Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares |
Mar. 31, 2025 |
Dec. 31, 2024 |
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Common Class A | ||
Stockholders' equity: | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 2,750,000,000 | 2,750,000,000 |
Common stock, shares issued (in shares) | 215,206,274 | 212,459,586 |
Common stock, shares outstanding (in shares) | 215,206,274 | 212,459,586 |
Common Class V | ||
Stockholders' equity: | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Common stock, shares issued (in shares) | 8,377,623 | 8,377,623 |
Common stock, shares outstanding (in shares) | 8,377,623 | 8,377,623 |
Organization |
3 Months Ended |
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Mar. 31, 2025 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Hims & Hers Health, Inc. (the “Company” or “Hims & Hers”), incorporated in Delaware, is a consumer-first platform transforming the way customers fulfill their health and wellness needs. The Company’s mission is to help the world feel great through the power of better health. The Hims & Hers platform includes access to a highly-qualified and technologically-capable provider network, a clinically-focused electronic medical records system, digital prescriptions, cloud-enabled pharmacy fulfillment, and personalization capabilities. The Company’s digital platform enables access to treatments for a broad range of conditions, including those related to sexual health, mental health, men’s dermatology, women’s dermatology, and weight loss. Hims & Hers connects patients to licensed healthcare professionals who can prescribe medications when appropriate. Prescriptions are fulfilled online through licensed pharmacies on a subscription basis, making accessing treatments simple, affordable, and straightforward. Through the Hims & Hers mobile applications, consumers can access a range of educational programs, wellness content, community support, and other services that promote lifelong health and wellness. In addition, the Company offers access to a range of health and wellness products designed to meet individual needs, which can include curated prescription and non-prescription products. The Company’s products and services are available for purchase directly by customers on the Company’s websites and mobile applications. Additionally, Hims & Hers non-prescription products can be found in tens of thousands of top retail locations in the United States.
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Summary of Significant Accounting Policies |
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Mar. 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to accounting principles generally accepted in the United States of America (“U.S. GAAP”). The condensed consolidated financial statements as of March 31, 2025 are unaudited. The condensed consolidated balance sheet as of December 31, 2024 included herein was derived from the audited consolidated financial statements as of that date. Certain information and note disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. As such, the information included herein should be read in conjunction with the consolidated financial statements and accompanying notes as of and for the year ended December 31, 2024 (the “audited consolidated financial statements”). The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and reflect, in management’s opinion, all adjustments of a normal, recurring nature that are necessary for the fair statement of the Company’s balance sheet, results of operations, and cash flows for the periods presented, but are not necessarily indicative of the results expected for the full fiscal year or any other period. The unaudited condensed consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries, and variable interest entities in which it is the primary beneficiary. All intercompany transactions and balances have been eliminated in these unaudited condensed consolidated financial statements. There have been no changes to the Company’s significant accounting policies described in the audited consolidated financial statements for the year ended December 31, 2024 that have had a material impact on these unaudited condensed consolidated financial statements and related notes. Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments, and assumptions that affect the amounts reported in the financial statements and accompanying notes. The more significant estimates, judgments, and assumptions by management include, among others, valuation and recognition of stock-based compensation expense, valuation of contingent consideration in business combinations or asset acquisitions, purchase price allocation for business combinations, valuation of assets acquired in an asset acquisition, valuation of deferred tax assets, valuation of inventory, and estimates used in the capitalization of website development and internal-use software costs. Management believes that the estimates, judgments, and assumptions upon which it relies are reasonable based upon information available to it at the time that these estimates, judgments, and assumptions were made. Actual results experienced by the Company may differ from management’s estimates. To the extent that there are material differences between these estimates and actual results, the Company’s unaudited condensed consolidated financial statements will be affected. Business Combinations The Company accounts for its business combinations using the acquisition method of accounting. The purchase price is attributed to the fair value of the assets acquired and liabilities assumed. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are measured separately at their fair values as of the acquisition date. The excess of the purchase price of acquisition over the fair value of the identifiable net assets of the acquiree is recorded as goodwill. The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of acquisition. When the Company issues stock-based or cash awards to an acquired company’s shareholders, the Company evaluates whether the awards are consideration or compensation for post-acquisition services. The evaluation includes, among other things, whether the vesting of the awards is contingent on the continued employment of the acquired company’s stockholders beyond the acquisition date. If continued employment is required for vesting, the awards are treated as compensation for post-acquisition services and recognized as expense over the requisite service period. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates, including the selection of valuation methodologies, estimates of future revenue and cash flows, discount rates, and selection of comparable companies. The estimates and assumptions used to determine the fair values and useful lives of identified intangible assets could change due to numerous factors, including market conditions, technological developments, economic conditions, and competition. In connection with determination of fair values, the Company may engage a third-party valuation specialist to assist with the valuation of intangible and certain tangible assets acquired and certain assumed obligations. Asset Acquisitions The Company accounts for a transaction as an asset acquisition when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, or the acquisition otherwise does not meet the definition of a business. Asset acquisitions are measured and recognized based on the cost to acquire the assets, which is allocated to the individual assets acquired and liabilities assumed on a relative fair value basis. Direct costs related to the acquisition are capitalized as part of the assets or liabilities acquired. Goodwill is not recognized in an asset acquisition with any consideration in excess of net assets acquired allocated to acquired nonfinancial assets on a relative fair value basis. Segment Reporting The Company is managed as a single operating segment on a consolidated basis, inclusive of acquisitions. The Company determines its operating segments based on how the chief operating decision maker (“CODM”) makes decisions regarding the allocation of resources and operational strategy, assesses performance, and manages the organization at a consolidated level. The Chief Executive Officer (“CEO”), is the CODM. The products and services from which this segment derives its revenues are described below in the discussion of revenue recognition. Goodwill Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business combination. Goodwill is not amortized but is tested for impairment annually in the fourth quarter or more frequently if events or changes in circumstances indicate that the asset may be impaired. The Company operates as one reporting unit. When testing goodwill for impairment, the Company may first perform an optional qualitative assessment. If the Company determines it is not more likely than not the reporting unit’s fair value is less than its carrying value, then no further analysis is necessary. If the Company determines that it is more likely than not that the fair value of its reporting unit is less than its carrying amount, then the quantitative impairment test will be performed. Under the quantitative impairment test, if the carrying amount of the Company’s reporting unit exceeds its fair value, the Company will recognize an impairment loss in an amount equal to that excess but limited to the total amount of goodwill. Goodwill of $5.0 million was acquired in relation to an immaterial business combination during the three months ended March 31, 2025. No goodwill impairment was recorded for the three months ended March 31, 2025 and 2024. Impairment of Long-Lived Assets Long-lived assets include property, equipment, and software and intangible assets subject to amortization. The