Good afternoon, everyone. Welcome to Cross Country Healthcare's earnings conference call for the second quarter, 2024. Please be advised that this call is being recorded, and a replay of this webcast will be available on the company's website. Details for accessing the audio replay can be found in the company's earnings release issued this afternoon. At the conclusion of the prepared remarks, I will open the lines for questions. I would now like to turn the call over to Josh Vogel, Cross Country Healthcare's Vice President of Investor Relations. Thank you, and please go ahead, sir. Thank you, and good afternoon, everyone. I'm joined today by our President and Chief Executive Officer, John Martins, as well as Bill Burns, our Chief Financial Officer, and Marc Krug, Group President of Delivery. Today's call will include a discussion of our financial results for the second quarter of 2024, as well as our outlook for the third quarter. A copy of our earnings press release is available on our website at crosscountry.com. Please note that certain statements made on this call may constitute forward-looking statements. These statements reflect the company's beliefs based upon information currently available to it. As noted in our press release, forward-looking statements can vary materially from actual results and are subject to known and unknown risks, uncertainties, and other factors, including those contained in the company's 2023 annual report on Form 10-K and quarterly reports on Form 10-Q, as well as in other filings with the SEC. The company does not intend to update guidance or any of its forward-looking statements prior to the next earnings release. Additionally, we reference non-GAAP financial measures such as adjusted EBITDA or adjusted earnings per share. Such non-GAAP financial measures are provided as additional information and should not be considered substitutes for or superior to those calculated in accordance with US GAAP. More information related to these non-GAAP financial measures is contained in our press release. Also, during this call, we may refer to pro forma when normalized numbers pertain to our most recent acquisitions as though the results were included or excluded from the periods presented. With that, I would now like to turn the call over to our Chief Executive Officer, John Martins. Thanks, Josh, and thank you everyone for joining us this afternoon. As you can see in today's press release, our second quarter 2024 revenue and adjusted EBITDA were near the high end of our guidance ranges, reflecting our continued ability to execute in what remains a challenging environment for core nurse and allied. Specific to travel, we have started to see some positive signs in the market. After troughing at the end of the first quarter, travel demand has been steadily rising for the last couple of months, and today is up more than 20% relative to the start of the second quarter. This increase in orders has been fueled in part by a bounce back in the market, as well as the impact from recent MSP wins that are starting to ramp. As a result, we are also starting to see weekly production improve, and though that will have a minimal impact on our third quarter, we believe that we are nearing an inflection point to begin regrowing our professionals on assignment as we enter the fourth quarter. With our sales pipeline remaining robust, we anticipate sequential revenue growth in the fourth quarter. We also continue to see strong momentum across the rest of our portfolio, notably in locums, education, and home care. Coupled with our strong balance sheet, I believe that Cross Country is very well positioned for long-term, sustained, profitable growth. Bill will get into the numbers in a few minutes, but I'd like to take a moment to comment on our second quarter results. Travel revenue was on track with expectations for both rates and volumes, and as expected, our actual average bill rates declined modestly as we continue to blend down towards current market rates on open orders. Similar to the recent increase in demand, we've also seen a modest improvement in our open order rates. From a bill pay spread perspective, we remain in a very competitive environment for talent, and though open order rates are up slightly, lodging subsidies and insurance costs are continuing to pressure our margins. Regardless, we will remain competitive on both bill rates and pay rates to preserve our market share and ensure our clients have clinicians at the bedside. Turning to physician staffing, we once again delivered a strong top line, reporting a record $48 million in revenue for a single quarter, which is up 7% over the prior year and 3% sequentially. Contribution income also increased both year- over- year and sequentially, reflecting the improved mix and proactive cost management. Our home care business was up double digits year over year and mid-single digits sequentially, driven in part by recent wins and program implementations that we've highlighted on prior calls. Since acquiring the business in 2021, we have doubled the number of PACE programs nationwide, while more than tripling the number of locations we serve. As a result, we will continue to make investments in this business. Lastly, our education business continued to perform well, in line with expectations. Revenue was up modestly year over year in the second quarter, though down sequentially due to the start of the summer vacation in June. We continue to believe this business can sustain organic growth as we expand our client base and geographical footprint. Shifting gears, I want to give an update on our cost actions. As noted in our last call, we are focused on remaining competitive while being mindful of preserving shareholder value and profitability. Accordingly, over the last 18 months, we have been proactively adjusting our cost structure to align with the demand environment. In 2024, we've reduced our U.S. headcount by more than 20%, with a portion of these reductions made possible by expanding our operations in India. Today, we believe we have the right level of capacity in place to fuel organic growth as market conditions improve. Though we've been very focused on driving costs out of the business, we continue to invest heavily in technology. The most impactful of these investments remains our client-facing workforce solutions platform, Intellify. Whether clients are managing their labor through VMS, MSP, or multiple programs across their enterprises, we're navigating per diem shifts, coordinating internal flow pools, arranging locum tenens placements. Intellify is streamlining their processes, saving them time and resources. As I like to say, we are never done investing in technology, and this is certainly the case with Intellify. We are focused on continually enhancing the platform with the latest features and functionality, including AI and predictive analytics. We are collaborating with our clients to tailor solutions to meet their specific needs, showcasing the flexibility and agility that this technology brings to them. Since its launch nearly two years ago, Intellify