Q3 2021 revenue grows 79% year-over-year to
$74.2 million
Q3 2021 ending member subscriptions grow 95%
year-over-year to 551,000
Exceeds Q3 2021 revenue guidance, raises full
year 2021 guidance
Hims & Hers Health, Inc. (“Hims & Hers”, NYSE: HIMS), a
multi-specialty telehealth platform that connects consumers to
licensed healthcare professionals, today reported financial results
for the third quarter ending September 30, 2021.
“This latest quarter of results shows that our vision to create
a new front door to healthcare is resonating,” said Andrew Dudum,
CEO and co-founder of Hims & Hers. “Not only did we deliver
strong revenue growth in Q3, we did so while maintaining customer
acquisition costs quarter-to-quarter, nearly doubling total
subscriptions year-over-year, and delivering on strategic
initiatives to catalyze future growth. We believe we are very well
positioned to deliver on our ambitious mission.”
Key Business Metrics
(In Thousands, Except AOV, Unaudited)
September 30, 2021
June 30, 2021
March 31, 2021
December 31, 2020
September 30, 2020
AOV (three months period)
$
74
$
74
$
74
$
69
$
67
Net Orders (three months period)
968
786
687
579
582
Subscriptions (end of period)
551
453
391
312
283
Revenue
(In Thousands, Unaudited)
Three Months Ended
September 30, 2021
June 30, 2021
March 31, 2021
December 31, 2020
September 30, 2020
Online Revenue
$
72,032
$
58,146
$
50,680
$
40,091
$
38,829
Wholesale Revenue
2,141
2,546
1,634
1,375
2,495
Total revenue
$
74,173
$
60,692
$
52,314
$
41,466
$
41,324
Total revenue year-over-year growth
79
%
69
%
74
%
67
%
91
%
- Revenue was $74.2 million for the third quarter 2021
compared to $41.3 million for the third quarter 2020, an increase
of 79% year-over-year.
- Net loss was $(15.9) million for the third quarter 2021
compared to $(5.9) million for the third quarter 2020.
- Gross margin was 74% for the third quarter 2021 compared
to 76% for the third quarter 2020.
- Adjusted EBITDA was $(9.8) million for the third quarter
2021 compared to $(1.6) million for the third quarter 2020.
A reconciliation of Adjusted EBITDA, a non-GAAP measure, to net
loss, its most comparable financial measure under generally
accepted accounting principles in the United States (“U.S. GAAP”),
has been provided in this press release in the accompanying tables.
Additional information about Adjusted EBITDA is also included below
under the heading “Non-GAAP Financial Measures”.
Financial Outlook
Hims & Hers provides guidance based on current market
conditions and expectations for revenue and Adjusted EBITDA, which
is a non-GAAP financial measure.
For the fourth quarter 2021, we expect:
- Revenue to be in the range of $76 million to $78 million.
- Adjusted EBITDA to be in the range of $(12) million to $(14)
million.
For the full year 2021, we expect:
- Revenue to be in the range of $263 million to $265
million.
- Adjusted EBITDA to be in the range of $(35) million to $(37)
million.
The guidance provided above constitutes forward-looking
statements and actual results may differ materially. Refer to the
“Cautionary Note Regarding Forward-Looking Statements” safe harbor
section below for information on the factors that could cause our
actual results to differ materially from these forward-looking
statements.
We have not reconciled forward-looking Adjusted EBITDA to its
most directly comparable U.S. GAAP measure, net loss, because we
cannot predict with reasonable certainty the ultimate outcome of
certain components of such reconciliations, including
market-related assumptions that are not within our control, or
others that may arise, without unreasonable effort. For these
reasons, we are unable to assess the probable significance of the
unavailable information, which could materially impact the amount
of future net loss. See “Non-GAAP Financial Measures” for
additional important information regarding Adjusted EBITDA.
Conference Call
Hims & Hers will host a conference call to review the third
quarter 2021 results on November 10, 2021, at 5:00 p.m. ET. The
conference call can be accessed by dialing (833) 900-2256 for U.S.
participants and (236) 714-2727 for international participants, and
referencing conference ID #6691217. A live audio webcast will be
available online at https://investors.forhims.com/. A replay of the
call will be available via webcast for on-demand listening shortly
after the completion of the call at the same link.
