randle Reece, Director of Investor Relations. Please go ahead. Good afternoon, everyone. Welcome to AMN Healthcare second quarter 2021 earnings call. A replay of this webcast will be available at ir.amnhealthcare.com following the conclusion of this call. Details for the audio replay of the conference call are in our earnings release issued this afternoon. Various remarks we make during this call about future expectations, projections, trends, plans, events, or circumstances constitute forward-looking statements. These statements reflect the company's current beliefs based upon information currently available to it. Our actual results may differ materially from those indicated by these forward-looking statements as a result of various factors and cautionary statements, including those identified in our most recently filed Forms 10-K and 10-Q, our earnings release, and subsequent filings with the SEC. The company does not intend to update guidance or any forward-looking statements provided today prior to its next earnings release. This call contains certain non-GAAP financial information. Information regarding and reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are included in our earnings release and on our financial reports page at ir.amnhealthcare.com. On the call today are Susan Salka, Chief Executive Officer, Brian Scott, Chief Financial Officer, Kelly Rakowski, Group President and COO of Strategic Talent Solutions, Landry Seedig, Group President and COO of Nursing and Allied Solutions, James Taylor, Group President and COO of Physician and Leadership Solutions. Also joining for the first time is Chris Schwartz, AMN Controller, who will serve as our interim Principal Financial Officer due to the impending departure of our friend and colleague, Brian Scott, from AMN. I will now turn the call over to Susan. Thank you so much, Randle, and welcome, everyone, to our earnings call. As always, it's a pleasure and honor to be with this team and with all of you today. The AMN team continues to make a greater impact in healthcare, and this last quarter was another testament to our relentless commitment to patients nationwide. More than 330 million Americans depend on 8 million professionals who provide healthcare in this country. AMN and our industry have always been an important part of the healthcare ecosystem. The pandemic has created short-term and permanent workforce shifts that increase our opportunity and the need to help change the paradigm of staffing for the future. Creating, supporting, and empowering a quality and agile workforce requires a multifaceted approach, particularly in the face of persistent workforce challenges. Healthcare organizations are increasing their hiring efforts as regular patient care volume is getting back to normal. However, they continue to struggle with a high volume of quits and long-term vacancies. On top of this, the pandemic is resurging. Our colleagues at AMN have stepped up in a way true to our values to help our clients deliver great patient care. Demand for contingent labor increased throughout the second quarter, and that trend has accelerated through today. Most of our staffing businesses are experiencing record high levels of demand across all geographies and almost all specialties. Our team has addressed the growing client need by expanding our technology solution footprint and placing tens of thousands of healthcare professionals where needed most. We are simultaneously investing heavily in our people and infrastructure to ensure that we're able to empower the future of care with our growing and new solutions. Our positive impact enabled us to exceed financial expectations in the second quarter. Consolidated revenue was $857 million, 41% higher than prior year, with outperformance and growth year-over-year from all segments. Our largest segment, Nurse and Allied Solutions, reported revenue of $624 million, up 41% year-over-year. We hit another record high for average travelers on assignment. Including supplier partners through our MSP and VMS platforms, our programs placed over 70,000 nurse and allied clinicians during the quarter. Travel nurse staffing grew above our expectations at 37% year-over-year. This increase was driven primarily by volume growth. After a brief decline in demand earlier in the year, orders began climbing again in April and now are at record levels. Total orders in nursing doubled in July compared with the second quarter level. Our Allied staffing team hit another record with $113 million second quarter revenue, up 44% year-over-year. Our imaging, respiratory, and lab revenue led our Allied growth again, rising 76% year-over-year. Also important was the continued comeback of therapy, which had been slower in 2020. New therapy orders in the second quarter were more than 50% higher than the first quarter level. Overall, Allied demand has seen consistent growth over the last three quarters, and today, the demand is at record high levels. Across Nursing and Allied, the labor market is experiencing extreme supply constraints, high demand, and intense competition for talent. Clients are citing problems not only with permanent hiring, but also with retention. We're hearing about vacancy rates at very high levels all across the board, all across the country. Most of the demand is not related to COVID patients, but rather leaves of absence, clinician fatigue, normal patient volumes rising, and operating room backlogs. Our clients are telling us that this is unlikely to change anytime soon. In anticipation of these trends continuing, we have increased investment in each phase of the recruiting, placement, and onboarding process. We continue to hire additional recruiters and invest in our digital platforms. These are leading to higher new applicants, although not enough to satisfy the extraordinary demand. For the third quarter of 2021, we expect Nurse and Allied Solutions segment revenue to be approximately 45% higher year-over-year. Physician and Leadership Solutions segment revenue for the second quarter was $139 million, 28% higher year-over-year, which was better than our guidance of 20% growth. Locum tenens revenue was $78 million, up 26% over prior year. Overall, locum demand has recovered nicely, with many specialties exceeding the pre-pandemic levels. Our highest demand specialties include anesthesiology, advanced practitioners, internal medicine, primary care, and psychiatry. Interim Leadership revenue grew 30% year-over-year as the business delivered a third consecutive quarter of strong sequential volume growth. Core demand for interim leaders is growing and has recovered to pre-pandemic levels. Physician and executive search revenue rose by 33% over the year-ago quarter, and permanent placement demand continues to strengthen. For the third quarter, we expect Physician and Leadership Solutions revenue to be 25%-27% higher year-over-year. Second quarter revenue for the Technology and Workforce Solutions segment grew 70% year-over-year. Language