Hims & Hers on path to profitable 2024, forecasts $1B+ revenue
Digital health and wellness company Hims & Hers charted strong growth in the fourth quarter, buoyed by increased demand for its mental health, dermatology and weight loss services.
The company, which went public three years ago, reached profitability in Q4, a first for the company, and expects to achieve its first full year of net income profitability in 2024.
Hims & Hers is now projecting that it hit 2025 targets of $1.2 billion of revenue and $100 million of EBITDA one year early, CEO Andrew Dudum told investors during its Q4 and full-year 2023 earnings call on Monday.
Share of Hims & Hers soared 31% on Tuesday
The multispecialty telehealth platform connects consumers to medical care for numerous conditions and primarily focuses on sexual health, men's and women's dermatology, mental health and weight loss. The company sells prescription and over-the-counter drugs online as well as personal care products and launched its weight loss business late last year.
Hims & Hers has increasingly focused on offering personalized treatments to consumers by leveraging technology and data.
"It is clear to us that personalized solutions drive increased longevity on the platform and help to facilitate the acquisition of new users. As we continue to see increasingly rapid adoption of personalized approaches across newer specialties such as Hers dermatology, mental health and weight loss, we are confident that each of these specialties has the ability to deliver more than $100 million of revenue in 2025," Dudum told investors.
Hims & Hers executives see a long runway for growth as the company's telehealth-based platform removes friction for consumers to get access to treatments for things like hair loss, erectile dysfunction and weight loss.
"Our aspiration is to bring tens of millions of users on our platform, given the fact that over 100 million consumers are impacted by conditions in the specialties we serve," Dudum said. "There's still so many barriers for why people are not getting treated, whether or not that's access or price or stigma or education or a lack of personalized choice."
"We are very much in the early days of weight management," CFO Yemi Okupe told investors. "That offering will continue to evolve. We're seeing early signs of traction. Historically, we've said that it takes 12 to 18 months to really see meaningful contribution from categories, but there is the potential for that to be brought forward."
About 30% of the company's subscribers have adopted its personalized offerings as of year-end, executives said.
Subscribers grew to 1.5 million in Q4, up 48% year-over-year. Hims & Hers brought in revenue of $247 million for the quarter compared to $167 million for the fourth quarter of 2022, up 47%. The company brought in $1.2 million in profit in Q4, or 1 cent per share, compared to a net loss of $10.9 million for the fourth quarter of 2022.
Adjusted EBITDA was $20.6 million for the fourth quarter of 2023 compared to $3.9 million for the fourth quarter of 2022.
For full-year 2023, Hims & Hers netted $872 million in revenue, a 65% jump compared to $527 million for 2022. The company shrunk its losses from a loss of $66 million in 2022 to a net loss of $23 million in 2023.
Adjusted EBITDA was $49.5 million for the year compared to a loss of $16 for 2022.
Hims & Hers top and bottom line results beat Wall Street expectations. Analysts polled by FactSet expected Hims & Hers to lose 2 cents a share, on revenue of $246.5 million.
In 2023, Hims & Hers generated over $73 million of operating cash flow, driving a free cash flow of $47 million, according to Okupe. "We ended the year with $221 million of cash and short-term investments on our balance sheet, up over $41 million from the end of 2022," Okupe said.
We intend to leverage the strength of our balance sheet to continue to expand our portfolio of personalized solutions as well as to improve the efficiency of affiliated pharmacies as they continue to scale over the course of the next two to three years. This is reflected in the higher capital expenditures in the fourth quarter as well as for the full year 2023. Our expectation is that the evolution of personalized offerings will drive continued market share gains and growth in the near future," Okupe said.
The company is projecting to bring in between $267 and $272 million in revenue in the first quarter of 2024 with adjusted EBITDA of $22 million to $27 million.
For the full year 2024, the company expects revenue to come in between $1.17 billion to $1.2 billion and adjusted EBITDA of $100 million to $120 million.
Progyny hits $1B in revenue with ongoing strong demand for fertility benefits
The fertility, family building benefits and women's health benefits provider brought in record revenue of $1.09 billion in 2023, up 38% from $787 million in 2022.