About Hims & Hers Health, Inc.
Hims & Hers is a multi-specialty telehealth platform that
connects consumers to licensed healthcare professionals, enabling
them to access high-quality medical care for numerous conditions
related to primary care, mental health, sexual health, dermatology,
and more. Launched in November 2017, the company also offers
thoughtfully created and curated health and wellness products. With
products and services available across all 50 states and
Washington, D.C., Hims & Hers is able to provide access to
quality, convenient and affordable care for all Americans. Hims
& Hers was founded by CEO Andrew Dudum, Hilary Coles, Jack
Abraham and Joe Spector at venture studio Atomic in San Francisco,
California. For more information about Hims & Hers, please
visit forhims.com and forhers.com.
Cautionary Note Regarding Forward-Looking Statements
This press release includes forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1934, as
amended. These forward-looking statements can be identified by the
use of forward-looking terminology, including the words “believes,”
“estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,”
“will,” “potential,” “projects,” “predicts,” “continue,” or
“should,” or, in each case, their negative or other variations or
comparable terminology. There can be no assurance that actual
results will not materially differ from expectations. Such
statements include, but are not limited to, any statements relating
to our financial outlook and guidance, our expected future
financial and business performance, the assumptions underlying such
statements, statements about events and trends including events and
trends that we believe may affect our financial condition, results
of operations, short- and long-term business operations and
objectives, and financial needs, our expectations regarding market
acceptance, user experience, the success of our business model, the
growth of certain of our categories and the impact of our recent
acquisitions, our ability to expand the scope of our offerings, and
our ability to comply with the extensive, complex and evolving
regulatory requirements applicable to the healthcare industry.
These statements are based on management’s current expectations,
but actual results may differ materially due to various
factors.
The forward-looking statements contained in this press release
are based on our current expectations and beliefs concerning future
developments and their potential effects on us. Future developments
affecting us may not be those that we have anticipated. These
forward-looking statements involve a number of risks, uncertainties
(some of which are beyond our control) and other assumptions that
may cause actual results or performance to be materially different
from those expressed or implied by these forward-looking
statements. These risks and uncertainties include, but are not
limited to, those factors described in the “Risk Factors” section
of our most recently filed Annual Report on Form 10-K for the year
ended December 31, 2020, as amended, our most recent Quarterly
Report on Form 10-Q, and our subsequent filings with the Securities
and Exchange Commission (the “Commission”).
Should one or more of these risks or uncertainties materialize,
or should any of our assumptions prove incorrect, actual results
may vary in material respects from those projected in these
forward-looking statements. We undertake no obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required
under applicable securities laws.
By their nature, forward-looking statements involve risks and
uncertainties because they relate to events and depend on
circumstances that may or may not occur in the future. We caution
you that forward-looking statements are not guarantees of future
performance and that our actual results of operations, financial
condition and liquidity, and developments in the industry in which
we operate may differ materially from those made in or suggested by
the forward-looking statements contained in reports we have filed
or will file with the Commission, including our annual report on
Form 10-K for the year ended December 31, 2020, as amended, our
most recent Quarterly Report on Form 10-Q, and our subsequent
filings with the Commission. In addition, even if our results of
operations, financial condition and liquidity, and developments in
the industry in which we operate are consistent with the
forward-looking statements contained in such reports, those results
or developments may not be indicative of results or developments in
subsequent periods.
Key Business Metrics
Average Order Value (“AOV”) is defined as Online Revenue
divided by Net Orders (each as defined below).
“Net Orders” are defined as the number of online customer
orders minus transactions related to refunds, credits, chargebacks
and other negative adjustments. Net Orders represent transactions
made on our platform during a defined period of time and exclude
revenue recognition adjustments recorded pursuant to U.S. GAAP.
“Online Revenue” represents the sales of products and
services on our platform, net of refunds, credits, chargebacks and
includes revenue recognition adjustments recorded pursuant to U.S.
