Hims-HIMS Stock Declines Following Q4 Earnings Miss, Gross Margin Contracts

Core Insights - Hims & Hers Health, Inc. reported an earnings per share (EPS) of 11 cents for Q4 2024, an increase from 1 cent in the same period last year, but missed the Zacks Consensus Estimate by 1 cent [1][2] - Full-year 2024 EPS was 53 cents, compared to a loss of 11 cents in the previous year, but also lagged the Zacks Consensus Estimate by 3.6% [2] Revenue Performance - Q4 2024 revenues reached $481.1 million, a 95.1% increase year over year, surpassing the Zacks Consensus Estimate by 2.1% [3] - Full-year 2024 revenues totaled$ 1.48 billion, reflecting a 69.3% increase from 2023, and beating the Zacks Consensus Estimate by 0.7% [3] Segment Analysis - Online Revenues for Q4 2024 were $470.8 million, up 98.3% year over year, with subscribers increasing to 2.2 million, a 45% rise [4] - Wholesale Revenues amounted to$ 10.4 million, a 12.1% increase year over year [5] Subscriber and Order Metrics - Monthly online revenue per average subscriber increased by 37.7% year over year to $73, driven by the scaling of GLP-1s and a shift to premium offerings [5] - The company generated 2.8 million net orders in Q4 2024, up 22.1% year over year, with an average order value (AOV) of$ 168, a 63.1% increase [5] Margin and Expense Analysis - Gross profit for Q4 increased by 81.1% to $369.5 million, but gross margin contracted by 594 basis points to 76.8% [6] - Marketing expenses rose by 75.6% to$ 221.1 million, while total operating expenses increased by 71.6% to $350.9 million, resulting in an operating profit of$ 18.6 million compared to a loss of $0.4 million in the prior year [7] Financial Position - At the end of 2024, the company had cash and cash equivalents of$ 300.3 million, up from $220.9 million at the end of 2023 [8] - Cumulative net cash provided by operating activities was$ 251.1 million, compared to $73.5 million a year ago [9] Future Outlook - For Q1 2025, Hims & Hers projects revenues between$ 520 million and $540 million, indicating a year-over-year increase of 87-94% [10] - For the full year 2025, the revenue outlook is set between$ 2.3 billion and $2.4 billion, representing growth of 56-63% from 2024 levels [11] Strategic Developments - In February, Hims & Hers acquired a U.S.-based peptide facility to enhance its domestic supply chain and announced plans for at-home lab testing through the acquisition of Trybe Labs [13] - These strategic moves are expected to support the growing demand for personalized healthcare [13]