Hims & Hers Scales Growth Through Subscriptions and Care Expansion

The renowned health and wellness platform, Hims & Hers Health, Inc. HIMS, generates the majority of its revenues from subscription-based plans, which provide patients with convenient, ongoing access to treatments while creating predictable recurring revenue streams for the company. Most offerings on its website and mobile apps are structured around monthly or longer-term subscription cadences, ranging from 30 to 360 days. Customers are billed on a recurring basis, and products are shipped accordingly, with options to pause or cancel subscriptions. This model not only increases customer retention but also enables Hims & Hers to leverage its technology-driven fulfillment and telehealth ecosystem to deliver treatments efficiently at scale. By integrating provider consultations, prescription management and pharmacy fulfillment into one seamless platform, HIMS lowers costs while maintaining robust gross margins.

The scale-oriented growth strategy builds on this recurring revenue foundation. Hims & Hers is rapidly expanding its product categories and clinical specialties, recently adding offerings in weight loss, dermatology, mental health and sexual health, with future opportunities in areas such as diabetes, hypertension and fertility. HIMS also invests heavily in proprietary facilities —including licensed mail-order pharmacies, compounding centers and even lab testing and peptide manufacturing facilities — to expand capabilities, drive operating leverage and reduce reliance on third parties.

Geographic expansion beyond the United States, particularly in the U.K. and potentially broader Europe, further increases the scalability of its digital-first model. Combined with brand-driven customer acquisition and a technology stack purpose-built for personalization and efficiency, Hims & Hers positions itself to continually add new subscribers, grow revenue per customer, and capture larger market share across multiple health categories.

TEM & TDOC’s Recurring Revenue Models Driving Scalable Growth

Tempus AI, Inc. TEM emphasizes scale-oriented growth by expanding its genomics, data and AI applications, leveraging one of the largest multimodal healthcare datasets with over 7.3 million de-identified patient records. Tempus derives recurring revenue through genomics testing and licensing de-identified data libraries to life sciences companies. The Paige acquisition further accelerates Tempus’ digital pathology reach, enhancing its AI-driven precision medicine platform and reinforcing its scalable foundation in oncology and beyond.

Teladoc Health, Inc. TDOC generates the majority of its revenues from recurring access fees, with 86% of consolidated 2024 revenue tied to per-member-per-month or participant-based contracts. Teladoc Health’s scale-oriented growth strategy rests on expanding its Integrated Care segment globally, deepening engagement across its 94 million U.S. members, and scaling BetterHelp internationally. Teladoc Health leverages its breadth of solutions, proprietary engagement science and scalable technology platform to enhance utilization and drive long-term recurring revenue growth.

HIMS’ Price Performance, Valuation and Estimates

Shares of Hims & Hers have gained 87.6% year to date, outperforming the industry’s growth of 24.9%.

HIMS’ forward 12-month P/S of 3.9X is lower than the industry’s average of 5.9X, but is higher than its three-year median of 2.4X. It carries a Value Score of D.

The Zacks Consensus Estimate for HIMS’ 2025 earnings per share suggests a 122.2% improvement from 2024.

Hims & Hers stock currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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