Pomegra
Hims & Hers shares fell 8.7% after a third 2026 adjusted EBITDA cut, a surprise $33 million Q3 loss and a 100,000 drop in subscribers to 2.79 million.
- Full-year adjusted EBITDA guidance fell to $257-277 million from $300-375 million set in February.
- Q3 brought a $33.0 million net loss against $15.8 million of net income a year earlier; gross margin fell to 57% from 74%.
- Shares closed at $20.95 on Nov. 10, down 8.67%, after an 11.8% drop in the prior session.
Lead
Hims & Hers Health (NYSE: HIMS) cut its 2026 adjusted EBITDA outlook for the third time this year on Monday, Nov. 9, after reporting a surprise third-quarter loss and a sequential decline of about 100,000 subscribers. Shares closed Tuesday at $20.95, down 8.67%, extending a slide of nearly 12% to $22.94 in the prior session on volume near four times the previous Friday's level. The stock has lost roughly 44% over twelve months and trades about two-thirds below its February 2025 peak of $68.74.What Did Hims & Hers Report for the Third Quarter?
The telehealth company posted revenue of $890.4 million, up 49% from a year earlier, but swung to a GAAP net loss of $33.0 million, or $0.14 a share, against consensus for a $0.06 profit. Revenue landed marginally below the roughly $893 million consensus.
Adjusted EBITDA was $82.4 million, up 5% year on year and below the $85.1 million expected. Operating cash flow dropped to $65.4 million from $148.7 million, and free cash flow fell to $26.0 million from $79.4 million. Over nine months, the company has recorded a net loss of $211.4 million, compared with net income of $107.8 million in the same period of 2025.
Subscribers totaled 2.788 million, up 13% year on year but down about 100,000 from nearly 2.9 million in the second quarter. Monthly revenue per average subscriber rose 30% to $105. U.S. revenue grew 21% to $657.1 million, while international revenue rose 321% to $233.3 million.
How Many Times Has Hims & Hers Cut Its Outlook?
The company has now lowered its adjusted EBITDA range in each reporting cycle of 2026. The February range of $300-375 million became $275-350 million in May, then $275-325 million in August, and now $257-277 million. The new midpoint of $267 million sits about 21% below the February midpoint and below the roughly $294 million consensus for the year.
Revenue guidance was narrowed to $3.13-3.15 billion, from $3.1-3.3 billion previously. Fourth-quarter guidance calls for revenue of $875-895 million and adjusted EBITDA of $70-90 million. The company raised its international revenue floor to $650 million from $600 million.
Why Did Hims & Hers Shares Fall?
Shares fell because the quarter combined a profit miss, a lower EBITDA range and a shrinking customer base, with management signaling more subscriber pressure ahead. The CFO flagged an additional quarter of headwinds for subscriber count, and the Q4 EBITDA range implies margins of 8-10%.
Chief Executive Andrew Dudum framed the subscriber loss as deliberate. "Each of these choices trades near-term subscriber growth for a stronger position in years that follow," he said, adding that it was "a trade we will make every time." Management attributed the decline to reduced U.S. weight-loss marketing ahead of new offerings and to brand migrations abroad. It also said the company is pacing marketing spend ahead of planned expansions, with demand historically peaking seasonally in the first quarter.
Why Did Gross Margin Drop to 57%?
Gross margin fell 17 percentage points to 57% because the revenue mix shifted toward lower-margin branded weight-loss drugs and international sales. In the first quarter of 2026, the company pivoted its U.S. weight-loss business to branded GLP-1 medications, anchored by Novo Nordisk (NVO) and its Wegovy since March, with only limited compounded offerings. Eli Lilly (LLY) products, including Zepbound and Foundayo, now sit alongside Wegovy on the platform.
The international surge follows the June acquisition of Eucalyptus, which lifted overseas revenue more than fourfold. That growth adds scale but carries lower margins than the compounded-drug model that powered the 74% margin of a year ago. Branded drugs raise revenue per subscriber while leaving the company with a thinner share of each sale.
Strategic Context
Management is positioning the business as a broader platform for the customer relationship rather than a single weight-loss product. A testosterone offering is on track for a $100 million annualized run rate. A peptides line has launched with sermorelin, glutathione and NAD+, while TB-500 and BPC-157 await regulatory clarity. The company also cited a Novo collaboration tied to the CagriSema candidate and the new Lilly partnership.
The strategy depends on a regulatory and supplier environment that has shifted quickly, as compounded GLP-1 products gave way to branded access. Reliance on two pharmaceutical suppliers whose pricing sets the company's margin structure remains a central constraint.
What Comes Next for Hims & Hers?
The next test is the fourth-quarter report, which will show whether subscriber losses stabilize and whether the $70-90 million EBITDA range holds. Management has pointed to the first quarter of 2027 as the seasonal demand peak, when the new product assortment will face its first full test. Investors will also track whether gross margin stabilizes near 57% as the international and branded mix grows.
Outlook
Hims & Hers enters the final quarter of 2026 with revenue growing near 49% but profitability, margins and subscriber counts all moving the wrong way. A third cut to EBITDA guidance has shifted attention from top-line growth to the cost of the pivot to branded drugs and international expansion. The balance sheet and positive free cash flow give management room to execute, while the 2027 subscriber trajectory will determine whether the trade-off pays off.
Mentioned tickers: HIMS, NVO, LLY
