Hims & Hers Soars to $586M Q1 Revenue, Eyes $6.5B by 2030

Hims & Hers Health, Inc. has delivered a blockbuster first quarter of 2025, reporting revenue of $586 million, a staggering 111% year-over-year surge. The telehealth company’s subscriber base has exploded to 2.4 million, up 38% from last year, while its monthly revenue per subscriber hit $84—a 53% jump—signaling deeper engagement and higher monetization. But behind the headline numbers lies a complex story of strategic bets, margin pressures, and ambitious long-term targets.

The Growth Engine: Subscriptions Drive Explosive Revenue

The company’s pivot to a subscription-centric model is paying off. Online revenue, fueled by recurring subscriptions, surged 115% to $576 million, while wholesale revenue (which includes partnerships with retailers) declined 7% to $9.6 million. This reflects a deliberate shift toward direct-to-consumer dominance, where customers pay monthly for personalized healthcare solutions rather than one-time purchases.

The subscriber count now stands at 2.4 million, with 1.4 million actively using personalized plans—a metric management highlighted as a sign of sticky customer relationships. The $84 monthly revenue per subscriber is up from $55 in Q1 2024, suggesting that users are buying more services (e.g., mental health consultations, chronic disease management) as the platform expands its offerings.

Margins Under Pressure, But Profitability Improves

While revenue and subscribers are soaring, gross margins have compressed—dropping from 82% in Q1 2024 to 73% this quarter. Management cited “scaling investments” and operational costs as the primary drivers. However, Adjusted EBITDA (a non-GAAP measure) more than tripled to $91 million, with a margin of 16%—up from 12% last year. This suggests that even as gross margins shrink, operational efficiencies are boosting profitability.

The company’s cash flow metrics are equally strong: operating cash flow hit $109 million (up 328% year-over-year), and free cash flow rose to $50 million, up from $12 million in Q1 2024. This liquidity will be critical as Hims & Hers executes its ambitious growth plans.

The 2030 Vision: Can $6.5 Billion Be Realistic?

Management didn’t stop at 2025. They unveiled long-term targets of $6.5 billion in revenue and $1.3 billion in Adjusted EBITDA by 2030, implying a compound annual growth rate (CAGR) of ~22% from today’s midpoint guidance of $2.35 billion in 2025. To put this in context, hitting $6.5 billion would require the company to grow its current revenue by a factor of ~28x over five years—a stretch, but not impossible if the subscription model scales as planned.

The five growth levers management emphasized include:
1. Deepening personalization via AI and data analytics.
2. Expanding into new specialties, such as chronic disease management and mental health.
3. Enhancing follow-up care to reduce patient churn.
4. Strategic partnerships with pharmaceutical companies and diagnostic firms.
5. Geographic expansion, though specifics remain vague.

Risks and Red Flags

The story isn’t all rosy. The compression of gross margins is a red flag for investors, as it suggests rising costs to sustain growth. Additionally, the company’s decision to stop reporting Net Orders and Average Order Value (AOV)—metrics once central to its model—hints at execution challenges in its shift to subscriptions.

Regulatory risks also loom large. As Hims & Hers moves into more complex healthcare services, it could face scrutiny over data privacy, drug approvals, or reimbursement models. Competitors like Teladoc (TDOC) and Oscar Health (OSCR) are also vying for the same market, though Hims & Hers’ focus on younger, subscription-driven customers gives it a unique niche.

Conclusion: A High-Reward, High-Risk Play

Hims & Hers’ Q1 results are undeniably impressive, but the road to $6.5 billion is fraught with challenges. The company’s subscriber-driven revenue model is a clear advantage, and its $50 million in free cash flow provides a solid foundation. Yet, the margin pressures and reliance on scaling a complex healthcare ecosystem are risks that could trip up even the most ambitious growth story.

For investors, the stock’s valuation will hinge on whether the 2030 targets are achievable. If Hims & Hers can sustain 16-17% EBITDA margins while expanding its subscriber base and service offerings, the 22% CAGR could materialize. But if operational costs balloon or regulatory hurdles arise, the dream of $6.5 billion might remain just that—a dream.

The jury is still out, but Q1 2025 has undeniably placed Hims & Hers in the fast lane of the digital health revolution—a race where execution will be everything.