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Hims & Hers Health trims losses after Q2 swing to loss
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Hims & Hers Health (HIMS) stock fell 3% before recovering slightly on Tuesday after reporting a second-quarter loss of $0.37 per share, compared to a profit of $0.17 per share a year earlier. Gross margins dropped to 64% from 76%, impacted by an $81 million one-time cost related to the acquisition of Australian digital health company Eucalyptus, restructuring from a shift in weight-loss strategy, and legal reserves for an FTC lawsuit. The FTC sued the company on July 29, alleging it shared private health data with Meta and Snap and made subscription cancellations difficult. Hims & Hers has rejected the claims and vowed to fight them. Year to date, the stock is down over 4%.
Source report
By: Ines Ferré, Senior Business Reporter, Yahoo Finance
Overview
Hims & Hers Health (HIMS) stock declined 3% before trimming losses on Tuesday, following the release of its quarterly results.
Key Developments
Shares were volatile after the telehealth company swung to a loss of $0.37 per share in the second quarter, compared to a profit of $0.17 per share in the year-earlier period.
Gross margins in the second quarter were 64%, down from 76% in the same period last year.
The results were impacted by a one-time cost of $81 million during the quarter, which included:
- Expenses related to the acquisition of Australian-based digital health company Eucalyptus
- Restructuring costs following Hims & Hers' shift in weight-loss strategy earlier this year
- Legal reserves tied to recent litigation with the Federal Trade Commission (FTC)
Stock Performance
| Metric | Value | |--------|-------| | Closing Price | $29.97 | | Daily Change | -$0.54 (-1.77%) | | Year-to-Date Performance | Down more than 4% |
Additional Context
Hims & Hers Health stock has been recovering from a drawdown earlier this year, as regulatory and legal risks surrounding the manufacturing of compounded GLP-1 weight-loss drugs have weighed on shares.
The company has been pivoting away from copycat weight-loss medications and toward partnerships with pharmaceutical manufacturers.
FTC Lawsuit
On July 29, the company faced another challenge when the FTC filed a lawsuit alleging that Hims & Hers:
- Shared private health data with advertisers Meta (META) and Snap (SNAP)
- Made subscription cancellations difficult
Hims & Hers has rejected the claim and vowed to fight it.
"We are confident in our position and intend to defend it vigorously," said CFO Yemi Okupe during the company's earnings call on Monday.
Ines Ferré is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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Source
Yahoo FinanceWestern
Part of this Story
US FTC Sues Hims & Hers Over Health Data Sharing and Billing Practices