Hims & Hers Health (HIMS) saw its shares tumble as much as 19% on Tuesday, hitting a seven-month low, after the telehealth company reported a third-quarter loss and fell short of Wall Street's revenue and subscriber growth expectations.
The company posted a loss of 14 cents per share on revenue of $890.4 million, a 49% increase from the same period last year. Analysts had anticipated earnings of 6 cents per share and revenue of approximately $893 million, according to FactSet.
Hims also swung to a net loss of $33 million, compared with a net income of $15.8 million a year earlier, and missed consensus estimates for a profit of $13.9 million.
The decline erased the stock's 8% gain from Friday, which followed an agreement with Eli Lilly to offer its weight-loss treatments, Zepbound and Foundayo, through Hims' platform.
Subscriber growth misses expectations as marketing spending falls
Hims reported that its subscriber base grew 13% year over year to 2.79 million in the third quarter. However, this figure was below analysts' expectations of 3.04 million and represented a decline of roughly 100,000 from the second quarter.
Revenue per average subscriber rose 30% to $105, indicating higher spending among existing customers. Jefferies attributed the sequential subscriber decline primarily to reduced advertising spending and lowered its price target to $24 from $31, maintaining a Hold rating.
The brokerage also warned that uncertainty surrounding demand for GLP-1 weight-loss prescriptions could lead to continued volatility in subscriptions and share prices, potentially resulting in "heightened stock gyrations."
Needham analyst Ryan MacDonald also linked the weaker subscriber performance to lower marketing spending, cutting his price target to $32 from $42 but retaining a Buy rating.
Lilly partnership and AI investments remain growth priorities
The earnings report followed Hims' agreement with Eli Lilly to make Zepbound and Foundayo available through its consumer platform. Customers can complete a consultation and receive a prescription if their healthcare provider considers it appropriate, with treatments shipped directly to their homes. Self-pay prices start at $149 a month for oral Foundayo and $299 for injectable Zepbound.
Co-founder and CEO Andrew Dudum said the company was focused on building stronger customer relationships by expanding treatment options and introducing an AI-native healthcare experience. Chief Technology Officer Mo Elshenawy said the AI experience launched for Hers weight-loss customers had increased engagement, with users sending three times as many messages while AI answered 80% of their questions.
Revenue growth remained strong across both domestic and international operations. US revenue increased 21% year over year to $657.1 million, while international revenue surged 321% to $233.3 million.
Hims lowers full-year adjusted EBITDA guidance
The company expects fourth-quarter revenue of $875 million to $895 million and adjusted EBITDA of $70 million to $90 million, implying a margin of 8% to 10%. Hims also narrowed its full-year 2026 revenue guidance to $3.13 billion to $3.15 billion, compared with the previous range of $3.1 billion to $3.3 billion.
More notably, it lowered its adjusted EBITDA forecast to $257 million to $277 million, from $275 million to $325 million. Chief Financial Officer Yemi Okupe said the company had made "deliberate strategic decisions" to support durable, multi-year growth, adding that planned platform expansions in the current quarter would position it for 2027.
The weaker outlook adds to pressure on the shares, which were already down 43% this year and 54% over the past 12 months.
This article is for informational purposes only and does not constitute financial advice.