services excelled again, with revenue of $46 million, 61% higher than the year-ago period. This is due to strong demand as healthcare utilization has returned to normal levels, but also due to new and expanded clients and the appeal of our video platform that enables virtual on-demand service. Second quarter revenue for our VMS business was $31 million, growing an incredible 76% year-over-year. The primary drivers here are the continued high demand across all clinician needs and the several new customers added over the last year. In the third quarter, we expect revenue for the Technology and Workforce Solutions segment to be up 44%-48% compared with the prior year. Over the past decade, we invested significantly in the evolution of AMN to become the leading, largest, and most diversified total talent solutions partner that we are today. Healthcare organizations continue to turn to AMN as a strategic partner, finding ways to increase the efficiency of the workforce and improve access to care. As an outcome, we have seen strong growth in our outsourced and technology solutions, including remote language services, telehealth, workforce and scheduling optimization, and Recruitment Process Outsourcing. In addition, our managed services programs continue to grow. We are adding new clients, and existing clients are engaging us for additional solutions. I am very proud of the AMN team and the recognition they are receiving for their outstanding efforts. For example, AMN recently earned HRO Today's highest ranking for customer satisfaction in healthcare MSP. We have nearly $5 billion gross spend under management through our MSP and VMS platforms, by far the leader in healthcare. Avantas currently has the highest overall KLAS score for nurse and staff scheduling. Our RPO solution was recently recognized as a star performer by Everest Group. These honors are just a few examples of how the AMN team is making a difference for healthcare professionals and clients. We work in a great industry with lots of amazing partners and people, which makes these accolades that much more meaningful. We are particularly proud of the positive impact we are having on health, equity, and access. We are honored to have been awarded the Eastern region of the FEMA Vaccine Administration program for underserved communities. We mobilized clinicians who administered nearly 100,000 vaccines, many delivered by mobile units to limited access areas. Our telehealth and remote language services are enabling care in alternative and rural settings. In their first quarter with AMN, Synzi delivered 60,000 telehealth visits. Our Televate platform for schools supports remote access to critical therapeutic services for students and supporting over 130,000 sessions throughout the pandemic. Over the last year, we have increased investments across our operations to be the best partner possible for our clients and our candidates. The most important investment we can make is always within our own teams. Of course, we've added many wonderful new colleagues to the AMN family over the last year. We have also increased our investment in our team members to ensure that we're supporting them and helping them to achieve their personal and professional goals. We've increased our benefits. We've increased our wellness and mental health support. We have increased our actions in line with our commitment to diversity, equality, equity, inclusion, and other critical social issues. We've seen tremendous participation in our employee resource groups and now have eight thriving ERGs to support our increasingly diverse team. We've increased our charitable activities and community impact, which is a very important part of the AMN culture and team member engagement. The benefit of all of this can be measured in our strong retention levels. Most importantly, we see the strong engagement of our team show up every day in the caring, courageous, and committed support that they give our clients, our clinicians, and to one another. Now and then, one of our great colleagues does decide to depart and pursue a new personal or professional goal outside of AMN. You're all aware, I believe, that Brian Scott made that decision recently. Brian has been an amazing friend and colleague to me and many of us over the past 17 years, including the last 10+ years as our CFO. Since that's more than twice the average tenure of a typical public company CFO, I think that says a lot about Brian's talents, but also his commitment to his colleagues and to our purpose. I've learned a great deal from you, Brian, over the years, and I will forever be grateful, as I know we all will be, for all you've done to evolve AMN Healthcare. One of the greatest legacies that Brian leaves for us is the strength of his team, the team that he's created and developed. All of the leaders across our finance, accounting, tax audit, customer service teams are exceptionally strong, which is why we did not feel the need to name an interim CFO when we are conducting the search for Brian's replacement. We are super fortunate that Chris Schwartz is seamlessly stepping into the role as Interim Principal Financial Officer, which is, of course, a natural extension for him, as Controller, since he's already responsible for most of the elements of financial SEC reporting and the interface with our auditors, amongst many other things. Chris has been a colleague with AMN since 2005 and has done a phenomenal job in a variety of financial leadership and investor relations roles, and he too has been instrumental in our evolution. He also happens to be a great role model for our culture and our values. I thank you and all of our leaders, Chris, for everything you do, including through this transition. In a few minutes, Kelly, Landry, James, and Chris will join us for the Q&A session. For now, I will turn the call over to Brian, who will give us more insights. Well, thank you, Susan, for those very kind words. Yeah, definitely a bittersweet day. Before I jump into the numbers, I want to just take a moment to acknowledge all of my amazing colleagues. During my 17+ years at AMN, I have been inspired every day by your passion, your drive, your dedication to serving our customers, our communities, and each other. You are truly the best of the best, both professionally and personally. While I'm so proud of what we've accomplished, I'm just as excited about the future of this organization and all that you will continue to do to advance our really important mission and strategy. I'd also like to personally thank Susan for her mentorship and friendship throughout those years, and also the AMN board for their continued guidance and support. With that, we'll turn back to the results. Second quarter revenue of $857 million was 3% above the upper end of our guidance with outperformance across all three segments. Second quarter consolidated revenue grew 41% year-over-year. Sequentially, revenue was down 3% due to an expected reduction in COVID-related