The company's fourth-quarter revenue came to $270 million, representing 26% growth compared to $214 million reported in Q4 2022
Progyny, which went public in 2019, provides fertility benefits for employees at large firms and has scaled its business to partner with more than 460 of the nation’s leading employers, representing 6.7 million covered lives.
The company's network consists of more than 1,000 providers across 650+ clinics.
Fertility benefit services revenue in the fourth quarter was $171 million, a 20% increase from the $143 million reported in the fourth quarter of 2022. Pharmacy benefit services revenue was $99 million, a 39% increase as compared to the $71 million reported in the fourth quarter of 2022.
During Q4, Progyny's net income almost quadrupled, hitting $13.5 million, or $0.13 income per diluted share, as compared to $3.4 million, or $0.03 income per diluted share, in the fourth quarter of 2022.
In 2023, fertility benefit services revenue came to $676 million, a 33% increase, and pharmacy benefit services revenue was $412 million, up 49%.
For 2023, the company notched $62 million in profit, or $0.62 income per diluted share, an increase of $32 million as compared to a profit of $30 million, or $0.30 income per diluted share, in 2022.
"2023 was another exceptional year for Progyny. We achieved record levels of revenue, profitability and operating cash flow, driven by the volume of new clients and covered lives, as well as the continued growth in the demand for fertility services, and our selling season yielded the largest number of new lives in our history, along with the formation of key channel partnerships that are expected to provide further energy and momentum with our go-to-market activities,” said Pete Anevski, Progyny CEO, in a statement.
The company is entering 2024 with a more comprehensive suite of services, including preconception, pregnancy and postpartum, and menopause, Anevski said. "Our active pipeline, consisting principally of the opportunities carried over from last year's selling season, is the highest it has ever been at this time of year, and we're very well-positioned to continue our success.”
Net cash provided by operating activities in 2023 was $188.8 million, compared to net cash provided by operating activities of $80.4 million in 2022.
As of December 31, 2023, the company had total working capital of approximately $454.5 million and no debt. This included cash and cash equivalents and marketable securities of $371.1 million, an increase of $35.5 million from the balances as of September 30, 2023.
The company projects 2024 revenue to come in between $1.28 billion and $1.3 billion, reflecting growth of 18% to 21%. Net income is projected to be $68 million to $74 million.
Progyny forecasts first-quarter revenue to be $285 million to $292 million, reflecting growth of 10% to 13%. The company expects to bring in $12.4 million to $13.7 million in profit in Q4.
During the company's earnings call Tuesday, executives said the Alabama Supreme Court ruling on IVF has not impacted its business in that state.
"We're fully committed to ensuring that access to IVF will continue for all of those in need, including our members regardless of where they live," Anevski told investors on the call.
"Just as we saw two years ago, following the Dobbs decision, a number of state legislatures and governors, including Alabama's, have indicated their intent to take action to ensure the continued availability of these services. And while this is encouraging, it isn't surprising to us given how life-affirming these services are to the millions of individuals who've already used it successfully and the reality that an even greater number of people will need it to turn to it in the future," he said.
He noted that one of the macro trends driving the demand for care is the increasing prevalence of infertility, which has gone from 1 in 8 just a handful of years ago to 1 in 5 today, according to CDC data.
Change Healthcare cyberattack has limited impact on GoodRx business
Digital healthcare platform GoodRx issued stronger-than-expected fourth-quarter results this week and announced a new $450 million stock repurchase program, sending shares climbing nearly 20%.
GoodRx is best known for providing prescription drug price comparison tools and drug discounts. Founded in 2011, the company offers an app that tracks prescription drug prices and offers coupons to get medication discounts. GoodRx also offers GoodRx Care, a telehealth platform that enables consumers to see a licensed physician for primary care services.
The company's revenue grew 7% year over year to $197 million in Q4 but its net loss widened to $26 million compared to a loss of $2 million in the same quarter a year ago.
Adjusted net income came to $31 million, or 8 cents per share, up from 7 cents per share in the prior-year period. The company's bottom line and topline results in Q4 both beat Wall Street estimates.