Company is a single asset group. Long-lived assets, including acquired assets from a business combination, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. In such cases, recoverability of asset groups to be held and used is assessed by comparing the carrying amount of the asset group with its future underlying net undiscounted cash flows without interest charges. If such asset group is considered to be impaired, an impairment is recognized as the amount by which the carrying amount of the asset group exceeds the estimated fair values of the asset group. No impairment of long-lived assets was recorded for the three months ended March 31, 2025. The Company recognized immaterial impairment charges on long-lived assets during the three months ended March 31, 2024 in technology and development expenses on the unaudited condensed consolidated statements of operations and comprehensive income. Revenue Recognition The Company recognizes revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. The Company’s consolidated revenue primarily comprises online sales of health and wellness products and services through the Company’s websites and mobile applications, including prescription and non-prescription products. In contracts that contain prescription products issued as the result of a consultation, revenue also includes medical consultation services and post-consultation service support provided by Affiliated Medical Groups (defined below). Additionally, the Company offers a range of health and wellness products through wholesale partners. Revenue consists of the following (in thousands):
For Online Revenue, the Company defines its customer as an individual who purchases products or services through its websites or mobile applications. For Wholesale Revenue, the Company defines its customer as a wholesale partner, with the exception of consignment arrangements, where its customer is defined as an individual who purchases products through certain third-party platforms. The transaction price in the Company’s contracts with customers is the total amount of consideration to which the Company expects to be entitled in exchange for transferring products or services to the customer. The Company’s contracts that contain prescription products issued as the result of a consultation primarily include the following performance obligations: access to (i) products, as well as medication adjustments, as applicable, and (ii) consultation services, as well as post-consultation service support, as applicable. The Company’s contracts that do not contain prescription products have a single performance obligation. Revenue is recognized at the time the related performance obligation is satisfied by transferring the promised product to the customer and, in contracts that contain services, by the provision of consultation services to the customer. The Company satisfies its performance obligation for products at a point in time, which is upon delivery of the products to a third-party carrier or wholesale customer warehouse. The Company satisfies its performance obligation for consultation services typically within one day and for post-consultation service support over the contract term. The customer obtains control of the products and services upon the Company’s completion of its performance obligations. For contracts with multiple performance obligations, the transaction price is allocated to each performance obligation on a relative stand-alone selling price basis. The stand-alone selling price is based on the prices at which the Company separately sells the products and services, as well as market and cost plus estimates. For each of the three months ended March 31, 2025 and 2024, service revenue, comprising consultation services and post-consultation service support, represented less than 10% of consolidated revenues. To fulfill its promise to customers for contracts that include professional medical consultations, the Company maintains relationships with various “Affiliated Medical Groups,” which are professional corporations or other professional entities owned by licensed physicians and that engage licensed healthcare professionals (physicians, physician assistants, nurse practitioners, and mental health providers; collectively referred to as “Providers” or individually, a “Provider”) to provide consultation services. Refer to Note 11 – Variable Interest Entities. The Company accounts for service revenue as a principal in the arrangement with its customers. This conclusion is reached because (i) the Company determines which Affiliated Medical Group and Provider provides the consultation to the customer; (ii) the Company is primarily responsible for the satisfactory fulfillment and acceptability of the services; (iii) the Company incurs costs for consultation services even for visits that do not result in a prescription and the sale of products; and (iv) the Company, in its sole discretion, sets all listed prices charged on its websites and mobile applications for products and services. Additionally, to fulfill its promise to customers for contracts that include sale of prescription products, the Company maintains relationships with (i) certain third-party pharmacies (“Partner Pharmacies” or individually, a “Partner Pharmacy”), (ii) XeCare, LLC (“XeCare”) and Apostrophe Pharmacy LLC (“Apostrophe Pharmacy”, and together with XeCare, the “Affiliated Pharmacies”), which are licensed mail order pharmacies providing prescription fulfillment solely to the Company’s customers; and (iii) Seaview Enterprises LLC (d/b/a MedisourceRx) (“MedisourceRx”), which is a wholly-owned licensed 503B outsourcing facility. MedisourceRx manufactures products solely for the Company’s customers, and the pharmacies, as licensed, fill prescription orders for customers who have received a prescription from a prescribing Provider through the Company’s websites and mobile applications. The Company accounts for prescription product revenue as a principal in the arrangement with its customers. This conclusion is reached because (i) the Company has sole discretion in determining which pharmacy fills a customer’s prescription; (ii) the pharmacies fill the prescription based on fulfillment instructions provided by the Company, including using the Company’s branded packaging for generic products; (iii) the Company is primarily responsible to the customer for the satisfactory fulfillment and acceptability of the order; (iv) the Company is responsible for refunds of the prescription medication after transfer of control to the customer; and (v) the Company, in its sole discretion, sets all listed prices charged on its websites and mobile applications for products and services. The Company estimates refunds using the expected value method primarily based on historical refunds granted to customers. The Company updates its estimate at the end of each reporting period and recognizes the estimated amount as contra-revenue with a corresponding refund liability. Sales, value-added, and other taxes are excluded from the transaction price and, therefore, from revenue. The Company accounts for shipping activities, consisting of direct costs to ship products performed after the control of a product has been transferred to the customer, in cost of revenue. For online sales, payment for prescription medication and non-prescription products is collected from the customer in accordance with contract terms a few days in advance of product shipment, or in the case of prepaid offerings, upfront with subsequent shipments typically occurring monthly, quarterly, or semi-annually. Contract liabilities are recorded when payments have been received from the customer for undelivered products or services and are recognized as revenue when the performance obligations are later satisfied. Contract liabilities consisting of balances related to customer prepayments are recognized as current deferred revenue on the unaudited condensed consolidated balance sheets since the associated revenue will be recognized within the following year. For wholesale arrangements, payments are collected in accordance with contract terms. As of March 31, 2025 and December 31, 2024, total deferred revenue was $110.8 million and $75.3 million, respectively. The increase of $35.5 million was primarily due to the impact of newer offerings introduced during 2024, which resulted in an increase in the uptake by customers of prepaid offerings. Recently Issued Accounting Pronouncements In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this ASU expand income tax disclosure requirements, primarily through enhanced disclosures related to income taxes paid and the rate reconciliation. ASU 2023-09 is effective for all public entities for annual periods beginning after December 15, 2024, with early adoption permitted. The amendments in this ASU should be applied on a prospective basis and retrospective application is permitted. The Company is evaluating the method of adoption and the impact of this ASU on its consolidated financial statements and related disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The amendments in this ASU expand certain expense category disclosure requirements, primarily though enhanced disclosures about inventory purchases, employee compensation, depreciation, amortization, and selling expenses. In January 2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), which clarified the effective date for ASU 2024-03. The ASU is effective for all public entities for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The amendments in this ASU should be applied on a prospective basis and retrospective application is permitted. The Company is evaluating the method of adoption and the impact of this ASU on its consolidated financial statements and related disclosures.