projects and lower travel nurse bill rates. As Susan mentioned earlier, we are very proud to partner with FEMA to vaccinate underserved communities. The ultimate financial impact from the project was minimal in the second quarter, and as of now, we do not expect any revenue from this contract in the third quarter in the material revenue. Gross margin for the quarter was 32.7%, which was 20 basis points higher than prior year and up 10 basis points sequentially. The improvements in the margin were driven primarily by a revenue mix shift toward our higher-margin segments. Consolidated SG&A expenses were $157 million, or 18.3% of revenue, compared with $137 million, or 22.5% of revenue in the year-ago quarter, and $161 million, or 18.2% of revenue in the previous quarter. Year-over-year, even with a significant investment in employee expenses and marketing costs to support our growth, we achieved strong operating leverage on the increased revenue. On a sequential basis, SG&A expenses declined due in part to lower stock-based compensation and a favorable professional liability reserve adjustment, more than offsetting growth in employee headcount and related expenses. In the second quarter, Nurse and Allied revenue was $624 million, 41% higher than the prior year and down 5% sequentially. For Travel Nurse, our largest business, revenue grew 37% over prior year with average travelers on assignment up 22%, the average bill rate up 14%, and slightly higher average hours worked. As expected, the average bill rate declined sequentially from the first quarter peak levels that were fueled by COVID-related needs. However, the sequential decline of about 9% was less than anticipated as demand increased through the second quarter. We are expecting third quarter bill rates to be down again sequentially in the high single digits, but remain at elevated levels throughout the balance of the year. Allied revenue was $113 million, up 44% from the prior year and up 4% sequentially. Allied volume was up nearly 40% over prior year, with the average bill rate higher by 4%. Nurse and Allied gross margin of 26.6% was 40 basis points lower than prior year and down 30 basis points sequentially. The segment gross margin was lower year-over-year, primarily from increases in clinician pay packages to fill more positions. Segment EBITDA margin of 14.4% was 60 basis points higher than prior year on improved operating leverage. Physician and Leadership Solutions revenue in the second quarter was $139 million, which was 28% higher year-over-year and down 1% sequentially. Gross margins for the segment was 36.6%, 20 basis points higher than the prior year and down 40 basis points sequentially. The year-over-year improvement is due to a favorable mix shift toward the interim leadership and search businesses. The sequential reduction in gross margin was due primarily to a mix shift toward lower-margin specialties and locum tenens, along with a reduction in COVID-related projects. Segment EBITDA margin was 15.7%, up 160 basis points from last year and up 60 basis points sequentially. The year-over-year improvement was driven primarily by operating leverage on the strong revenue growth. Technology and Workforce Solutions segment revenue was $94 million in the second quarter, growing 70% year-over-year and 6% sequentially, with strong growth across all service lines in the segment. Segment gross margin was 67.7%, down 100 basis points year-over-year and flat sequentially. The year-over-year change was due to a revenue mix shift within the segment. Segment EBITDA margin of 45.4% was up 590 basis points year-over-year and was 210 basis points lower sequentially. Consolidated second quarter adjusted EBITDA of $134 million was 66% higher year-over-year, driven by revenue growth and improved operating leverage. Adjusted EBITDA margin of 15.6% was 240 basis points higher year-over-year and lower by 30 basis points sequentially. We reported net income of $67 million and diluted earnings per share of $1.39 in the second quarter. Adjusted earnings per share was $1.64, compared with $0.83 in the year-ago quarter. Days sales outstanding improved to 50 days, seven days lower than last quarter, as strong cash collections caught up with the large increases in revenue and accounts receivable that occurred in the first quarter. Operating cash flow for the quarter was $171 million and $211 million year-to-date. Capital expenditures in the quarter were $11 million. As of June 30th, we had cash and equivalents of $139 million, long-term debt of $850 million, and a leverage ratio of 1.7x:1x. Turning to third quarter guidance, we are projecting consolidated revenue to be in a range of $770 million- $790 million, 40%- 43% higher than the prior year. This includes approximately $20 million of revenue related to labor disruption activities. Third quarter gross margin is projected to be 33.4%- 33.9%. Reported SG&A expenses are projected to be 19.8%- 20.2% of revenue. Operating margin is expected to be 10%-10.5%. Adjusted EBITDA margin is expected to be 14.2%-14.7%. Our third quarter estimates include the following: depreciation expense of $10 million, non-cash amortization expense of $16 million, stock-based compensation expense of $3.5 million, interest expense of $10 million, integration and other expenses of $3 million, and an adjusted tax rate of 28%. Now we'd like to open up the call for questions. As a reminder, to ask a question, you will need to press star one on your telephone. To withdraw your question, press the pound key. Please stand by while we compile the Q&A roster. Your first question comes from the line of Mark Marcon from Baird. Hey, congratulations everybody. Brian, congratulations to you. It's been great working with you over the years. I've got several questions related to Nurse and Allied. Obviously, demand is extremely strong in both Nurse and Allied. I'm wondering, you mentioned where you're thinking about pricing being for the upcoming quarter. I'm wondering if you can expand a little bit on that with regards to travel nursing, just in terms of the pricing expectations for the coming quarter, but also as you're thinking about the year unfolding, because clearly, the shortages don't seem to be abating. How are you thinking about that with regards to Allied as well? Hey, Mark, it's Landry. Maybe it might be helpful to kind of talk about the trend that we've seen even starting in January. Our bill rates actually peaked at the end of the first quarter. Since that point, they've been steadily decreasing. They really have not been declining quite as steep as what we had originally thought. From what we can tell, though, especially where the demand is today, and we can see, of course, the rates on all of our new orders, we would expect that it would probably take a turn again, and we'd start to see increases in our average bill rate as we exit the third quarter. We're seeing increases across almost all the specialties in nursing, even the orders that aren't tied