Hims & Hers Health shares fell on Monday after the telehealth company reported a surprise third-quarter loss, cut its full-year profit guidance and disclosed its first fall in subscriber numbers. The shares had already dropped about 12 per cent during Monday's regular session, closing at $22.94, and slipped further in after-hours trading once the results were released.

Revenue rose 49 per cent to $890.4 million from $599.0 million a year earlier, but that was slightly below the roughly $892.8 million analysts had expected. Adjusted earnings came in at $0.03 per share, against a consensus estimate of $0.07 per share, according to Zacks, which put the earnings miss at 57.14 per cent.

Loss replaces last year's profit

On a generally accepted accounting basis, the company swung to a net loss of $33.0 million, or $0.14 per share, from net income of $15.8 million in the same quarter last year. Gross margin contracted sharply to 57 per cent from 74 per cent a year ago, pressured by international expansion costs and a shift towards lower-margin branded medicines, including GLP-1 weight-loss drugs, in place of compounded versions.

Subscribers fell by about 100,000 in the quarter to roughly 2.79 million, down from 2.89 million at the end of June, the company's first sequential subscriber decline. Revenue from outside the United States rose sharply to $233.3 million, while US revenue rose 21 per cent to $657.1 million.

Guidance cut for a third time

The outlook disappointed investors more than the quarter itself. Hims & Hers now expects full-year 2026 revenue of $3.13 billion to $3.15 billion and has lowered its full-year adjusted core profit expectations to $257 million to $277 million, the third cut to that guidance this year. For the fourth quarter, it guided revenue of $875 million to $895 million, against about $953 million expected by analysts.

The company said the margin pressure reflects a deliberate shift in its weight-loss offering towards branded GLP-1 drugs, and its chief financial officer has previously told analysts that margins will remain below historical levels as branded products and international revenue become a larger part of the business. With growth still running at 49 per cent but profitability moving the other way, investors will be watching whether the fourth quarter stabilises margins or brings another downgrade.