HIMS Posts $92M Q1 Loss as Branded GLP-1 Shift Craters Margins

The Print

HIMS reported Q1 2026 revenue of $608.1 million, up just 4% year-over-year and short of the $616.9 million consensus. The earnings line was the bigger problem: a net loss of $92.1 million, translating to -$0.40 EPS against the $0.03 profit analysts were modeling. Compare that to the year-ago quarter, when HIMS printed $0.20 EPS on $586 million of revenue — the top line decelerated from 111% growth to 4%, and earnings flipped from profit to a nine-figure loss in twelve months. Adjusted EBITDA halved to $44.3 million from $91.1 million, with the margin landing at 7%. Subscribers grew 9% to 2.584 million, but every economic ratio behind those subs got worse.

Why Margins Cratered

Gross margin compressed 800 basis points to 65% from 73% a year ago, and the mechanism is the one investors were warned about going in. In March HIMS restructured its U.S. weight loss business away from compounded GLP-1s toward branded Wegovy and Ozempic, striking a direct distribution agreement with Novo Nordisk after the FDA tightened the rules on compounded semaglutide. Branded inventory carries far thinner take rates than compounded — HIMS is now a distribution channel rather than a pharmacy with its own margin stack on top. The brutal part of the timing: the Novo Nordisk arrangement only went live on March 26, five days before the quarter closed. The cost structure shifted; the offsetting revenue base did not. That is the entire reason the print looks the way it does.

The Guide and the Tape

Management raised full-year revenue guidance to $2.8-3.0 billion with adjusted EBITDA of $275-350 million, implying a 10 to 12% margin. But Q2 guidance lands at $680-700 million in revenue against just $35-55 million of EBITDA — a 5 to 8% margin that sits below the full-year corridor. Translation: the back half has to do all the work, and the bull case requires believing the branded GLP-1 ramp rebuilds margin by Q4. That guide also excludes the pending $1.15 billion Eucalyptus acquisition targeted to close mid-2026, so reported numbers will look noisier still once that closes. The setup we covered into the print — Friday's $31.24 squeeze unwinding into the binary — resolved to the bear case. $26.16 puts the tape back below the $27.25 average analyst price target and 16% below the squeeze high, with the next test whether desks defend the post-November consolidation shelf in the mid-$24s.