Prescription transactions revenue increased 11% to $144 million in Q4. Subscription revenue decreased 6% to $23 million during the quarter, primarily driven by a decrease in the number of subscription plans due to the anticipated sunset of GoodRx's partnership subscription program, Kroger Savings Club. Kroger Savings Club revenue was over $1 million less in the fourth quarter of 2023 than in the prior year period.
Pharma manufacturer solutions revenue decreased 2% to $24 million during Q4.
Over 7 million consumers used GoodRx's prescription-related offerings by the end of Q4.
For the full-year 2023, GoodRx brought in revenue of $750 million, down from $766 million in 2022.
Revenue in the third quarter of 2023 was impacted by a $10 million client contract termination payment, which was recognized as a reduction of revenue, in connection with our plan to de-prioritize certain solutions under our pharma manufacturer solutions, the company said in its Q4 and full-year financial results.
GoodRx narrowed its losses in 2023, reporting a net loss of $9 million compared to $33 million.
“We’ve locked in on creating value for consumers and ended the year strong building on our third quarter progress with accelerating momentum in the business, both financially and operationally, in the fourth quarter,” GoodRX interim CEO Scott Wagner said in a statement. “We’ve been ruthlessly focused on driving prescription-savings events by leaning into our deep relationships with retail partners, bringing the fundamental benefit of GoodRx to commercial plans through our integrated savings program and bringing savings to brand drugs through our pharma manufacturer solutions offering. These all reinforce our value proposition and are expected to continue driving topline growth in the first quarter and the full year 2024.”
GoodRx is guiding to first-quarter revenue in the range of about $195 million to $198 million, representing about 6% to 8% year-over-year growth.
"Our first quarter guide includes our current estimate of the impact of the recent system outages disclosed by UnitedHealth Group that we believe, at this early stage, is not reasonably likely to have a material impact on our financials despite the impact lasting a couple of days,” said Karsten Voermann, chief financial officer.
"We've been really pleased with the performance of our tech teams. We think they did an amazing job in two ways: first of all, creating alternatives for us, so alternatives in the context of what switches we use and being able to shift our volume quite rapidly," Voermann said. "That's one of the big reasons we refer to this as being an issue that affected us for a couple of days versus an issue that affected many in the industry for a longer period of time. I think our much quicker response was helpful to our users, and of course, helpful to us because that diminished the impact that would otherwise have manifested in the quarter."
He added, "We're still evaluating it, but sort of like with a winter storm, when volume drops, you often see a significant portion of that volume come back. And that's one of the reasons the impact has been not as large as it would otherwise have been."
Wagner said the company is focused on strengthening its retail pharmacy relationships and accelerating the continued success of its hybrid model, which includes retailer direct and PBM contracting.
For the full year 2024, GoodRx is forecasting revenue and adjusted revenue of $800 million, representing about 7% and 5% year-over-year growth, respectively.
"The anticipated adjusted revenue growth rate is tempered by approximately $15 million of top-line impact associated with the deprioritization of vitaCare as part of our pharma manufacturer solutions restructuring, as well as the wind-down of the Kroger Savings Club. Our continued investments in consumer incentives will increase contra revenue by approximately $10 million. In aggregate, this $25 million of top-line impact is absorbed in our full-year $800 million revenue and adjusted revenue guidance," Voermann told investors during the earnings call Thursday.
GoodRx reported it had cash and cash equivalents of $672 million as of December 31, 2023.
DocGo's 2023 revenue jumped 42% with strong growth in mobile health, transportation services
DocGo, a provider of tech-enabled mobile health services in 30 states and the UK reported strong Q4 and full-year 2023 revenue growth, boosted by ongoing demand for its mobile health and transportation services.
Q4 revenue came to $199 million, up 83% from $109 million during the same quarter a year ago. The company reported a profit of $8 million in Q4, representing 13% growth from a profit of $7 million a year ago.
"In the fourth quarter alone, DocGo performed over 72,000 mobile health interactions and 190,000 medical transports globally, while leveraging a workforce of now more than 8,000," Lee Bienstock, DocGo's CEO told investors during its Q4 and full-year 2023 earnings call Wednesday.
"We continue to grow not only in size but also in scope as we have more than doubled our service offerings in the last year to include procedures such as bone density scans, depression screenings and other valuable services we can deliver where convenient outside of the traditional brick-and-mortar healthcare system," he said.
