Hims & Hers Health, Inc. (HIMS)

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Financial statements

data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .

From 10-Q filed 2026-05-11 (period ending 2026-03-31).

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)

The following discussion and analysis provides information that management believes is relevant to an assessment and understanding of our consolidated results of operations and financial condition. You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our Form 10-K for the year ended December 31, 2025 (our “2025 Annual Report”), including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Item 7 of Part II of our 2025 Annual Report and the accompanying unaudited condensed consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q. Our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. You should not rely on forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Except as required by law, we do not intend to update any of these forward-looking statements after the date hereof or to conform these statements to actual results or revised expectations. Forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) and other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described in the section titled “Risk Factors” in Item 1A of Part II of this Quarterly Report on Form 10-Q.

Unless otherwise indicated or the context otherwise requires, references in this discussion and analysis to “we,” “us,” “our,” the “Company,” and “Hims & Hers” refer to Hims & Hers Health, Inc. and its subsidiaries and variable interest entities.

Overview

Hims & Hers is a consumer-first platform transforming the way customers fulfill their health and wellness needs. Our mission is to help the world feel great through the power of better health. We believe that we have the technical infrastructure, distributed provider network, and access to clinical capabilities to lead the migration of routine office visits to a personalized, digital, accessible format. The Hims & Hers platforms (collectively, our “platform”) include access to a highly-qualified and technologically-capable provider network, a clinically-focused electronic medical records system, digital prescriptions, cloud-enabled pharmacy fulfillment, and personalization capabilities. Our digital platform enables access to treatments for a broad range of conditions, including primarily those related to sexual health, hair loss, hormone health, weight loss, dermatology, and mental health, as well as services such as comprehensive laboratory testing. Hims & Hers connects patients to licensed healthcare professionals who can prescribe medications when appropriate. Prescriptions are fulfilled online through licensed pharmacies, making accessing treatments simple, affordable, and straightforward. Through the Hims & Hers mobile applications, consumers can access a range of educational programs, wellness content, community support, and other services that promote lifelong health and wellness.

In addition, we offer access to a range of health and wellness products designed to meet individual needs, which can include curated prescription and non-prescription products. Our products and services are available for purchase directly by customers on our websites and mobile applications. Additionally, Hims & Hers non-prescription products can be found in tens of thousands of top retail locations in the United States.

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Revenue and Key Business Metrics

Our management monitors United States Revenue and Rest of the World Revenue (both defined below) to track our total revenue generation. We also monitor the additional key business metrics set forth below to help us evaluate our business, identify trends affecting our business, formulate business plans and make strategic decisions. Increases or decreases in these key business metrics may not correspond with increases or decreases in our revenue. We continually and strategically review our key business metrics to ensure that they are helpful in managing or monitoring the performance of our business as it grows, which may result in changes in our key business metrics over time. Our management primarily uses the Subscribers and Monthly Revenue per Average Subscriber metric, each as defined below, to manage and monitor the performance of our business.

The limitations our key business metrics have as an analytical tool include: (i) they might not accurately predict our future financial results pursuant to accounting principles generally accepted in the United States of America (“U.S. GAAP”); and (ii) other companies, including companies in our industry, may calculate our key business metrics or similarly titled measures differently, which reduces their usefulness as comparative measures.

Our consolidated revenue primarily comprises online sales of health and wellness products through our websites and mobile applications, including prescription and non-prescription products, as well as services, primarily consisting of medical consultation services, post-consultation service support, and delivery of laboratory testing results, as applicable. Our online sales are net of refunds, credits, and chargebacks, and include revenue recognition adjustments recorded pursuant to U.S. GAAP, primarily relating to deferred revenue and returns reserve. The majority of our online sales are subscription-based, where customers agree to be billed on a recurring basis to have products and services automatically delivered to them. This revenue also includes sales from customers who have made one-time purchases. Additionally, in the United States, we offer a range of health and wellness products through wholesale partners as a way of generating brand awareness with new customers in physical environments and on third-party platforms, with such revenue not considered material to our business.

Brief descriptions of our key business metrics are provided below.

“United States Revenue” represents the sales of products and services by our consolidated legal entities operating within jurisdictions located inside of the United States.

“Rest of the World Revenue” represents the sales of products and services by our consolidated legal entities operating within jurisdictions located outside of the United States.

