Hims & Hers Health, Inc. (HIMS)·Q4 2024 Earnings Summary

Executive Summary

• Strong top-line and profitability with strategic investments: Q4 revenue grew 95% YoY to $481.1M and diluted EPS was $0.11; Adjusted EBITDA was $54.1M (11% margin), while free cash flow reached $59.5M . Full-year 2024 revenue rose 69% to $1.4765B and net income was $126.0M, aided by a valuation allowance release; Adjusted EBITDA was $176.9M .
• Mix shift and pricing pressured gross margin: Q4 gross margin declined to 77% (down ~600 bps YoY) as GLP‑1 offerings scaled and strategic pricing actions took effect; management expects margin improvement to begin in Q2 2025 with volume discounts and added sterile capacity .
• 2025 outlook is robust: Q1 2025 revenue guidance $520–$540M and Adjusted EBITDA $55–$65M; FY 2025 revenue $2.3–$2.4B and Adjusted EBITDA $270–$320M. Company also targets at least $725M from weight loss offerings in 2025 (largely oral solutions and liraglutide, with personalized semaglutide only where clinically necessary) .
• Strategic catalysts: acquisitions of an at‑home lab testing business and a U.S. peptide facility to deepen personalization, diagnostics, and supply chain durability; Hers brand eclipsed 30% of Q4 revenue, and a Super Bowl campaign expanded brand reach .

What Went Well and What Went Wrong

What Went Well

• Record scale with accelerating KPIs: Q4 subscribers reached 2.229M (+45% YoY), Monthly Online Revenue per Avg Subscriber rose to $73 (+38% YoY), and AOV climbed to $168 (+63% YoY) .
• Platform breadth and non‑GLP strength: 2024 revenue excluding GLP‑1 increased 43% to >$1.2B, hitting a prior 2025 target a year early, underscoring durability beyond weight loss .
• Profitability and cash generation: Q4 Adjusted EBITDA of $54.1M (+>160% YoY) and free cash flow of $59.5M, with FY 2024 Adjusted EBITDA of $176.9M and operating cash flow $251.1M .

Quotes

• CEO: “2024 was a fantastic year… we expect 2025 will be another exciting step toward our vision of this next‑generation of healthcare.”
• CFO: “Revenue excluding our GLP‑1 offering increased 43% year‑over‑year to over $1.2 billion in 2024, meeting our previous 2025 revenue target a year early.”

What Went Wrong

• Margin compression: Q4 gross margin fell ~600 bps YoY to 77% due to GLP‑1 mix and strategic pricing, partially offset by scale benefits .
• Near‑term margin pressure flagged: Q1 2025 expected to be an “investment quarter” (Super Bowl spend and pricing actions), with margins improving from Q2 as volume discounts and sterile capacity additions kick in .
• Regulatory/supply risk around semaglutide: FDA’s resolution of the semaglutide shortage could constrain compounded semaglutide access after current inventory, shifting mix toward oral and liraglutide; management communicated plans and compliance posture .

Financial Results

Selected financials (oldest → newest):

Channel revenue (oldest → newest):

KPIs (units as reported; oldest → newest):

Notes

• Non‑GAAP: Q3 2024 net income included a $60.8M tax benefit from valuation allowance release; Adjusted EBITDA reconciliations provided in filings .

Guidance Changes

Additional outlook color

• Q1 2025 margins to face near‑term pressure (Super Bowl and pricing) with recovery starting Q2 as volume discounts kick in and sterile capacity ramps .

Earnings Call Themes & Trends

Management Commentary

• Strategy and vision: “We are building the next‑generation health care platform… access to affordable, on‑demand, high‑quality and precision‑tailored care to millions of people.” – CEO, prepared remarks . “2024 was a fantastic year… expect 2025 will be another exciting step” .
• Platform breadth beyond GLP‑1: “Revenue excluding our GLP‑1 offering increased 43% year‑over‑year to over $1.2 billion in 2024” – CFO .
• Margin trajectory: “Gross margins declined… primary drivers GLP‑1 scaling and strategic pricing… expect margins to start to recover in the second quarter” – CFO .
• Diagnostics and expansion: “With [whole‑body lab testing], we will be able to test for… biomarkers… enabling a more holistic individualized treatment plan… expand into specialties such as menopausal support, low testosterone” – CEO .
• Supply chain durability: “Acquir[ing] a California peptide facility… bolster our domestic supply chain… opportunities in preventative health… recovery science” – CEO .