to specialties that are there to take care of COVID patients. It's really probably the extremely high demand that's driving up the rates. There is a lag because there's a lot of instances where you might see rates that are impacting orders, which then, of course, would impact future placements. It looks like we should start to see our average bill rates increase two to three months from whenever you would see some of the peak demand, which we're experiencing right now. Still a little bit too early to tell, but that's how we're currently thinking about it. Landry, how much are you thinking that those bill rates could actually go up on a year-over-year basis once that starts occurring? Yeah. It's still really hard to tell, Mark, just because we are still booking in. Even today, we're still booking a little bit into the third quarter. We can see the orders, but there's some other things there, such as mix, that make it a little bit difficult right now to fully predict it. Originally, we thought that they'd likely decline even throughout the entire year. Just with where we're seeing the demand right now, we think that it will take a turn right at the end of the third quarter, and then potentially come up as we exit the year. That's great. Then can you just talk a little bit about what you're seeing in terms of fill rates? Also just given the dynamics that are occurring at various units, what you're seeing in terms of follow-on assignments. Lastly, related to that, I imagine your fill rates are better than the vendor-neutral MSPs that are out there. To what extent are you actually seeing an increasing level of interest in terms of using you as the MSP, given your superior ability in terms of filling positions? Yeah, Mark, I'll hit on a couple of those, and then maybe I'll turn it over to Kelly to talk about customers as it relates to utilizing our VMS, our vendor neutral program versus our MSP product. On the fill rate side, we did see fill rates across the industry at the beginning of this year that were lower than what it had historically been, and that's, of course, because of the really high demand that we saw at the peak of the pandemic. It got to a point back to where it was respectable, to levels that we had experienced before the pandemic, and that would've been kind of the March, April timeframe. Right now, what the entire industry is experiencing just over the past couple of months on fill rates is that they have declined a little bit, which you would expect with the excessive demand that we have out there right now across the entire industry. Within our own MSP programs as well as our vendor neutral programs, we do rely heavily on our supplier partners. They've been able to help quite a bit with those fill rates to help support our clients, which we're very appreciative of those partners. As it relates to retention of our own healthcare professionals, of course, we've seen that kind of go up and down throughout the past year as well. At least kind of way back to Q2, Q3 timeframes of last year, we did see some declines in our retention rates in skills such as OR whenever the procedures were paused. It did return to some of the levels that we would experience historically. Q2 of this year actually did go down again on our retention, but that was more of a skill mismatch. You had some of these COVID vaccine projects that were in place. We were placing pharmacy techs, for example. For the most part, those COVID vaccine projects have gone away. There's nowhere to put those clinicians. Of course, we're only one month into the third quarter, but the retention rates of clinicians across both Nurse and Allied are back to where they were pre-pandemic. Might be a good opportunity for Kelly to chime in regarding our MSP programs. You asked Mark about the preference of clients to have a staffing-led MSP versus VMS. Of course, we're really fortunate that we can offer both, which was extremely valuable during the last year. As you heard me mention, we added many new clients in our technology VMS platform. That certainly has helped make an impact there, helped drive that revenue for that division. We're finding more and more clients are wanting to have that staffing-led offering. Maybe, Kelly, you could chat a little bit about that. Yeah, a couple of comments on there. Thank you, Susan and Mark. We certainly see stronger performance from a fill perspective with our AMN-led program. We have seen a strong part of our over performance in Technology and Workforce Solutions this quarter was due to the strength of VMS. We've seen higher demand sustain as well. We have a little less influence despite really strong partnerships with our suppliers, our ability to partner with our clients. In our MSP program, strategize with them around utilization, around bill rates, around marketing strategies. It certainly benefits those MSP programs, and they see that in higher bill rates as well as other value that they receive from that. We are seeing in the market, from a new program perspective, many clients who were without workforce solution partners throughout the pandemic, really turning now towards reassessing their strategies and engaging us in conversation. That's evidenced in new business we brought on in the last quarter and a very strong pipeline going forward to the end of the year. We're very bullish and continue to prioritize our current managed services programs, but looking to, with our expansion, take on more and be able to provide more support to the industry. That sounds really promising. Congratulations. Thank you. Thank you. Your next question comes from the line of Tobey Sommer from Truist Securities. Thank you. I was wondering if you could describe what you're hearing from clients and seeing, to the extent you have visibility into the full-time labor supply and the shortness, the extent to which there are short to medium term issues, such as, hopefully I'm describing that accurately, the burnout, the need to take vacations, do other things. A full-time staff that may remain in the labor force versus structural things like the retirements and early and/or catch-up from last year where we may have seen delays, I imagine. Thanks. Yeah. A very important question, Tobey Sommer. This is Susan. As you can imagine, those conversations are happening pretty much daily. Earlier today, Landry Seedig and I were on a call with one of our largest clients about their outlook, and it's very similar to what we hear from other large systems and large clients in that they don't see this ending anytime soon. They believe that there's been a shift in the workforce that will have impact for many years to come. It's a combination of all of those things that you've just described. It's retirements, people choosing to do other things, their existing staff being burned out, fatigued, wanting to get to good staffing levels from a quality of care standpoint. It becomes a little bit of a vicious circle, right? Where if you're understaffed, people