“Subscribers” are customers who have one or more “Subscriptions” pursuant to which they have agreed to be automatically billed on a recurring basis at a defined cadence. The Subscription billing cadence is typically defined as a number of days (for example, billed every 30 days or every 90 days), which are excluded from our reporting when payment has not occurred at the contracted billing cadence. Subscribers can cancel or snooze Subscriptions in between billing periods to stop receiving additional products and/or services and can reactivate Subscriptions to continue receiving additional products and/or services. Customers who have made one-time purchases are not considered Subscribers.

“Monthly Revenue per Average Subscriber” is defined as total revenue divided by “Average Subscribers”, which amount is then further divided by the number of months in a period. “Average Subscribers” are calculated as the sum of the Subscribers at the beginning and end of a given period divided by 2.

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The table below provides a breakdown of total revenue between United States Revenue and Rest of the World Revenue for the three months ended March 31, 2026 and 2025, as well as key business metrics that we believe drive total revenue (i.e., Subscribers and Monthly Revenue per Average Subscriber) and the change and percentage change between such periods (in thousands, except for Monthly Revenue per Average Subscriber):

	Three Months Ended March 31,
		2026		2025		Change		% Change
United States Revenue		$	529,909	$	578,692	$	(48,783)	(8)	%
Rest of the World Revenue		78,195		7,318		70,877		969	%
Total revenue		$	608,104	$	586,010	$	22,094	4	%
Subscribers (end of period)		2,584		2,366		218		9	%
Monthly Revenue per Average Subscriber		$	80	$	85	$	(5)	(6)	%

We generated $529.9 million in United States Revenue for the three months ended March 31, 2026, a decrease of $48.8 million, or (8)%, as compared to $578.7 million for the three months ended March 31, 2025. The change in United States Revenue for the three months ended March 31, 2026 was primarily impacted by a change in the timing of revenue recognition for certain of our weight loss offerings, inclusive of our Hers brand, as a result of a shift to shorter shipping cadences. During each of the three months ended March 31, 2026 and 2025, our Hers brand represented approximately 40% of United States Revenue. Uptake of the Hers brand is primarily driven by our glucagon-like peptide-1 receptor agonists (“GLP-1s”) and dermatology offerings. During the three months ended March 31, 2026, a majority of our total United States Revenue came from non-GLP-1 offerings. United States Revenue can fluctuate on a period-to-period basis due to various factors, including launches of new product offerings, the success of our marketing campaigns, product shipping cadences, and pricing decisions impacting customer uptake of our offerings, as well as product availability and the regulatory landscape impacting our offerings.

We generated $78.2 million in Rest of the World Revenue for the three months ended March 31, 2026, an increase of $70.9 million, or 969% as compared to $7.3 million for the three months ended March 31, 2025. Growth in Rest of the World Revenue was primarily driven by the geographic expansion from our recent acquisitions. Rest of the World Revenue can fluctuate on a period-to-period basis due to various factors, including those related to United States Revenue discussed above, as well as the magnitude of any future geographic expansion.

Subscribers grew 9% to approximately 2.6 million as of March 31, 2026 as compared to approximately 2.4 million Subscribers as of March 31, 2025. Growth in Subscribers was primarily driven by increased traffic to our platform (through our websites and mobile applications) as a result of our marketing activities, including both ordinary-course marketing campaigns and a specialized Super Bowl marketing campaign in both periods presented, and improved onsite and customer onboarding experiences. Monthly Revenue per Average Subscriber decreased $5 to $80 for the three months ended March 31, 2026 as compared to $85 for the three months ended March 31, 2025. This decrease was primarily due to the shift to shorter shipping cadences for certain of our offerings as discussed above. This metric includes revenue contributed by customers who made one-time purchases and therefore were not considered Subscribers. If the revenue contribution of customers who made one-time purchases was excluded from this metric, Monthly Revenue per Average Subscriber for the three months ended March 31, 2026 and 2025 would have been lower by approximately $10 and less than $5, respectively.

