Hims & Hers Had a Tough Quarter. Weight-Loss Drugs Are Only One Problem.

A hair regrowth gummy sold by telehealth firm Hims & Hers Health. (Courtesy Hims & Hers)

Telehealth storefront Hims & Hers Health has been a fast-growing company with a pricey stock. A disappointing sales figure in its latest quarter has caught investors by surprise.

Hims shares opened down 12.7% on Tuesday morning, but the selloff didn’t last, with the stock back to positive territory within a few minutes of the open. Then the selloff resumed. As of Tuesday afternoon trading, Hims shares were down 10%.

The roller coaster response isn’t surprising for a stock that’s climbed more than 260% over the past 12 months, despite significant uncertainties about the future market for the weight-loss drugs that boosted the company’s revenue over the past year.

Hims trades at more than 70 times earnings expected over the next 12 months, according to FactSet, a significantly higher valuation than any healthcare stock in the S&P 500.

That valuation is bolstered by exuberant enthusiasm among some investor’s about the company’s long-term vision. What’s not clear is how Hims will get there.

The telehealth company, which sells generic erectile dysfunction and hair loss drugs, became a household name last year as it leapt into the weight-loss business. Hims revenue jumped 70% in 2025 after the company started selling legal knockoff versions of Novo Nordisk’s weight loss drug Wegovy made by compounding pharmacies.

After climbing steadily through 2024, the stock price exploded in February of this year, after Hims aired a catchy Super Bowl ad. Shares fell months later, after the Food and Drug Administration declared an end to the Wegovy shortage, limiting Hims’ ability to keep selling compounded versions of the drug, but as of late July had nearly regained their February-era highs.

Meanwhile, the company’s business is in transition. Hims still says it can sell $725 million worth of weight loss drugs this year, including GLP-1 drugs and a weight loss pill. It an ambitious goal, and, in the meantime, growth of the non-weight-loss parts of the company’s business has stalled, based on the company’s latest results.

Hims’ total second-quarter revenue was down 7% from the first quarter of the year, to $545 million. Analysts had expected a big sales dip after the FDA smothered the compounded GLP-1 market. But the sales miss wasn’t restricted to weight-loss sales. Analysts had expected sales of $551 million for the quarter.

The company said in a filing Monday that GLP-1 drugs sold online brought in around $190 million in revenue in the second quarter, down from around $230 million in the first. It’s the rest of the business that’s likely driving Tuesday’s selloff.

Aside from GLP-1 drugs, sales were roughly flat from quarter to quarter.

Asked on an investor call late Monday about the company’s non-GLP-1 business, CFO Oluyemi Okupe pointed to problems with the company’s sexual health business, which sells products like an erectile dysfunction pill. “What we’re seeing is really there’s a drag coming from the sexual health on-demand component of the business,” Okupe said.

Putting aside sexual health, Okupe said that other specialties were seeing “strong growth.”

With the weight-loss market in flux, there’s lots of pressure on the rest of the business to take up the slack.

“We see a challenging near-term path for HIMS,” Bank of America analyst Allen Lutz wrote Tuesday.

Write to Josh Nathan-Kazis at josh.nathan-kazis@barrons.com