are getting burned out and they quit, it just makes the scenario that much more difficult. Because of that, we're talking with them about certainly urgent, immediate action, and collaborative things we can do to get them the staff they need immediately. Also, what can we do midterm and longer term? Some of the solutions that we have to offer are things like RPO. In fact, our RPO business had a phenomenal second quarter and has a great pipeline going forward because so many clients are wanting assistance and new ways, new best practices to recruit their permanent staff. We're talking with clients about new grad programs where we can provide, and we've done this before with some of our large clients where we provide new grads in a preceptor program, and those individuals can ultimately go permanent. Our international business, O'Grady Peyton, that team has done a phenomenal job of serving clients. Remember, international nurses come over on green cards and are on assignment with us for generally two years before they go permanent, and they are seen as a core staffing solution as opposed to a temporary solution. When we're having these conversations with clients, we're fortunate that we have the ability to discuss multiple solutions for them that address that from short-term, midterm, and long-term need that they have. I'll just add one more thing. There's also a need for float pool management and how do they optimize the availability of nurses that they may have locally and use technology, which is why things like our B4Health technology become very valuable. Right. Thank you. Have you heard any legislative or industry-wide measures, any sort of changes to improve supply that could impact the market over any sort of medium term? Doing something to encourage students is many years away from impacting supply. Right. I'll start with there's nothing material or significant. There certainly are things being discussed. There's advancement, albeit slow, on things like the Nurse Licensure Compact, which now has 38 states that are members of that compact. The Advanced Practice Compact is really just getting started with only North Dakota involved. The Physical Therapy Compact has 21 member states. All of those things help the mobility of clinicians crossing state lines and enabling to deliver care faster. We have the TREAT Act that's been introduced at a national level would help a bit in times of national healthcare crisis, which we're in, to be able to get clinicians moved around and utilizing their licensure across state lines as well. None of that is going to materially change the supply of clinicians in the next year. Okay. Last question from me. Could you comment on your internal efforts to streamline recruiting and implement technology and onboard people in as automated a fashion as possible, credentialing, et c? Maybe juxtapose that with what's going on in the market as you see it, if there is a juxtaposition to be had, because there's a lot of times crises spur innovation, acceptance of frameworks and processes that maybe in normal times wouldn't be embraced. Absolutely. The last year has certainly advanced innovation, both within AMN and across the industry, and I think adoption as well. In many cases, maybe the tool or technology was there, but there was a hesitancy, whether it be with candidates or clients to utilize it. We've definitely seen faster adoption of digital capabilities. One great example is our AMN Passport app, which enables clinicians to search for jobs and look for their next great assignment. Certainly gives us the ability to personalize the experience for them and push out personalized opportunities that are going to be of the greatest interest to them. It also enables them to get their credentials uploaded and accelerate the process of getting onboarded. We've seen great adoption of AMN Passport, and every week practically are rolling out new features and functionality. We're not the only ones doing these things within the industry, but we do believe that we are ahead of the majority of our industry. We should be, as the leader in the industry. We're learning new things every day that we can do differently. Landry, did I miss anything there you want to add? No, that was right. You mentioned adoption. It's beating our expectations of the clinicians wanting that technology, wanting to be able to do things, and take more control over the process and within their career. You still have to have the talent. We're making investments there in our talent, not only our existing team members, but doing a lot to attract new talent to the organization. We've made investments recently, actually this entire year, in our account management team. We've also made investments in our recruitment team. In the second quarter, we increased our number of producers as a percentage double digits, and it's even higher today. We continue to make those investments. Tobey, you probably remember the Advanced Medical acquisition that we did. All of those team members are now in our systems and within our processes. Their productivity per person is more than double what it was before the acquisition. That team is doing an excellent job. I appreciate that. If I can do a little follow-up. You know we love quantification in this business. To the extent the Passport has improved or kind of improved the credentialing time, could you give us an example of what that might look like today versus under a more human intervention process? Why don't you let us work on that, Tobey? Yes, we have those metrics internally, but why don't you let us come back to you with something that we think would be meaningful externally for you? We have tons of data. I look forward to it. Thank you. We'll take that as an action item. Thanks, Tobey. Your next question comes from the line of A.J. Rice with Credit Suisse. Hi, everybody. A couple questions. First of all, you mentioned the strength you saw this quarter in the interim leadership and permanent placement and also in the allied side, the rebound in therapy demand. I guess I'm trying to understand some of those areas, and maybe there's some others I'm not thinking of, didn't fare as well in the height of the pandemic and now seem to be coming back. Do you think they're back to normal, or do you think there's still further room for them to rebound as we see the coming months unfold? Thank you, A.J. This is James. I'll jump in. I'll start with the search business. Our search business was the hardest hit business through the pandemic, and it is the slowest recovering, coming back to pre-pandemic demand levels. I will say the good news is that we have had four quarters of sequential growth in our search business, and our search business continues to see strong pipeline significantly or specifically with inside of our mid-level management and with inside of academia. I will say, we have forecasted, we're saying that from getting back to pre-pandemic is H1 of 2022, which is going to be faster than our