We continuously test and optimize the online experience and offerings to improve the customer experience, maximize sales, and improve gross margin. Our Subscribers select an available cadence at which they wish to receive product shipments or a treatment term depending on the offering. In addition to a 30-day cadence or treatment term, we offer Subscribers the ability to select from a range of Subscription shipment cadences or treatment terms, from every 60 days to 360 days, depending on the offering, as available. In recent quarters, there has been a shift towards shorter shipping cadences, which has impacted our gross margins. We expect this shift to continue due to the launch of our membership program described below. Subscriptions automatically renew on the applicable cadence selected by the Subscriber when purchasing or updating the Subscription. To ensure timely delivery of prescription medications and in accordance with our terms and conditions, Subscribers may sometimes be charged, and products may sometimes be shipped, earlier than their regularly scheduled cadence to accommodate holidays or for other operational reasons to support continuity of treatment. With the exception of prepaid offerings and the membership program described below, the Subscriber is typically billed upon each shipment. Subscribers can cancel or snooze Subscriptions in between billing periods to stop receiving additional products and can reactivate Subscriptions at any time. For

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longer term Subscriptions, we incur shipping and fulfillment expenses fewer times per year than for 30-day Subscriptions. The Subscriber uptake of longer term Subscriptions typically results in lower recurring costs and higher gross margins as compared to 30-day Subscriptions.

Additionally, at the end of March 2026, we launched a membership program for our weight loss offerings. Among other benefits, this program grants eligible customers access to a range of weight loss medications, plus unlimited support from our network of healthcare providers. Memberships auto-renew monthly and must be active for customers to obtain weight loss medications through a separate Subscription. While customers must have an active membership to obtain prescription medication, they can hold a membership without a medication plan.

Key Factors Affecting Results of Operations

We believe that our performance and future success depend on several factors that present significant opportunities for us but also pose risks and challenges.

New customer acquisition

Our ability to attract new customers is a key factor for our future growth. To date, we have successfully acquired new customers through marketing and the development of our brands, as well as through launches of new offerings, including branded weight loss offerings, and through mergers and acquisitions. As a result, revenue has increased each year since our launch. If we are unable to acquire enough new customers in the future, revenue might decline. New customer acquisition could be negatively impacted if our marketing efforts are less effective in the future. Increases in advertising rates could also negatively impact our ability to acquire new customers. Consumer tastes, preferences, and sentiment for our brands may also change and result in decreased demand for our products and services. Changes in the legal or regulatory environment, including as a result of our expansion into new geographies, have and could continue to impact our ability to acquire new customers, including changes to privacy, healthcare, or other laws, or the interpretation or enforcement of such laws, and could impact customer acquisition costs. In addition, acquiring new customers may be impacted by supply chain constraints related to our offerings that may be outside of our control and may impact our future results.

Retention of customers

Our ability to retain customers is a key factor in our ability to generate revenue. A majority of our customers purchase products and services through subscription-based plans, where Subscribers are billed and sent products and/or receive services on a recurring basis. The recurring nature of this revenue provides us with a certain amount of predictability for future revenue if past Subscriber behavior stays relatively consistent in the future. We expect to retain a significant majority of revenue from Subscribers who maintain a Subscription for more than two years (sometimes referred to by us as “long-term revenue retention”). However, if customer behavior changes, or our assumptions regarding long-term revenue retention are incorrect and Subscriber retention decreases in the future, then future revenue will be negatively impacted. Macroeconomic factors including inflation or recessionary pressures or the impact of trade actions may affect the ability of our Subscribers to continue to pay for our products and services, which may also impact the future results of our operations.

Investments in growth

We expect to continue to focus on long-term growth. We intend to continue to invest in our fulfillment, distribution, and operating capabilities, including in our wholly-owned pharmacies (also referred to herein as our “Pharmacies”), our laboratory testing facilities and our peptide manufacturing facility (collectively with our Pharmacies sometimes herein referred to as our “Facilities”), with the goal of fulfilling a majority of our pharmaceutical and over-the-counter customer orders through internal fulfillment capabilities. For example, we are making investments in the expansion of our current Facilities, which are expected to continue for at least the next 12 months. Additionally, we expect to continue to make significant investments in marketing to acquire new customers across all of our brands, and we expect to continue to make investments in product offerings and customer experience. We are working to enhance our offerings and expand the breadth of health and wellness products and services offered on our websites and mobile applications. In addition, we may continue to pursue opportunities to acquire or invest in complementary businesses, services, and technologies, including intellectual property rights. Specifically, in July 2025, we acquired all of the outstanding equity of Zava Global GmbH (which is now H&H Germany GmbH) and its subsidiaries (“Zava”), a digital health platform registered in Germany with operations in the United Kingdom and the European Union, in November 2025, we acquired all of the outstanding equity of Medici Technologies, Inc. (“Medici”), a digital health

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platform registered in Canada, in January 2026, we completed a merger pursuant to which YourBio became our wholly-owned subsidiary, and in February 2026, we entered into a definitive agreement for the proposed acquisition of Eucalyptus (for additional details regarding the YourBio and Eucalyptus transactions, refer to the “Liquidity and Capital Resources” section). In the short term, we expect these investments to increase our operating expenses; however, in the long term, we anticipate that these investments will positively impact our results of operations. If we are unsuccessful at improving our offerings or are unable to generate additional demand for our offerings, we may not recover the financial investments we make into the business and revenue may not increase in the future.

