Hims & Hers, an online health and wellness company, reported stronger-than-expected fourth-quarter earnings and a promising forecast for 2025. However, the company’s stock fell 19% in after-hours trading as investors remain concerned about the shifting dynamics in the GLP-1 market.
For 2024, Hims & Hers posted $1.48 billion in revenue, marking a 69% increase from $872 million in 2023. The company also reported a net profit of $126 million, a significant recovery from the previous year’s $25 million loss. This translated to earnings of 53 cents per share. Adjusted EBITDA for the year reached $177 million, compared to $50 million in 2023. Subscriber growth surged by 45%, bringing the total to 2.2 million.
The fourth quarter saw a dramatic 95% increase in revenue, totaling $481 million, up from $247 million in Q4 2023. Profit for the quarter was $26 million, compared to just $1.2 million a year earlier. Adjusted EBITDA for Q4 was $54 million, a substantial rise from $21 million in the same period last year. Earnings per share for the quarter came in at 11 cents, meeting analysts’ expectations.
Despite the positive figures, the company’s gross margin fell to 77% in Q4, down from 83% in the same period last year. CFO Yemi Okupe explained that this decline was attributed to the scaling of the GLP-1 offering and strategic pricing. He noted that margins were expected to recover in Q2.
Looking ahead to 2025, Hims & Hers is projecting revenue between $2.3 billion and $2.4 billion, representing a growth of about 59% at the lower end of the range. The company also expects adjusted EBITDA to reach between $270 million and $320 million. For Q1, it anticipates revenue of $520 million to $540 million, with adjusted EBITDA of $55 million to $65 million.
CEO Andrew Dudum emphasized that the company is building a new model of healthcare, leveraging technology and personalization to deliver accessible, high-quality care. He likened Hims & Hers’ approach to that of Amazon in e-commerce, Netflix in media, and PayPal in digital payments, focusing on on-demand, personalized, and transparent services.
The company’s growth has been fueled by its expansion into weight loss services, particularly through compounded GLP-1 injections. However, recent changes in the GLP-1 market have raised concerns. On Friday, the FDA announced that semaglutide, the active ingredient in popular weight loss drugs Ozempic and Wegovy, is no longer in short supply. As a result, compounding semaglutide will no longer be permitted under current regulations. This news caused a 25% drop in Hims & Hers’ stock on Friday.
Despite this setback, Hims & Hers remains optimistic about its weight loss business, projecting $725 million in revenue from this segment in 2025. However, this forecast excludes commercially available doses of semaglutide, which the company will no longer offer after Q1. The company plans to focus on evolving its oral-based solutions and introducing liraglutide later this year.
Hims & Hers is also exploring a legal pathway to offer personalized titration schedules and dosage levels for patients who require customized treatments. The company is expanding its offerings to include a generic version of Novo Nordisk’s diabetes drug, liraglutide, alongside personalized doses of semaglutide for certain patients.
In 2024, non-GLP-1 offerings accounted for $1.2 billion of Hims & Hers’ total revenue, highlighting the company’s diverse portfolio. The company expanded its weight loss services in late 2023 and added compounded GLP-1 medications in May 2024. It also offers subscriptions for Ozempic and Wegovy, priced around $1,800 per month, with compounded GLP-1 medications available for $165 per month.
Hims & Hers is betting on personalized treatments across various healthcare categories, including mental health, sexual health, dermatology, and primary care. The company recently acquired Trybe Labs, a provider of at-home lab testing, to expand its ability to offer personalized treatments and accelerate its growth in clinical areas such as low testosterone and menopausal support.
In addition to its lab diagnostics capabilities, the company has made significant investments in expanding its domestic supply chain. It recently acquired a U.S.-based peptide facility in California and a 503B outsourcing facility in Ohio. These acquisitions position Hims & Hers to explore new areas of innovation, including preventive health, metabolic optimization, cognitive performance, and more.
Hims & Hers is also focused on scaling its technology to handle more visits on its platform. CEO Dudum emphasized the need for investments in decision-making tools for providers, AI capabilities, and long-term solutions that enhance the customer experience.
Despite the challenges in the GLP-1 market, analysts are optimistic about Hims & Hers’ ability to thrive. BTIG analyst David Larsen believes that the company’s focus on personalized weight loss solutions will allow it to continue growing. He also pointed to the potential influence of Dr. Marty Makary, who is poised to play a role in shaping the FDA’s approach to GLP-1 compounding and personalization.
As Hims & Hers continues to innovate and expand, its leadership remains confident that the company is well-positioned for long-term success in the evolving healthcare landscape.