guidance was of H2 of 2022. The search business is coming back a little bit slower, but we are seeing some pickup on demand there. From an interim standpoint, which we're very confident and very good about where the interim business is. Our interim business has had a second quarter of finishing above 7% of its pre-COVID levels and three consecutive quarters of record orders volume contributing to really eight consecutive months of improving interim on assignment. Our demand has returned back to pre-pandemic levels, that's been driven by our core direct and also our MSP clients. We feel very good about where we are from a demand standpoint and the revenues to be able to throw from that. Hey, A.J., Landry. Well, that business has become very large for us. They are number one in their space, and that team has just done a fantastic job of executing up against the demand that they have. They actually did not see that same dip in demand like we saw in travel nursing in that April timeframe. Their demand just has continued an upward trajectory, and today they are at record levels, and those record levels are just about across every single specialty that they support. I know we talked about probably five quarters ago, therapy being down due to some reimbursement changes. That demand is back, and the team is executing well against that. Imaging demand is at a highest level that I've seen it, same with laboratory. Respiratory is up significantly from prior year, but probably more flat from the peak of the pandemic, as you would expect. Okay, thanks a lot. I wonder, on your bill rate comments, that was, I think, aggregate bill rates. Is there any way to parse out what you're seeing? Obviously, you got the COVID premium rates, and the percentage of those assignments is probably coming down, it sounds like. You've got just sort of your traditional assignments. Given the tightness of the supply, what is happening on pricing for those non-COVID assignments? I don't know if you have a statistic you'd share as to how many of your assignments in the recent quarter were COVID-related versus the last few quarters. Is it materially changing? Hey, A.J., this is Brian. I'll start off and then Landry may have some color. I think to start with, we don't really try to separate COVID versus non-COVID. The reality is, in this environment, our clients need our help really across the board. The rates, as we mentioned, were at the peak level in the first quarter. Of course, you could attribute some of that to the highest hospitalizations in COVID and the significant demand it drove, and you saw the highest levels. As we came off of that peak level in March, we had anticipated that we would see rates come down, and that has happened, but not as much as we expected because they're now all the dynamics that Susan talked to in our opening remarks. It's somewhat COVID-related, of course, but this burnout we're seeing and the very high vacancy rates on staff in conjunction with an increased utilization of healthcare, it's created this dynamic, again, that's kind of a byproduct of the pandemic that's driven really large record levels of demand across all geographies and all specialties. That's what's driving rates up overall. It's not really COVID-specific at this point. It's just a lot of competition for scarce talent. Again, they've come down because there was a kind of a one point in time where the rates were very high. You're seeing now maybe not the highest levels of bill rates that we had in the first quarter, but now we have more orders at a higher bill rate both in totality. As we're booking into those, it's keeping the overall rates at very elevated levels. We mentioned being down a little under 10% sequentially in Q2, down again in the third quarter. Those rates are still significantly above where they were in the early part of 2020. At this point, with demand where it is, it's just hard to foresee that coming down. In fact, if anything, as Landry mentioned, they might come up a little bit in the fourth quarter, just because there is just so much need across the country. Okay, that's great. I want to add my best wishes to you, Brian, as well. Maybe just a last question. Lead generation and new applicants trying travel assignments and so forth for the first time, we talked a little bit about what you're seeing when people come off the an assignment, h ow's the applicant pool? Is that expanding? Are people more open to considering taking on an assignment like this? Hey, A.J. Landry. Yeah, all those higher supply metrics look really good. Of course, we track it a lot of different ways. In particular, though, our new applicant numbers are really strong. Last year was our highest year on record, and this year we are pacing ahead of prior year. I think that's a really good stat and a good thing to see that nice supply that's coming into the business. Conversion rates look good also. I think a lot of that has probably contributed to some of the improvements that we've made in the process and AMN Passport that we mentioned, too, that allows people an easier experience still to make it through all the way to on assignment. Okay, great. Thanks so much. Thanks, A.J. Rice. Your next question comes from the line of Kevin Fischbeck from Bank of America. Hey, thanks. Just wanted to dig into the guidance, I guess, like in doing it right, it looks like your revenue guidance is sequentially to be down. It looks like obviously the biggest part of that is the Nurse and Allied. The Physician and the Workforce Resources also look like they're going to be down sequentially, which was a little bit less clear to me as to why that would be the case. Maybe you can just go into what would be driving that outlook for each business. Sure. I'll provide some color to kick off on that. I think on the Nurse and Allied, bill rates would be the number one reason we talked about that as they come down again, even though they're elevated levels, they're off that peak of week that really was at the March point. Even as they kind of hit their lowest point in July and are slightly up in August, September, but even as you average out the quarter, it's down sequentially. Nurse volume is down just slightly as well at this point, and it's really driven by some of the vaccine projects that we had in the second quarter. We did pick up some revenue from those projects that you can imagine have, for the most part, ended at this point. You're kind of stripping some of that out. You'd actually see volume up just slightly on a sequential basis third quarter. The reality is you'll still be down because of that change. On the Allied side, you've got a little bit of decline, mainly from the schools business. As you get into the summer months, you have an obviously lower number of therapists on assignment during the summer. Outside of that, the core business outside of schools is still growing as well. Physician and Leadership, it's relatively similar on a sequential basis. The math you do with