Expansion into new specialties

We expect to continue to expand into new health and wellness specialties with our offerings. Specialty expansion allows us to increase the number of health and wellness consumers for whom we can provide products and services. It also allows us to offer access to treatment of additional conditions that may already affect our current customers. Expanding into new health and wellness specialties has required and may continue to require financial investments in additional headcount, marketing and customer acquisition costs, additional operational capabilities, and may require the purchase of new inventory. If we are unable to generate or maintain sufficient demand in new health and wellness specialties, we may not recover the financial investments we make into new specialties and revenue may not increase in the future.

Non-GAAP Financial Measures

In addition to our financial results determined in accordance with U.S. GAAP, we present Adjusted EBITDA (which is a non-GAAP financial measure), Adjusted EBITDA margin (which is a non-GAAP ratio), and Free Cash Flow (which is a non-GAAP financial measure), each as defined below. We use Adjusted EBITDA, Adjusted EBITDA margin, and Free Cash Flow to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that Adjusted EBITDA, Adjusted EBITDA margin, and Free Cash Flow, when taken together with the corresponding U.S. GAAP financial measures, provide meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations, or outlook. We consider Adjusted EBITDA, Adjusted EBITDA margin, and Free Cash Flow to be important measures because they help illustrate underlying trends in our business and our historical operating performance on a more consistent basis. We believe that the use of Adjusted EBITDA, Adjusted EBITDA margin, and Free Cash Flow is helpful to our investors as they are used by management in assessing the health of our business, our operating performance, and our liquidity.

However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool, and should not be considered in isolation or as a substitute for financial information presented in accordance with U.S. GAAP. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP financial measures or ratios differently or may use other financial measures or ratios to evaluate their performance, all of which could reduce the usefulness of Adjusted EBITDA, Adjusted EBITDA margin, and Free Cash Flow as tools for comparison. Reconciliations are provided below to the most directly comparable financial measures stated in accordance with U.S. GAAP. Investors are encouraged to review our U.S. GAAP financial measures and not to rely on any single financial measure to evaluate our business.

Adjusted EBITDA is a key performance measure that our management uses to assess our operating performance. Because Adjusted EBITDA facilitates internal comparisons of our historical operating performance on a more consistent basis, we use this measure for business planning purposes. “Adjusted EBITDA” is defined as net (loss) income before stock-based compensation, restructuring and other related charges that are considered non-recurring, depreciation and amortization, change in fair value of liabilities, legal settlement costs that are considered non-recurring, acquisition and transaction-related costs (which includes (i) consideration paid for employee and nonemployee compensation with vesting requirements incurred directly as a result of acquisitions, and (ii) transaction professional services), change in fair value of equity securities, payroll tax expense related to stock-based compensation, interest income and expense, net, and income taxes. “Adjusted EBITDA margin” is defined as Adjusted EBITDA divided by revenue.

In the first quarter of 2026, we announced a strategic shift for our United States weight loss offering ("2026 US WL Announcement"). As a result, we evolved our United States weight loss offering to match our global approach towards providing access to branded GLP-1 medications, and offering access to compounded GLP-1 medications through our platform on a limited scale. In connection with the strategic shift, we revised our definition of Adjusted EBITDA to include restructuring and other related charges that are considered non-recurring, as we believe these costs are distinguishable from ongoing

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operating costs and do not reflect current or expected performance of our ongoing operations. These costs consist of inventory write-downs and third-party costs that were incurred directly as a result of the 2026 US WL Announcement. To the extent that we incur additional restructuring charges and other related charges in connection with the 2026 US WL Announcement in future periods, these costs will be presented consistently with our current presentation. As we did not record any non-recurring restructuring and other related charges in prior quarters, prior period disclosures were not impacted.

In the second quarter of 2025, we revised our definition of Adjusted EBITDA to include payroll tax expense related to stock-based compensation, which comprises employer taxes incurred upon vesting of restricted stock units and upon exercise of nonqualified stock options. As a result of recent trends in our stock price, this amount was not considered significant for prior periods and, accordingly, prior period disclosures were not recast to conform to the current presentation.

