Revenue of $190.8 million, up 88%
year-over-year in Q1 2023
Net loss of $10.1 million; Adjusted EBITDA
profitability of $6.1 million in Q1 2023
Subscribers grew to over 1.2 million, up 87%
year-over-year in Q1 2023
Raises full year 2023 revenue guidance to a
range of $810 million to $830 million and Adjusted EBITDA guidance
to a range of $25 million to $30 million
Hims & Hers Health, Inc. (“Hims & Hers” or the
“Company”, NYSE: HIMS), the leading health and wellness platform,
today reported financial results for the first quarter ended March
31, 2023.
“We are pleased with our outstanding performance in the first
quarter, as our ability to deliver more personalized and accessible
products and services is inspiring more customers to take better
care of their health and well-being,” said Andrew Dudum, co-founder
and CEO. “Our significant market opportunity, robust consumer
demand and consistent execution across our four strategic pillars –
trusted brand, leading technology, product innovation and clinical
excellence – uniquely positions us as a trusted market leader.”
“Our resilient customer base and durable recurring revenue model
is operating at a scale that enables us to generate high growth
while generating incremental efficiencies,” said Yemi Okupe, CFO.
“These dynamics enable us to unlock our market opportunity from a
position of strength and we expect to continue delivering leading
innovation and access to care to our customers to capitalize on our
growth momentum while driving operational excellence.”
Key Business Metrics
(In Thousands, Except for Monthly Online
Revenue per Average Subscriber and AOV, Unaudited)
Three Months Ended March
31,
2023
2022
% Change
Subscribers (end of period)
1,209
646
87
%
Monthly Online Revenue per Average
Subscriber
$
55
$
52
6
%
Net Orders
2,047
1,207
70
%
AOV
$
90
$
78
15
%
Revenue
(In Thousands, Unaudited)
Three Months Ended March
31,
2023
2022
% Change
Online Revenue
$
184,175
$
94,102
96
%
Wholesale Revenue
6,595
7,212
(9
) %
Total revenue
$
190,770
$
101,314
88
%
First Quarter 2023 Financial Highlights
- Revenue was $190.8 million for the first quarter of 2023
compared to $101.3 million for the first quarter of 2022, an
increase of 88% year-over-year.
- Gross margin was 80% for the first quarter of 2023
compared to 74% for the first quarter of 2022.
- Net loss was $(10.1) million for the first quarter of
2023 compared to $(16.3) million for the first quarter of
2022.
- Adjusted EBITDA was $6.1 million for the first quarter
of 2023 compared to $(6.1) million for the first quarter of
2022.
A reconciliation of Adjusted EBITDA, a non-GAAP measure, to net
loss, its most comparable financial measure under generally
accepted accounting principles in the United States (“U.S. GAAP”),
has been provided in this press release in the accompanying tables.
Additional information about Adjusted EBITDA is also included below
under the heading “Non-GAAP Financial Measures”.
Financial Outlook
Hims & Hers provides guidance based on current market
conditions and expectations for revenue and Adjusted EBITDA, which
is a non-GAAP financial measure.
For the second quarter 2023, we expect:
- Revenue of $200 million to $205 million.
- Adjusted EBITDA of $4 million to $7 million, reflecting an
Adjusted EBITDA margin of 2% to 3%.
For the full year 2023, we expect:
- Revenue of $810 million to $830 million.
- Adjusted EBITDA of $25 million to $30 million, reflecting an
Adjusted EBITDA margin of 3% to 4%.
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 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 first
quarter 2023 results on May 8, 2023, 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 https://investors.forhims.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
https://investors.forhims.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 long-term financial targets; our
expected future financial and business performance, including with
respect to the Hims & Hers platform, our marketing campaigns,
our market opportunity, 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 success of our business model, our market
opportunity, our ability to scale our business, the growth of
certain of our categories, 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 product quality 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
As our business grows and evolves, we continually and
strategically review our key metrics. Beginning with our 2022
Annual Report on Form 10-K, we commenced reporting “Subscribers”
and “Monthly Online Revenue Per Average Subscriber” as additional
key business metrics (as defined below). As a result of broadening
the number of health and wellness categories we serve, we believe
it is important to measure the holistic relationship that we have
with our customers. Additionally, the recurring nature of our
revenue necessitates the need for metrics that provide greater
visibility into both the breadth and engagement of users on our
platform. We believe Subscribers represent a more accurate
reflection of the number of distinct users that we have on our
platform relative to the number of subscriptions, and beginning
with the three months ending March 31, 2023, we are no longer
reporting “Subscriptions” as a key business metric. Monthly Online
Revenue per Average Subscriber reflects how users’ engagement with
products across our platform is evolving. These changes are
intended to better align our key business metrics with our internal
priorities and business plans.
“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. We sell only
non-prescription products to wholesale partners. In addition to
being revenue generative and profitable, wholesale partnerships
have the added benefit of generating brand awareness with new
customers in physical environments.