has gained critical mass and wide adoption. We now have more than 40 clients across 500 facilities with more than 5,500 active users. Intellify also continues to fuel our pipeline with opportunities in various stages of the sales cycle. I'm pleased to announce that we have two new awards in contracting, with a combined estimated annual spend under management of $70 million. While both programs will utilize Intellify, it's worth noting that one is a VMS program and the other is an MSP, which is reflective of the more balanced demand environment we see in the market today. I'm also excited to announce that we have our first SaaS-based subscription with a third party who's utilizing our Intellify technology for the delivery of their services. Additionally, I'm happy with the speed of execution and implementation from the team on all of our current programs in flight that we have highlighted last quarter. Now, turning to our outlook. Given that the travel demand backdrop that persisted through much of the second quarter, as well as the normal seasonal impact in our education business from the summer break, we anticipate that third quarter revenue will be between $305 million and $315 million, with adjusted EBITDA coming in at $10 million-$13 million. While our goal remains to achieve a high single-digit adjusted EBITDA margin, we still expect mid-single digits in the near term, while ensuring we have sufficient capacity in place to grow once the travel market inflects. We believe we can expand our market share by leveraging client and candidate-facing technologies, as well as our expertise in delivering high-quality clinical and non-clinical professionals. We also envision a strong runway of growth for our other lines of business, notably locums, home care, and education. Of course, we are focused on putting our strong balance sheet to work. We have a comprehensive capital allocation strategy that emphasizes a balanced approach, including investing in key areas for growth, particularly in technology, as well as executing share purchases. We bought back almost 1 million shares in the second quarter, bringing the total to 5 million shares repurchased since August of 2022. Additionally, we are actively exploring M&A opportunities that can help further diversify our business, complement existing lines of business, and augment our technological capabilities, all of which can enhance our value proposition and improve our margin profile. In closing, I am encouraged by the recent trends in travel, and I believe that the market is nearing an inflection. Coupled with the impact from recent wins and the momentum in many of our other lines of business, we have a solid foundation in place for long-term growth and improved profitability. None of this is possible without our dedicated employees. I want to thank all of you for your hard work. Last quarter, we won several Most Loved Workplace awards, and it humbles me that we have such a deep pool of talent that has made Cross Country their employer destination of choice. I also want to thank all of our healthcare professionals for your continued hard work and contributions, as well as our shareholders for believing in the company. With that, let me turn the call over to Bill. Thanks, John, and good afternoon, everyone. As highlighted in our press release, performance for the second quarter was in line with expectations, with revenue and adjusted EBITDA near the high end of our guidance ranges. Consolidated revenue for the second quarter of $340 million was down 10% sequentially and 37% over the prior year, driven primarily by declines in travel and local assignments in large acute care settings. I'll get into more details on the segments in just a few minutes. Gross profit for the quarter was $71 million, which represented a gross margin of 20.8%. Gross margin was up 40 basis points sequentially, due primarily to the impact from the annual payroll tax reset at the start of the year. Gross margin was down 200 basis points over the prior year, due principally to higher lodging subsidies on travel assignments, as well as certain burdens such as health insurance, workers' comp, and professional liability. Specific to the bill pay spread, it's worth noting that overall pay rates continued to decline faster than bill rates, but the cost of housing and benefits continue to mask that trend. Moving down the income statement, selling, general, and administrative expense was $60 million, down 5% sequentially and 24% over the prior year. The majority of the decrease relates to lower salary and benefit costs associated with reductions in headcount. Over the last 18 months, we've been proactively managing our costs in order to align with the broader market, while preserving capacity and funding investments in parts of the business where we are seeing opportunities for organic growth. By leveraging our enterprise capacity metrics and by offshoring certain operational and middle office processes, we have scaled down our U.S. headcount by more than 20% since the start of the year. As a percent of revenue, SG&A was 18% for the quarter, and on an adjusted basis, excluding the ERP implementation costs and stock-based compensation, SG&A was roughly 17%. With the first phase of our ERP now live, we have started the second phase of this multi-year initiative to replace multiple middle office systems for payroll and billing. We expect this next phase will take us into the middle of 2025 to complete. Also, within operating expenses, we reported a bad debt expense of $19 million, reflecting the impact of a bankruptcy reported by a single MSP client. Given the unusual and distortive impact from such a bankruptcy, we have excluded the charge pertaining to this client from our adjusted EBITDA. As discussed on previous calls, there is no significant impact on operations from this client, as the majority of the business had been wound down in the prior year. Excluding the bad debt charge and our other normal add backs, adjusted EBITDA was $14 million for the quarter, near the high end of our guidance range and representing an adjusted EBITDA margin of 4.2%. Interest expense was $600,000, related primarily to the carrying costs for our ABL and fees related to our outstanding letters of credit. As a result of our strong collections, we ended the quarter once again with no debt outstanding. Given our significant cash position at the end of the quarter, we will likely report net interest income for the third quarter, depending on our capital allocation decisions. I'll go into more detail in a few minutes. Finally, on the income statement, we reported an income tax benefit of $3.5 million. This net tax benefit was driven primarily by the bad debt charge I mentioned a moment ago and was partly offset by a higher effective tax rate. Our overall effective tax rate is impacted by permanent differences, such as the nondeductible portion of meals and incidentals, as well as reserves for certain uncertain tax positions relative to our pre-tax income. Our overall performance resulted in adjusted earnings per share of $0.10 toward