The following table reconciles net (loss) income to Adjusted EBITDA for the three months ended March 31, 2026 and 2025 (in thousands):

	Three Months Ended March 31,
		2026			2025
Revenue		$	608,104		$	586,010
Net (loss) income		(92,115)			49,485
Stock-based compensation		36,862			24,858
Restructuring and other related charges		33,488			—
Depreciation and amortization		21,953			8,276
Change in fair value of liabilities		17,646			—
Legal settlement costs		15,000			—
Acquisition and transaction-related costs		13,366			24
Change in fair value of equity securities		9,682			—
Payroll tax expense related to stock-based compensation		2,867			—
Interest income and expense, net		(5,033)			(2,596)
(Benefit from) provision for income taxes		(9,436)			11,010
Adjusted EBITDA		$	44,280		$	91,057
Net (loss) income as a % of revenue		(15)		%	8		%
Adjusted EBITDA margin		7		%	16		%

Some of the limitations of Adjusted EBITDA include (i) Adjusted EBITDA does not properly reflect capital commitments to be paid in the future, and (ii) although depreciation and amortization are non-cash charges, the underlying assets may need to be replaced and Adjusted EBITDA does not reflect these capital expenditures. In evaluating Adjusted EBITDA, you should be aware that in the future we will incur expenses similar to the adjustments in this presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these expenses or any unusual or non-recurring items. We compensate for these limitations by providing specific information regarding the U.S. GAAP items excluded from Adjusted EBITDA. When evaluating our performance, you should consider Adjusted EBITDA in addition to, and not as a substitute for, other financial performance measures, including our net (loss) income and other U.S. GAAP results.

Free Cash Flow is a key performance measure that our management uses to assess our liquidity. Because Free Cash Flow facilitates internal comparisons of our historical liquidity on a more consistent basis, we use this measure for business planning purposes. “Free Cash Flow” is defined as net cash provided by operating activities, less purchases of property, equipment, and intangible assets and investment in website development and internal-use software in investing activities.

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The following table reconciles net cash provided by operating activities to Free Cash Flow for the three months ended March 31, 2026 and 2025 (in thousands):

	Three Months Ended March 31,
		2026		2025
Net cash provided by operating activities		$	89,356	$	109,090
Purchases of property, equipment, and intangible assets in investing activities		(29,844)		(55,327)
Investment in website development and internal-use software in investing activities		(6,480)		(3,711)
Free Cash Flow		$	53,032	$	50,052

Some of the limitations of Free Cash Flow include (i) Free Cash Flow does not represent our residual cash flow for discretionary expenditures and our non-discretionary commitments, and (ii) Free Cash Flow includes capital expenditures, the benefits of which may be realized in periods subsequent to those in which the expenditures took place. In evaluating Free Cash Flow, you should be aware that in the future we will have cash outflows similar to the adjustments in this presentation. Our presentation of Free Cash Flow should not be construed as an inference that our future results will be unaffected by these cash outflows or any unusual or non-recurring items. When evaluating our performance, you should consider Free Cash Flow in addition to, and not as a substitute for, other financial performance measures, including our net cash provided by operating activities and other U.S. GAAP results.

Basis of Presentation

Currently, we conduct business through one operating segment. The unaudited condensed consolidated financial statements include the accounts of our company, our wholly-owned subsidiaries, and variable interest entities (“VIEs”) for which we are the primary beneficiary. As of March 31, 2026, the VIEs are the “Affiliated Medical Groups,” which are professional corporations or other professional entities located in the United States and owned by licensed physicians and that engage licensed healthcare professionals (physicians, physician assistants, nurse practitioners, and mental health providers; collectively referred to as “Providers” or individually, a “Provider”) to provide consultation services. We determined that we are the primary beneficiary of the Affiliated Medical Groups for accounting purposes because we have the ability to direct the activities that most significantly affect these entities’ economic performance and have the obligation to absorb the entities’ losses. Under the VIE model, we present the results of operations and the financial position of the entities as part of our unaudited condensed consolidated financial statements as if the consolidated group were a single economic entity. Additionally, Apostrophe Pharmacy LLC and XeCare, LLC, which are licensed mail order pharmacies providing prescription fulfillment solely to our customers, were VIEs through April 2025 and November 2025, respectively, when, as a result of changes of ownership, they became wholly-owned subsidiaries of our company and were no longer considered VIEs.

Components of Results of Operations

Revenue

We recognize revenue when we transfer promised goods or services to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services.