“Subscribers” are customers who have one or more
“Subscriptions”, which are agreements 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 months (for example, billed every month or every three
months), 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 services and can reactivate Subscriptions
to continue receiving additional products and 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.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In Thousands, Except Share and
Per Share Data, Unaudited)
March 31, 2023
December 31, 2022
(Unaudited)
Assets
Current assets:
Cash and cash equivalents
$
48,745
$
46,772
Short-term investments
135,648
132,853
Inventory
20,697
21,562
Prepaid expenses and other current
assets
20,435
15,408
Total current assets
225,525
216,595
Restricted cash
856
856
Goodwill
110,881
110,881
Intangibles, net
20,909
21,841
Operating lease right-of-use assets
4,548
4,936
Other long-term assets
13,587
11,232
Total assets
$
376,306
$
366,341
Liabilities and stockholders'
equity
Current liabilities:
Accounts payable
$
37,609
$
32,363
Accrued liabilities
14,121
12,448
Deferred revenue
2,866
1,472
Operating lease liabilities
1,687
1,658
Total current liabilities
56,283
47,941
Operating lease liabilities
3,217
3,649
Earn-out liabilities
3,977
2,975
Other long-term liabilities
84
35
Total liabilities
63,561
54,600
Commitments and contingencies
Stockholders' equity:
Common stock – Class A shares, par value
$0.0001, 2,750,000,000 shares authorized and 200,934,421 and
200,051,689 shares issued and outstanding as of March 31, 2023 and
December 31, 2022, respectively; Class V shares, par value $0.0001,
10,000,000 shares authorized and 8,377,623 shares issued and
outstanding as of March 31, 2023 and December 31, 2022
21
21
Additional paid-in capital
667,531
656,626
Accumulated other comprehensive loss
(111
)
(277
)
Accumulated deficit
(354,696
)
(344,629
)
Total stockholders' equity
312,745
311,741
Total liabilities and stockholders'
equity
$
376,306
$
366,341
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In Thousands, Except Share and
Per Share Data, Unaudited)
Three Months Ended March
31,
2023
2022
Revenue
$
190,770
$
101,314
Cost of revenue
37,345
26,558
Gross profit
153,425
74,756
Gross margin %
80
%
74
%
Operating expenses:(1)
Marketing
97,245
48,093
Operations and support
26,182
15,683
Technology and development
10,748
6,088
General and administrative
30,513
21,811
Total operating expenses
164,688
91,675
Loss from operations
(11,263
)
(16,919
)
Other income:
Change in fair value of liabilities
(295
)
441
Other income, net
1,877
320
Total other income, net
1,582
761
Loss before income taxes
(9,681
)
(16,158
)
Provision for income taxes
(386
)
(94
)
Net loss
(10,067
)
(16,252
)
Other comprehensive income (loss)
166
(186
)
Total comprehensive loss
$
(9,901
)
$
(16,438
)
Net loss per share attributable to common
stockholders:
Basic and diluted
$
(0.05
)
$
(0.08
)
Weighted average shares outstanding:
Basic and diluted
207,140,298
202,695,970
______________
(1)
Includes stock-based compensation expense
as follows (in thousands):
Three Months Ended March
31,
2023
2022
Marketing
$
996
$
823
Operations and support
1,154
486
Technology and development
1,461
906
General and administrative
10,556
6,641
Total stock-based compensation expense
$
14,167
$
8,856
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In Thousands, Unaudited)
Three Months Ended March
31,
2023
2022
Operating activities
Net loss
$
(10,067
)
$
(16,252
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
2,117
1,741
Stock-based compensation
14,167
8,856
Change in fair value of liabilities
295
(441
)
Net (accretion) amortization on
securities
(1,041
)
971
Provision (benefit) for deferred taxes
49
(112
)
Impairment of long-lived assets
429
—
Non-cash operating lease cost
448
377
Non-cash acquisition-related costs
566
69
Non-cash other
75
(163
)
Changes in operating assets and
liabilities:
Inventory
865
1,415
Prepaid expenses and other current
assets
(4,984
)
(7,677
)
Other long-term assets
5
(30
)
Accounts payable
3,955
4,266
Accrued liabilities
1,673
(3,148
)
Deferred revenue
1,394
(2,043
)
Operating lease liabilities
(463
)
(384
)
Earn-out payable
—
(6,848
)
Net cash provided by (used in) operating
activities
9,483
(19,403
)
Investing activities
Purchases of investments
(40,687
)
(84,881
)
Maturities of investments
39,084
82,340
Proceeds from sales of investments
—
22,291
Investment in website and mobile
application development and internal-use software
(1,875
)
(1,197
)
Purchases of property, equipment, and
intangible assets
(635
)
(100
)
Net cash (used in) provided by investing
activities
(4,113
)
18,453
Financing activities
Proceeds from exercise of vested stock
options
245
891
Payments for taxes related to net share
settlement of equity awards
(3,657
)
(404
)
Payments for earn-out consideration for
acquisitions
—
(23,014
)
Net cash used in financing activities
(3,412
)
(22,527
)
Foreign currency effect on cash and cash
equivalents
15
(23
)
Increase (decrease) in cash, cash
equivalents, and restricted cash
1,973
(23,500
)
