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

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George Hill: Okay. That’s helpful. Maybe just a really quick follow-up. Just can you comment on uptake of the mix? Has it been kind of €“ I know it’s early, but kind of met expectations, surpassed expectations?

Andrew Dudum: I think we have very high expectations. And I think they’re meeting them. There’s been strong adoption and strong engagement just in the last few weeks since getting those out. So, has given the team a lot of energy and excitement to keep pushing forward.

George Hill: Okay. Thank you.

Operator: Thank you. We go next now to Korinne Wolfmeyer at Piper Sandler.

Korinne Wolfmeyer: Hey, good afternoon. Congrats on a great quarter and thanks for taking the questions. So first, I’d like to, kind of, I guess, piggyback on that last question, but address some of the newer products that you’ve been launching, such as like the shampoo and the conditioners. Are you viewing these as more so market expansive and being able to tap into a broader customer base or are you seeing existing customers start tacking on these other products that you’re launching into their current orders? Any color there would be helpful. Thank you.

Andrew Dudum: Yes, that’s a great question. I think it’s a mix of both. We see similarly in the retail channels, which we continue to invest in for the most strategic partners. Being on shelves and having OTC product breadth for customers allows them to have an introductory relationship with Hims & Hers. And I think as we invest in brand building initiatives and an omnichannel presence and the ability to touch and have deep relationships with these patients, those products in a lot of ways are sometimes less intimidating and more accessible and first start products. So, I think that’s definitely a part of it. And then I think it’s probably equally weighted that patients that are coming to us and are getting personalized prescription, pharmaceutical products to the platform and getting treated with specific issues.

Often ask for and desire complementary products that work with that regiment. So, having a prescription made topical spray, let’s say, for a woman who’s experiencing hair loss postpartum, that woman is also going to ask us what is the right shampoo, what is the right conditioner that can also boost volume and boost thickening and help regrow. And so, the ability to have that assortment, that proprietary assortment and the breadth of products, I think, ultimately does drive increased bundled value and average order size in a way that it is incrementally pretty meaningful to the business.

Korinne Wolfmeyer: That’s really helpful. Thank you. And then if I could just push you a little bit more on the 20% to 30% EBITDA margin guide that you put out for the longer-term, can you just talk about how far down the road is that? I mean you gave us some 2025 targets, but seems like we’re not quite there, although those are at least $100 million EBITDA, but just how are we going to get to that 20% to 30%? And how far down the road do you think that really is? Thank you.

Yemi Okupe: Yes, sure. Thanks for the question. I’d say that I think we have direct line of sight to continue to get leverage on many of the line items that we’ve seen leverage on already. So, we do expect to continue to be very disciplined in the way that we grow our G&A footprint. So, you can expect us over the coming years to get leverage on that side. We see a lot of things that are very exciting on our variable costs that primarily show up in operations and support. And so, over the coming years, we’ll continue to get leverage there. Then we’d also expect to see is, right now, we’re currently investing in acquiring more and more customers onto the platform, also investing across a breadth of categories, but what we do see over time is that the base of the existing customers that we have is also rapidly growing.

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