Cost of revenue

Cost of revenue consists of costs directly attributable to the products shipped and services rendered, including costs of purchased products net of vendor rebates per contract terms, as applicable, manufactured products, packaging materials, shipping costs, labor costs directly related to revenue generating activities including primarily medical consultation services and manufacturing labor, and overhead costs associated with manufactured products. Costs related to free products where there is no expectation of future purchases from a customer and depreciation and amortization on property, equipment, and software (other than related to manufactured products) are considered to be operating expenses and are excluded from cost of revenue.

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Gross profit and gross margin

Our gross profit represents total revenue less our total cost of revenue, and our gross margin is our gross profit expressed as a percentage of our total revenue. Our gross profit and gross margin have been and will continue to be affected by a number of factors, including the prices we charge for our products and services, the costs we incur from our vendors for certain components of our cost of revenues, the mix of the various products and services we sell in a period including the launch of new offerings, the volume of fulfillment through internal fulfillment capabilities, and our ability to sell our inventory. Our gross margin may decrease throughout fiscal year 2026, primarily as a result of the 2026 US WL Announcement. While we expect our gross margin to fluctuate from period to period depending on these and other factors, over the long term we expect gross margin to stabilize as we continue to scale our business and increase our ability to negotiate and optimize more favorable costs of revenue, as well as integrate new acquisitions.

Marketing expenses

The largest component of our marketing expenses consists of our discretionary customer acquisition costs. Customer acquisition costs, also called paid marketing expense, are the advertising and media costs associated with our efforts to acquire new customers, promote our brands, and build awareness for our products and services. Customer acquisition costs include advertising in digital media, social media, television, radio, out-of-home media, and various other media outlets and exclude content production costs. Marketing expenses also include overhead expenses, including salaries, benefits, taxes, and stock-based compensation for personnel; agency, contractor, and consulting expenses; content production, software, and other marketing operating costs. Marketing is an important driver of growth and we intend to continue to make significant investments in customer acquisition and our marketing organization. Historically, our marketing expenses have increased quarter-over-quarter, though marketing expenses may fluctuate from period to period due to the timing and discretionary nature of these expenses. While marketing expenses may fluctuate as a percentage of revenue, we expect total marketing expenses as a percentage of revenue to continue to decrease over the long term.

Operations and support expenses

Operations and support expenses include the salaries, benefits, taxes, professional services expenses, and stock-based compensation for personnel, consultants, and contractors for our supply chain, retail, medical, pharmacy, fulfillment, diagnostics, customer service, and corporate quality functions. These expenses also include operating expenses primarily relating to operations and support functions for our Facilities, warehousing and storage, fulfillment, transaction processing, third-party software and hosting to support those functions, and related depreciation and amortization. We expect operations and support expenses may increase for the foreseeable future as we continue to invest in our fulfillment and operating capabilities and grow our business, resulting in additional operational efficiencies, although it may fluctuate as a percentage of total revenue from period to period due to the timing and amount of these expenses.

Technology and development expenses

Technology and development expenses include the salaries, benefits, taxes, professional services expenses, and stock-based compensation for personnel, consultants, and contractors for our engineering, product management, product development, and data science functions. These expenses also include operating expenses primarily relating to technology and development functions for the operation, maintenance, and enhancement of our digital platform, websites, and mobile applications, inclusive of related expenses for third-party software and hosting to support those functions, and related depreciation. Expenses also include investments to develop new health and wellness products and services. We expect technology and development expenses may increase in the foreseeable future as we grow our business and continue to invest in our platform, including our artificial intelligence capabilities, as well as in new offerings. We expect these expenses to stabilize over the long term, although it may fluctuate as a percentage of total revenue from period to period due to the timing and amount of these expenses.

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General and administrative expenses

General and administrative expenses (“G&A”) include the salaries, benefits, taxes, professional services expenses, and stock-based compensation for personnel, consultants, and contractors for our executive, legal, human resources, finance, brand strategy, communications, public and government relations, and other corporate functions. These expenses also include operating expenses primarily relating to general and administrative functions for insurance, third-party software and hosting to support those functions, related depreciation and amortization, and other general corporate costs. G&A may fluctuate as a percentage of total revenue from period to period due to the timing and amount of these expenses.

Total other (expense) income, net

Total other (expense) income, net primarily consists of changes in fair value of equity securities and liabilities, as well as interest income. Additionally, total other (expense) income, net includes expenses associated with our debt, as well as non-operating and one-time charges classified outside of operating expenses. Interest income is driven by our cash and cash equivalents and available-for-sale investments and fluctuates from period to period based on balances and applicable interest rates. Interest expense is related to the amortization of debt discount and issuance costs on our debt, as well as applicable interest on any borrowings under our revolving credit facility.