GAAP, primarily relating to deferred revenue and returns
reserve.
“Subscriptions” are defined as the number of customer
agreements where the customer has agreed to be automatically billed
on a recurring basis at a defined cadence. The billing cadence is
typically defined as a number of months (for example, billed every
month or every three months). Subscriptions are excluded from our
reporting when payment has not occurred at the contracted billing
cadence. Subscription billing is preferred by many of our customers
because most of the products and services we make available treat
chronic conditions and these product and service offerings are most
effective when taken consistently and continuously. Customers can
cancel subscriptions in between billing periods to stop receiving
additional products and services and can reactivate subscriptions
to continue receiving additional products and services.
“Wholesale Revenue” represents non-prescription product
sales to retailers through wholesale purchasing agreements.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In Thousands, Except Share and
Per Share Data)
September 30,
2021
December 31,
2020
(Unaudited)
Assets
Current assets:
Cash and cash equivalents
$
64,772
$
27,344
Short-term investments
187,653
72,864
Inventory
10,858
3,543
Prepaid expenses and other current
assets
10,950
5,404
Deferred transaction costs
—
3,929
Total current assets
274,233
113,084
Restricted cash
856
1,006
Other long-term assets
7,167
4,548
Intangibles, net
26,932
59
Goodwill
110,881
—
Total assets
$
420,069
$
118,697
Liabilities, mezzanine equity, and
stockholders' equity (deficit)
Current liabilities:
Accounts payable
$
16,094
$
8,066
Accrued liabilities
11,206
4,984
Deferred revenue
1,993
1,272
Earn-out liabilities
23,205
—
Warrant liabilities
—
906
Total current liabilities
52,498
15,228
Earn-out liabilities
11,200
—
Other long-term liabilities
1,218
381
Total liabilities
64,916
15,609
Commitments and contingencies
Mezzanine equity:
Redeemable convertible preferred stock par
value $0.0001, 275,000,000 and 95,997,674 shares authorized and nil
and 93,328,118 shares issued and outstanding as of September 30,
2021 and December 31, 2020, respectively; liquidation preference of
nil and $268,452 as of September 30, 2021 and December 31, 2020,
respectively
—
249,962
Total mezzanine equity
—
249,962
Stockholders' equity (deficit):
Common stock – Class A shares, par value
$0.0001, 2,750,000,000 and 166,696,759 shares authorized and
195,439,626 and 46,025,754 shares issued and outstanding as of
September 30, 2021 and December 31, 2020, respectively; Class V
shares, par value $0.0001, 10,000,000 shares authorized and
8,377,623 shares issued and outstanding as of September 30, 2021;
Class F shares, par value $0.0001, 6,941,352 shares authorized,
issued, and outstanding as of December 31, 2020
20
—
Additional paid-in capital
602,975
24,429
Accumulated other comprehensive loss
(52
)
(11
)
Accumulated deficit
(247,790
)
(171,292
)
Total stockholders' equity (deficit)
355,153
(146,874
)
Total liabilities, mezzanine equity, and
stockholders' equity (deficit)
$
420,069
$
118,697
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In Thousands, Except Share and
Per Share Data, Unaudited)
Three Months Ended September
30,
Nine Months Ended September
30,
2021
2020
2021
2020
Revenue
$
74,173
$
41,324
$
187,179
$
107,291
Cost of revenue
19,301
10,047
44,783
29,733
Gross profit
54,872
31,277
142,396
77,558
Gross margin %
74
%
76
%
76
%
72
%
Operating expenses:(1)
Marketing
38,293
15,102
93,195
39,675
Selling, general, and administrative
44,240
19,496
142,678
48,401
Total operating expenses
82,533
34,598
235,873
88,076
Loss from operations
(27,661
)
(3,321
)
(93,477
)
(10,518
)
Other income (expense):
Change in fair value of liabilities
8,328
(2,527
)
13,610
(2,477
)
Interest expense
—
—
—
(10
)
Other income, net
219
8
320
223
Total other income (expense), net
8,547
(2,519
)
13,930
(2,264
)
Loss before income taxes
(19,114
)
(5,840
)
