Hims & Hers Health, Inc. (Ticker: HIMS) is a telehealth company that connects customers with licensed healthcare professionals to get prescriptions, over-the-counter medications, and personal care products delivered directly to their homes. Think of it as a digital health platform where you can get personalized care for various health and wellness needs without leaving your couch.

The Business Model (How They Make Money)

Hims & Hers makes money primarily by selling health and wellness products and services directly to consumers through its online platform. Their core business revolves around a subscription-based model where customers receive ongoing access to medical consultations and treatments for conditions like sexual health, hair loss, hormone health, weight loss, dermatology, and mental health.

In 2025, the company generated a total revenue of $2,347.6 million. The vast majority of this, $2,311.4 million, came from their "Online" segment, which includes all the direct-to-consumer sales through their platform. This shows that their direct online sales are the powerhouse of their business. Their personalized offerings, which are tailored treatment plans developed by healthcare providers, made up over 70% of their U.S. revenue in 2025. The "Hers" brand, focusing on women's health, contributed nearly 40% of their U.S. revenue in 2025, largely driven by weight loss treatments (GLP-1s) and dermatology products.

For the first quarter of 2026, Hims & Hers reported revenue of $608.1 million. The company expects its full-year 2026 revenue to be between $2.8 billion and $3.0 billion.

The Metrics That Matter Most

For Hims & Hers, a company focused on growing its direct-to-consumer health platform, these 3 to 5 metrics are crucial:

1. Revenue: This metric tells you the total amount of money the company brings in from selling its products and services. For Hims & Hers, strong revenue growth indicates that more people are signing up for their services and that their personalized health offerings are resonating with customers. It's the most direct measure of how much their business is expanding. In 2025, revenue was $2,347.6 million, and for the first quarter of 2026, it was $608.1 million.
2. Gross Margin: This shows how much profit the company makes from its sales after subtracting the direct costs of providing its services and products. For Hims & Hers, it reflects how efficiently they are delivering their telehealth consultations and medications. A healthy gross margin means they are managing their costs well. The gross margin was 65% in the first quarter of 2026, a decrease from 73% in the first quarter of 2025. This decline is an important trend to watch as it impacts their overall profitability.
3. Net Income (or Net Loss): This is the company's total profit after all expenses, including operating costs, interest, and taxes, have been paid. It's the ultimate measure of how profitable the business is. For Hims & Hers, seeing whether they are making a profit or a loss, and how that changes over time, is key to understanding their financial health. The company reported a net loss of $92.1 million in the first quarter of 2026, compared to a net income of $49.5 million in the first quarter of 2025. In contrast, for the full year 2025, Hims & Hers had a net income of $128.4 million.
4. Operating Cashflow: This metric shows the cash generated by the company's regular business activities, before accounting for investments or financing. For Hims & Hers, it indicates how much cash their core operations are actually bringing in, which is vital for funding their growth, paying bills, and potentially expanding without needing to borrow more money. For the full year 2025, net cash provided by operating activities was $300.0 million. In the first quarter of 2026, net cash provided by operating activities was $89.4 million.
5. Sales & Marketing (S&M) expenses: As a direct-to-consumer company, Hims & Hers relies heavily on advertising and promotions to attract new customers to its platform. This metric tells you how much they are spending to get people to sign up for their services. Watching this expense helps understand how much it costs them to grow their customer base and if those marketing efforts are efficient.

How to Value This Company

For Hims & Hers, the P/Sales (Price-to-Sales Ratio) is the most relevant valuation metric.

Here's why: Hims & Hers is a growing company that has recently reported a net loss in its latest quarter. When a company is still in a growth phase and its profits (net income) might be small or even negative, traditional valuation metrics like the Price-to-Earnings (P/E) ratio aren't very useful because there are no earnings to compare to the stock price.

The P/Sales ratio helps you figure out if the stock is cheap or expensive by comparing the company's total stock market value (its "market capitalization") to its total sales (revenue) over the last year. It essentially tells you how much investors are willing to pay for each dollar of the company's sales. For Hims & Hers, a lower P/Sales ratio compared to its competitors or its own historical average might suggest it's a more attractive investment, indicating that you're paying less for each dollar of revenue the company generates. It's a good way to value companies that are prioritizing expanding their customer base and revenue, even if they aren't consistently profitable yet.