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Acquisitions |
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Mar. 31, 2025 | |||||||||||||||||||||||||||||||
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |||||||||||||||||||||||||||||||
Acquisitions | Acquisitions C S Bio Co. In February 2025, the Company acquired via an asset purchase agreement, executed in December 2024, certain manufacturing assets from C S Bio Co. (the “Seller”), a company located in the United States. The Company entered into the asset purchase agreement in order to strengthen its supply chain capabilities. The total cash and Class A common stock consideration payable and issuable in connection with the closing of the transaction is up to approximately $39.1 million, consisting of: (i) upfront cash and Class A common stock consideration of approximately $32.7 million; and (ii) additional maximum $6.4 million in Class A common stock consideration payable on the one year anniversary of closing in accordance with the terms of the asset purchase agreement. A maximum additional amount of $32.7 million in cash and/or Class A common stock consideration is payable to the Seller upon satisfying certain earn-out conditions. This earn-out payment is subject to a continued service condition by the Seller’s. CEO, as defined in the asset purchase agreement, and is therefore accounted for as post-transaction compensation expense when payout becomes probable and is reasonably estimable. Additionally, as part of the transaction, the Company entered into a transition services agreement with the Seller under which the Company will receive certain services and technical support during the period of transition. The acquisition was accounted for as an asset acquisition because it does not meet the definition of a business because there are no outputs and no employees coming over as part of the acquisition. When determining the fair value of tangible assets acquired, the Company estimated replacement cost, taking into consideration such factors as age, condition, and the economic useful life of the assets. No intangible assets or assumed liabilities were identified. As such, the total purchase price of $41.2 million was allocated on a relative fair value basis to the various tangible assets acquired and was primarily comprised of total cash and Class A common stock consideration as described above, as well as capitalized direct acquisition costs of $2.1 million. The tangible assets acquired are included as part of property, equipment, and software, net as presented on the Company’s unaudited condensed consolidated balance sheets. Sigmund NJ, LLC, marketed as Trybe Labs In February 2025, the Company acquired via a purchase agreement all of the membership interests of Sigmund NJ, LLC, marketed as Trybe Labs (“Trybe Labs”), a lab testing services business located in the United States, for total cash consideration of $5.1 million. There were no material acquired assets and assumed liabilities and the excess of the consideration paid over the fair value of the net assets assumed of $5.0 million was recorded as goodwill. The acquired goodwill represents future economic benefits expected to arise from having the capacity to add lab testing capabilities to the Hims & Hers platform in the future. MedisourceRx In September 2024, the Company acquired via a purchase agreement all of the membership interests of MedisourceRx, a 503B outsourcing facility registered with the Food and Drug Administration and located in the United States. The purchase price for accounting purposes was $31.0 million, consisting of cash and Class A common stock not subject to any vesting terms. The Company also incurred acquisition costs of $1.4 million directly related to the acquisition which were recorded within general and administrative expenses on the unaudited condensed consolidated statements of operations and comprehensive income. The acquisition was accounted for as a business combination under the acquisition method with the purchase price being allocated to tangible and identifiable intangible assets acquired and liabilities assumed based on their respective estimated fair values on the acquisition date. The fair value of the 503B pharmacy license was determined using the income approach. The following table summarizes the acquisition date fair values of assets acquired and liabilities assumed (in thousands):
Amortization expense related to the 503B pharmacy license is recognized on a straight-line basis over the useful life of ten years, within operations and support expense on the unaudited condensed consolidated statements of operations and comprehensive income. The excess of the consideration paid over the fair value of the net assets acquired is recorded as goodwill. The acquired goodwill of $1.8 million represents future economic benefits expected to arise from synergies from combining operations resulting in increased market presence of compounding capabilities and advanced expertise of compounding operations. The $1.8 million of goodwill recognized upon acquisition is expected to be deductible for U.S. income tax purposes. The acquisition did not have a material impact on the Company’s revenue or earnings generated during the period after the acquisition date, and historical and pro forma disclosures have therefore not been presented.
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Investments |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments | Investments Short-term investments as of March 31, 2025, consist of the following (in thousands):
Short-term investments as of December 31, 2024, consist of the following (in thousands):
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Inventory |
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Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory | Inventory Inventory consists of the following (in thousands):
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Prepaid Expenses and Other Current Assets |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following (in thousands):
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Property, Equipment, and Software, Net |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Equipment, and Software, Net | Property, Equipment, and Software, Net Property, equipment, and software, net consist of the following (in thousands):
Depreciation and amortization expense for property, equipment, and software was $6.2 million and $2.3 million for the three months ended March 31, 2025 and 2024, respectively. There were no impairment charges on property, equipment, and software for the three months ended March 31, 2025. Impairment expense for property, equipment, and software was immaterial for the three months ended March 31, 2024.
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Intangible Assets, Net |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets, Net | Intangible Assets, Net Intangible assets, net as of March 31, 2025 consist of the following (in thousands):
Intangible assets, net as of December 31, 2024 consist of the following (in thousands):
Amortization expense for intangible assets was $2.1 million and $0.7 million for the three months ended March 31, 2025 and 2024, respectively. There were no impairment charges on intangible assets for the three months ended March 31, 2025 and 2024. Amortization that will be charged to expense over the remaining life of the intangible assets subsequent to March 31, 2025 is as follows (in thousands):
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Accrued Liabilities |
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Accrued Liabilities and Other Liabilities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Liabilities | Accrued Liabilities Accrued liabilities consist of the following (in thousands):
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Operating Leases |
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Leases | Operating Leases The Company has various operating leases for fulfillment and corporate facilities with lease periods expiring between fiscal years 2025 and 2036, not including renewal options the Company is reasonably certain to exercise. The operating lease agreements provide for rental payments on a graduated basis and for options to renew, which could increase future minimum lease payments, if exercised. The Company utilizes the reasonably certain threshold criteria in determining which options it will exercise. During the three months ended March 31, 2025, the Company executed new operating leases in Mesa, Arizona and Menlo Park, California, resulting in additional operating lease right-of-use (“ROU”) assets of $20.9 million and $31.5 million, respectively, along with corresponding increases to operating lease liabilities. For the three months ended March 31, 2025 and 2024, the Company recorded operating lease costs of $1.3 million and $0.6 million, respectively, including variable operating lease costs of $0.1 million in each period. For the three months ended March 31, 2025 and 2024, operating cash flows used for operating leases were $1.2 million and $0.5 million, respectively. As of March 31, 2025, the weighted average remaining lease term and weighted average discount rate, including for renewal options the Company is reasonably certain to exercise, was 9.5 years and 6.8%, respectively. Future minimum lease payments subsequent to March 31, 2025 under the Company's non-cancelable operating leases with an initial lease term in excess of one year are as follows (in thousands):
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Variable Interest Entities |
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Mar. 31, 2025 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | Variable Interest Entities The variable interest entities (“VIEs”) for the periods presented are: (i) the Affiliated Medical Groups; and (ii) the Affiliated Pharmacies. The Company determined that it is the primary beneficiary of these entities for accounting purposes because it has the ability to direct the activities that most significantly affect the entities’ economic performance and has the obligation to absorb the losses. Under the VIE model, the Company presents the results of operations, cash flows, and the financial position of the VIEs as part of the consolidated financial statements of the Company as if the consolidated group were a single economic entity. The assets of the VIEs can only be used to settle the obligations of the VIEs. There is no noncontrolling interest upon consolidation of the entities. The results of operations and cash flows of the VIEs are also included in the Company’s unaudited condensed consolidated financial statements. As of March 31, 2025 and December 31, 2024, the Company’s unaudited condensed consolidated balance sheets included current and total assets of $75.4 million and $56.1 million, respectively, for the VIEs. As of March 31, 2025 and December 31, 2024, current and total liabilities were $23.1 million and $16.6 million, respectively. All amounts are after elimination of intercompany transactions, balances, and non-cash impact of operating leases. For the three months ended March 31, 2025 and 2024, the VIEs charged $127.4 million and $33.1 million, respectively, for services rendered. For the three months ended March 31, 2025 and 2024, operations of the VIEs generated net losses of $7.7 million and $0.8 million, respectively, inclusive of administrative expenses. In April 2025, as a result of a change of ownership, Apostrophe Pharmacy became a wholly-owned subsidiary of the Company and is no longer considered an Affiliated Pharmacy or a VIE. Refer to Note 20 – Subsequent Events for additional detail.
