Cross Country 2025 Q3 Earnings Revenue Dives 20.6%, Net Loss Widens 287%

Cross Country Healthcare (CCRN) reported Q3 2025 results that fell short of expectations, with revenue declining 20.6% year-over-year and a net loss widening sharply. The company also suspended forward guidance due to pending merger uncertainty, while analysts reiterated cautious ratings.

Revenue

Total revenue slid to $250.05 million in Q3 2025 from $315.12 million in the prior year, driven by volume declines in core segments. The Nurse and Allied Staffing segment, which accounts for 81% of revenue, reported $201.95 million, while Physician Staffing generated $48.10 million. Despite these declines, Homecare Staffing saw robust growth of 29% year-over-year, reflecting improved client demand and operational execution.

Earnings/Net Income

The company swung to a net loss of $4.77 million ($0.15 per share) in Q3 2025, compared to a $2.56 million profit ($0.08 per share) in Q3 2024, representing a 287.5% deterioration. Adjusted EBITDA fell to $6.5 million (2.6% of revenue) from $10.3 million (3.3% of revenue) a year earlier, underscoring margin compression amid higher restructuring costs.

Post-Earnings Price Action Review

The strategy of buying CCRN shares on the date of a revenue raise and holding for 30 days showed poor performance over the past three years. The initial 30-day period provided no cushion against the subsequent decline in the stock. In fact, the stock fell further in the following months. This indicates that relying solely on a recent positive revenue raise to predict future performance can be risky, as the company's stock continued to underperform the market. The strategy yielded a negative return in the initial 30 days following the revenue raise, with the stock price falling from the purchase price. Over the subsequent months, the stock continued to decline, indicating that the positive revenue raise may not have been a reliable indicator of future performance. The S&P 500, a broad market index, showed a gain over the same period, indicating that the strategy's poor performance was not due to a general market downturn. The decline in the stock price may reflect broader market conditions or company-specific factors not related to the revenue raise. The strategy does not account for potential risks such as changes in market sentiment, economic conditions, or company performance that could affect the stock's value beyond the immediate reaction to the earnings report. In conclusion, this strategy of buying CCRN shares on the date of its revenue raise and holding for 30 days would not have delivered positive returns over the past three years. The stock's continued decline in the following months highlights the importance of considering multiple factors and not relying solely on a recent positive revenue report for investment decisions.

CEO Commentary

John A. Martins highlighted progress in Homecare Staffing (29% YoY growth) and stabilization in core travel/local staffing. He emphasized $400 million in new/expanded contract value for Managed Service Program clients and robust balance sheet strength ($99 million cash, $20 million Q3 cash flow). Despite merger uncertainty, the tone remained cautiously optimistic, with investments in technology platforms like Intellify and xPerience.

Guidance

The company withheld formal guidance due to pending merger uncertainty, particularly delays in FTC review of the Aya Merger (HSR waiting period extended to December 3, 2025). The CEO noted ongoing discussions to extend the merger deadline but warned of potential termination if unresolved.

Additional News

Cross Country’s pending merger with Aya Healthcare remains central to its strategic outlook. The merger agreement end date was extended to December 3, 2025, with no changes to other terms. The company’s 2025 Annual Meeting of Stockholders is scheduled for December 9, 2025, but will be canceled if the merger is finalized beforehand. Analysts at Citizens reiterated a Market Perform rating, citing a 32% discount to the proposed Aya merger price and valuation uncertainty. Meanwhile, Cross Country’s stock trades at a 10.4x 2025 EBITDA multiple, a four-turn premium to peer AMN Healthcare.

Key Metrics

• Q3 Revenue: $250.05M (-20.6% YoY)

• Net Loss: $4.77M (-287.5% YoY)

• Cash Balance: $99M

• Merger Deadline: December 3, 2025

• Analyst Rating: Market Perform (Citizens)