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Hims & Hers Health, Inc. Reports Fourth Quarter and Full Year 2023 Financial Results

SAN FRANCISCO , February 26 /Businesswire/ - Hims & Hers Health, Inc. (“Hims & Hers” or the “Company”) (NYSE: HIMS), the leading health and wellness platform, today announced financial results for the fourth quarter and full year ended December 31, 2023 in a shareholder letter that is posted at investors.hims.com.

“Our outstanding results in 2023 underscore the power of the Hims & Hers brands and superior execution across the organization,” said Andrew Dudum, co-founder and CEO. “We are continuing to advance our mission to make the world feel great through the power of better health, which is evident in the significant, consistent and category-leading revenue growth and market share gains we have been delivering. In 2024, we expect to eclipse $1 billion in revenue and deliver our first full year of net income profitability through a continued focus on building personalized and accessible treatments in each of our core specialties. We believe this approach will meaningfully break down barriers that keep individuals from seeking treatment, which will allow us to bring these unique offerings to tens of millions of subscribers over time.”

Yemi Okupe, CFO, stated, “The strong momentum our business is currently experiencing is the direct result of a simple but powerful strategy to provide users with access to high quality personalized care that is attractively priced and backed by a delightful experience from beginning to end. Our operational excellence, solid foundation for profitable growth and highly disciplined capital allocation framework position the Company to continue building upon this momentum in 2024 and beyond. Execution across these factors is driving the expected attainment of our 2025 Adjusted EBITDA target one year early and gives us direct line of sight to our 2025 revenue target.”

Key Business Metrics

(In Thousands, Except for Monthly Online Revenue per Average Subscriber and AOV, Unaudited)

 

 

 

Three Months Ended

December 31,

 

Year Ended

December 31,

 

 

2023

 

2022

 

% Change

 

2023

 

2022

 

% Change

Subscribers (end of period)

 

 

1,537

 

 

1,040

 

48

%

 

 

1,537

 

 

1,040

 

48

%

Monthly Online Revenue per Average Subscriber

 

$

53

 

 

$

55

 

 

(4

)%

 

$

54

 

 

$

53

 

 

2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Orders

 

 

2,298

 

 

 

1,855

 

 

24

%

 

 

8,676

 

 

 

6,122

 

 

42

%

AOV

 

$

103

 

 

$

87

 

 

18

%

 

$

97

 

 

$

82

 

 

18

%

Revenue

(In Thousands, Unaudited)

 

 

 

Three Months Ended

December 31,

 

Year Ended

December 31,

 

 

2023

 

2022

 

% Change

 

2023

 

2022

 

% Change

Online Revenue

 

$

237,363

 

$

161,162

 

47

%

 

$

842,381

 

$

502,507

 

68

%

Wholesale Revenue

 

 

9,256

 

 

 

6,041

 

 

53

%

 

 

29,619

 

 

 

24,409

 

 

21

%

Total revenue

 

$

246,619

 

 

$

167,203

 

 

47

%

 

$

872,000

 

 

$

526,916

 

 

65

%

Fourth Quarter 2023 Financial Highlights

  • Revenue was $246.6 million for the fourth quarter of 2023 compared to $167.2 million for the fourth quarter of 2022, an increase of 47% year-over-year.
  • Gross margin was 83% for the fourth quarter of 2023 compared to 79% for the fourth quarter of 2022.
  • Net income was $1.2 million for the fourth quarter of 2023 compared to a net loss of $(10.9) million for the fourth quarter of 2022.
  • Adjusted EBITDA was $20.6 million for the fourth quarter of 2023 compared to $3.9 million for the fourth quarter of 2022.
  • Net cash provided by operating activities was $22.0 million for the fourth quarter of 2023 compared to net cash used in operating activities of $(6.7) million for the fourth quarter of 2022.
  • Free Cash Flow was $10.8 million for the fourth quarter of 2023 compared to $(9.3) million for the fourth quarter of 2022.