In the fourth quarter, DocGo's mobile health services brought in $150 million in revenue, up 110% from $72 million for the fourth quarter of 2022. Transportation Services revenue came to $49 million compared to $37 million for the fourth quarter of 2022, an increase of 32%.
Bienstock, a former Google executive, took the reins as CEO back in September when former CEO Anthony Capone stepped down amid allegations that he lied about his educational background.
"It is certainly fair to say that 2023 was an eventful year and my first hundred days as CEO were laser-focused on setting an ambitious vision for how we will proactively help make patients healthier and help keep them out of the hospital," Bienstock said. "Our record Q4 and full-year results are proof that this vision is taking shape, and I look forward to continuing to build on this momentum in 2024 and beyond. During the quarter, we experienced significant growth and strong operational execution as we made considerable progress with our core strategic objectives in all three key customer verticals, insurance partners, hospital systems and our government population health programs."
DocGo reported $624 million in revenue for 2023, up 42% from $440.5 million in 2022. The company netted $10 million in profit for 2023, compared to net income of $31 million in 2022, down 67%.
Mobile health services revenue jumped 36% to $443 million in 2023 and transportation services revenues grew 58% to approximately $181.5 million in 2023.
Formerly called Ambulnz, the company hit the public market in November 2021 in a special purpose acquisition company deal. Founded in 2015, DocGo offers what it calls "last-mile" healthcare services to patients in their homes or at work, such as testing, vaccinations, bloodwork, IV hydration, wound care, mobile imaging and EKGs, among other services. Together with its integrated Ambulnz medical transport services, DocGo says it bridges the gap between physical and virtual care.
DocGo missed on earnings expectations. Net income per share came to 6 centers in Q4, compared to Wall Street analysts' expectations of 13 cents per share.
The company's care gap closure programs with major insurance companies offers "tremendous growth potential," Bienstock said. "We are now offering over 30 different care gap closure services, including colon cancer screenings and diabetic retinal exams. Late in 2023, we launched payer programs in Michigan, Connecticut and New Jersey, and during the fourth quarter alone, we more than doubled the number of patients seen under these programs when compared to the third quarter, and we expect that trend to continue."
The company also is focused on cross-selling and growing its mobile health presence with hospital system partners.
As part of its government business, DocGo operates population health programs in Arizona, California, Michigan and Tennessee and New York to provide health services to underserved populations like the homeless and asylum seekers.
"These represent excellent opportunities to prove our value proposition and grow these geographies over time, much like we have done so successfully in the northeast. Our work with asylum seeker populations in New York has enabled us to expand and augment DocGo’s offerings, including scaling our behavioral health competency by performing over 50,000 depression screenings, growing our mobile pharmacy to prescribe over 70 different types of medications, and increasing our vaccine administration capacity to over 40 different types of vaccines," Bienstock said.
"The impact and reach of our business extends far beyond underserved populations like the homeless and asylum seekers. We provide Medical Transportation for hundreds of hospitals, we deploy vaccination programs in multiple states, we monitor tens of thousands of cardiac patients, we close care gaps for bedbound, chronically ill and so much more," he said.
The company's migrant care contract with New York City has faced scrutiny. Last spring, NYC officials raised eyebrows when they declared a state of emergency and awarded DocGo a $432 million no-bid contract to house migrants and provide them with services including case management, medical care, food, transportation, lodging and round-the-clock security.
The New York State Attorney General's office is now investigating the medical services for possible violations of state or federal laws over the treatment of people in its care, The New York Times and other media outlets have reported.
The company's migrant-care contract business falls within its mobile health services unit, which makes up about 70% of its revenue.
Bienstock told investors that the migrant-related revenues will moderate as the year progresses. "We have various different models relating to the migrant revenues, and we’re continuing to help the city through the humanitarian crisis. And so we did forecast that migrant-related revenues would decline in the back half of the year," he said.
CFO Norman Rosenberg said any anticipated declines in migrant-related revenues in the second half of the year are expected to be offset by new programs and growth in other areas.
DocGo is projecting full-year 2024 revenues to be in the range of $715 million to $725 million.