Benefit from (provision for) income taxes

Benefit from (provision for) income taxes primarily consists of the impacts of pre-tax losses, federal and state tax credits, and windfall tax benefits, partially offset by officer compensation limitations and acquisition-related addbacks. Deferred tax assets are reduced by a valuation allowance to the extent management believes it is not more likely than not to be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income. Management makes estimates and judgments about future taxable income based on assumptions that are consistent with our plans and estimates. If and when we conclude that we are more likely than not to utilize some or all of our deferred tax assets, we release some or all of our valuation allowance and our tax provision will decrease in the period in which we make such determination, which will cause a corresponding one-time increase to net income. Any future releases of our current valuation allowance would be immaterial to the unaudited condensed consolidated statements of operations.

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Results of Operations

Comparisons for the three months ended March 31, 2026 and 2025

The following table sets forth our unaudited condensed consolidated statement of operations for the three months ended March 31, 2026 and 2025, and the dollar and percentage change between the two periods (dollars in thousands):

	Three Months Ended March 31,
		2026		2025		Change		% Change
Revenue		$	608,104	$	586,010	$	22,094	4	%
Cost of revenue		211,317		155,321		55,996		36	%
Gross profit		396,787		430,689		(33,902)		(8)	%
Operating expenses:(1)
Marketing		222,003		231,235		(9,232)		(4)	%
Operations and support		96,503		63,033		33,470		53	%
Technology and development		46,936		29,914		17,022		57	%
General and administrative		109,668		48,610		61,058		126	%
Total operating expenses		475,110		372,792		102,318		27	%
(Loss) income from operations		(78,323)		57,897		(136,220)		*
Other (expense) income:
Change in fair value of equity securities		(9,682)		—		(9,682)		*
Change in fair value of liabilities		(17,646)		—		(17,646)		*
Other income, net		4,100		2,598		1,502		58	%
Total other (expense) income, net		(23,228)		2,598		(25,826)		*
(Loss) income before income taxes		(101,551)		60,495		(162,046)		*
Benefit from (provision for) income taxes		9,436		(11,010)		20,446		*
Net (loss) income		$	(92,115)	$	49,485	$	(141,600)	*

______________

(*) Not meaningful

(1)Includes stock-based compensation expense as follows (in thousands):

	Three Months Ended March 31,
		2026		2025
Marketing		$	2,815	$	2,774
Operations and support		6,113		3,006
Technology and development		5,990		4,045
General and administrative		21,944		15,033
Total stock-based compensation expense		$	36,862	$	24,858

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The following table sets forth our results of operations as a percentage of our total revenue for the periods presented:

	Three Months Ended March 31,
		2026		2025
Revenue		100	%	100	%
Cost of revenue		35	%	27	%
Gross profit		65	%	73	%
Operating expenses:
Marketing		36	%	39	%
Operations and support		16	%	11	%
Technology and development		8	%	5	%
General and administrative		18	%	8	%
Total operating expenses		78	%	63	%
(Loss) income from operations		(13)	%	10	%
Other (expense) income:
Change in fair value of equity securities		(2)	%	—	%
Change in fair value of liabilities		(3)	%	—	%
Other income, net		1	%	—	%
Total other (expense) income, net		(4)	%	—	%
(Loss) income before income taxes		(17)	%	10	%
Benefit from (provision for) income taxes		2	%	(2)	%
Net (loss) income		(15)	%	8	%

Revenue

Revenue was $608.1 million for the three months ended March 31, 2026, compared to $586.0 million for the three months ended March 31, 2025, an increase of $22.1 million, or 4%. For a detailed discussion of this increase, refer to the “Revenue and Key Business Metrics” section.

Cost of revenue and gross profit

Cost of revenue was $211.3 million for the three months ended March 31, 2026, compared to $155.3 million for the three months ended March 31, 2025, an increase of $56.0 million, or 36%. This increase was primarily due to increased product and packaging costs of approximately 47%, increased shipping costs of 10%, and increased costs associated with medical consultation services of 4% compared to the three months ended March 31, 2025. This increase in cost of revenue for the three months ended March 31, 2026 was primarily due to our weight loss offerings, some of which have higher product and packaging costs and shipping costs compared to our other offerings, including as a result of the 2026 US WL Announcement, as well as overall increased business activity with the addition of new Subscribers and our recent acquisitions. Cost of revenue for the three months ended March 31, 2026 included $28.5 million of non-recurring restructuring and other related charges, consisting of inventory write-downs, in connection with the 2026 US WL Announcement.