Full Year 2023 Financial Highlights

  • Revenue was $872.0 million for the year ended December 31, 2023 compared to $526.9 million for the year ended December 31, 2022, an increase of 65% year-over-year.
  • Gross margin was 82% for the year ended December 31, 2023 compared to 78% for the year ended December 31, 2022.
  • Net loss was $(23.5) million for the year ended December 31, 2023 compared to $(65.7) million for the year ended December 31, 2022.
  • Adjusted EBITDA was $49.5 million for the year ended December 31, 2023 compared to $(15.8) million for the year ended December 31, 2022.
  • Net cash provided by operating activities was $73.5 million for the year ended December 31, 2023 compared to net cash used in operating activities of $(26.5) million for the year ended December 31, 2022.
  • Free Cash Flow was $47.0 million for the year ended December 31, 2023 compared to $(33.8) million for the year ended December 31, 2022.

Reconciliations of Adjusted EBITDA and Free Cash Flow, non-GAAP measures, to net loss and cash provided by (used in) operating activities, respectively, their most comparable financial measures under generally accepted accounting principles in the United States (“U.S. GAAP”), have been provided in this press release in the accompanying tables. Additional information about Adjusted EBITDA and Free Cash Flow is also included below under the heading “Non-GAAP Financial Measures.”

Financial Outlook

Hims & Hers is providing the following guidance:

For the first quarter 2024, we expect:

  • Revenue of $267 million to $272 million.
  • Adjusted EBITDA of $22 million to $27 million, reflecting an Adjusted EBITDA margin of 8% to 10%.

For the full year 2024, we expect:

  • Revenue of $1.17 billion to $1.20 billion.
  • Adjusted EBITDA of $100 million to $120 million, reflecting an Adjusted EBITDA margin of 9% to 10%.

The guidance provided above constitutes forward-looking statements and actual results may differ materially. Refer to the “Cautionary Note Regarding Forward-Looking Statements” safe harbor section below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.

We have relied upon the exception in Item 10(e)(1)(i)(B) of Regulation S-K and have not reconciled forward-looking Adjusted EBITDA to its most directly comparable U.S. GAAP measure, net loss, because we cannot predict with reasonable certainty the ultimate outcome of certain components of such reconciliations, including market-related assumptions that are not within our control, or others that may arise, without unreasonable effort. For these reasons, we are unable to assess the probable significance of the unavailable information, which could materially impact the amount of future net loss. See “Non-GAAP Financial Measures” for additional important information regarding Adjusted EBITDA.

Conference Call

Hims & Hers will host a conference call to review the fourth quarter and full year 2023 results on February 26, 2024, at 5:00 p.m. ET. The conference call can be accessed by dialing +1 (888) 510-2630 for U.S. participants and +1 (646) 960-0137 for international participants, and referencing conference ID #1704296. A live audio webcast will be available online at investors.hims.com. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call at the same link.

About Hims & Hers Health, Inc.

Hims & Hers is the leading health and wellness platform on a mission to help the world feel great through the power of better health.

We believe how you feel in your body and mind transforms how you show up in life. That’s why we’re building a future where nothing stands in the way of harnessing this power. Hims & Hers normalizes health & wellness challenges—and innovates on their solutions—to make feeling happy and healthy easy to achieve. No two people are the same, so the Company provides access to personalized care designed for results.

For more information, please visit investors.hims.com.

Cautionary Note Regarding Forward-Looking Statements

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believe,” “estimate,” “anticipate,” “expect,” “assume,” “imply,” “intend,” “plan,” “may,” “will,” “potential,” “project,” “predict,” “continue,” “could,” or “should,” or, in each case, their plural, their negative or other variations or comparable terminology. There can be no assurance that actual results will not materially differ from expectations. Such statements include, but are not limited to, any statements relating to our financial outlook and guidance, including our mission to drive top-line growth and profitability and our ability to attain our medium- and long-term financial targets; our expected future financial and business performance, including with respect to the Hims & Hers platform, our marketing campaigns, investments in innovation, and our infrastructure, and the underlying assumptions with respect to the foregoing; statements relating to events and trends relevant to us, including with respect to our financial condition, results of operations, short- and long-term business operations, objectives, and financial needs; expectations regarding our mobile applications, market acceptance, user experience, customer retention, brand development, our ability to invest and generate a return on any such investment, customer acquisition costs, operating efficiencies and leverage (including our fulfillment capabilities), the effect of any pricing decisions, changes in our product or offering mix, the timing and market acceptance of any new products or offerings, the success of our business model, our market opportunity, our ability to scale our business, the growth of certain of our specialties, our ability to innovate on and expand the scope of our offerings and experiences, our ability to reinvest into the customer experience, and our ability to comply with the extensive, complex and evolving regulatory requirements applicable to our business, including without limitation state and federal healthcare, privacy and consumer protection laws and regulations. These statements are based on management’s current expectations, but actual results may differ materially due to various factors.

