Hims & Hers Stock Plunges Post Q2 Earnings Miss, Gross Margin Down

HIMS’ Revenues in Detail

Hims & Hers registered revenues of $753.2 million in the second quarter, up 38.2% year over year. The figure surpassed the Zacks Consensus Estimate by 9.1%.

Solid revenues from both geographic segments drove the top line.

Shares of this company lost nearly 6.8% in today’s pre-market trading.

Hims & Hers’ Geographical Results

In the second quarter of 2026, revenues in the United States increased 15.7% year over year to $621.8 million.

Rest of the World revenues grossed $131.4 million, up from the year-ago quarter’s $7.5 million.

During the reported quarter, subscribers were 2.9 million, up 18.5% year over year.

Monthly online revenue per average subscriber increased 21.1% year over year to $92 in the second quarter. Per management, the uptick was primarily driven by changes in product mix, including uptake of HIMS’ weight loss offerings.

HIMS’ Margin Analysis

In the second quarter of 2026, Hims & Hers’ gross profit increased 15.5% year over year to $480.8 million. However, the gross margin contracted 1256 basis points to 63.8%.

Marketing expenses increased 20.4% year over year to $262.2 million, while technology and development expenses jumped 45.1% year over year to $54.9 million. General and administrative expenses surged 145.8% year over year to $165.4 million, while operations and support expenses increased 43.6% year over year to $95.5 million. Operating expenses of $577.9 million increased 48.4% year over year.

Operating loss totaled $97.2 million against the year-ago quarter’s operating profit of $26.7 million.

Hims & Hers’ Financial Position

Hims & Hers exited second-quarter 2026 with cash and cash equivalents and short-term investments of $841 million compared with $750.9 million at the end of first-quarter 2026.

Cumulative net cash provided by operating activities at the end of second-quarter 2026 was $53.4 million compared with $89.9 million a year ago.

HIMS’ Outlook

Hims & Hers has provided its revenue outlook for the third quarter and raised the same for 2026.

The company projects revenues for the third quarter of 2026 in the range of $880 million to $900 million, reflecting an uptick of 47%-50% year over year. The Zacks Consensus Estimate is pegged at $778.6 million.

For the full year, HIMS now projects revenues in the range of $3.1 billion to $3.3 billion (representing growth of 32%-41% from 2025 levels), up from the prior outlook of $2.8 billion to $3 billion (representing growth of 19%-28% from 2025 levels). The Zacks Consensus Estimate is pegged at $2.91 billion.

Our Take on Hims & Hers

Hims & Hers exited the second quarter of 2026 with better-than-expected revenues. The company recorded robust improvement in the top line and geographic revenues in the quarter. The increase in subscribers and monthly online revenue per average subscriber during the quarter was encouraging.

Per management, HIMS’ geographic results were strengthened by the close of the Eucalyptus acquisition in June. Management expects its domestic business to continue accelerating through the second half of the year. The company is optimistic about the combination of this momentum with the meaningful efficiencies being generated from Hims & Hers’ investments in AI and technology. These raise our optimism about the stock.

However, Hims & Hers’ wider-than-expected loss per share and dismal bottom-line results in the quarter were disappointing. The contraction of the gross margin during the quarter does not bode well for the stock.

HIMS’ Zacks Rank and Key Picks

Hims & Hers currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space that have announced quarterly results are BrightSpring Health Services, Inc. BTSG, Quest Diagnostics Incorporated DGX and Avantor, Inc. AVTR.

BrightSpring, sporting a Zacks Rank of 1 (Strong Buy), reported second-quarter 2026 adjusted EPS of 45 cents, beating the Zacks Consensus Estimate by 21.6%. Revenues of $3.87 billion outpaced the consensus mark by 6.1%. You can see the complete list of today’s Zacks #1 Rank stocks here.

BrightSpring has a long-term estimated growth rate of 46%. BTSG’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 16.1%.

Quest Diagnostics reported second-quarter 2026 adjusted EPS of $3.12, beating the Zacks Consensus Estimate by 11%. Revenues of $3.04 billion surpassed the Zacks Consensus Estimate by 2.2%. It currently carries a Zacks Rank #2 (Buy).

Quest Diagnostics has a long-term estimated growth rate of 9.7%. DGX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 5.8%.

Avantor reported second-quarter 2026 adjusted EPS of 21 cents, beating the Zacks Consensus Estimate by 10.5%. Revenues of $1.69 billion surpassed the Zacks Consensus Estimate by 4.2%. It currently carries a Zacks Rank #2.

Avantor has a long-term estimated growth rate of 1.6%. AVTR’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 4.3%.

7 Best Stocks for the Next 30 Days

Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."

Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.9% per year. So be sure to give these hand picked 7 your immediate attention. 

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research