(79,547
)
(12,782
)
Benefit (provision) for income taxes
3,173
(31
)
3,049
(103
)
Net loss
(15,941
)
(5,871
)
(76,498
)
(12,885
)
Other comprehensive (loss) income
(12
)
6
(41
)
(12
)
Total comprehensive loss
$
(15,953
)
$
(5,865
)
$
(76,539
)
$
(12,897
)
Net loss per share attributable to common
stockholders:
Basic and diluted
$
(0.08
)
$
(0.16
)
$
(0.42
)
$
(0.36
)
Weighted average shares outstanding:
Basic and diluted
200,038,761
35,614,598
181,867,522
35,345,972
______________
(1) Includes stock-based
compensation expense as follows (in thousands):
Three Months Ended September
30,
Nine Months Ended September
30,
2021
2020
2021
2020
Marketing
$
2,328
$
261
$
4,946
$
919
Selling, general, and administrative
9,541
1,153
50,313
3,824
Total stock-based compensation expense
$
11,869
$
1,414
$
55,259
$
4,743
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In Thousands, Unaudited)
Nine Months Ended September
30,
2021
2020
Operating activities
Net loss
$
(76,498
)
$
(12,885
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
2,445
692
Stock-based compensation
55,259
4,743
Change in fair value of liabilities
(13,610
)
2,477
Warrant expense in connection with
Merger
154
—
Lease termination expense
—
1,846
Amortization of debt issuance costs
144
251
Net amortization on securities
1,732
21
Benefit for deferred taxes
(3,178
)
—
Non-cash other
871
—
Changes in operating assets and
liabilities:
Inventory
(6,928
)
(735
)
Prepaid expenses and other current
assets
2,635
37
Other long-term assets
(58
)
777
Accounts payable
6,306
(897
)
Accrued liabilities
(794
)
1,149
Deferred revenue
217
(65
)
Other long-term liabilities
(4
)
379
Net cash used in operating activities
(31,307
)
(2,210
)
Investing activities
Purchases of investments
(219,361
)
(84,015
)
Maturities of investments
99,375
43,790
Proceeds from sales of investments
3,465
11,550
Acquisition of businesses, net of cash
acquired
(46,468
)
—
Investment in website development and
internal-use software
(3,242
)
(1,651
)
Purchases of property, equipment, and
intangible assets
(279
)
(1,293
)
Net cash used in investing activities
(166,510
)
(31,619
)
Financing activities
Proceeds from issuance of redeemable
convertible preferred stock
—
51,927
Pre-closing stock repurchase
(22,027
)
—
Proceeds from issuance of common stock
upon Merger
197,686
—
Proceeds from PIPE
75,000
—
Payments for transaction costs
(12,851
)
(2,074
)
Proceeds from repayment of promissory
notes associated with vested and unvested shares
1,193
—
Proceeds from exercise of Class A common
stock warrants, net of redemption payments
787
—
Proceeds from exercise of vested and
unvested stock options, net of repurchases and cancelations
567
111
Repayments of principal on term loan
—
(1,515
)
Payments for taxes related to net share
settlement of equity awards
(5,234
)
—
Net cash provided by financing
activities
235,121
48,449
Foreign currency effect on cash and cash
equivalents
(26
)
(11
)
Increase in cash, cash equivalents, and
restricted cash
37,278
14,609
Cash, cash equivalents, and restricted
cash at beginning of period
28,350
22,797
Cash, cash equivalents, and restricted
cash at end of period
$
65,628
$
37,406
Supplemental disclosures of cash flow
information
Cash paid for taxes
$
279
$
246
Cash paid for interest
—
10
Non-cash investing and financing
activities
Expiration of Class A common stock
redemption right
$
—
$
4,500
Exercise of convertible preferred stock
warrants
—
6,508
Recapitalization of redeemable convertible
preferred stock from pre-closing stock repurchase
125
—
Conversion of redeemable convertible
preferred stock to common stock
249,837
—
Assumption of Merger warrants
liability
51,814
—
Redemption/exercise of Class A common
stock warrants
37,834
—
Reclassification of deferred transaction
costs
3,929
—
Conversion of Series D preferred stock
warrants to Class A common warrants
1,160
—
Deferred transaction costs payable
—
577
Purchase of property and equipment
included in accounts payable
—
35
Change in transaction costs payable