the lower end of the range, primarily as a result of the higher tax rate. Turning to the segments. Nurse and Allied reported revenue of $292 million, down 12% sequentially and 41% from the prior year. Our largest business, Travel Nurse and Allied, was down 16% sequentially and 48% from the prior year, driven primarily by a decline in billable hours and, to a lesser extent, the normalization in bill rates. As John noted, our travel orders have risen over the last several months and is up another 8% just since the start of the third quarter. With an improving demand outlook, we're also starting to see a modest increase in open order rates for specialties such as Med-Surg, ICU, and respiratory. Should these trends continue, we would anticipate them having a more meaningful impact on our fourth quarter results. Similar to travel, our local or per diem business has also been impacted by softer demand for contingent clinical labor, with revenue down approximately 2% sequentially. Also within Nurse and Allied, our home care staffing business was up 6% sequentially and 12% over the prior year. Fueled by a number of recent PACE program wins, we believe this business is poised for continued organic growth. Education was up 4% from the prior year, but down 10% sequentially due to the timing of school breaks. Finally, Physician Staffing reported a record $48 million in revenue, which was up 7% over the prior year and 3% sequentially. Billable days were up 2%, both sequentially and over the prior year, with price and favorable mix accounting for the rest of the increases. Turning to the balance sheet. We ended the quarter with $70 million in cash and no outstanding debt. With the health of our balance sheet and strong cash flow, we remain well positioned to make further investments in technology and accretive acquisitions, as well as to continue repurchasing shares under our $100 million share repurchase plan. From a cash flow perspective, we generated $82 million in cash from operations in the second quarter, fueled by strong collections from clients. Days sales outstanding was 56 days, representing an 18-day sequential improvement and 12 days since the start of the year. Cash used in investing activities was $3 million, primarily reflecting the continued technology investments to expand functionality and features for Intellify, as well as the build-out and deployment of our new ERP system. As a result of the strong cash quarter, we opted to buy more shares of our stock, repurchasing nearly 1 million shares, or roughly 3% of the outstanding shares, for approximately $15 million under both our 10b-18 and 10b5-1 trading plans. With no debt and $70 million in cash, I expect we will continue to repurchase some amount of shares throughout the remainder of the year, but we'll be preserving a decent amount of cash to fund strategic investments. This brings me to our outlook for the third quarter. We're guiding to revenue of between $305 million and $315 million, representing a sequential decline of 7%-10%, driven predominantly by the expected decline in the number of travelers on assignment. Let me just pause on that for a second. Though the number of travelers will be down sequentially, I think it's important to note that the number of travelers is expected to remain fairly steady throughout the quarter, indicating that we are seeing some stability. With the recent rise in orders and commensurate improvement in production, we may see the number of travelers start to grow late in the third quarter or early in the fourth. With a sequential decline in revenue lowering the gross profit, we're guiding to an adjusted EBITDA range of between $10 million and $13 million, representing an adjusted EBITDA margin of between 3% and 4%. Adjusted e arnings per share is expected to be between $0.08 and $0.12, based on an average share count of approximately 33.5 million shares. Also assumed in this guidance is a gross margin of 21%, interest income of $250,000, depreciation and amortization expense of $5 million, stock-based compensation expense of $2 million, and a tax provision of between $1 million and $2 million. That concludes our prepared remarks, and we'd now like to open the lines for questions. Operator? Thank you. We will now begin the question-and-answer session. If you would like to ask a question, please press star one, unmute your phone, and record your name clearly. If you need to withdraw your question, press star two. Again, to ask a question, please press star one. Our first question will come from Kevin Fishbeck with Bank of America. Your line is open. Yeah, I guess just want to get a little bit more color on, you know, the volume outlook. I guess, you know, we've obviously had a difficult time getting visibility into where those numbers were going to trend. You know, a couple of quarters out, I guess, you know, last quarter, you were thinking that we should see volume growth in the back half, but now it's kind of pushed to Q4. I mean, when you think about that, that visibility, is there anything anecdotally you can put on top of. I guess understand the math, I kinda think Q3 should be stable, and stable should be the beginning towards going up. But, like, is there anything you'd say anecdotally around demand or initial view and early order for Q4 that kind of give you a little more comfort about potential growth? Hey, Kevin, this is John. I'll start, and then Bill will, you know, follow up from my response. But, you know, when we start with demand, and as we said in our prepared remarks, we've seen demand steadily increase over the last couple of months to where we saw from the start of the second quarter, up 20%. But what's important to note is that it's over a broad spectrum of specialties and disciplines. It's not just one or two disciplines. And the other thing I think that's very encouraging is that the demand increase is not being driven by winter needs. This is the winter needs, and that would be defined as orders now that we're getting for October starts. We're not seeing that. Zero. There's zero winter needs in this increase, and we would still anticipate to see those winter needs coming in later. We've been speaking over the last several weeks to our clients and some and other hospital leaders. In fact, I spoke with a CEO of a large hospital system last week, and they're all seeing increase in census. They're all seeing increase in higher acuity, which is very much in line with what the publicly traded hospitals have reported over the past couple weeks. Then, if we also look at the macro level, and we look at BLS JOLTS data report that came out yesterday, that showed a openings to higher ratio of 2.1, which of course, we've talked about before, which is historically, pre-COVID was 1.5. So you're talking two job openings per hire, for one hire. It's just continuing to show that the systemic supply and demand imbalance is out there. And then lastly, I'll leave you this before I hand it over to Bill. If you start looking just across Cross Country, what we're doing and why we're optimistic as an organization, the first half of wins