Hims & Hers Is Growing Fast. Its Next Test Is the Quality of That Growth

Hims & Hers has a clear demand story. In the quarter ended June 30, revenue reached $753.2 million, up 38% from a year earlier, and subscribers rose 19% to 2.89 million. The company raised its full-year 2026 revenue outlook to $3.1 billion–$3.3 billion. All three figures come from its second-quarter results.

U.S. dollars. Source: Hims & Hers Q2 2026 results. Free cash flow is a company-defined non-GAAP measure.

The growth rate has more than one story

U.S. revenue grew 16% year over year, below the consolidated 38% rate. Revenue outside the U.S. climbed from a much smaller base. Hims completed its Eucalyptus acquisition in June and launched the Hims brand in Australia at the end of August. International expansion broadens the opportunity, but consolidated growth alone does not reveal how quickly the U.S. business is growing.

Margins and cash need to catch up

The same quarterly release shows a 64% gross margin, down from 76% a year earlier. Hims reported a GAAP net loss of $86.3 million, versus net income of $42.5 million in the prior-year quarter. Adjusted EBITDA, a non-GAAP measure, fell to $60.3 million from $82.2 million. Free cash flow was negative $68.2 million.

Cost of revenue means the direct cost of delivering what Hims sells: purchased and manufactured products, packaging, shipping, medical consultations, manufacturing labor, and related factory overhead. Advertising is reported separately in marketing expense. In the Q2 SEC filing, Hims reported that cost of revenue rose from $128.6 million to $272.4 million year over year, up 112% while revenue rose 38%.

Hims said total product and packaging costs rose 141%, shipping costs 56%, and medical consultation costs 30%. It attributed the increase mainly to weight-loss offerings, some of which carry higher product, packaging, and shipping costs than its other offerings, as well as shorter shipping cycles, more subscribers, and recent acquisitions. Those are changes in total costs and product mix. The filing does not show that manufacturers raised the price of the same medicine.

These figures do not erase the demand story. They show that faster sales have not yet produced stronger quarterly profit or positive cash flow. A useful next test is whether gross margin stabilizes and more revenue converts into GAAP earnings and cash.

Weight loss is entering a new phase

In March, Hims announced a shift in its U.S. GLP-1 strategy. It said it would offer more FDA-approved medicines through a Novo Nordisk collaboration and limit access to compounded semaglutide to cases a provider determines clinically necessary. Novo’s approved options became available on the platform later that month.

The change could support a more durable weight loss business if patients stay and the economics work at scale. That is an interpretation, not a reported result. Branded medicines may have different prices and margins from the previous mix. Subscriber growth, revenue per subscriber, gross margin, and cash flow need to be read together.

What recent analyst coverage adds

Moomoo reported a J.P. Morgan Hold rating and $32 target on September 11 and a BofA Hold rating with the same target on September 25. A syndicated account of J.P. Morgan’s note says its analyst saw headwinds for compounded GLP-1 medicines but thought the Novo Nordisk partnership could more than offset them. That is an analyst’s assessment, not a reported business result. Price targets are opinions, not predictions; the next margins and cash-flow figures will be more useful tests of the transition.

A pending lawsuit adds uncertainty

On July 29, the Federal Trade Commission and state and local authorities filed a lawsuit alleging deceptive practices involving health-data sharing, billing, and subscription cancellation. These are allegations in a pending case, not court findings. Hims denies the claims and says it will defend itself. The outcome, including any effect on customer trust or operations, remains uncertain.

What to watch

The central question is whether Hims can keep adding customers while rebuilding gross margin and turning growth into earnings and cash. Watch U.S. growth separately from international revenue, the economics of approved GLP-1 treatments, and developments in the FTC case. The company’s $3.1 billion–$3.3 billion revenue outlook is management’s expectation, not a guaranteed result.