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Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements The Company’s fair value hierarchy for its financial assets that are measured at fair value on a recurring basis as of March 31, 2025, is as follows (in thousands):
The Company’s fair value hierarchy for its financial assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2024, is as follows (in thousands):
The fair values of cash, accounts receivable, accounts payable, and accrued liabilities approximated their carrying values as of March 31, 2025 and December 31, 2024, due to their short-term nature. The fair value of the non-current portion of the earn-out liability, presented within other long-term liabilities, approximated its carrying value as of March 31, 2025 due to all of the earn-out consideration being paid in cash and the timing of its payout being subject to estimation. All other financial instruments are valued either based on recent trades of securities in active markets or based on quoted market prices of similar instruments and other significant inputs derived from or corroborated by observable market data. During the three months ended March 31, 2025 and 2024, the Company had no transfers between levels of the fair value hierarchy of its assets measured at fair value.
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Revolving Credit Facility |
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Mar. 31, 2025 | |
Debt Disclosure [Abstract] | |
Revolving Credit Facility | Revolving Credit Facility On February 18, 2025, the Company entered into a Revolving Credit and Guaranty Agreement (the “Revolving Credit Agreement”) with certain lenders and JPMorgan Chase Bank, N.A., as the administrative and collateral agent, which provides for a three-year $175.0 million senior secured revolving credit facility (the “Credit Facility”). The Credit Facility additionally includes letter of credit and swing line loan sub-limits of $40.0 million and $20.0 million, respectively, and an accordion option, which, if exercised, would allow the Company to increase the aggregate commitment amount by up to $125.0 million, plus additional amounts if the Company is able to satisfy a leverage test and certain other conditions. The obligations under the Credit Facility are secured by a lien on substantially all of the Company’s assets, and are guaranteed by certain of the Company’s material domestic subsidiaries. The commitments under the Credit Facility expire on February 18, 2028. Loans under the Credit Facility bear interest, at the Company’s election, at either (a) an adjusted term Secured Overnight Financing Rate plus 0.10% plus a margin of 1.50% - 2.00%, depending on the Company’s total leverage ratio, or (b) an alternative base rate plus a margin of 0.50% - 1.00%, depending on the Company’s total leverage ratio. Loans under the Credit Facility may also be made in Canadian Dollars, Euros, and Sterling, at comparable interest rates. The Company is required to pay a fee on the average daily undrawn portion of the aggregate commitments that accrues at 0.20% - 0.30% per annum, depending on the Company’s total leverage ratio. The Credit Facility also allows the Company to issue letters of credit, which reduce the amount that can be borrowed. The Company is required to pay a commission on any outstanding letters of credit that accrues at 1.50% - 2.00% per annum, depending on the Company’s total leverage ratio, and a fronting fee that accrues at 0.125% per annum. The Credit Facility contains customary conditions to borrowing, events of default and covenants, including but not limited to negative covenants that restrict the Company’s ability to incur indebtedness, grant liens, make distributions, pay dividends, repurchase shares, make investments and engage in transactions with the Company’s affiliates, in each case subject to certain exceptions. The Credit Facility also requires the Company to maintain a total leverage ratio of no greater than 3.50 to 1.00 and an interest coverage ratio of no less than 3.00 to 1.00. As of March 31, 2025, no loans or letters of credit were outstanding under the Credit Facility, and the Company was not yet required to be in compliance with all conditions and covenants thereunder. Compliance will be required beginning in the second quarter of 2025.
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Commitments and Contingencies |
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Mar. 31, 2025 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Purchase Obligations The Company has non-cancelable contractual obligations with remaining terms in excess of one year to make future purchases, primarily related to cloud-based software contracts used in operations. As of March 31, 2025, non-cancelable purchase obligations with remaining terms in excess of one year were $21.2 million, with $2.3 million payable in 2025, $10.1 million payable in 2026, $8.5 million payable in 2027, $0.2 million payable in 2028, and $0.1 million payable in 2029. Lease Commitments Refer to Note 10 – Operating Leases for discussion of the Company’s future lease commitments. Legal Proceedings From time to time, the Company is a party to litigation, various claims, and other legal and administrative proceedings arising in the ordinary course of business. Some of these claims, lawsuits, and other proceedings may involve highly complex issues that are subject to substantial uncertainties, and could result in damages, fines, penalties, non-monetary sanctions, or relief. Management is not currently aware of any matters that are reasonably likely to have a material adverse impact on the Company’s business, financial position, results of operations, or cash flows.
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Stockholders’ Equity |
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Stockholders’ Equity | Stockholders’ Equity Common Stock The Company has two classes of common stock, Class A and Class V common stock. The rights are identical, including liquidation and dividend rights, except Class V common stock has additional voting rights. Share Repurchase Programs In October 2023, the Board of Directors authorized and approved a share repurchase program (the “2023 Share Repurchase Program”) pursuant to which the Company was authorized to repurchase up to $50.0 million of the Company’s Class A common stock. During the three months ended March 31, 2024, the Company repurchased and retired 2,023,080 shares of Class A common stock under the 2023 Share Repurchase Program for $28.1 million. As of December 31, 2024, the entire $50.0 million originally available under the 2023 Share Repurchase Program had been utilized. In July 2024, the Board of Directors authorized and approved a new share repurchase program (the “2024 Share Repurchase Program”) pursuant to which the Company may repurchase up to $100.0 million of the Company’s Class A common stock. The 2024 Share Repurchase Program expires on August 31, 2027. The Company intends to use the 2024 Share Repurchase Program to repurchase shares on a discretionary basis from time to time, subject to general business and market conditions and other investment opportunities, through open market purchases, privately negotiated transactions or other means. The 2024 Share Repurchase Program may be suspended or discontinued at any time. During the three months ended March 31, 2025, the Company did not repurchase any shares of Class A common stock under the 2024 Share Repurchase Program. As of March 31, 2025, $65.0 million remains available under the 2024 Share Repurchase Program. RSU Releases During the three months ended March 31, 2025, the Company released 1,938,929 gross shares of Class A common stock upon vesting of restricted stock units (“RSUs”). In connection with the releases, 759,276 shares of Class A common stock were withheld for the payment of employee taxes. During the three months ended March 31, 2024, the Company released 1,424,493 gross shares of Class A common stock upon vesting of RSUs. In connection with the releases, 499,250 shares of Class A common stock were withheld for the payment of employee taxes. 