that we had and we started to implement, they're now all being starting to ramp up. They're implemented, implemented, and we're starting to increase our capture rate, but we still have more ramp in the back half of the year to increase that capture rate from the wins in the first and second quarter that'll be implemented. And then announcing the two wins we have, we announced today, those we'll start implementing and then have a fourth, potential fourth quarter impact as we start ramping those up. And so with that is why we're really optimistic about why we believe demand is will be sustainable and starting increasing because of the macro level, because of what we're seeing in the market, and of course, because of the wins that we've had. And as we ramp up those wins, we'll start seeing demand increase from those new counts. Bill? Yeah. Hey, Kevin. So I guess I'll just give a couple points. I mean, besides the fact that demand has been improving for the last, you know, couple of months now, and bill rates also are improving modestly, not, you know, nothing, not off to the races. But travel is the business we have the best lens on, and when we look at our traveler on assignment count across the quarter, it's very, very stable month to month to month across the third quarter. So what we had been seeing up until this point was Q1 and Q2 were sequential declines throughout the quarter, exiting at a low point. Now, as we come into July, we see that the travelers on assignment are forecasted through the balance of this quarter, and we're already a month into the quarter, so we kinda have a good lens on where August should be. And then September, really, you know, we're starting to lock those orders now. So I think that's one thing, is that the travelers on assignment is steady. The bill rates in the backdrop are improving a little bit, which is helping. And then I'd say one other point is, when I look at the weekly production, and this is really down in the weeds, but when you look at our weekly production, if I strip out the Fourth of July, which is a short week for us, our actual weekly average production is about up about 3% relative to the second quarter production. So we're coming in at a good clip. It's early, it's just a few weeks, but at least it's starting to indicate that the market backdrop is improving and production is following. If that continues, that's why we say I think the sequential improvement we would really expect is more going into the fourth quarter, but there's still an opportunity to affect the third quarter. We're not certainly giving up on it, but I just want to be clear, I think that the opportunity really is more towards the back end in the fourth quarter. Okay. No, that, that's all very helpful. I guess, you know, one thing that makes it difficult from the outside to tell exactly what's going on is that, you know, you and your peer don't really disclose kinda the same contract growth versus kinda new contract wins or, or, or the impact of losses. So it's hard to tell, you know, how much of the decline was maybe lost share and how much of this improvement might be new contract wins. If you stripped out things and kinda looked at a sustained client basis, you know, how would those trends look? Is that still coming down, or is that actually going up, or how should we think about same store, if you will? Yeah, Kevin, It's Bill again. So I mean, I don't think we've made any secret about it. We had attrition earlier in 2023, and as we exited last year, we were on a much better trajectory. We do have an internal metric we look at for net contract value, which is the net effect of wins, losses, and expansions. And for the last couple of quarters, we've had positive net contract value, so we're adding more to the stable, to our pipeline and to our portfolio, excuse me, of opportunities that we can staff. That's probably the biggest thing I can tell you. The retention and renewal rates are pretty strong at this point. I would say it's really about continuing to win new business. Yeah, I'd just add, this is John, Kevin. The reason we haven't really disclosed those numbers is, but we've seen volumes from hospitals going down and bill rates going down, but it's hard to say what the baseline was. So they're kind of meaningless where the number was. And so as Bill said, you know, we've now tracked over the last several quarters of having that positive rate. So in the future, we can see ourselves tracking that more and publishing that for you. Yeah, and you know, just a little more color on the MSP business or the vendor neutral business. So we have $600 million-$700 million in spend under management on an annualized basis. Our capture rate for the quarter was just under 70%, which was down a tick from the first quarter, and that was largely due to the ramp of this, of our large vendor neutral program that we called out. If I take them out, the capture rate actually moved up a couple of hundred basis points. So we're increasingly doing better with our own programs, but we also have this opportunity across that vendor neutral program. So that's another thing that just gives us a little bit of comfort as we look to the back half. All right, great. Thank you. Thank you. Next, we will hear from Trevor Romeo with William Blair. You may proceed. Afternoon, thanks so much for taking the questions. The first one, just, you know, definitely encouraging to finally hear about an uptick in you know, demand in some of the numbers. Just kind of wondering, when you speak to the client base, you know, what is the general consensus on why you're starting to see an increase in demand? I know, I think, John, you just mentioned the growing census volumes as one thing, but generally, you know, does it feel like the hospitals are now kind of comfortable with the mix of permanent travel staff where they are? You know, are you seeing less CFO and finance organization involvement in the staffing decisions? And does it kind of feel like this is the start of a new post-pandemic equilibrium, in your view? Hey, Trevor, it's John. Yes, you actually answered the question for me. Thank you. Yes, it does feel like talking to our clients and talking to other healthcare leaders out there, what we're hearing is that they're comfortable with the labor they have. And some of them who are using a lot of labor, they're comfortable because they're having a hard time finding their own core staff, and they need to keep beds open, and we've become a very valuable resource for them. Other ones have already settled down, and they've figured out the right number. And I would say, almost every client we speak to feels very comfortable with the amount of contingency labor they're using. And I would also point out that while bill rates, we're starting to see that stabilization, you know, there's still, you know, overall, maybe coming a little bit down, but we're really starting to see a stabilization. But within those orders and in those specialties, we're actually seeing some specialties starting to increase bill rates, because there is still, again, as I mentioned