them might be slightly down, depending on where you put in that range. Some of the interim revenue was, again, project-related, so down slightly there, even though, again, the underlying business performance trends are really positive as we look to the back half of the year. Then on the Technology and Workforce Solutions, the same driver for nursing with rates does have an impact on VMS. Again, you've got good trends there, but with the average rate down kind of across the industry, that has a direct impact on the top-line revenue. Those are the biggest ones. I will say in Technology and Workforce Solutions, we also had a contact tracing project we mentioned last year, and that also ended in the second quarter. We've got a tougher consequential as you go into the third quarter. Okay, great. That's helpful. I guess just maybe going back to some earlier questions about supply and whether there's any kind of risk to that coming back. I guess when you talk to the providers, some of them seeing very acute staffing issues, but everyone's talking about labor pressure to some degree. The companies who seem more comfortable with the labor outlook seem to point to, hey, in September, unemployment benefits go away. Kids go back to school, nurses don't have to stay home to take care of them. COVID coming down, fewer quarantine days. It seems like they think that these are relatively meaningful tailwinds from a supply perspective. It sounds like that's not what you're hearing on average. Why aren't those potentially risks to the back half? Yeah, we aren't hearing that from our clients at all. In fact, like you said, quite the opposite. We're hearing they expect it to continue to be very challenging, certainly for the remainder of the year and even really going into next year and beyond, that there's been some sort of structural shift. The unemployment benefits aren't as likely to affect our supply and placement of clinicians. There could be some element of the schools of nurses that maybe have stayed home, I think all nurses are being highly incented to be at work today. If they want to be at work, there's a reason for them to be there, and they've got the financial incentive to do so. We're just not hearing that from our clients, that they expect there to be some sort of relief around the corner. Okay, last question, I guess you talked about utilization. I should say bill rates starting to kind of flatten and then maybe start to tick up. How should we think about gross margins during this kind of period? I know oftentimes your bill rates and pay rates have lagged versus each other. Is there anything that we should be keeping in mind as we think about that trajectory over the next several quarters? The only thing I'd mention for the Q3 guidance, you saw the guidance we gave was around 100 basis points up sequentially. Part of that is because of the strike-related revenue that we mentioned. Just the way the dynamics work in that, there's some upfront revenue we get in preparation for an event, and that has a favorable margin influence on it. Outside of that, I'd say there's a pretty stable margin trend as we go into the third and fourth quarter, and the teams are doing a really effective job, even as they're navigating a very challenging time with these shifting rates and pay packages, keeping really nice stability across the board. I think the bigger influences are really going to be driven more by a mix shift between the businesses, but at a business unit level, we should expect to see stability. All right. Great. Thanks. Your next question comes from the line of Brian Tanquilut with Jefferies. Hey, good afternoon, guys. Brian, congrats on the move and good luck as well. I guess my first question, just looking at the strength in the Technology and Workforce Solutions business, how should I think about the different drivers of that? Is it cross-selling? Is it new business? Is it selling into existing relationships? Then I guess the follow-up to that would just be your thoughts on the margin opportunity for that business, given the continued strength that we're seeing from that. I'll start, and Kelly may want to add in here. Some of the drivers have been a bit different for the various businesses that are included in there. For language services, it's been increased volumes from existing clients as they continue to expand their utilization, seeing the benefit from using the service, and they expand it into more areas of their facility or other facilities. They've had some really nice new client wins over the last year, and so getting those launched and starting to see some volumes from those. Although I have to say, there was a little bit of a delay in some of those just because of the pandemic, so more of that benefit will really come into the future. We are cross-selling into our existing MSPs, but the majority of what you saw in their growth did not come from that, because we've been pretty preoccupied with other things and dealing with the overall growth. We probably haven't made quite as much progress as we would've normally expected in getting them cross-sold. Brian mentioned VMS. A lot of the drivers there are the additional clients that we added over the last year, a lot of really great wins as clients were seeking solutions, vendor neutral or really any solution that would help them to better access their talent. Of course, the bill rate increase did improve, or did help them a bit, although volumes are also very, very strong across VMS. RPO, I mentioned, has had some really great success. The margins in that segment do get impacted a bit by the growth of those various businesses, right? Some of the stronger, higher margins, such as in VMS, have certainly been additive to the gross margin. As we might see bill rates come down across the travel nurse and allied industry, that will affect the growth of the VMS business. It'll still be super positive, but it won't maybe be as big of a mix as other parts of the segment grow. Kelly, what else you want to add? Yeah. The only thing I would add, great job, Susan. Brian, another thing to think about that will fuel growth is, a lot of the more complex solutions we've delivered this year for things like mass vaccination sites, we've really used multiple technology solutions and integrated those to deliver a full comprehensive solution. Bringing together the Smart Square scheduling, utilizing our VMS, integrating that with our language services platform. We continue to see clients looking for that. Synzi, the Synzi platform, is a telehealth platform. As we start to talk with clients, very receptive market to how do we bring full solutions that bring both the staffing and labor component on a platform that can be delivered virtually. That will fuel growth that I think goes beyond just cross-selling, but really integrated solutions. I have to give a call-out to the Synzi team that just joined us, because they've been such a wonderful addition. We had a fabulous win of a new MSP in