margin expansion for hims & hers ($HIMS)
// note
market seems to think hims is cooked b/c margins on non-glp1 services are low
this is true
however, they are not as bad as people think
from my experience working in d2c pharmacy space, i know gross margins working w/ a fulfillment process are going to be approx 50%. hims owns their own pharmacies and has likely optimized their logistics heavily. thus, 70%?
oh wait, we can actually just check this
"Hims & Hers Health (HIMS) does not publicly disclose gross margins for individual products like Minoxidil, but the company's overall gross margin for the quarter ending September 30, 2025, was 74%."
hmm, this is heavily inflated by charging \$100 for the glp1s, but
so main ways to improve margin from here are to inrcease ARPU (duration + sub length/multiple purchases/bundles/etc) and lower CAC (network effects/branding/optimizing ads)
oh wow!
"While Hims & Hers Health (HIMS) does not publicly report margins for individual products, analysts estimate that the gross margins for Minoxidil and other "core" generic treatments (like Sildenafil and Finasteride) are approximately 80% to 85%"
That's insane! So the cheap, old generic small molecules are even more streamlined!
Great news.
OK - so Hims margin actually expands...
What am I missing here?
GLP1 rev goes away *completely* but they just keep expanding ED + hair + testosterone (new) + labs (bundle increasing arpu) and they are golden
Trading at 3x rev right now.
Some of board is likely mad at dudum for taking this co public. If they had stayed out of the public eye, they might've not had this lawsuit + headwind