Andrew Dudum: Yes. I think you’re hitting it right on the head, Jack. I think it is both a great recapture mechanism for individuals that may have churned off. As the selection of kind of cross-category compounds grows, it also is a really attractive mechanism because 1 category might catch the eye as an individual over another. I also think in combination with the strategic price reduction, those 2 together is really quite powerful. And I think we’ve seen that pretty substantially in the last couple of quarters. We track market share capture across each of our categories across the top 3 or 4 competitors. We’ve seen really big mix shift, right, as we’ve continued to accelerate and capture more share. And I think this combination of mass market pricing and a wide portfolio of personalized capabilities that are really bread and butter kind of like made in our facilities, right, really only in our facility are delivering, I think, a pretty unique and compelling value prop to customers that getting them either to come for the first time or to come back and consider for the second time.
Operator: Your next question comes from the line of of Bank of America.
Unidentified Analyst: Congrats on a nice quarter. I guess Andrew, 1 for you. You just mentioned you’re taking market share among some of your top competitors. I guess as we look at what’s going on September, October, November, what is your gauge of what’s going on with the consumer as we’re heading into November now? Is things like student loans, interest rates, are those things impacting the consumer in any observable way on the platform? Do you think that’s impacting your competitors maybe more than you? Just curious if you’re seeing any month-over-month or quarter-over-quarter changes in consumer behavior on the platform.
Andrew Dudum: Great question, Allen. The short answer is we’ve not. The last couple of quarters have been fairly consistent with historical behavior. It does not seem that there’s any type of market shock or market behavioral dynamics that are influencing us in any material way. I can’t speak to the rest of the competitive landscape. But to my knowledge, there hasn’t been anything unique that’s been thought of a disruption.
Allen Lutz: Got it. And then 1 for Yemi. I know that the gross margin has already been touched on a bit, but I want to come at it from a different angle. Just curious, as we think about these investments in price, it’s not even offsetting the benefits you’re getting from the move to affiliated pharmacies and longer-duration subscriptions. I’m just curious about as you think about balancing growth with the gross margin, is there any opportunity to invest further in price given the stability in gross margins that we’ve seen? Or are you comfortable with the balance that you guys have here heading into 2024?
Yemi Okupe: Yes, great question. Thanks for the question, Allen. I think that we will continue to explore various ways to give value back to consumers. I think that our approach there is very thoughtful and deliberate. And so typically, when we do take the decision to whether it’s going to make pricing adjustments or take other strategies to value back to consumers, those are typically backed by experience that happen over the course of several months. And so I think we’re going to be very thoughtful around how we think around how to get value back to consumers in the form of that. Constantly, we are experimenting receiving feedback from consumers around various offerings that we do put into the market. I think over the mid- to long term, our gross margin target has been in the mid-70s.
I think the reality is that we’re hitting a level of scale as mentioned, where there’s likely to be further efficiency unlocked from affiliated pharmacies and so more than likely probably likely going to be a multiyear period for us to identify the most accretive way to give value back to consumers to hit kind of the target on the mid-70s that we’ve predicted.
Operator: [Operator Instructions]. Your next question comes from the line of Jailendra Singh of Truist Securities.
Jailendra Singh: Congrats on a strong quarter. I want to follow up on the weight management offering discussion. Just asking slightly differently, how would you describe this offering in context of your 2025 goal of $1.2 billion plus in revenues? Would you say that this offering represents incremental to your long-term outlook? Is it more like supporting your growth to the long-term outlook? Or is it just too early to say? And kind of related to that, I mean, clearly, we’ve seen several employers launching programs and offerings in this area for ’24 and expectations are that it will pick up in 2025. Considering that, can you update us on your thinking of long-term opportunities in this area for DTC space?
Yemi Okupe: Yes. Thanks for the question. Maybe I can start with the first part around just impact to 2025 targets, and then Andrew can handle the product issued a question around weight management. I think the short of it is, I think we’re very confident in our ability to hit the 2025 targets. Those were given a floor at the time that we set on. I think what we’re seeing with the strong performance even in the current categories that we were present in, the chance on these new categories alone, such as women’s hair, dermatology, men’s hair as well as sexual health, we just has to start with even on those categories alone. And so we provided those targets embedded in our ability to hit those is primarily around continuing to execute across the dimensions that we’ve spoken around earlier.
The shift to personalized products continuing to make a broader set of consumers aware of our capabilities and products. And I think at this moment in time that we have a lot of conviction in our ability to at least hit, if not even surpass the 2025 target, even in the absence of the launch of new categories with the inclusion of weight management. And so that would be accretive to those targets. And Andrew, if you want to take the second part of that.
Andrew Dudum: Yes. Thanks, Jailendra, for the question. Regarding the weight management category, to be honest, we think it’s going to be an extraordinarily valuable category, right? It affects a very large chunk of the population. I think what the GLP-1s have done in the last year have really educated the population that there are pharmaceutical treatments that are highly effective, and more of them are coming is the reality, right? There might be 15 to 20 different medications currently under clinical review that are showing incredibly good data profiles and safety profiles that in the next couple of years will be live in the market. And so we believe this is going to be a really big category. To Yemi’s point, this will be accretive on top of anything we put forward for 2025.
So what we’re starting with, I think, is a very safe mass market, well-studied approach that directly goes after some of the underlying dynamics, such as kind of appetite curve craving, insulin resistance metabolism dynamics that all affect the gaining of weight. But the platform is being built in such a manner so that in the coming years, as this portfolio of GLP-1 and others come to market, we will be equipped to bring those to market when we can hit those thresholds of safety of supply chain consistency of reimbursement consistency. So we’re really on top of this category, really excited by this category. I believe this will be a very large tailwind for the business in the coming years. But I think we are — as we’ve talked about in the past, feel like it’s prudent that we maintain trust with the consumer and that we’re only bringing to market where we believe we can deliver consistently and safely.
