Hims & Hers Health, Inc. (NYSE:HIMS) Q4 2022 Earnings Call Transcript

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So, I think there’s a balanced effort here of improving the customer experiences for those core categories that have, you know, really rapid scale and are continuing to grow pretty robustly, while also looking and getting excited about, you know, what else to plot form can serve and unlock. And I think to your point, there’s quite a lot. I think in some of the materials we released today, there’s categories in women’s health across digestion, menopause, men’s health, testosterone, prostate health, general health such as pain management fertility, cardiovascular, diabetes. These are all categories that over time I believe we will be in and have a very strong presence in. But I think we’re just being balanced in making sure that we are continuously improving the core experience of the segments that are growing today and then the recent people are coming to us today.

And as Yemi said, you can kind of expect us to act as we have in the past, which is to continue to roll-out meaningfully new categories on a 1x to 2x per year basis, while innovating within those categories on a much more rapid timeline.

Yemi Okupe: And then to hit the second part of your question, Jack, we actually continue to see our cost structure get more and more efficient over time. And so, really what we would look to do is look for again as Andrew mentioned, new ways to improve the overall customer experience, whether that comes in the form of more personalized products, new services evolving our overall offering, that’s what we expect to drive more of the movement in gross margin that we expected as opposed to our evolving cost structure. We’re actually getting to see more and more efficiency which is showing up in the form of higher gross margin.

Jack Wallace: Got you. That’s really helpful. And then just a quick follow-up on the CapEx. Are there certain maybe robotic processes that you’re looking at or I’m just trying to get an idea for what the expansion or the opportunities are that you’re looking at that is going to be an incremental to the budget the next couple of years?

Yemi Okupe: Yes, I think at a high level it is to do a few things. It’s to, you know, just augment the, you know, given the pipeline of products that we have that are centered on creating a unique experience that’s personal for customers. Some of the investment is going towards that, as well as towards just increasing the overall efficiency of our €“ of the affiliated fulfillment centers since it relates to a combination of that are driving the incremental investment.

Jack Wallace: Got it. Thanks again and congrats on another great quarter and great year.

Yemi Okupe: Thanks, Jack.

Andrew Dudum: Thanks, Jack.

Operator: Thank you. We’ll go next now to Glen Santangelo with Jefferies.

Glen Santangelo: Thanks for taking my question. Hey, Andrew, I just want to follow-up on some of the comments you were just making regarding the competitive landscape. As you obviously noticed, right, Amazon sort of not sitting still, people looking at, sort of category expansion at Roman. And I’m just kind of wondering how you view the competitive landscape these days because I think what investors are trying to understand is that’s had to those, sort of long-term margin targets, right? It seems like you’re clearly getting the SG&A leverage this year right, but people are, kind of looking more at the marketing expense and, sort of thinking about customer acquisition costs vis à vis that competitive landscape. And what maybe is happening with CAC over time?

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