Key takeaways
- HIMS fell in after-hours trading as widening first-quarter losses outpace revenue gains.
- A growing subscriber base provides support, but concerns about profitability are weighing heavily on sentiment.
- The company’s outlook points to continued expansion, although margin pressure maintains downward pressure.
- Long-hour selling intensifies as HIMS swings from previous year’s profit to a big loss.
- GLP-1 product expansion offers growth potential while earnings challenges push the stock lower.
Hims & Hers Health (HIMS) shares fell during extended trading hours despite the digital health platform posting an increase in first-quarter revenue. The stock ended regular trading at $29.14, posting a 3.08% gain, before falling 9.75% to $26.30 after the earnings announcement. The after-hours decline reflects investor concerns about deteriorating profitability, margin pressure and a significant reversal in earnings compared to the previous year.
Hims & Hers Health, Inc., HIMS
Higher earnings cannot mask profitability concerns
He whispered and hers First-quarter revenues totaled $608.1 million, representing a 4% increase from $586.0 million in the corresponding period last year. The rise demonstrated continued consumer demand for telehealth offerings. However, this increased growth was not enough to ease investors’ concerns about deteriorating bottom-line performance.
Gross profit margin contracted significantly to 65% from 73% recorded in the same quarter last year. This pressure reflects escalating operational expenses associated with the company’s expanded service offerings. The deterioration in margin also raised questions about the sustainability of profits despite increasing revenues.
The company reported a net loss of $92.1 million during the quarter. This represents a stark reversal from the $49.5 million net income generated in the same quarter last year. Likewise, adjusted EBITDA fell to $44.3 million from $91.1 million.
The customer base expands while local revenues decline
He whispered and hers It concluded the quarter with about 2.6 million subscribers on its platform. This represents a 9% increase year over year from 2.37 million subscribers. The expanding customer base has strengthened the foundation for providing customized healthcare solutions.
Average monthly revenue per subscriber fell to $80 from $85 in the same period a year earlier. This 6% reduction indicates the challenges of extracting greater value from existing customers. This decline partially negated the positive effect of adding new subscribers.
Domestic revenues contracted 8% to $529.9 million during the quarter. Conversely, international revenues rose to $78.2 million compared to just $7.3 million previously. This significant overseas expansion has provided a crucial boost to consolidated revenues amid weak US performance.
Forward guidance shows growth ambitions amid margin challenges
Management provided guidance for second-quarter revenue of $680 million to $700 million. the a company It also expected adjusted EBITDA to range between $35 million and $55 million. These forecasts translate into an EBITDA margin of about 5% to 8%.
For the full 2026 fiscal year, Hims & Hers expects revenue between $2.8 billion and $3.0 billion. Full-year adjusted EBITDA is expected to be in the range of $275 million to $350 million. This forecast excludes any potential contributions from the pending acquisition of Eucalyptus.
The organization continues to invest in branded GLP-1 offerings and additional sponsorship segments. Management also announced a move from quarterly to annual communications to shareholders. Despite these strategic initiatives, the sharp after-hours decline showed that investors remain focused on margin weakness and earnings inconsistency as key concerns for HIMS stock.
