Shares of Hims & Hers Health Inc. (HIMS) were heading lower in Tuesday's premarket, a stumble that followed a classic "mixed" earnings report. The company beat on the bottom line but missed on the top, and its outlook for the current quarter came in lighter than Wall Street hoped. It's the kind of news that makes investors pause, even when other parts of the story look pretty good.
Here's the mix: for the fourth quarter, Hims & Hers posted revenue of $617.82 million. That was up a solid 28% from a year ago, but it fell just short of the $619.22 million analysts were expecting. On the profit side, the company reported earnings of 8 cents per share, handily beating the estimate of 3 cents. The subscriber engine is still humming, too, with over 2.5 million people signed up—a 13% increase.
So, why the stock drop? It often comes down to what's next. The company's guidance for the first quarter is where the caution flags are flying. Hims & Hers expects revenue between $600 million and $625 million. The consensus estimate was sitting at $653.12 million, so that's a noticeable gap.
The company pointed to two specific pressures. First, there's a change in how it ships medications for its weight loss business. Due to a shift to a more personalized fulfillment process under U.S. law, the company expects this to create a revenue headwind of about $65 million in Q1. For context, that same issue created a $40 million headwind in the second half of last year. Management expects subscriber growth in weight loss to remain strong through 2026, but the timing of revenue recognition is getting pushed out.
The second pressure point is a bit more glamorous: a 60-second Super Bowl commercial. That kind of prime-time advertising doesn't come cheap, and the company said the investment will put additional pressure on its adjusted EBITDA in the quarter. It's a classic growth company trade-off—spend now to build the brand, even if it pinches profits in the short term.
Looking at the full fiscal year 2026, the company sees sales in the range of $2.7 billion to $2.9 billion, which brackets the current consensus of $2.74 billion. It expects adjusted EBITDA between $300 million and $375 million.
Notably, this outlook does not include the impact of a major acquisition announced just last week. Hims & Hers has agreed to buy Eucalyptus, a digital health leader, in a deal valued at up to $1.15 billion. About $240 million of that will be paid in cash when the deal closes. The move is aimed at supercharging the company's international expansion plans.
On the charts, the stock is showing some bearish technical signals. It's currently trading 10.3% below its 20-day simple moving average and 12.5% below its 100-day average, which suggests a downtrend in the short to medium term. The stock is also much closer to its 52-week low than its high. The Relative Strength Index (RSI) is sitting right at 50, which is neutral territory, but the MACD indicator is below its signal line, hinting at bearish momentum. Key resistance is seen at $15.00, with support around $14.00.
In premarket trading Tuesday, shares of Hims & Hers were down 6.90% at $14.44.
