Hims & Hers Posts Strong Quarter, But Investors Lock In Gains After Big Run

Hims & Hers Health delivered a standout Q1 2025 earnings report that reinforced its position as a high-growth digital health platform, but profit-taking pressured shares after a strong rally into the results. Revenue rose 111% year-over-year to $586 million, surpassing the $538 million consensus, while adjusted EBITDA surged to $91 million, nearly 50% above expectations. Net income came in at $49.5 million with EPS of $0.20, beating the $0.12 forecast. Despite reaffirming its full-year guidance and announcing a transformative partnership with Novo Nordisk for Wegovy access, shares dropped 4% as investors locked in gains following a 50% run since the Novo announcement.

The quarter’s core drivers included explosive subscriber growth, robust engagement with personalized offerings, and continued expansion into new treatment areas like weight loss, menopause, and low testosterone. The subscriber base rose to nearly 2.4 million, with over 1.4 million users engaging with personalized solutions. Monthly online revenue per average subscriber jumped to $84, a 50% year-over-year increase. Gross margins temporarily declined due to GLP-1 (weight loss drugs) scaling, but management guided for sequential improvement starting Q2. Marketing efficiency improved sharply, with spend falling to 39% of revenue from 46% in Q4 2024.

Weight loss remains a key specialty, with management reaffirming its $725 million revenue target for the vertical in 2025. The Wegovy partnership with Novo Nordisk adds a premium branded option alongside existing offerings like liraglutide and personalized semaglutide. The transition of subscribers off commercially available semaglutide is expected to be completed in Q2 and could cause a temporary dip in revenue before recovery in H2. Meanwhile, sexual health saw a transition to premium daily-use products, accounting for 40% of that segment and driving improved retention despite some near-term growth volatility.

Operationally, the company continued to invest in fulfillment and personalization infrastructure, expanding its nationwide footprint to 700,000 square feet and ramping up automation and sterile capacity. Free cash flow was $50 million, and the company ended the quarter with $323 million in cash. With COO Nader Kabbani, a 20-year Amazon veteran, now on board, Hims & Hers is sharpening operational execution in anticipation of broader scale.

For Q2, management guided to revenue of $530 million to $550 million and adjusted EBITDA of $65 million to $75 million, both largely in line with estimates but showing cautious assumptions given subscriber transitions. Full-year guidance was reiterated with revenue of $2.3 billion to $2.4 billion and EBITDA of $295 million to $335 million, suggesting confidence in second-half momentum. Long-term, the company laid out a 2030 target of $6.5 billion in revenue and $1.3 billion in adjusted EBITDA, signaling strong ambition and belief in its expanding healthcare ecosystem.

Analysts acknowledged the beat-and-raise quarter but pointed to elevated expectations and a "show-me" setup that could require consolidation before the next leg higher. Piper raised its price target to $39 from $35, and Morgan Stanley held at $40, both citing strong margin expansion, retention trends, and longer-term opportunity. Still, many are taking a wait-and-see stance until visibility improves around weight loss transitions and sustained margin gains.

Technically, shares pulled back to the mid-$30s, a key support area that may attract new buyers if the broader growth narrative remains intact. The $33–$35 range is widely watched as potential bounce territory, especially given strong operational trends, high retention, and growing optionality across new specialties. If the company can maintain its marketing efficiency while onboarding Wegovy subscribers and launching new offerings like at-home diagnostics and hormone-related care, the stock may reclaim momentum in the second half.

Ultimately, Hims & Hers Health continues to evolve into a personalized healthcare powerhouse. The platform’s unique combination of direct-to-consumer reach, data-driven personalization, and pharmaceutical partnerships positions it to disrupt traditional care models. While the short-term pullback reflects high expectations and macro caution, execution in upcoming quarters will determine whether HIMS earns its place as the category-defining name in digital health.