Hims & Hers stock falls 10% on revenue miss

Shares of Hims & Hers Health experienced a significant decline of 9% in after-hours trading on Monday following the telehealth company's disappointing second-quarter earnings report, which fell short of Wall Street's revenue expectations. The company's revenue surged by 73% year-over-year, reaching $315.6 million this past quarter. However, analysts had anticipated higher figures, which contributed to the stock's drop. Hims & Hers reported a net income of $42.5 million, translating to 17 cents per share, a notable increase from $13.3 million, or 6 cents per share, from the same quarter last year. Looking ahead, Hims & Hers forecasts its third-quarter revenue to be between $570 million and $590 million, while analysts were predicting a more optimistic $583 million. Additionally, the company's adjusted EBITDA is expected to fall between $60 million and $70 million, which is below the $77.1 million estimated by analysts. Recent controversies surrounding the company's sale of compounded GLP-1 medications have also affected its reputation. These unapproved, lower-cost alternatives to popular diabetes and weight-loss drugs have drawn scrutiny, especially after the FDA reported a resolution to supply issues in February. Despite this, Hims & Hers continues to offer these compounded treatments under specific circumstances, such as when a patient requires a personalized dosage due to allergies. The company's stock faced another blow in June when a partnership with Novo Nordisk collapsed, leading to a more than 30% drop in shares. Novo Nordisk cited Hims & Hers' non-compliance with legal standards concerning the mass sale of compounded drugs as the reason for ending the collaboration. Despite these challenges, Hims & Hers reported a strong adjusted EBITDA of $82 million for the second quarter, a substantial increase from $39.3 million last year, and surpassing StreetAccount's expectations of $73 million. The company will discuss these results in a quarterly call with investors scheduled for 5 p.m. ET.