earlier, this supply and demand imbalance that's out there. So overall, I think hospitals seem to be, from what we're hearing, very comfortable with where they're at. It's definitely census driven. There is higher acuity, and it's not just because of one issue. A lot of this, and we've talked about this for the last 18 months after COVID, but a lot of this was all the deferred healthcare that happened, and now we're actually seeing increases in heart disease. We're seeing increase in diabetes, hypertension, and all these lead to other issues with people's health, and that's really what seems to be driving this. And so there's not a date where this goes away, but this probably is a prolonged issue that will go on for some time. Yep. Great. Okay, and then I think, John, you'd said the recent demand increase, I think, has not been driven by winter needs orders. But was just curious, because I think this is kind of the time where you start getting some of those indications. Have you received any indications from clients at this point on, you know, their winter needs, how much they will need, I guess, and expectations on how you think that might play out this year? Yeah. First part of the question is, yes, that is correct. The this uptick has no winter needs included in it, and clients are waiting a little bit longer than normal, is what we're hearing, to give us those needs, holding the cards a little closer to the vest, until we get there. So I, I would anticipate we're going to get the winter needs probably closer to September than normal in the past, where we'd see it in July and August. Okay, great. Thank you. I'll leave it there. Our next question will come from Brian Tanquilut with Jefferies. Your line is open. Hey, good afternoon, guys. Maybe just curious, any comments you can share first on the segment operating margin for Nurse and Allied, and how we should be thinking about that? You know, it sounds like there's optimism into Q4. So just your view on the cadence, for potential improvement in that margin level as we look into Q3 and to Q4. Yeah, Brian, it's Bill again. I guess what I'd say is starting with the bill pay spreads, we've had some improvement in the bill pay spreads specific to travel, but it's been kind of muted, as John mentioned, by the, I'll call it, the housing or the lodging subsidy portion of it, because those costs haven't gone down with inflation, et cetera. So those elements of the compensation package remain elevated relative to the bill rate. So we're not getting the overall gross margin improvement we'd like to see out of the bill pay spreads. Now, as bill rates start to tick up a little bit, perhaps there's an opportunity there. But I think the bigger levers for us, really, around margin will be continuing to drive the mix of our, our business with new Intellify clients coming aboard. That certainly helps, not just because of the efficiencies of staffing direct clients that are, you know, where you've got either exclusivity or at least, certainly at least, you know, a crack to be able to pipeline for their orders. You also have the fees from the subcontractor portion, so it helps the overall margin mix. And then you have to think about the rest of the mix of business. Multiple lines of business operate with higher margins than travel today. So our home care does, our education business does, our search RPO business does. They're on a good trajectory, those lines. So I think as we enter the fourth quarter, schools come back off their summer break. That's their next chance for them to see another organic jump in their revenue run rate as they start a new school year. So I think we'll come into the fourth quarter with a pretty good clip there. They were already exiting at, you know, some of the highest levels that we've seen for that business. So I think coming into the new school year will be another opportunity. Beyond that, it's really about continuing to drive all of our efficiencies as we can. And I'll just make one quick comment on the margins with regards to the burdens. So I mentioned healthcare workers' comp. Let me just pause on that for a second. So workers' comp, you know, for us, it isn't like we've had a major uptick in claims or workers' comp cases. There's some timing elements to it when cases settle, but it's also an actuarial-driven model, so there's sometimes some charges that come through, you just, you know, you're dealing with. So I think that was what we saw in the second quarter. The health comment, though, I think is an interesting dynamic. And as the headcount has been declining, what our benefits carry on for the month after the person, as long as they are at the start of the month, their benefits carry forward. So what we've seen a little bit of is that the healthcare cost, as we've had fewer people, a declining number of people on assignment, the healthcare cost relative to the actual people working, has been a little bit elevated. So I think that we'll see that start to normalize as we move into the back half as well. So that, that may not be as big of a drag as we go into the next year. That doesn't mean healthcare costs aren't rising. They certainly are. You know, specialty prescriptions and the like are a big driver of it. But for us right now, it seems to be the number of claims that we're seeing relative to, you know, to the total expense we expect. Now, that makes a lot of sense. So then maybe, John, as we're starting to see seemingly the stabilization of bill rates, right? How are you thinking about where the premium for temp versus permanent placements will end up? Or is this the right spot where we are right now? Because obviously, that has narrowed versus pre-COVID levels. So just curious what your thoughts are on that. Yeah, you know, I think, Brian, we are in a challenging market with margins. And so I think we're probably in the spot where it is right now, and, you know, adding a little color to Bill's margin statements is really what I think what's going to happen in this industry, and you're seeing what we're doing Cross Country, is this becomes an SG&A game, where margins are going to be hard to crack. I think we have... You're looking at every, you know, nickel, dime, and quarter on the margin side to improve, and you're going to get that. But really, I think you're going to see the margins, and where the margin EBITDA margin is going to improve is as we get that SG&A down, because that's the new model of what the industry is heading towards. And so when we move, as we've increased and really expanded our operations in India, to lower some of our costs there, as we start utilizing more of our technology with AI and predictive analytics, not only for our clients with Intellify, our clinicians with Xperience, but also internally within our organizations, for our team members, that's where this game is going to be won and lost. Got it. Okay, sounds good. Thank you, guys. Our next question will come from A.J. Rice with UBS. Please go ahead. Hey, thanks for the question. I wanted to just go back, make sure I'm getting the right takeaway. So, the rate was