2017 Stock Plan and 2020 Equity Incentive Plan In July 2017, Hims, Inc. (“Hims”) adopted the 2017 Stock Plan (the “2017 Plan”). Under the 2017 Plan, the board of directors of Hims granted awards, including incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock awards, RSU awards, and other stock awards to employees, directors, and consultants of Hims. In January 2021, the Board of Directors adopted the 2020 Equity Incentive Plan (the “2020 Plan”) and reserved 21,000,000 authorized shares of Class A common stock the Company could issue. In addition, up to 19,000,000 shares of Hims Class A common stock subject to awards granted under the 2017 Plan that were forfeited, expired, or lapsed unexercised or unsettled could be added to the 2020 Plan reserve. Beginning on January 1, 2022 and ending on January 1, 2031, the number of authorized shares of common stock under the 2020 Plan will automatically increase each fiscal year by 5% of the total number of Class A and Class V common stock issued and outstanding on the last day of the preceding fiscal year unless the Board of Directors approves a lesser number. As of December 31, 2024, there were 54,360,277 and 15,162,111 shares of Class A common stock reserved and available for issuance, respectively, under the 2020 Plan. For the three months ended March 31, 2025, no shares of Class A common stock subject to awards granted under the 2017 Plan that were forfeited after the adoption of the 2020 Plan were added to the 2020 Plan reserve. Additionally, on January 1, 2025, 11,041,860 shares of Class A common stock were automatically added to the 2020 Plan reserve. Therefore, as of March 31, 2025, there were 65,402,137 shares of Class A common stock reserved and 22,510,375 shares of Class A common stock available for grant under the 2020 Stock Plan. There were no more shares available for grant under the 2017 Plan since the 2017 Plan was replaced by the 2020 Plan. 2020 Employee Stock Purchase Plan In January 2021, the Board of Directors adopted the Company’s Employee Stock Purchase Plan (“ESPP”). The total shares of Class A common stock initially reserved under the ESPP is limited to 4,000,000 shares of Class A common stock. Beginning on January 1, 2022 and ending on January 1, 2041 (unless extended by the Board of Directors and approved by the Company’s shareholders), the number of authorized shares of common stock under the ESPP will automatically increase each fiscal year by the lesser of (i) 1% of the total number of Class A and Class V common stock issued and outstanding on the last day of the preceding fiscal year, (ii) 12,000,000 shares of Class A common stock, or (iii) a number of shares of Class A common stock determined by the Board of Directors. As of December 31, 2024, there were 6,047,919 and 4,441,943 shares of Class A common stock reserved and available for issuance, respectively, under the ESPP. There were no shares added to the ESPP reserve on January 1, 2025. Therefore, as of March 31, 2025, there were 6,047,919 shares of Class A common stock reserved for issuance under the ESPP. No shares were issued under the ESPP during the three months ended March 31, 2025 and 2024. As of March 31, 2025, there were 4,441,943 shares of Class A common stock available for issuance under the ESPP. Under the ESPP, eligible employees may purchase the Company’s Class A common stock during pre-specified offering periods at a discount established by the Company’s compensation committee. The purchase price is 85% of the lower of the fair market value of the Company’s Class A common stock on the first trading day of the offering period or the fair market value on the purchase date. Under the ESPP, the Company may specify offering periods with durations of not more than 27 months, and may specify shorter purchase periods within each offering period. Employees participating in the ESPP commence payroll withholdings that accumulate through the end of the respective offering period. As of March 31, 2025, $2.3 million has been withheld via employee payroll deductions for employees who have opted to participate in the purchase periods ending May 2025. As of March 31, 2025, there was $3.4 million of unrecognized stock-based compensation related to the ESPP which is expected to be recognized over a weighted average period of 1.19 years. Stock Options The Company has historically granted stock options prior to 2024, which for new employees generally vest over four years, with 25% vesting one year after the vesting commencement date and then 1/48th of the total grant vesting monthly thereafter. Options granted to existing employees generally vest 1/48th of the total grant monthly over four years. Options granted are exercisable within a period not exceeding ten years from the grant date. In June 2020, the board of directors of Hims granted 3,246,139 and 1,623,070 stock options to the CEO with an exercise price of $2.43 to vest upon either (i) an acquisition of the Company with per share consideration equal to at least $22.99 and $38.31, respectively, or (ii) a per share price on a public stock exchange that is at least equal to $22.99 and $38.31, respectively. The CEO is required to be employed at the time the per share consideration/price is achieved in order to receive the awards, but the awards are not subject to any other service condition. The Company recognizes expense related to these awards based on the fair value and derived service period as measured using a Monte Carlo simulation model, and the expense is accelerated if the requirements outlined in (i) and (ii) above are achieved. The grant date fair value was $16.6 million for these awards. The $22.99 per share price threshold related to awards for the 3,246,139 stock options was achieved in February 2021. The $38.31 per share threshold related to awards for the 1,623,070 stock options was achieved in February 2025. As of March 31, 2025, 3,110,127 of these stock options have been exercised at a weighted average exercise price of $2.43. As of March 31, 2025, all stock-based compensation expense for the awards has been recognized. In February 2022, the Board of Directors granted 2,085,640 stock options to the CEO with an exercise price of $5.01 that vest in equal tranches. On each anniversary date after February 24, 2022, 25% of the shares subject to the options will vest provided that (i) the CEO is employed on the anniversary date and (ii) the closing price of the Company’s Class A common stock is more than $10 per share in 20 of the 30 trading days prior to the anniversary date. The award is not subject to any other service condition. Vesting is cumulative in subsequent years if the market condition was not previously met. The Company recognizes expense related to this award for each tranche individually based on the fair value and requisite service period, which is the greater of the derived service period and the explicit service period. The fair value and the derived service term of the market condition were both measured using a Monte Carlo simulation model. The total grant date fair value was $3.8 million for this award. As of March 31, 2025, 1,564,230 shares have vested and no shares have been exercised. As of March 31, 2025, there was $0.3 million of remaining compensation expense to be recognized over a period of 0.90 years. In March 2025, the Board of Directors granted 557,244 stock options to the CEO with an exercise price of $34.71 that vest at the end of a three-year period, with the number of shares earned ranging from 0% to 250% of the target, provided that (i) the CEO remains employed at the end of the period and (ii) the Company achieves certain revenue and Adjusted EBITDA performance metrics related to the 2027 fiscal year. The total grant date fair value was $11.0 million, which was based on the probable achievement of 100% of the target and measured using the Black-Scholes option pricing model. The assumptions used in the model were an expected term of 6.41 years, an expected volatility of 54.0%, a risk-free interest rate of 4.0%, and an expected dividend yield of 0%. As of March 31, 2025, there was $10.8 million of remaining compensation expense to be recognized over a period of 2.92 years. The Company will continue to evaluate the likelihood of achieving the performance metrics on a quarterly basis. Option activity (excluding the stock options granted to the CEO outlined above) is as follows (in thousands, except for weighted average exercise price and weighted average contractual term in years):
The intrinsic value of vested options exercised was $42.6 million. As of March 31, 2025, there was $5.2 million of unrecognized stock-based compensation expense related to unvested stock options (excluding the stock options granted to the CEO outlined above) which is expected to be recognized over a weighted average period of 1.25 years. The options outstanding and exercisable as of March 31, 2025 (excluding the stock options granted to the CEO outlined above) have been aggregated into ranges for additional disclosure as follows (in thousands, except weighted average remaining contractual life and exercise price):
RSUs RSUs for new employees generally vest over four years, with 25% vesting one year after the vesting commencement date on the first Company Quarterly Vesting Date (defined below) and the remaining grant vesting quarterly thereafter on the specified vesting dates of March 15, June 15, September 15, and December 15 (each, a “Company Quarterly Vesting Date” or collectively, “Company Quarterly Vesting Dates”). Additional RSUs granted to current employees generally vest quarterly on Company Quarterly Vesting Dates over four years. RSU activity (excluding the performance RSUs outlined below) is as follows (in thousands, except for weighted average grant date fair value):