The forward-looking statements contained in this press release are based on our current expectations and beliefs concerning future developments and their potential effects on us. Future developments affecting us may not be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) and other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described in the “Risk Factors” section of each of our most recently filed Quarterly Report on Form 10-Q, our most recently filed Annual Report on Form 10-K, and any of our subsequent filings with the Securities and Exchange Commission (the “Commission”).

Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. We caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition and liquidity, and developments in the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements contained in reports we have filed or will file with the Commission, including our most recently filed Annual Report on Form 10-K, our most recently filed Quarterly Report on Form 10-Q, and any of our subsequent filings with the Commission. In addition, even if our results of operations, financial condition and liquidity, and developments in the industry in which we operate are consistent with the forward-looking statements contained in such reports, those results or developments may not be indicative of results or developments in subsequent periods.

Key Business Metrics

“Online Revenue” represents the sales of products and services on our platform, net of refunds, credits, and chargebacks, and includes revenue recognition adjustments recorded pursuant to U.S. GAAP, primarily relating to deferred revenue and returns reserve. Online Revenue is generated by selling directly to consumers through our websites and mobile applications. Our Online Revenue consists of products and services purchased by customers directly through our online platform. The majority of our Online Revenue is subscription-based, where customers agree to be billed on a recurring basis to have products and services automatically delivered to them.

“Wholesale Revenue” represents non-prescription product sales to retailers through wholesale purchasing agreements. Wholesale Revenue also includes non-prescription product sales to third-party platforms through consignment arrangements. In addition to being revenue generative and profitable, wholesale partnerships and consignment arrangements have the added benefit of generating brand awareness with new customers in physical and online environments.

“Subscribers” are customers who have one or more “Subscriptions” pursuant to which they have agreed to be automatically billed on a recurring basis at a defined cadence. The Subscription billing cadence is typically defined as a number of days (for example, billed every 30 days or every 90 days), which are excluded from our reporting when payment has not occurred at the contracted billing cadence. Subscribers can cancel Subscriptions in between billing periods to stop receiving additional products and/or services and can reactivate Subscriptions to continue receiving additional products and/or services.

“Monthly Online Revenue per Average Subscriber” is defined as Online Revenue divided by “Average Subscribers,” which amount is then further divided by the number of months in a period. “Average Subscribers” are calculated as the sum of the Subscribers at the beginning and end of a given period divided by 2.

“Net Orders” are defined as the number of online customer orders minus transactions related to refunds, credits, chargebacks, and other negative adjustments. Net Orders represent transactions made on our platform during a defined period of time and exclude revenue recognition adjustments recorded pursuant to U.S. GAAP.

Average Order Value (“AOV”) is defined as Online Revenue divided by Net Orders (each as defined above).

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands, Except Share and Per Share Data, Unaudited)

 

 

December 31,

 

2023

 

2022

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

96,663

 

 

$

46,772

 

Short-term investments

 

124,318

 

 

 

132,853

 

Inventory

 

22,464

 

 

 

21,562

 

Prepaid expenses and other current assets

 

21,608

 

 

 

15,408

 

Total current assets

 

265,053

 

 

 

216,595

 

Restricted cash

 

856

 

 

 

856

 

Goodwill

 

110,881

 

 

 

110,881

 

Property, equipment, and software, net

 

36,143

 

 

 

11,199

 

Intangible assets, net

 

18,574

 

 

 

21,841

 

Operating lease right-of-use assets

 

9,588

 

 

 

4,936

 

Other long-term assets

 

91

 

 

 

33

 

Total assets

$

441,186

 

 

$

366,341

 

Liabilities and stockholders' equity

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

43,070

 

 

$

32,363

 

Accrued liabilities

 

28,972

 

 

 

12,448

 

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