NEW YORK: Hims & Hers Health posts a wider-than-expected second-quarter (2Q) loss as the telehealth company’s shift to branded weight-<a href="https://healthylife7.com/eye-on-health-foot-condition-is-a-possible-side-effect-of-weight-loss-drugs/" title="Eye on Health: Foot condition is a possible side effect of weight loss drugs“>loss drugs drive up costs, sending its shares down 6% in extended trading
The company’s growing GLP-1 weight-loss business and international expansion have boosted subscriptions and increased monthly revenue per subscriber by 21% from a year earlier, although executives and investors say the expansion has weighed on gross profit margins
Hims reported a 2Q net loss of 37 US cents per share, compared with analysts’ estimate of a one cent loss per share, according to LSEG-compiled data
The company said the transition to branded GLP-1 weight-loss drugs resulted in restructuring costs of US$4.6mil during the 2Q and that it expects to return to profitability in 2027
Hims raised its full-year revenue outlook to US$3.1bil to US$3.3bil from its previous forecast of US$2.8bil to US$3bil, including a contribution from Eucalyptus, an Australian digital health company that Hims agreed to acquire in February
Eucalyptus revenue is not included by most analysts but its chief financial officer Yemi Okupe told Reuters that the new figures were ahead of most analyst targets
“Even if you pull out Eucalyptus (from the guidance), the domestic business and the existing international business were already ahead of our guidance range,” Okupe said
The company added it expects gross margins to remain below historical levels, as it accelerates its weight-loss and international offerings
“Do we have the ability to set the foundation for strong cash flows in the future?” Okupe told Reuters. “Resoundingly, the answer is ‘yes’.”
