Hims & Hers: Can the Stock Bounce Back After the Wegovy Bust?

The sudden termination of Hims & Hers' partnership with Novo Nordisk over Wegovy—a blockbuster weight-loss drug—sent its stock plunging 30% on June 23. But is this a buying opportunity or a warning sign for investors? Let's dissect the chaos and assess whether Hims & Hers (HIMS) can survive the regulatory and competitive storm brewing in the GLP-1 market.

The Wegovy Wipeout: A Near-Term Shock or Long-Term Disaster?

The breakup was ugly. Novo Nordisk accused Hims & Hers of selling “knockoff” Wegovy versions, which they allegedly marketed illegally as compounded drugs. Hims denied wrongdoing, calling the move “anticompetitive.” While the drama is fresh, investors need to look beyond the noise and ask: How much did Wegovy really matter to Hims' bottom line?

The short answer? A lot—but not everything.

In Q1 2025, Hims reported $586 million in revenue, up 111% year-over-year. Wegovy was a major growth driver, contributing a “disproportionate share” of that haul. Yet, the exact figure isn't clear. What is clear is that Hims isn't a one-trick pony. Over 80% of its 2024 revenue ($1.2 billion of $1.48 billion) came from non-GLP-1 drugs, including mental health, dermatology, and sexual health services.

Diversification: The Lifeline or a Mirage?

Hims' survival hinges on whether its other revenue streams can compensate for losing Wegovy. Let's break down the numbers:
- Mental Health: Projected to hit $100 million+ annually by 2025, targeting a $14 billion market.
- Dermatology: Expected to generate over $100 million via hair loss and skin care, leveraging a $44 billion market.
- Retail Partnerships: Over 20,000 locations (including Walmart and GNC) now sell Hims' products, boosting wholesale revenue.
- Acquisitions: The Trybe Labs buy gives Hims at-home lab testing, while a new peptide facility expands into hormone management—a $200 million+ opportunity.

These moves aren't just “diversification for show.” Hims' telehealth infrastructure now handles 40,000 daily visits, with 82% of customers sticking around past three months. Its subscription model (90% of revenue) is a cash cow, averaging $350 per customer over time.

The Regulatory Wildcard: Can Hims Navigate the GLP-1 Minefield?

The bigger threat isn't losing Wegovy—it's the broader crackdown on compounded drugs. The FDA is cracking down on knockoff GLP-1s (like Wegovy's generic cousin, liraglutide), which Hims once relied on. The company insists it'll pivot to FDA-approved alternatives, but trust is in short supply after the scandal.

Competitors like Amazon's One Medical and established pharma giants are also muscling into telehealth and weight-loss markets. Hims needs to prove it can innovate faster than regulators can close doors.

Bottom Line: Buy the Dip, But Keep a Safety Net

Hims' stock is a rollercoaster right now, but the long-term picture isn't all doom. Its non-Wegovy business is solid, and its tech-driven telehealth model is scalable. If it can pivot quickly to FDA-approved treatments and leverage its retail partnerships, this could be a generational buying opportunity.

Action Alert:
- Bull Case: Hims hits its 2030 targets ($6.5 billion revenue, $1.3B EBITDA). Buy now and hold for 5+ years.
- Bear Case: Regulatory fines or lost partnerships cripple growth. Set a strict stop-loss at 20% below entry.

Investors should also monitor these key metrics:

In short, Hims' volatility is here to stay, but its diversified moat just might keep it afloat—even without Wegovy.

Final Take: A risky bet, but one worth considering for aggressive growth investors willing to stomach short-term swings.