568
—
Vesting of early-exercised stock
options
147
27
Common stock issued, contingent
consideration, and liabilities assumed in acquisition of
businesses
99,958
—
Equity awards classified as prepaid
expenses
2,625
—
Non-GAAP Financial Measures
In addition to our financial results determined in accordance
with U.S. GAAP, we present Adjusted EBITDA (as defined below), a
non-GAAP financial measure. We use Adjusted EBITDA to evaluate our
ongoing operations and for internal planning and forecasting
purposes. We believe that Adjusted EBITDA, when taken together with
the corresponding U.S. GAAP financial measure, provides meaningful
supplemental information regarding our performance by excluding
certain items that may not be indicative of our business, results
of operations, or outlook. We consider Adjusted EBITDA to be an
important measure because it helps illustrate underlying trends in
our business and our historical operating performance on a more
consistent basis. We believe that the use of Adjusted EBITDA is
helpful to our investors as it is a metric used by management in
assessing the health of our business and our operating
performance.
However, non-GAAP financial information is presented for
supplemental informational purposes only, has limitations as an
analytical tool and should not be considered in isolation or as a
substitute for financial information presented in accordance with
U.S. GAAP. In addition, other companies, including companies in our
industry, may calculate similarly-titled non-GAAP financial
measures differently or may use other measures to evaluate their
performance, all of which could reduce the usefulness of Adjusted
EBITDA as a tool for comparison. A reconciliation is provided below
for Adjusted EBITDA to net loss, the most directly comparable
financial measure stated in accordance with U.S. GAAP. Investors
are encouraged to review net loss and the reconciliation of
Adjusted EBITDA to net loss, and not to rely on any single
financial measure to evaluate our business.
Adjusted EBITDA is a key performance measure that our management
uses to assess our operating performance. Because Adjusted EBITDA
facilitates internal comparisons of our historical operating
performance on a more consistent basis, we use this measure for
business planning purposes. Adjusted EBITDA is defined as net loss
before depreciation and amortization, benefit (provision) for
income taxes, interest income, interest expense, amortization of
debt issuance costs, stock-based compensation, change in fair value
of liabilities, one-time bonuses and warrant expense in connection
with the combination of Hims, Inc. (“Hims”) and Oaktree Acquisition
Corp. (“OAC”), with Hims continuing as the surviving entity and as
a wholly-owned subsidiary of OAC, which changed its name to Hims
& Hers Health, Inc. (the “Merger”), and acquisition-related
costs, which include professional services and consideration paid
for employee equity with vesting requirements incurred directly as
a result of acquisitions.
Net Loss to Adjusted EBITDA
Reconciliation
(In Thousands, Unaudited)
Three Months Ended September
30,
Nine Months Ended September
30,
2021
2020
2021
2020
Net loss
$
(15,941
)
$
(5,871
)
$
(76,498
)
$
(12,885
)
Depreciation and amortization
1,546
300
2,445
692
(Benefit) provision for income taxes
(3,173
)
31
(3,049
)
103
Interest income
(103
)
(48
)
(298
)
(398
)
Interest expense
—
—
—
10
Amortization of debt issuance costs
—
84
144
251
Stock-based compensation
11,869
1,414
55,259
4,743
Change in fair value of liabilities
(8,328
)
2,527
(13,610
)
2,477
Merger bonuses
—
—
5,219
—
Warrant expense in connection with
Merger
—
—
154
—
Acquisition-related costs
4,342
—
7,214
—
Adjusted EBITDA
$
(9,788
)
$
(1,563
)
$
(23,020
)
$
(5,007
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211110006039/en/
Investor Relations Mike Bishop mike@bishopir.com
Media Relations Press@forhims.com
Hims and Hers Health (NYSE:HIMS)
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