the home health space, and they were a very instrumental part of helping us win that client and improve our commitment and capabilities within the non-acute category. Thanks to our Synzi colleagues. That's awesome. I guess my second question, just on the capital deployment side, free cash flow is really strong, $160 million this quarter. If you're generating this much cash, how are you thinking about redeploying that, and where should we be thinking you'd allocate that? Well, first, we're of course investing internally. We talked about that. I think you're seeing the benefits of those investments, whether it be in digital or in our own infrastructure and certainly in our people. Never want to lose sight of that. When we think about additional opportunities to add in other capabilities, strategic services, again, we just mentioned Synzi, was a great example of how we continue to add in technology capabilities, and in that case, helps us to really address a growing part of the market that we want to make sure that we've got a presence in the sub-acute and home health space. We'll always be looking at what does the client want and need? How do we build stronger relationships? Those technology workforce solutions are absolutely a priority for us. It could be an addition to something that we're already doing in that space, something that helps us to consolidate within a fragmented part of the market, or it could be something new, a net new capability like Synzi brought to us. Consolidation opportunities, I'd say particularly in our nurse and allied space. Locums has great growth, as does interim leadership. When we look at these longer-term trends of shortages in really all the clinical disciplines, it probably raises our interest more than it was two years ago in terms of consolidation opportunities that might be out there in our staffing services. That's always been on the table, but I'm just kind of recognizing that since we've seen this shift in the shortage and very high demand, we want to make sure that we are as capable as possible to deliver to our clients. Awesome. Thank you, guys. Thanks, Brian. Your next question comes from the line of Tim Mulrooney from William Blair. Hey, guys, this is Sam on for Tim. Hope you're all doing well. Got a few questions here. I think you previously thought bill rates would settle maybe 10%-15% higher relative to the pre-pandemic levels by the end of this year. It's sounding like that's not the case anymore. Can you update us on the timing when you now expect this to occur? And if you think they might settle higher or lower than that 10%-15% during a more normalized environment? Yeah. Difficult to say. Quite honestly, at this point, the magnitude of the demand that we're seeing is definitely more than we even anticipated. We knew on the heels of the pandemic, as things improved, there would be more vacancies, and that has definitely played out, but even in a more severe way than we anticipated, and that's led to these higher and more elevated rates. We do expect them to come down. At this point, if you take the kind of metrics we've given, it would still point to a rate in the fourth quarter, 20% above where it was pre-pandemic. Quite honest, we're not really in a position at this point to say when that would go down further. With demand stays where it is, it's hard to imagine a scenario that would change materially. That's really something we'll have to see how that plays out into 2022. No, that's super fair and so good. Good call there. Maybe switching gears to more of the Delta variant here, it seems with COVID cases on the rise, you've had some contingency conversations with clients should this pandemic continue worsening. I guess there's really two questions I want to ask around that. First, how are you thinking about Delta as it relates to your ER nurse demand? Maybe second, do you think this might negatively affect demand for OR nurses, or are hospitalization rates continuing to move higher even despite the recent rise in cases? One of the things that happened over the last year, I think through all the lessons learned in the pandemic, is healthcare organizations figured out how they could continue to deliver normal patient care and keep their procedures moving. Even things such as isolating COVID patients outside of the normal facility patient flow. What we're hearing from them is they are committed to keeping the doors open and keeping the patients coming in to be seen. If anything, because of the pent-up demand, there's a greater urgency to make sure that they have their ORs open. It's absolutely still a huge need. Right now, the gating factor is staff. If they're having to close down an OR, it's because they don't have nurses or scrub techs to come in and assist. We think that it's not likely going to affect the normal sort of patient demand or the demand that kind of drives more utilization of clinicians, if that's what you're asking. Yeah. No, that's good to hear. I appreciate that. I think I'll leave it at that then, but Brian, I know I speak for Tim as well, best of luck in this next endeavor here. Appreciate it. Your last question comes from the line of Mitra Ramgopal from Sidoti. Yes, hi. Good afternoon. Thanks for taking the questions. I just had a quick one. Based on the need to acquire talent and address staffing needs, I was just wondering if you had an update as it relates to the Randstad partnership and how has that worked out for you. If you might need to enter into even more partnerships like that. Hi, Mitra, it's Kelly. Yeah, the Randstad partnership's gone very well. We continue to collaborate together with existing clients, bringing together their full complement of contingent needs and integrating our programs so we can support them in a comprehensive way. At the moment, we don't see any kind of real gaps in certain labor pools. With Randstad, we're also looking at other ways that we can influence and provide capabilities to our clients that go beyond even just staffing, looking at some of our data and insights and analytics, and other capabilities that we both bring to the table, different best practices that we can bring to our healthcare clients that they might have in other industries or globally. We're going to continue to invest and focus on that jointly. Okay. No, that's great. Thanks again, and Brian, best wishes and good luck in your new endeavor. Great. Thanks, Mitra. There are no further questions at this time. Great. Well, thank you everyone for joining us today. As always, we are proud and honored to serve our country, but also to collaborate alongside our clients and our clinicians, and with this really amazingly passionate and talented team that we're all a part of. We see them lean in and bring their heart and their soul and their talents every single day. We just want to say thank you to all of our incredible colleagues across the country. This concludes today's conference call. Thank you for participating. You may now disconnect.