- Hims & Hers Health (HIMS) shares dropped 22% to $39.84 after Q4 earnings revealed a gross margin decline to 77% from 83% and revenue of $481.1 million beat the $470.3 million consensus, but the FDA’s resolution of semaglutide shortages threatens its lucrative compounded GLP-1 business.
- The company reported 95% year-over-year revenue growth, 2.2 million subscribers (up 45%), and a $0.11 EPS topping estimates, yet higher costs and a shift to oral medications and liraglutide injections for weight loss sparked investor concerns amid a 72% operating expense surge to $351 million.
- Despite a Q1 revenue forecast of $520 million to $540 million and full-year 2025 guidance of $2.3 billion to $2.4 billion -both above consensus – the market’s reaction underscores uncertainty over Hims & Hers’ ability to sustain growth without its semaglutide edge in a shifting regulatory landscape.
Hims & Hers Health (SMCI) saw its shares plummet 22% to $39.84 in midday Tuesday trading, with an intraday low of $36.02. The decline followed its Q4 earnings report, which highlighted a reduction in gross margin to 77% from 83% and raised concerns about the sustainability of its weight loss segment.. The telehealth firm posted a robust $481.1 million in revenue – beating the $470.3 million consensus with a 95% year-over-year surge – and an EPS of $0.11 topping the $0.10 estimate, yet investor unease flared over higher product expansion costs and a regulatory bombshell threatening its GLP-1 playbook. Total subscribers hit 2.2 million, up 45% year-over-year, and average order value climbed 63% to $168, but net orders of 2.81 million missed the 2.90 million mark, while operating expenses ballooned 72% to $350.9 million amid aggressive growth bets.
The FDA’s Friday announcement that semaglutide shortages – fueling demand for drugs like Ozempic and Wegovy – are resolved, with Novo Nordisk and others confirming ample supply, has yanked a key pillar from Hims & Hers’ strategy of selling compounded versions, a niche that turbocharged its rise but now faces obsolescence. Adjusted EBITDA held steady at $54.1 million, up from $20.6 million last year, and the company’s Q1 revenue guidance of $520 million to $540 million trumps the $497.05 million consensus, with full-year 2025 revenue eyed at $2.3 billion to $2.4 billion against a $2.1 billion estimate—bullish figures overshadowed by the weight loss pivot. Hims & Hers plans to lean on oral medications and introduce liraglutide injections in 2025, sidestepping semaglutide’s crowded field, but the market’s 22% rebuke signals doubt about this recalibration’s punch in a post-shortage world.
The company’s telehealth model, once a Wall Street favorite for its agility in tapping unmet needs, now grapples with a double-edged sword: stellar growth metrics – 95% revenue jump, 45% subscriber spike – clashing with margin compression and a regulatory curveball that could kneecap its GLP-1 revenue stream. Liraglutide, a less potent GLP-1 cousin, offers a fallback, but its efficacy and appeal lag behind semaglutide’s blockbuster status, leaving Hims & Hers to prove it can sustain momentum without the shortage-driven tailwind that juiced its stock. With 2025 EBITDA guidance of $270 million to $320 million topping the $258.9 million consensus, the firm’s betting big on its broader platform, yet Tuesday’s slide reflects a market wrestling with whether this growth story can outrun the shadows of a vanishing niche.
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