Telehealth company Hims & Hers (HIMS) delivered an earnings beat in its first-quarter report Monday evening, driven by surging demand for weight-loss treatments.
Revenue soared 111% year-over-year to $586 million, crushing Wall Street’s estimate of $538.6 million. Adjusted EBITDA landed at $91.1 million, far above the $61 million consensus.
Still, the post-earnings reaction was mixed. Shares tumbled as much as 7.5% in premarket trading Tuesday before rebounding once the market opened. By midday, the stock had risen 7.8% to $45.14. While Hims maintained its 2025 revenue outlook and slightly raised its full-year profit forecast, second-quarter guidance disappointed investors: projected revenue of $530 million to $550 million fell short of analysts' $553 million target.
More notably, the company issued a long-term revenue target of at least $6.5 billion for 2030—below the consensus of $7.8 billion—along with adjusted EBITDA guidance of $1.3 billion, narrowly beating expectations.
From Compounded Drugs to Branded Partnerships
Hims’ dramatic growth has been largely fueled by the sale of compounded semaglutide, a cheaper alternative to Novo Nordisk’s blockbuster weight-loss drug Wegovy. Capitalizing on a national shortage of the branded version, Hims marketed its compounded offering heavily—including a Super Bowl ad that drew attention and controversy.
But a turning point arrived in late February when the FDA declared the shortage over. Under federal rules, this means pharmacies must halt mass production of compounded semaglutide by May 22. That regulatory shift raises questions about the sustainability of Hims’ weight-loss revenue, which totaled $225 million in 2024 and is expected to hit at least $725 million in 2025—accounting for nearly a third of projected revenue.
In a bid to adapt, Hims struck a new deal with Novo Nordisk last week to distribute branded Wegovy directly to consumers via its platform. Hims will charge $599 per month for the branded drug, compared to Novo’s $499 price through its own online pharmacy. The agreement marks a significant shift from selling low-cost knockoffs to offering premium, FDA-approved treatments.
CEO Andrew Dudum has signaled that the company is not fully abandoning compounded medications. He argued on an investor call that personalized semaglutide remains “clinically necessary for some patients” and that limited compounding will continue within regulatory bounds. However, the company has noticeably scaled back its rhetoric on personalized dosing as it focuses on relationships with pharmaceutical manufacturers.
New Leadership to Steer the Next Phase
Hims also announced the appointment of Nader Kabbani as Chief Operating Officer. A 20-year Amazon veteran, Kabbani played key roles in launching Amazon Pharmacy and acquiring PillPack. His experience building logistics and healthcare delivery infrastructure at scale is seen as a strategic asset for Hims as it pushes deeper into branded pharmaceuticals and broader healthcare services.
CEO Dudum framed Kabbani’s hire as critical to “delivering a new and innovative healthcare experience” while scaling operations to reach tens of millions of patients. With nearly 2.4 million subscribers and a rapidly growing base of personalized-care users, Hims is betting that operational excellence—and partnerships with major drugmakers—will sustain momentum even as regulatory and competitive pressures rise.
Balancing Growth, Regulation, and Expectations
Despite a recent selloff—Hims shares are down more than 35% since the FDA’s Wegovy announcement—the stock is still up over 70% in 2025 and more than 260% over the past 12 months. The strong performance reflects investor enthusiasm for its high-growth, direct-to-consumer model. But analysts remain split on what lies ahead.
Citi’s Daniel Grosslight called the latest results “a Rorschach test,” noting that the upbeat Q1 was clouded by cautious Q2 guidance. While Grosslight maintained a Sell rating, he raised his price target to $30, citing the company’s massive user base and potential for continued expansion.
The next chapter for Hims & Hers hinges on its ability to transition from opportunistic growth during a shortage to durable performance in a more regulated, competitive environment. With new leadership in place and partnerships solidifying, the company has laid the groundwork. The challenge now is execution—and convincing the market that the growth story is only just beginning.
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