down, about 5% sequentially. I know you had guided for it to be low single digit coming out of the first quarter, and admittedly, you know, it seems to be improving versus before, but it seems like there was a little bit of variance. Is that a mix, either the types of nurses you're providing to hospitals, or is, home health and, and education picking up on a relative percentage? Is that impacting it? Or what was the main variance there, and how much of those other aspects impacting your rates? Hey, A.J., this is Bill. I think there's a lot to that question. So I think when you look at the revenue per FTE per day, certainly there's a mix element where, education, home care in particular, you know, growing nicely, is it has a lower overall average bill rate, but that would be with regards to the KPI we publish. When we talk, in the prepared remarks about the bill rates, I think the bill rates are tracking, you know, very closely to what we've expected. I'd say if there really wasn't a big surprise, it's not as though, anything significant changed for in the marketplace for us. So if there's anything, more significant there, I'd say it's probably an element of mix across between allied and nursing, because they do have slightly different bill rates. Okay. And then and the FTEs, just again, to be more precise about it, you were down about 7.8%. I think coming out of the first quarter, you'd said low double digit decline. Where was the variance? Was that in placements, travel, travelers to hospitals? Was it that the home health and the education was so strong that that's why you were variance? How much sort of broke out between the different segments? I mean, I guess we'd have to go down one by one. But I'm going to say there wasn't a big surprise for the quarter across any of the lines of business. I do think home care performed a little bit stronger, so that's a piece of it as well. But on the travel side, I think we exited right in line with where we thought we were going to be, so there really wasn't a big surprise to the numbers. Anything else would really have been caused by mix. And then, just a final question. Some of the discussion we've had over the last six months or so has been about the competitive landscape and that there could be some shakeout of, especially some of the smaller competitors that have grabbed share in the marketplace. How much is your feeling a little bit better about the outlook, any change in the competitive landscape? Are you seeing any meaningful change in terms of pressure, either on bill-pay spread or availability of nurses, whatever, that would be impacted by a changing competitive landscape in any way? Hey, A.J., this is John. Yeah, look, this is a tremendously competitive market right now. A lot of new entrants came in over the last through COVID and probably a little before COVID, but many companies started putting out their shingle during COVID. And I think those smaller companies are going to have a struggle. If you don't have MSPs or VMSs, and you are not being able to control some of your orders and be able to increase capture because you're utilizing third parties, I think we're going to see a lot of the mid-sized and small-sized companies be challenged in this market and continue to be challenged in this market, as margins, as we said earlier, as margins are constrained. Okay. It sounds like that's still in process as opposed to something you've seen a meaningful change in the last six months or so? Still in process. I think companies are still trying to hang on, but I think, you know, you can only hang on for so long. Okay. All right. Thanks a lot. Our next question will come from Bill Sutherland with The Benchmark Company. Your line is open. Hey, guys. I'm just thinking about the fact that the health systems are mostly saying that they're happy with where they've gotten their ratio of contract labor to full time. And so if that ratio, I mean, is mostly where it should be, then is market growth going to be primarily in terms of those travelers? Primarily, is that mostly going to be market share, you know, taking share primarily at, I suppose, through your MSP expansion? Yeah, I think a good portion of that is going to be gaining market share, winning MSPs, winning more VMS deals, increasing our capture as we're winning those deals and ramping them up. And I don't know when, you know, if I had that crystal ball, when the market expands again, you know, just... You're definitely reading it the right way as we're talking to clients saying they're happy and content with where the number of clinicians, temporary clinicians they have on assignment are. That may be good for now, but the dynamic may change in six months, right, or three months. And part of that goes to the whole BLS JOLTS data, where we're seeing two openings for every one hire. While the hospitals, as I said earlier, have done a tremendous job of hiring new core staff, attrition still seems to be not favoring them as nurses are still leaving, and there's this discrepancy. So there is a chance for the market to grow, but I don't think any of us want to, you know, plant a flag and say, "This is the date that the market is going to start growing." So to your earlier assertion, yes, as we grow and we see ourselves increase our share of the market, it's going to be by outperforming our competitors, winning more MSPs, having higher capture rates, winning VMSs, increasing the capture rates there, and probably a little bit of market share going up. Mm-hmm. Okay. I'm sorry, and a little bit of the market growing, but I don't want to plant a flag of saying the date, like, in the next two months or a month, we're going to see the market starting to expand. Yeah. But I think for certain, over the next, you know, year, we'll start seeing the market expand. It's just, you know, when you start seeing that happen. The faster- Okay. Obviously, just to go on, the faster it happens, obviously, the faster we'll start increasing our expectations of our growth as that happens. You've read stories in the industry press about how hospitals will kind of figure out how to manage flexible, you know, add flexibility to their own workforce. Is that really in line with the reality, or is that just a few isolated cases? I think there are some hospitals that have done a terrific, tremendous job of being able to utilize their own resources to add flex, flex pools, and we recognize that Cross Country, that this is an opportunity for hospitals to do it. But many hospitals don't have the knowledge or capabilities, and certainly not the technology. If you go into most hospitals around the country, many, many of them have some type of internal resource pool or float pool, and most of them manage it on Excel spreadsheets. Mm. That's the reality of what's happening. So when we built Intellify, we actually built Intellify with an internal resource pool or float pool technology that allows hospitals, for us to go into hospitals, and we have experts that have run large resource pools at hospitals across country, who can help bring this technology and these learnings