Q&A Highlights

• Personalization approach: Intake captures prior GLP‑1 experience and side‑effect sensitivities; MedMatch aids providers with similar‑patient insights to tailor dosing; not a one‑size‑fits‑all regimen .
• Post‑shortage semaglutide: Commercially available semaglutide likely to come off the platform after Q1; personalized dosing remains where clinically necessary under clear regulatory frameworks .
• Liraglutide timing/pricing: Expected mid‑year or early 2H 2025; pricing likely in the “couple of hundred dollar” range initially given daily dosing/packaging costs, with aim to lower over time via scale .
• Mix and demand: Majority of GLP‑1 users on platform use personalized dosages; oral weight loss remains popular and broadens eligibility, supporting the ≥$725M 2025 weight target .
• Branded partnerships: Openness to branded GLP‑1 partnerships, but supply reliability and reimbursement variability are current constraints for a durable, transparent offering at scale .

Estimates Context

• Wall Street consensus (S&P Global) for Q4 2024 and Q1 2025 was unavailable at the time of analysis due to S&P Global request limits; therefore, we cannot provide a vs‑consensus comparison for revenue/EPS/EBITDA in this report. As a result, any estimate comparisons are omitted and should be incorporated once S&P Global access is restored. Values would be retrieved from S&P Global.

Where estimates may need to adjust

• The FY 2025 revenue outlook of $2.3–$2.4B and Adjusted EBITDA of $270–$320M, plus ≥$725M from weight loss (with a pivot to oral and liraglutide) likely requires models to reflect lower reliance on compounded semaglutide and a path to margin recovery beginning in Q2 2025 .

Key Takeaways for Investors

• Revenue and profitability inflecting at scale: Q4 revenue +95% YoY to $481.1M, with Q4 Adjusted EBITDA $54.1M and FY 2024 Adjusted EBITDA $176.9M; sustained cash generation (Q4 FCF $59.5M) supports reinvestment and buybacks .
• Near‑term margin headwinds, then recovery: Mix/pricing drove Q4 margin compression; Q1 2025 flagged as investment quarter, with margin improvement expected from Q2 via volume discounts and capacity expansion .
• Weight loss durability via diversified modalities: 2025 plan emphasizes oral solutions and liraglutide, with personalized semaglutide reserved for clinical necessity; ≥$725M weight contribution underpins growth regardless of commercial semaglutide availability .
• Structural moats strengthening: Lab testing and peptide facility acquisitions deepen personalization, diagnostics, and domestic supply resilience, expanding the addressable set of specialties (e.g., menopause, low T, sleep) .
• Marketing efficiency compounding: Management targets 1–3 pts annual marketing leverage; Q4 marketing 46% of revenue (down 5 pts YoY) indicates improved paybacks and brand strength .
• Women’s brand momentum: Hers exceeded 30% of Q4 revenue, providing a more balanced growth mix across demographics .
• Trading setup: Watch for Q1 margin pressure, Q2 margin inflection catalysts (discounts/capacity), liraglutide launch timing/pricing, and updates on AI/MedMatch and diagnostics integration that could lift ARPU and retention .

## Appendix: Additional Data Points
- Q4 revenue composition: Online $470.8M (+98% YoY), Wholesale $10.4M (+12% YoY) **[1773751_0001773751-25-000059_hims-20241231x8xkearningsr.htm:0]**.
- Q4 operating expense leverage: Marketing down to 46% of revenue (GAAP) from 51% YoY; G&A down to 10% from 13% YoY **[1773751_0001773751-25-000059_finalq42024shareholderle.htm:12]**.
- Balance sheet: $300M+ in cash, cash equivalents, and short‑term investments; no debt **[1773751_0001773751-25-000059_finalq42024shareholderle.htm:13]**.
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