Regulatory Headwinds Cloud Hims & Hers' Record Financial Performance

Telehealth firm Hims & Hers posts record $2.35B revenue but stock hits 52-week low due to SEC investigation into weight-loss drug disclosures and cautious near-term guidance.

Despite posting its most successful financial year to date, shares of telehealth provider Hims & Hers Health are trading near a 52-week low. The disconnect stems not from the company's operational results but from a formal investigation by the U.S. Securities and Exchange Commission (SEC) and a cautious near-term forecast that has unsettled the investment community.

Record Growth Amidst Market Skepticism

The company's operational metrics for the 2025 fiscal year present a compelling growth story. Annual revenue surged by 59% to reach $2.35 billion. Notably, Hims & Hers achieved a net profit of $128.4 million, demonstrating the scalability of its direct-to-consumer healthcare model. Its subscriber base also expanded, growing 13% to over 2.5 million members by year-end.

However, these strong fundamentals have been overshadowed by other concerns. The stock has lost nearly 57% of its value since the start of the year, with shares recently trading around €12.28.

SEC Inquiry and Subdued Guidance Weigh Heavily

The primary pressure point is a confirmed investigation by the SEC. The regulator has requested documents related to the company's disclosure practices concerning compounded semaglutide products. This category of weight-loss medications has been a significant recent growth driver, and the probe creates uncertainty around future marketing and sales prospects for these profitable offerings.

Compounding investor unease was the company's outlook for the first quarter of 2026. Hims & Hers provided revenue guidance in the range of $600 million to $625 million, which fell short of some analyst projections. Market observers are also scrutinizing the company's gross margin, which contracted to 72% in the fourth quarter.

Strategic Shift: Diversification and International Push

In response to the scrutiny, management is actively working to downplay the company's reliance on GLP-1 weight-loss products. Executives have emphasized that the majority of revenue and profit originates from other service areas within their platform.

To bolster this diversification strategy, Hims & Hers is accelerating its international expansion plans. A key component is the planned acquisition of Eucalyptus, a move designed to strengthen its European footprint and facilitate market entry into Australia and Japan. The company has set an ambitious target: scaling its international business to over $1 billion in annual revenue within the next three years.

For the full 2026 fiscal year, management projects total revenue between $2.7 billion and $2.9 billion, with adjusted EBITDA potentially reaching $375 million. Company leadership is expected to address these targets and field questions regarding the SEC investigation at the upcoming Morgan Stanley Technology, Media & Telecom Conference.