Included in the above activity are 476,308 earn-out RSUs and 9,478 Parent Warrant RSUs issued to the CEO in January 2021 that vest in accordance with the same market conditions as the CEO stock options issued in June 2020, of which all 476,308 earn-out RSUs and 9,478 Parent Warrant RSUs have vested as of March 31, 2025. As of March 31, 2025, there was $272.1 million of unrecognized stock-based compensation expense related to unvested RSUs (excluding the performance RSUs outlined below) which is expected to be recognized over a weighted average period of 3.12 years. Performance RSUs In March 2023, the Board of Directors granted awards of 1,115,709 target shares of performance RSUs (“PRSUs”) to certain executive officers. As of March 31, 2025, 11,408 shares subject to PRSUs have been forfeited. The PRSUs vest at the end of a three-year period, with the number of shares earned ranging from 0% to 200% of the target, provided that (i) the recipient remains employed at the end of the period and (ii) the Company achieves certain revenue and Adjusted EBITDA performance metrics related to the 2025 fiscal year. The total grant date fair value of the awards was $12.9 million, which was based on the probable achievement of 100% of the target. In February 2024, the Board of Directors granted awards of 1,218,467 target shares of PRSUs to certain executive officers and senior leadership, none of which have been forfeited as of March 31, 2025. The PRSUs vest at the end of a three-year period, with the number of shares earned ranging from 0% to 200% of the target, provided that (i) the recipient remains employed at the end of the period and (ii) the Company achieves certain revenue and Adjusted EBITDA performance metrics related to the 2026 fiscal year. The total grant date fair value of the awards was $16.2 million, which was based on the probable achievement of 100% of the target. In November 2024, the Board of Directors granted awards of 16,778 target shares of PRSUs to certain senior leadership, with the same vesting terms as the PRSUs granted on February 28, 2024, none of which have been forfeited as of March 31, 2025. The total grant date fair value of the awards was $0.4 million, which was based on the probable achievement of 100% of the target. As of March 31, 2025, there was unrecognized stock-based compensation expense related to unvested PRSUs of $21.4 million, which is expected to be recognized over a weighted average period of 1.59 years. The Company will continue to evaluate the likelihood of achieving the performance metrics on a quarterly basis. Warrants The Company has historical Class A common stock warrants issued to nonemployees in connection with vendor service arrangements. As of March 31, 2025, there were 271,962 of these warrants outstanding and exercisable, with a weighted average exercise price of $1.75, a weighted average contractual term of 7.01 years, and an aggregate intrinsic value of $7.6 million. Upon the exercise of outstanding warrants, vendors also have the right to receive 26,603 additional shares of Class A common stock. As of March 31, 2025, all stock-based compensation expense related to vendor warrants and associated earn-out shares has been recognized. Stock Subject to Vesting and Earn-out Share Liability In June 2021, the Company granted 447,553 restricted shares of Class A common stock subject to vesting with an aggregate grant date fair value of $5.5 million in connection with the acquisition of Honest Health Limited, which is now Hims & Hers UK Limited (“HHL”). As part of the acquisition of HHL, the Company also recognized an earn-out liability based on the achievement of certain revenue targets. Vesting of the restricted shares and a portion of total earn-out payable to specific individuals are contingent on each recipient’s continued employment. Accordingly, the Company has recognized stock-based compensation expense related to these awards for the three months ended March 31, 2025 and 2024. The expense is being recognized over a four-year vesting period with 25% vesting one year after the acquisition date and the remaining vesting quarterly thereafter. As of March 31, 2025, there was unrecognized stock-based compensation expense of $0.3 million, which will be recognized over a weighted average period of 0.20 years. Stock-Based Compensation Expense The following table summarizes stock-based compensation expense for employees and nonemployees, by category, on the unaudited condensed consolidated statements of operations and comprehensive income for the three months ended March 31, 2025 and 2024 (in thousands):
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Related-Party Transactions |
3 Months Ended |
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Mar. 31, 2025 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party Transactions For the three months ended March 31, 2025 and 2024, the Company recorded $1.4 million and $1.2 million, respectively, within operating expenses on the unaudited condensed consolidated statements of operations and comprehensive income for payments made to Woolly Labs, Inc. (d/b/a Vouched), a related-party company that provides identity verification services.
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Basic and Diluted Net Income per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basic and Diluted Net Income per Share | Basic and Diluted Net Income per Share The Company uses the two-class method to calculate net income per share. No dividends were declared or paid for the three months ended March 31, 2025 and 2024. Undistributed earnings for each period are allocated equally to participating securities based on the contractual participation rights of the security to share in the current earnings as if all current period earnings had been distributed. The Company’s basic net income per share is computed by dividing the net income attributable to common stockholders by the weighted average shares of common stock outstanding during the period. The Company’s diluted net income per share is computed by dividing the net income attributable to common stockholders by the weighted average shares of common stock outstanding and, when dilutive, potential common shares outstanding during the period. The dilutive effect of potential common shares is reflected in diluted net income per share by application of the treasury stock method. The following table sets forth the computation of the Company’s basic and diluted net income per share attributable to common stockholders for the three months ended March 31 (in thousands, except share and per share amounts):
The following table discloses weighted-average Class A securities that were not included in the computation of diluted net income per share as their inclusion would have been anti-dilutive:
There were no Class V securities that were excluded in the computation of diluted net income per share for the periods presented.
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Segments |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segments | Segments The CODM utilizes net income as the measure of segment profit or loss. The CODM uses net income to evaluate return on assets and decide whether to reinvest profits into the segment or into other new investment opportunities. In addition to the unaudited condensed consolidated statements of operations and comprehensive income, the CODM is regularly provided with financial information that includes the following captions when assessing the performance and allocation of resources: cost of revenue, customer acquisition costs (comprising advertising and media costs associated with the Company’s efforts to acquire new customers, promote its brands, and build awareness for its products and services, including advertising in digital media, social media, television, radio, out-of-home media, and various other media outlets and excluding content production costs), employee compensation (comprising salaries and wages, benefits, taxes, and performance bonuses, and excluding stock-based compensation) by operating expense caption, and stock-based compensation by operating expense caption. These are significant segment expenses, as they are regularly provided to the CODM. The table below highlights the segment’s revenue, expenses, and net income for the three months ended March 31, 2025 and 2024 (in thousands):
______________ (*) Other segment items included in segment net income primarily consist of professional services, fulfillment, transaction processing, technology, and other general operating costs. In addition to the segment’s operating results, the CODM is regularly provided with total assets as reported on the Company’s unaudited condensed consolidated balance sheets as well as the expenditures for both purchases of property, equipment, and intangible assets, and investment in website development and internal-use software, which are reported on the Company’s consolidated statements of cash flows and totaled $59.0 million and $14.0 million during the three months ended March 31, 2025 and 2024, respectively.
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Income Tax |
3 Months Ended |
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Mar. 31, 2025 | |
Income Tax Disclosure [Abstract] | |
Income Tax | Income TaxThe effective income tax rate was 18.2% and 10.3%, respectively, for the three months ended March 31, 2025 and 2024. The effective tax rate differs from the U.S. federal rate primarily due to the impacts of the valuation allowance placed on the Company’s deferred tax assets in prior periods, the windfall tax benefit on stock compensation activity, the executive compensation addback under Internal Revenue Code Section 162(m), generation of research and development tax credits, and state taxes. |
Subsequent Events |
3 Months Ended |
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Mar. 31, 2025 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events In April 2025, as a result of a change of ownership, Apostrophe Pharmacy became a wholly-owned subsidiary of the Company and is no longer considered an Affiliated Pharmacy or a VIE. Previously, the Company was the primary beneficiary of the entity and consolidated its operations under the VIE model. The change of ownership will not have a material impact on the Company’s unaudited condensed consolidated financial statements. In April 2025, the Company accounted for a lease extension for one of its facilities as a lease modification in accordance with Accounting Standards Codification 842, Leases (“ASC 842”), under which the Company extended the existing lease term for an additional period of 122 months. The modification of the lease will increase the lease liability and the corresponding ROU asset by $10.4 million for the existing facility.
