Hims & Hers shares rest on a company that is growing fast and losing money at the same time. The New York listed online health company lifted sales 38% in the June quarter, with more than half of the extra sales coming from outside the United States, helped by its purchase of Australia’s Eucalyptus.
The catch: The same growth keeps less of each sale, spending rose faster than sales, and the quarter swung to a loss. Hims & Hers expects profit again in 2027.
Here’s what changed, why it lost money, and what to watch.
What changed
In February, Hims & Hers (NYSE: HIMS) agreed to buy Eucalyptus, which Hims & Hers describes as Australia’s largest digital health provider. Eucalyptus was founded in 2019 and runs the weight-loss program Juniper and the men’s health brand Pilot. According to the company’s announcement of the agreement, the deal was valued at up to US$1.15 billion. That is the most it could cost, not what changed hands on day one: about US$240 million was payable in cash at closing, and the rest is deferred and performance-linked payments that run to early 2029. All figures in this report are in US dollars.
The deal closed on 2 June. By then Eucalyptus had served more than 850,000 customers, meaning people who had bought a program, not current subscribers. Since then Hims & Hers has put its own names on both Australian brands. Pilot became Hims on 31 August. On 12 October, Juniper became Hers, which the company says completes its full platform launch in Australia.
The first results to include Eucalyptus came on 10 August 2026. In the June quarter results, revenue was US$753.2 million, up 38% from US$544.8 million a year earlier, with one month of Eucalyptus included. Revenue outside the United States rose to US$131.4 million from US$7.5 million, which the finance chief said was “strengthened by the close of our Eucalyptus acquisition in June”. That line is not Eucalyptus alone; it also includes businesses bought in 2025. Of the extra revenue the company added on a year earlier, about US$124 million came from outside the United States, more than half of the total increase. Subscribers rose 19% to nearly 2.9 million, and the average monthly revenue from each subscriber rose 21% to about US$92, so customers were both more numerous and spending more. The company raised its 2026 revenue forecast to between US$3.1 billion and US$3.3 billion, including Eucalyptus, and said it has growing conviction in its 2030 target of at least US$6.5 billion in revenue.
Why it binds
A company like this makes a profit from three things: how fast sales grow, how much of each sale it keeps, and what the growth costs. In the June quarter the first went the right way and the other two went the wrong way.
The second is the gross margin, the share of each sale left after the cost of the product itself. It fell to 64% from 76% a year earlier. One reason is weight loss. Earlier this year, after the US regulator moved to restrict compounded copies of weight-loss drugs, the company moved its US weight-loss business from cheaper compounded versions to the branded drugs, Reuters reported in May. Compounded versions are still offered on a limited scale.
The other reason is international. On the analyst call, finance chief Yemi Okupe said that as branded weight-loss products and international revenue become a larger part of the business, the company expects gross margins to remain below the levels it has historically achieved, according to Reuters. That is a statement that margins stay lower, not a forecast that they keep falling.
The third is the cost of growth. Gross profit still rose, to US$480.8 million from US$416.2 million, because sales grew so fast. The swing to a loss came from spending. Operating expenses rose 48%, to US$578.0 million from US$389.5 million, while revenue rose 38%. They include US$47.5 million for legal contingencies and US$28.8 million of acquisition and transaction costs.
The result was a net loss of US$86.3 million, against a profit of US$42.5 million a year earlier. The loss is the sum of all three forces, not one of them. The margin fall alone did not cause it: gross profit grew in dollars. What turned a rising gross profit into a loss was spending growing faster still, including one-off legal and deal items that may not recur at the same size.
Who absorbs it
Hims & Hers shareholders carry the trade-off. The company is buying growth with a lower margin and higher spending, and expects that growth to turn back into profit in 2027. Until it does, the quarterly loss sits with them. Hims & Hers is the one listed company in this story. Eucalyptus is private and now owned by Hims & Hers, and no ASX-listed company has a direct, sourced link to the deal in this research.
The people who sold Eucalyptus collect first. They received about US$240 million in cash at closing, with further deferred and performance-linked payments to come. Because part of the price depends on targets, the final cost of the deal is not yet known.
Customers in Australia are part of the change too. People who used Pilot and Juniper now deal with brands called Hims and Hers, and the business is run as part of the company’s international arm under Tim Doyle, the former chief executive of Eucalyptus.
The company also faces a pending case from a US regulator. On 29 July, the US Federal Trade Commission sued Hims & Hers. The FTC alleges that the company shared customers’ health information with advertising platforms such as Meta and Snap, and made subscriptions difficult to cancel. These are allegations, not findings. The company called the claims baseless, Reuters reported, and the case is pending.
What to watch
The next check is the September quarter result, which Hims & Hers will report after the US market closes on 9 November. The company forecast revenue of US$880 million to US$900 million for that quarter, the first full quarter with Eucalyptus included.
Two numbers settle most of the question. The first is revenue against that forecast. The second is the gross margin against the 64% of the June quarter.
If revenue reaches the forecast and the gross margin holds near 64%, the case that growth can turn back into profit by 2027 would look stronger, because the extra sales would be arriving without each one keeping less. If revenue reaches the forecast but the margin falls again, growth would be costing more of each sale, and profit could take longer than the company expects. If revenue falls short of the forecast, the growth side of the case would be weaker, whatever the margin does.
A longer yardstick sits behind those two. The company has said it is aiming for at least US$6.5 billion of revenue by 2030, roughly double its 2026 forecast, and it has tied its return to profit to 2027. Each quarterly result is a reading on whether the path between those two points is holding.
Spending is the third thing to read. The June quarter’s costs included legal and deal items, so the operating expenses line will show whether spending is rising more slowly than sales once those items are set aside. The FTC case is still pending.
Frequently asked questions
What does Hims & Hers have to do with Australia?
Hims & Hers bought Eucalyptus, the Australian company behind the Juniper and Pilot online clinics, in a deal that closed on 2 June 2026. It has since renamed Pilot as Hims and Juniper as Hers, and its sales outside the United States rose to US$131.4 million in the June quarter.
Why did Hims & Hers make a loss when its sales grew?
Sales rose 38% in the June quarter, but the company kept less of each sale, with its gross margin falling to 64% from 76%, and its operating expenses rose 48%, including legal and deal costs. The quarter ended with a net loss of US$86.3 million, against a profit of US$42.5 million a year earlier.
When do Hims & Hers shares next get a results update?
The company reports its September quarter after the US market closes on 9 November, which is the morning of 10 November in eastern Australia. It forecast revenue of US$880 million to US$900 million for that quarter.
