Hims & Hers Climbs 6% Despite Five States Joining FTC Suit; Eli Lilly Dips, Novo Nordisk Holds Steady
Yahoo! Finance ·
Key points
- Hims & Hers rose 6% to about $20.34 after a 17% drop, following news that five U.S. states joined the FTC's expanded lawsuit over privacy and billing practices; the stock had fallen ~34% over the past month.
- Q3 2026 revenue rose 48.6% year over year to $890.37 million, but missed the consensus of $892.77 million, and GAAP diluted EPS was a loss of $0.14; for Q4 2026, revenue guidance was $875 million to $895 million, far below the $954.58 million expected by analysts.
- Management trimmed full-year 2026 EBITDA guidance to $257 million to $277 million, signaling tighter margins amid pricing pressure and AI investment; KeyBanc labeled the period a 'transition year' with potential near-term headwinds to earnings.
- Lilly and Novo Nordisk remain the primary suppliers of GLP-1 drugs that Hims & Hers plans to lean on, a dynamic that explains why both Lilly and Novo Nordisk traded roughly flat despite the Hims rebound.
- Novo Nordisk announced a U.S. price cut for Wegovy and Ozempic starting January 1, 2027, a change that could alter self-pay spending and press,g margins for related offerings; Hims & Hers depends on supplier pricing for margin, making it vulnerable to such shifts.
- Hims & Hers’ growth strategy centers on owning the customer relationship via a subscription telehealth platform across weight loss, hair, sexual health, and testosterone care; the company warned that near-term subscriber growth may be sacrificed for longer-term positioning.
- Looking ahead, management expects potential benefits from Lilly agreement, faster international expansion, and free cash flow positive for 2026, but investors must weigh the FTC case progression, ongoing margin pressure, and the impact of lower pricing on future earnings.
Summary
Hims & Hers edges higher after a sharp prior drop as five states join the FTC lawsuit over privacy and billing practices, while weak Q4 guidance keeps pressure on the stock. The rebound is isolated to Hims & Hers, even as Lilly and Novo Nordisk move little, highlighting the telehealth firm's dependence on GLP-1 drug suppliers. With Q3 revenue near expectations but a below-consensus Q4 outlook, management signals a transition year as it leans on broader branded products and international expansion. The path forward hinges on subscriber growth resuming amid regulatory scrutiny and margin dynamics tied to supplier pricing and ongoing AI investments. Investors will watch FTC developments and any shifts in GLP-1 pricing that could reshape self-pay spend.
This summary was written with AI. The full story has every detail.