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Pay vs Performance Disclosure - USD ($) $ in Thousands |
3 Months Ended | |
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Mar. 31, 2025 |
Mar. 31, 2024 |
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Pay vs Performance Disclosure | ||
Net income | $ 49,485 | $ 11,128 |
Insider Trading Arrangements |
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Mar. 31, 2025
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Trading Arrangements, by Individual | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Material Terms of Trading Arrangement | During the fiscal quarter ended March 31, 2025, none of our directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408 of Regulation S-K, except as described in the table below:
______________ (1)Denotes whether the trading plan is intended to satisfy the affirmative defense of Rule 10b5-1(c) when adopted.
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Non-Rule 10b5-1 Arrangement Adopted | false | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rule 10b5-1 Arrangement Terminated | false | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-Rule 10b5-1 Arrangement Terminated | false | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Irene Becklund [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Trading Arrangements, by Individual | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Name | Mike Chi | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Title | Chief Commercial Officer | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rule 10b5-1 Arrangement Adopted | true | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adoption Date | 3/4/2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Expiration Date | 4/1/2026 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Arrangement Duration | 300 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Aggregate Available | 825,264 |
Summary of Significant Accounting Policies (Policies) |
3 Months Ended |
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Mar. 31, 2025 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to accounting principles generally accepted in the United States of America (“U.S. GAAP”). The condensed consolidated financial statements as of March 31, 2025 are unaudited. The condensed consolidated balance sheet as of December 31, 2024 included herein was derived from the audited consolidated financial statements as of that date. Certain information and note disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. As such, the information included herein should be read in conjunction with the consolidated financial statements and accompanying notes as of and for the year ended December 31, 2024 (the “audited consolidated financial statements”). The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and reflect, in management’s opinion, all adjustments of a normal, recurring nature that are necessary for the fair statement of the Company’s balance sheet, results of operations, and cash flows for the periods presented, but are not necessarily indicative of the results expected for the full fiscal year or any other period.
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Consolidation | The unaudited condensed consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries, and variable interest entities in which it is the primary beneficiary. All intercompany transactions and balances have been eliminated in these unaudited condensed consolidated financial statements. There have been no changes to the Company’s significant accounting policies described in the audited consolidated financial statements for the year ended December 31, 2024 that have had a material impact on these unaudited condensed consolidated financial statements and related notes.
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Use of Estimates | Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments, and assumptions that affect the amounts reported in the financial statements and accompanying notes. The more significant estimates, judgments, and assumptions by management include, among others, valuation and recognition of stock-based compensation expense, valuation of contingent consideration in business combinations or asset acquisitions, purchase price allocation for business combinations, valuation of assets acquired in an asset acquisition, valuation of deferred tax assets, valuation of inventory, and estimates used in the capitalization of website development and internal-use software costs. Management believes that the estimates, judgments, and assumptions upon which it relies are reasonable based upon information available to it at the time that these estimates, judgments, and assumptions were made. Actual results experienced by the Company may differ from management’s estimates. To the extent that there are material differences between these estimates and actual results, the Company’s unaudited condensed consolidated financial statements will be affected.
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Business Combinations | Business Combinations The Company accounts for its business combinations using the acquisition method of accounting. The purchase price is attributed to the fair value of the assets acquired and liabilities assumed. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are measured separately at their fair values as of the acquisition date. The excess of the purchase price of acquisition over the fair value of the identifiable net assets of the acquiree is recorded as goodwill. The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of acquisition. When the Company issues stock-based or cash awards to an acquired company’s shareholders, the Company evaluates whether the awards are consideration or compensation for post-acquisition services. The evaluation includes, among other things, whether the vesting of the awards is contingent on the continued employment of the acquired company’s stockholders beyond the acquisition date. If continued employment is required for vesting, the awards are treated as compensation for post-acquisition services and recognized as expense over the requisite service period. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates, including the selection of valuation methodologies, estimates of future revenue and cash flows, discount rates, and selection of comparable companies. The estimates and assumptions used to determine the fair values and useful lives of identified intangible assets could change due to numerous factors, including market conditions, technological developments, economic conditions, and competition. In connection with determination of fair values, the Company may engage a third-party valuation specialist to assist with the valuation of intangible and certain tangible assets acquired and certain assumed obligations.
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Asset Acquisition | Asset Acquisitions The Company accounts for a transaction as an asset acquisition when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, or the acquisition otherwise does not meet the definition of a business. Asset acquisitions are measured and recognized based on the cost to acquire the assets, which is allocated to the individual assets acquired and liabilities assumed on a relative fair value basis. Direct costs related to the acquisition are capitalized as part of the assets or liabilities acquired. Goodwill is not recognized in an asset acquisition with any consideration in excess of net assets acquired allocated to acquired nonfinancial assets on a relative fair value basis.
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Segment Reporting | Segment Reporting The Company is managed as a single operating segment on a consolidated basis, inclusive of acquisitions. The Company determines its operating segments based on how the chief operating decision maker (“CODM”) makes decisions regarding the allocation of resources and operational strategy, assesses performance, and manages the organization at a consolidated level. The Chief Executive Officer (“CEO”), is the CODM. The products and services from which this segment derives its revenues are described below in the discussion of revenue recognition.
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Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business combination. Goodwill is not amortized but is tested for impairment annually in the fourth quarter or more frequently if events or changes in circumstances indicate that the asset may be impaired. The Company operates as one reporting unit. When testing goodwill for impairment, the Company may first perform an optional qualitative assessment. If the Company determines it is not more likely than not the reporting unit’s fair value is less than its carrying value, then no further analysis is necessary. If the Company determines that it is more likely than not that the fair value of its reporting unit is less than its carrying amount, then the quantitative impairment test will be performed. Under the quantitative impairment test, if the carrying amount of the Company’s reporting unit exceeds its fair value, the Company will recognize an impairment loss in an amount equal to that excess but limited to the total amount of goodwill. Goodwill of $5.0 million was acquired in relation to an immaterial business combination during the three months ended March 31, 2025.
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Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets include property, equipment, and software and intangible assets subject to amortization. The Company is a single asset group. Long-lived assets, including acquired assets from a business combination, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. In such cases, recoverability of asset groups to be held and used is assessed by comparing the carrying amount of the asset group with its future underlying net undiscounted cash flows without interest charges. If such asset group is considered to be impaired, an impairment is recognized as the amount by which the carrying amount of the asset group exceeds the estimated fair values of the asset group. No impairment of long-lived assets was recorded for the three months ended March 31, 2025. The Company recognized immaterial impairment charges on long-lived assets during the three months ended March 31, 2024 in technology and development expenses on the unaudited condensed consolidated statements of operations and comprehensive income.
