Hims & Hers Health, Inc. (HIMS) Earnings

Management highlights

• Strategic Direction - Transitioning earnings communications to an annual shareholder letter, retaining quarterly earnings calls, releases, and supplemental materials to focus on long-term strategy and sustained value creation - Reaffirmed confidence in 2030 ambitious targets of at least $6.5 billion in total revenue and $1.3 billion in adjusted EBITDA - Long-term goal to become the world's leading global default everyday consumer health and wellness platform • Weight Loss Business Update - Completed strategic shift from compounded GLP-1 products to offering a broad assortment of branded GLP-1 medications, including Novo Nordisk's Wegovy and Eli Lilly's Zepbound, via partner pharmacy fulfillment - Within six weeks of launching branded Wegovy access, the company fulfilled over 125,000 Wegovy shipments, with particularly strong customer adoption of the oral Wegovy pill - The shift has significantly expanded the addressable market for the weight loss segment, driving subscriber growth to levels above prior seasonal peaks from New Year and Super Bowl marketing campaigns • Proactive Care Expansion - Expanding into new proactive care specialties including testosterone, menopause, and at-home lab testing, which build long-term customer relationships - The testosterone service, which currently serves tens of thousands of U.S. men, delivered increased testosterone levels within two months for 95% of customers via at-home testing and personalized treatment - Completed acquisition of YearBio to enable simple, painless at-home blood sampling, supporting deeper proactive health biomarker insights and preventative care • Technology and AI Progress - Built an in-house AI team of nearly 40 specialized members including senior engineers, applied scientists, and PhDs from top academic institutions - Re-architected the platform around modular, reusable capabilities to enable faster launch of new specialties and geographic expansion, with a new no-code commercial engine and configurable clinical workflows - Already launched two AI tools: a provider-facing AI co-pilot that drafts context-aware responses for care coaches (reviewed by humans before sending), and Labs AI that explains customer-specific biomarker results and flags issues for provider escalation; an AI-powered weight loss companion will launch soon - Operating a closed-loop proprietary data flywheel that collects end-to-end patient journey data, with clinician-verified training labels that create a high-quality, hard-to-replicate data advantage • Emerging Peptide Category Preparation - Investing in preparation for the peptide therapy category, as the FDA moves toward clearer regulatory classification; the company will not launch until it meets strict safety, quality, and clinical oversight standards - Holds a competitive advantage from a 1 million+ square foot 503a compounding footprint that enables personalized dosing at scale, a fully verticalized U.S.-based domestic peptide manufacturing facility acquired in 2025, and in-house clinical expert teams to build robust safety protocols

Guidance

• Full year 2026 guidance was revised upward: management raised revenue guidance to a range of $2.8 billion to $3.0 billion, representing 19% to 28% year-over-year growth • Full year 2026 adjusted EBITDA is guided to a range of $275 million to $350 million, with an 11% adjusted EBITDA margin at the midpoint of the ranges • Q2 2026 expected revenue is $680 million to $700 million, 25% to 28% year-over-year growth, with adjusted EBITDA of $35 million to $55 million, for a 7% adjusted EBITDA margin at the midpoint • The Eucalyptus acquisition is excluded from the 2026 guidance as closing timing remains uncertain • Management expects meaningful step-ups in adjusted EBITDA in the third and fourth quarters of 2026, driven by stacking of monthly subscriber cohorts, G&A operating leverage, and continued marketing efficiency gains • Near-term margin compression is expected as the company prioritizes investment in high-growth, lower-margin areas including weight loss, new specialties, and international expansion; long-term margins are expected to expand as scale drives operating leverage • Efficiency gains from technology and AI investments are expected to begin reducing cost-to-serve starting in 2027 • Management reaffirms the target of returning to GAAP net income profitability in 2027, with a core ongoing priority of maintaining healthy free cash flow generation while scaling the business

