Hims & Hers Weakens on Numbers

Hims & Hers Health (NYSE:HIMS) shares plunged early Tuesday after investors looked past better-than-expected revenue and earnings and focused instead on the disappointing gross margin.Earnings per share were 11 cents vs. 10 cents expected, on revenue of $481 million vs. $470 million expectedRevenue at the telehealth company increased 95% in the fourth quarter from $246.6 million during the same period last year, according to a release.However, the company’s gross margin, or the profit left after accounting for the cost of goods sold, was 77%, while analysts were expecting 78.4%.It is the second big stock drop for Hims & Hers in a matter of days. The shares tumbled 26% on Friday after the U.S. Food and Drug Administration announced that the shortage of semaglutide injection products has been resolved.In May, Hims & Hers started prescribing compounded semaglutide, the active ingredient in Novo Nordisk’s blockbuster GLP-1 medications Ozempic and Wegovy. The company was a breakout star within the digital health sector in 2024, in part because of the success of its popular new weight loss offering.The company said its GLP-1 offering generated more than $225 million in revenue in 2024. The stock climbed about 200% for the year.HIMS began trading Tuesday down $9.78, or 19.1%, to $41.53.