Cash, cash equivalents, and restricted
cash at beginning of period
47,628
72,640
Cash, cash equivalents, and restricted
cash at end of period
$
49,601
$
49,140
Reconciliation of cash, cash
equivalents, and restricted cash
Cash and cash equivalents
$
48,745
$
48,284
Restricted cash
856
856
Total cash, cash equivalents, and
restricted cash
$
49,601
$
49,140
Supplemental disclosures of cash flow
information
Cash paid for taxes
$
286
$
36
Non-cash investing and financing
activities
Purchase of property and equipment
included in accounts payable
$
1,290
$
—
Vesting of early exercised stock
options
—
38
Non-GAAP Financial Measures
In addition to our financial results determined in accordance
with U.S. GAAP, we present Adjusted EBITDA (which is a non-GAAP
financial measure), and Adjusted EBITDA margin (which is a non-GAAP
ratio), each as defined below. We use Adjusted EBITDA and Adjusted
EBITDA margin to evaluate our ongoing operations and for internal
planning and forecasting purposes. We believe that Adjusted EBITDA
and Adjusted EBITDA margin, when taken together with the
corresponding U.S. GAAP financial measures, provide meaningful
supplemental information regarding our performance by excluding
certain items that may not be indicative of our business, results
of operations, or outlook. We consider Adjusted EBITDA and Adjusted
EBITDA margin to be important measures because they help illustrate
underlying trends in our business and our historical operating
performance on a more consistent basis. We believe that the use of
Adjusted EBITDA and Adjusted EBITDA margin is helpful to our
investors as they are used by management in assessing the health of
our business and our operating performance.
However, non-GAAP financial information is presented for
supplemental informational purposes only, has limitations as an
analytical tool, and should not be considered in isolation or as a
substitute for financial information presented in accordance with
U.S. GAAP. In addition, other companies, including companies in our
industry, may calculate similarly-titled non-GAAP financial
measures or ratios differently or may use other financial measures
or ratios to evaluate their performance, all of which could reduce
the usefulness of Adjusted EBITDA or Adjusted EBITDA margin as
tools for comparison. Reconciliations are provided below to the
most directly comparable financial measures stated in accordance
with U.S. GAAP. Investors are encouraged to review our U.S. GAAP
financial measures and not to rely on any single financial measure
to evaluate our business.
Adjusted EBITDA is a key performance measure that our management
uses to assess our operating performance. Because Adjusted EBITDA
facilitates internal comparisons of our historical operating
performance on a more consistent basis, we use this measure for
business planning purposes. “Adjusted EBITDA” is defined as net
loss before stock-based compensation, depreciation and
amortization, acquisition-related costs (which includes
consideration paid for employee compensation with vesting
requirements incurred directly as a result of acquisitions,
inclusive of revaluation of earn-out consideration recorded in
general and administrative expenses), impairment of long-lived
assets, income taxes, change in fair value of liabilities, and
interest income. “Adjusted EBITDA margin” is defined as Adjusted
EBITDA divided by revenue.
Some of the limitations of Adjusted EBITDA include (i) Adjusted
EBITDA does not properly reflect capital commitments to be paid in
the future, and (ii) although depreciation and amortization are
non-cash charges, the underlying assets may need to be replaced and
Adjusted EBITDA does not reflect these capital expenditures. In
evaluating Adjusted EBITDA, you should be aware that in the future
we will incur expenses similar to the adjustments in this
presentation. Our presentation of Adjusted EBITDA should not be
construed as an inference that our future results will be
unaffected by these expenses or any unusual or non-recurring items.
We compensate for these limitations by providing specific
information regarding the U.S. GAAP items excluded from Adjusted
EBITDA. When evaluating our performance, you should consider
Adjusted EBITDA in addition to, and not as a substitute for, other
financial performance measures, including our net loss and other
U.S. GAAP results.
Net Loss to Adjusted EBITDA
Reconciliation
(In Thousands, Unaudited)
Three Months Ended March
31,
2023
2022
Revenue
$
190,770
$
101,314
Net loss
(10,067
)
(16,252
)
Stock-based compensation
14,167
8,856
Depreciation and amortization
2,117
1,741
Acquisition-related costs
646
116
Impairment of long-lived assets
429
—
Provision for income taxes
386
94
Change in fair value of liabilities
295
(441
)
Interest income
(1,913
)
(175
)
Adjusted EBITDA
$
6,060
$
(6,061
)
Net loss as a % of revenue
(5
) %
(16
) %
Adjusted EBITDA margin
3
%
(6
) %
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230508005588/en/
Investor Relations Alice Lopatto
Investors@forhims.com
Media Relations Press@forhims.com
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