Hims & Hers Health, Inc. Q3 FY2024 earnings call

• Strong momentum continued into the second half with revenue growth accelerating to 77% YOY, surpassing $400 million in revenue. Adjusted EBITDA was $51.1 million, with a 13% adjusted EBITDA margin.
• Launched personalized titration schedules and dosing for semaglutide in weight loss, expanded multi-condition solutions, and increased form factor options.
• Added Dr. Jessica Shepherd as Chief Medical Officer of Hers, with expertise in women's health areas.
• Service appreciation initiative offers U.S. military veterans, teachers, nurses, and first responders access to personalized GLP-1 weight-loss solutions for as low as $99 per month.
• Technology platform enables quick provider communication, on-demand follow-up care, and access outside traditional hours, driving customer acquisition and adherence.

In the third quarter, revenue increased 77% year-over-year to $401.6 million. Online revenue was $392.6 million, up 79% from the third quarter of last year. The subscriber base grew at a record pace with over 180,000 net subscribers added in the third quarter, ending the quarter with over two million subscribers. Excluding GLP-1s, the subscriber base grew approximately 40% year-over-year. North of 65% of new subscribers benefited from a personalized solution in the third quarter. The weight loss specialty, including GLP-1 offerings, contributed to growth, with the oral weight management offering starting at $79 per month and GLP-1 offerings starting at $199 per month.

• Fourth quarter revenue expected in the range of $465 million to $470 million, representing a year-over-year increase of 89% to 91%. Adjusted EBITDA expected between $50 million to $55 million.
• Full year 2024 revenue anticipated between $1.46 billion to $1.465 billion, +67% to 68% YOY. Adjusted EBITDA expected between $173 million and $178 million.
• Expect more substantial marketing spend in Q4, with CapEx to increase in Q4 for platform evolution, including expanding personalized solutions and automation at facilities.

• Regulatory landscape evolution, including potential impacts on GLP-1 access.
• Side effects from GLP-1 treatments affecting patient adherence.
• GLP-1 shortage leading to limited access for patients, impacting care delivery.

Q: Could you provide the GLP-1 contribution to revenue in the quarter?

A: Yemi Okupe mentioned the subscriber base growth excluding GLP-1s was north of 40% YOY, but specific GLP-1 revenue contribution details weren't provided directly.

Q: What are key reasons for patient dropout during initial GLP-1 treatment and average duration of GLP-1 patients?

A: Andrew Dudum stated reasons include side effects like nausea, vomiting, muscle loss. Providers engaging with patients monthly, technology like MedMatch, and personalized dosages drive adherence. Average duration of GLP-1 patients is around five months.

Q: What investments are needed to get the acquired 503B compound pharmacy operational for GLP-1s?

A: Yemi Okupe said investments include expanding capacity and leveraging automation playbook. CapEx will be diversified across personalization capacity and breadth of options.

Q: How are you thinking about pricing structure and cross-selling of the platform?

A: Yemi Okupe said they look to pass efficiency gains to consumers, test price as a lever, and cross-selling is largely organic with plans to reduce friction for multi-specialty subscriptions in the future.