from their past experiences to hospitals to teach them. So there is an opportunity for hospitals to increase their utilization of their core staff and hire their own local float pool staff to increase their productivity. But I would say it's really right now, not—it's not widespread in good programs with utilization. I think certain hospitals do it very, very well, but I think a lot of hospitals could benefit from using our expertise and our technology- Mm ... to create, some optimization within their staffing. Okay. And then I just wanted to get one clarification on how you're thinking about how the fourth quarter could be shaping up, and you eliminate, you know, you're not factoring in the winter orders. Is that the main driver for the seasonal pickup in the travel and allied in the fourth quarter? And so that would be. I don't know how to think about it. Would that be incremental if the winter orders are sort of picking up? Yes, that's how we think about it. We're not building in any anticipation of winter orders. Well, we are anticipating that we'll get orders in September as we're modeling it. We're anticipating, especially as we saw last year, we anticipated we'd receive winter orders last year, and, you know, we waited from July, August, September, October, November, December, January, never realized those orders. So as we model it out this year, we are not modeling in those winter needs, but we're anticipating them, and that would be on top of what we're modeling. Mm-hmm. Okay. Thanks, guys. You're welcome. Next, we will hear from Tobey Sommer with Truist. You may proceed. Thank you. I wanted to ask another bill rate question. If you look at your recent weeks of sales production and the bill rates associated with those in travel nursing, how does that compare to the average bill rate of your travelers on assignment? Thanks. Hey, Tobey, it's Bill. Well, I guess what I'd say is it's starting to move in the right direction, right? It's low single digits. The average bill rate on open orders, the average bill rate on locked orders, and what we're seeing from overall production is starting to move up just a little bit. It's, you know, it's low single digit percentage improvement, but it's still moving in the right direction, so it's not declining as we're looking at this point from a production standpoint relative to what our average bill rate is. When you say improving low single digits, I presume that's sort of on some sequential comparison or something compared to a few months ago or something like that? Yeah, I apologize. I, I should have been more clear. The, the third—like, if I look at third quarter production relative to second quarter production, we're up about, you know, 2% on what we're seeing so far coming into this quarter. And open order rates are really following a very similar track. In fact, open order rates today, believe it or not, on the same s—if I look at a basket of orders, just Med-Surg and ICU, as an example, open order rates are actually up closer to 4% over the prior year. But again, a lot goes into that, but the, the point is, the backdrop is improving. That's, that's the important point. Right. And at this point in a given month, how much of the travel nurses are renewals versus sort of recent, the product of recent sales production? And I know that varies month to month, but in approximate terms, can you tell us what a split looks like there? Sorry, Tobey, could you repeat that question? I apologize. Yeah. How... What proportion of your travelers on assignment have been renewed from a previous assignment? Sorry. Oh, I see what you're saying. Well, that's probably a good question for Mark. So how often do our travelers renew? What percentage of renewal rates do we typically see from an assignment rolling quarter? In terms of how many assignments are they completing? Yeah, I mean, I know there's been a material change in our renewal rates quarter-over-quarter, but it's historically been, you know, about the two-thirds range or something like that. Right. We don't give the exact number out. Right ... but it's in that range. It hasn't really changed that much. It, if there's probably, like, two-thirds is a good way to describe it, Tobey, and then it probably bounces on, you know, 3-4 points down or 3-4 points up from that, from that midpoint, and it's been a very tight range, and it's interesting, it's been a tight range from COVID to even post-COVID and pre-COVID. It's been in that probably 8-point swing. Okay. I'm trying to square how long it'll take for renewal rates, which tend to blend down from wherever those whenever those nurses started their, you know, sort of travel stints, and where weekly sales production rates are today. Do you when you think of it in those terms, are nurses renewing, can that continue to cause some overall bill rate declines, or do you think that effect is, you know, approaching the end for you here? I think, I think we're nearing the end. I think bill rate, bill rates on assignments that renew, we're not seeing continued step down in those rates, so I think it's, it's largely baked in. I, I know what you're where you're going with the question. You're, you're right, that the portfolio continues to blend down to an open order rate, but we're nearing that. We're nearing the bottom. I mean, plus or minus a point or two, it's not, it's not wildly going to be a rate-driven story in as we look at, you know, third, fourth quarter right now. Thanks. That's helpful to see. We're going with the difference is coins, not a lot of bills. I got it. And the winter orders, how do we, you know, how do you think about that? It's been so long since we've had anything seasonal that could be called normal. If your memory goes back far enough to refresh us on what that could look like or used to look like, that would be helpful. Sure. And again, I think you're right, we have to definitely go back to the recesses of our minds to remember, what that looked like. Typically, we would have seen, again, depending... I'll just give it for the, for the industry-wide perspective. You would have seen a 20%-30% increase in orders coming in June, July, and more call it July, August, September, for starts between October and January. And those would have been the winter needs. And that historically was pretty much for over a decade where you saw that happen. And you're right, last year, as I mentioned earlier, we never saw those orders come through, and that's why we're really not modeling those winter needs into, where we're seeing we're gonna be in the fourth quarter. But there could be upside on that if it comes through. Thanks. Last one for me. You, you talked about some client wins, Intellify, et cetera. Several quarters ago, you had lost some business. Is the effect of that market share loss out of the P&L, or are there lingering renewals of travelers that you're still sort of generating revenue and EBITDA from? I guess, Tobey, it's Bill. I'd say it's mostly out. I mean, from accounts that have traded over, if we're still continuing to support them, the level of support hasn't, is kind of stabilized