Segment performance

U.S. Operations: Revenue was pressured in Q1 2026 by temporary revenue recognition dynamics from shorter shipping cadences for weight loss products and a tough year-over-year comparison against record Q1 2025 weight loss subscriber growth. International Operations: Revenue increased nearly tenfold year-over-year to $78 million in Q1 2026, driven by the prior acquisitions of Zava and LiveWell, with strong ongoing growth. The planned acquisition of Eucalyptus, expected to close in H2 2026, will further expand international operations across Australia, the UK, Germany, Japan, and Canada. Weight loss Specialty: Following the Q1 2026 strategic pivot to prioritize branded GLP-1 products over compounded products, the segment is on track to add over 100,000 new subscribers per month, with 90% of new branded subscribers downloading the platform app and average 3 provider interactions in the first month. The pivot incurred $33 million in one-time Q1 2026 restructuring costs, $28 million of which reduced gross margin by ~5 percentage points.

Risks & headwinds

• The strategic pivot in the weight loss business created one-time restructuring charges in Q1 2026, and will continue to cause near-term GAAP financial volatility and margin compression as the business transitions to monthly shipping cadences for branded products • The peptide category regulatory framework remains pending; FDA classification expected in July 2026 is still uncertain, which could delay or change launch plans • Expanding into new specialties and international markets requires sustained near-term investment, which may pressure near-term profitability even as it supports long-term growth • The company faces competition from unregulated gray market peptide providers that currently operate with lower safety and quality standards • Integration of acquired businesses (including the upcoming Eucalyptus acquisition) carries execution risk that could impact expected growth and cost synergies

Analyst Q&A

• Q: What is the difference in unit economics between branded GLP-1 customers and legacy compounded GLP-1 customers, and how much of the 2026 full-year guidance increase comes from the weight loss pivot versus other business segments?

  A: On a per-customer dollar basis, the unit economics of branded and compounded GLP-1 customers are roughly comparable. The strategic pivot expanded the total addressable audience for weight loss, driving platform traffic back to levels not seen since 2025 peaks, which benefits not just weight loss but also cross-selling to other platform specialties. The strength of demand from the pivot, paired with continued stable growth across other U.S. specialties, gave management the conviction to raise the full-year 2026 revenue guide.

• Q: How ready is Hims & Hers to launch peptides if the FDA reclassifies them in July, how large is the internal opportunity sizing for peptides, and what is your market positioning?

  A: The team is actively working to complete all required preparations for safe launch, including supply chain validation, transparent data protocols, and bulletproof clinical frameworks. Management does not prioritize being first to market; the goal is to be best-in-market when launching, so Hims & Hers will not launch until all safety standards are met. The peptide opportunity is seen as very large, aligned with the broader consumer tailwind toward proactive, preventative, longevity-focused health that also is driving growth in categories like lab testing, testosterone, and menopause.

• Q: How much more gross margin degradation can be expected through the end of 2026, and why do you expect high incremental EBITDA margins in the second half of the year?

  A: A couple of additional percentage points of gross margin degradation are expected over the coming quarters, as the business prioritizes building market leadership before capturing scale economies, following the same playbook Hims & Hers has used for prior category launches. The expected back-half EBITDA acceleration comes from three key factors: monthly shipping cadences create a natural stacking of returning subscriber cohorts that builds revenue and EBITDA through the year; heavy G&A investment front-loaded to the first half of the year will create operating leverage in the back half; and continued marketing efficiency gains from stronger cross-selling, higher retention, and growth in low-cost acquisition channels will support margin expansion.

• Q: What is the long-term vision for AI on the Hims & Hers platform, and what is your approach to integrating wearable device data?

  A: The long-term vision is to build a suite of AI agents that support every step of the customer journey across all specialties, from dynamic conversational intake to ongoing personalized care support and clinician decision assistance. The company's unique closed-loop data set creates a powerful network effect: every patient interaction improves the models, enabling more personalized care that draws from nine years of collective patient experience. For wearables, Hims & Hers plans to both partner with existing popular wearable brands to integrate customer data and potentially develop its own affordable wearable devices integrated with platform memberships to deepen customer engagement.