Gross profit was $396.8 million for the three months ended March 31, 2026, compared to $430.7 million for the three months ended March 31, 2025, a decrease of $33.9 million, or 8%. Correspondingly, gross margin was 65% for the three months ended March 31, 2026, compared to 73% for the three months ended March 31, 2025. This decrease in gross margin was primarily due to our weight loss offerings, which have shorter shipping cadences and increased fulfillment costs, along with the impact of the growth of our international business and new offerings, and the non-recurring restructuring and other related charges in connection with the 2026 US WL Announcement.

Marketing expenses

Marketing expenses were $222.0 million for the three months ended March 31, 2026, compared to $231.2 million for the three months ended March 31, 2025, a decrease of $9.2 million, or 4%. Customer acquisition costs decreased to $192.8 million in the

Table of Contents

three months ended March 31, 2026, compared to $201.6 million for the three months ended March 31, 2025, a decrease of $8.8 million. The decrease in customer acquisition costs was primarily a result of management’s decision to focus on more efficient acquisition channels.

Operations and support

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Held by

holders ( registered funds via N-PORT, institutional investors via 13F). Showing top by dollar value.

Holder	Type	ETF	MF	Position ($)	% of holder	Δ % of holder	Holder AUM

Recent insider activity

Last 90 days. Open-market trades (purchases & sales) by directors, officers, and 10%+ owners. 10 transactions across 6 insiders. Net: -71,929 shares, -$2,713,716.

Date	Insider	Role	Action	Shares	Price	Value
2026-07-17	Okupe Oluyemi	Chief Financial Officer	Sell	-7,163	$31.99	-$229,168
2026-07-06	Okupe Oluyemi	Chief Financial Officer	Sell	-7,163	$36.49	-$261,351
2026-06-22	Okupe Oluyemi	Chief Financial Officer	Sell	-18,197	$34.03	-$619,217
2026-06-18	Carroll Patrick Harrison	Chief Medical Officer	Sell	-23,726	$35.00	-$830,410
2026-06-17	Becklund Irene	PAO	Sell	-4,490	$31.50	-$141,435
2026-06-16	Becklund Irene	PAO	Sell	-7,573	$30.25	-$229,083
2026-06-17	Chi Michael	Chief Operating Officer	Sell	-14,027	$31.50	-$441,850
2026-06-17	Elshenawy Mohamed	CTO	Sell	-30,040	$31.50	-$946,260
2026-05-26	WELLS DAVID B	Director	Buy	+48,400	$24.23	$1,172,974
2026-05-18	Okupe Oluyemi	Chief Financial Officer	Sell	-7,950	$23.64	-$187,916

Source: SEC Form 4 filings.

Next expected filings

~2026-08-03 10-Q expected by 2026-08-07 (in 5 days)
~2026-11-02 10-Q expected by 2026-11-06 (in 96 days)
~2027-02-22 10-K expected by 2027-02-25 (in 208 days)
~2027-05-10 10-Q expected by 2027-05-14 (in 285 days)

Predicted from historical filing cadence; not an SEC commitment.

Recent SEC filings

2026-07-17 8-K Officer/Director Change
2026-07-01 8-K Material Agreement Entered; Material Financial Obligation; Financial Statements and Exhibits
2026-06-02 8-K Material Agreement Entered; Material Financial Obligation; Other Events; Financial Statements and Exhibits
2026-05-21 8-K Material Agreement Entered; Material Financial Obligation; Unregistered Equity Sale; Financial Statements and Exhibits
2026-05-19 8-K Other Events; Financial Statements and Exhibits
2026-05-11 8-K Earnings Release; Financial Statements and Exhibits
2026-05-11 10-Q Quarterly Report
2026-04-28 DEF 14A Proxy Statement
2026-02-23 10-K Annual Report
2026-02-23 8-K Earnings Release; Financial Statements and Exhibits
2026-02-19 8-K Material Agreement Entered; Unregistered Equity Sale; Regulation FD Disclosure; Financial Statements and Exhibits
2025-11-17 8-K Other Events
2025-11-03 10-Q Quarterly Report
2025-11-03 8-K Earnings Release; Financial Statements and Exhibits
2025-10-02 8-K Officer/Director Change

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