at this point. So I don't think there's a lot of headwinds faced from client retention. Yeah, this is, this is John, Tobey. What I'd say is on the programs where we chose not to participate if we lost it, those are all clean, and they're gone. There are programs that we may have lost that we wanted to participate in. Those ones are, we're participating at the level that we're happy with. So there's no other things to be able to come out of the numbers at this point. Terrific. Thank you for your help. Our next question will come from Constantine Davides with JMP. Your line is open. Thanks. Bill, really nice cash flow improvement this quarter. Just wondering if you can give us a sense for where cash flow could shake out this year. Last year, you had some outsized working capital improvements, and then this year, you have the drag associated with that one client. Just, just if you can kind of help us understand where you're thinking on the cash flow front, if there's any other sort of puts and takes to think about. Hey, Constantine. No, appreciate that. And look, at the end of the day, we did a great job this quarter of bringing our DSO back in line. The impact from the bankruptcy, that client, as we called out last quarter, was between four and five days. So we reported 56 days. So even if you said, you know, excluding that, you would've been, call it 60. At the end of the day, we're getting very close to where I think the normalized DSO for this business will be. I don't think there's a significant opportunity for much further improvement, maybe a little bit, but I'd say it's more about converting EBITDA to cash flow at this point. So as we look, you know, to this quarter coming and the quarter after, it'll be closer to our normal conversion rates, right? So you have your reported EBITDA, you have your other costs that come out of it. Interesting to note that, you know, interest won't be a drag this quarter coming up. It'll actually be a little bit of a good guy for the first time, 'cause we will be holding onto a sizable portion of the cash. Got it. Thanks. And then I guess, related question, John, just, you know, if you're a little bit more confident that we're nearing an inflection point, does that make you more comfortable in terms of deploying capital towards M&A? And I guess, you know, a follow-up to that is can you see the need to scale up the core nurse and allied business, or is there more of a preference towards some of your specialty subverticals, be it something like education, or home care, or maybe additional locums opportunities? Thanks. Sure. So what I'd say is, look, we have a balanced approach when it comes to our capital allocation strategy. We're continuing to repurchase shares. We talked about in Q2, almost 1 million shares repurchased. We'll continue to look to repurchase shares as well moving forward. We're also deploying capital investments into our technology. I mentioned earlier, look, we want to create efficiencies throughout our whole organization, and that starts with Intellify, as we're delivering our candidates to our hospitals and other clients. It also goes into our Xperience app and continuing to invest in that as well to create the efficiencies to get clinicians faster to the hospital at a lower cost, as well as all our internal technologies. Finally, we continue with a really disciplined approach on our M&A. While the last 12 months has been really slow in deals in the industry that are coming in, we're out there aggressively looking. And, we have, as you noted, a great balance sheet, a good amount of cash on hand, and we're really well positioned, to look out there and pick up those deals when they come through. And the deals we're looking at will probably... You know, we look more towards our diversifying the portfolio of the organization, looking towards, allied locums, which we've done tremendous. Our last acquisition of locums, Mint and Lotus, has done really well for us. Looking at the education space and also technologies that can improve how we deliver clinicians or how we improve how we can have more impact and help hospitals achieve their goals of retaining clinicians and optimizing their workforce. Thank you. Now our last question will come from Kevin Steinke with Barrington Research. Please go ahead. Thank you. So with the demand picture in travel improving, and you also mentioned bill rates improving modestly, do you think there's an opportunity, you know, over the next several quarters for some incremental gross margin improvement, or do you think this constrained environment is more structural? And as you referenced, you know, the adjusted EBITDA margin improvement is really just gonna all have to come from the SG&A side? Hey, Kevin, thanks for the question. It's Bill again. As I mentioned a little while ago, I think bill-pay spread's gonna be hard to come by, right? I think that we're competitive market on both sides, and sure, we're happy that the bill rates improved a little bit. I think that will give you some leverage. As you know, if you think of it, the M&IE subsidies don't necessarily flex with the bill rate. So as the bill rate improves, you'll get a little bit of an uplift if those dollars just even remain flat. So there's a little opportunity there, but the majority of the gross margin improvement for the business will come from mix, will come from other operational efficiencies, and from the mix of clients that are using Intellify. Okay, understood. And you've referenced in the last couple of quarters here about insurance costs pressuring the gross margin. Is that something that's, you know, completely out of your control, or is there something you could do to manage that with your providers or, you know, in terms of rates or policy or anything like that? Well, some of it's experience driven, and some of it is your premiums that you're gonna face each year. So we do come into a renewal cycle as we go through the third quarter. I'm not gonna hazard a guess as to how the rates will look on the renewals for premiums. But specific to health, I mentioned a little while ago that that is one that is somewhat. It seems to be experience driven. And as you're kind of declining on a number of personnel basis, and this also applies to our corporate employee base, as John mentioned, we're down 20% since the start of the year. It's probably nearly double that since our peak, you know, probably 18 months ago. And so you have the phenomenon where folks carry their benefits for a period of time post-employment, and you're still having those claims come through until they either secure their next assignment or the new benefits kick in. So I think we're seeing a little bit of an excessive amount of health insurance costs relative to that, but it's also continuing rising healthcare costs in the country as a driver. So we take what, you know, we do what we can to take appropriate actions. But as I said, we've got the renewals coming up in the third quarter. We'll know more as we go into the fourth quarter of what that looks like. Okay, thanks for taking the questions. Our pleasure.