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Revenue Recognition | Revenue Recognition The Company recognizes revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. The Company’s consolidated revenue primarily comprises online sales of health and wellness products and services through the Company’s websites and mobile applications, including prescription and non-prescription products. In contracts that contain prescription products issued as the result of a consultation, revenue also includes medical consultation services and post-consultation service support provided by Affiliated Medical Groups (defined below). Additionally, the Company offers a range of health and wellness products through wholesale partners. For Online Revenue, the Company defines its customer as an individual who purchases products or services through its websites or mobile applications. For Wholesale Revenue, the Company defines its customer as a wholesale partner, with the exception of consignment arrangements, where its customer is defined as an individual who purchases products through certain third-party platforms. The transaction price in the Company’s contracts with customers is the total amount of consideration to which the Company expects to be entitled in exchange for transferring products or services to the customer. The Company’s contracts that contain prescription products issued as the result of a consultation primarily include the following performance obligations: access to (i) products, as well as medication adjustments, as applicable, and (ii) consultation services, as well as post-consultation service support, as applicable. The Company’s contracts that do not contain prescription products have a single performance obligation. Revenue is recognized at the time the related performance obligation is satisfied by transferring the promised product to the customer and, in contracts that contain services, by the provision of consultation services to the customer. The Company satisfies its performance obligation for products at a point in time, which is upon delivery of the products to a third-party carrier or wholesale customer warehouse. The Company satisfies its performance obligation for consultation services typically within one day and for post-consultation service support over the contract term. The customer obtains control of the products and services upon the Company’s completion of its performance obligations. For contracts with multiple performance obligations, the transaction price is allocated to each performance obligation on a relative stand-alone selling price basis. The stand-alone selling price is based on the prices at which the Company separately sells the products and services, as well as market and cost plus estimates. For each of the three months ended March 31, 2025 and 2024, service revenue, comprising consultation services and post-consultation service support, represented less than 10% of consolidated revenues. To fulfill its promise to customers for contracts that include professional medical consultations, the Company maintains relationships with various “Affiliated Medical Groups,” which are professional corporations or other professional entities owned by licensed physicians and that engage licensed healthcare professionals (physicians, physician assistants, nurse practitioners, and mental health providers; collectively referred to as “Providers” or individually, a “Provider”) to provide consultation services. Refer to Note 11 – Variable Interest Entities. The Company accounts for service revenue as a principal in the arrangement with its customers. This conclusion is reached because (i) the Company determines which Affiliated Medical Group and Provider provides the consultation to the customer; (ii) the Company is primarily responsible for the satisfactory fulfillment and acceptability of the services; (iii) the Company incurs costs for consultation services even for visits that do not result in a prescription and the sale of products; and (iv) the Company, in its sole discretion, sets all listed prices charged on its websites and mobile applications for products and services. Additionally, to fulfill its promise to customers for contracts that include sale of prescription products, the Company maintains relationships with (i) certain third-party pharmacies (“Partner Pharmacies” or individually, a “Partner Pharmacy”), (ii) XeCare, LLC (“XeCare”) and Apostrophe Pharmacy LLC (“Apostrophe Pharmacy”, and together with XeCare, the “Affiliated Pharmacies”), which are licensed mail order pharmacies providing prescription fulfillment solely to the Company’s customers; and (iii) Seaview Enterprises LLC (d/b/a MedisourceRx) (“MedisourceRx”), which is a wholly-owned licensed 503B outsourcing facility. MedisourceRx manufactures products solely for the Company’s customers, and the pharmacies, as licensed, fill prescription orders for customers who have received a prescription from a prescribing Provider through the Company’s websites and mobile applications. The Company accounts for prescription product revenue as a principal in the arrangement with its customers. This conclusion is reached because (i) the Company has sole discretion in determining which pharmacy fills a customer’s prescription; (ii) the pharmacies fill the prescription based on fulfillment instructions provided by the Company, including using the Company’s branded packaging for generic products; (iii) the Company is primarily responsible to the customer for the satisfactory fulfillment and acceptability of the order; (iv) the Company is responsible for refunds of the prescription medication after transfer of control to the customer; and (v) the Company, in its sole discretion, sets all listed prices charged on its websites and mobile applications for products and services. The Company estimates refunds using the expected value method primarily based on historical refunds granted to customers. The Company updates its estimate at the end of each reporting period and recognizes the estimated amount as contra-revenue with a corresponding refund liability. Sales, value-added, and other taxes are excluded from the transaction price and, therefore, from revenue. The Company accounts for shipping activities, consisting of direct costs to ship products performed after the control of a product has been transferred to the customer, in cost of revenue. For online sales, payment for prescription medication and non-prescription products is collected from the customer in accordance with contract terms a few days in advance of product shipment, or in the case of prepaid offerings, upfront with subsequent shipments typically occurring monthly, quarterly, or semi-annually. Contract liabilities are recorded when payments have been received from the customer for undelivered products or services and are recognized as revenue when the performance obligations are later satisfied. Contract liabilities consisting of balances related to customer prepayments are recognized as current deferred revenue on the unaudited condensed consolidated balance sheets since the associated revenue will be recognized within the following year. For wholesale arrangements, payments are collected in accordance with contract terms.
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Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this ASU expand income tax disclosure requirements, primarily through enhanced disclosures related to income taxes paid and the rate reconciliation. ASU 2023-09 is effective for all public entities for annual periods beginning after December 15, 2024, with early adoption permitted. The amendments in this ASU should be applied on a prospective basis and retrospective application is permitted. The Company is evaluating the method of adoption and the impact of this ASU on its consolidated financial statements and related disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The amendments in this ASU expand certain expense category disclosure requirements, primarily though enhanced disclosures about inventory purchases, employee compensation, depreciation, amortization, and selling expenses. In January 2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), which clarified the effective date for ASU 2024-03. The ASU is effective for all public entities for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The amendments in this ASU should be applied on a prospective basis and retrospective application is permitted. The Company is evaluating the method of adoption and the impact of this ASU on its consolidated financial statements and related disclosures.
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Summary of Significant Accounting Policies (Tables) |
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Mar. 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | Revenue consists of the following (in thousands):
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Acquisitions (Tables) |
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Mar. 31, 2025 | |||||||||||||||||||||||||||||||
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |||||||||||||||||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the acquisition date fair values of assets acquired and liabilities assumed (in thousands):
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Investments (Tables) |
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Mar. 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Marketable Securities | Short-term investments as of March 31, 2025, consist of the following (in thousands):
Short-term investments as of December 31, 2024, consist of the following (in thousands):
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Inventory (Tables) |
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Mar. 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventory, Current | Inventory consists of the following (in thousands):
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Prepaid Expenses and Other Current Assets (Tables) |
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Mar. 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following (in thousands):
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Property, Equipment, and Software, Net (Tables) |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Equipment, and Software | Property, equipment, and software, net consist of the following (in thousands):
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Intangible Assets, Net (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Finite-Lived Intangible Assets | Intangible assets, net as of March 31, 2025 consist of the following (in thousands):
Intangible assets, net as of December 31, 2024 consist of the following (in thousands):
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Finite-lived Intangible Assets Amortization Expense | Amortization that will be charged to expense over the remaining life of the intangible assets subsequent to March 31, 2025 is as follows (in thousands):
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Accrued Liabilities (Tables) |
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Mar. 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Liabilities and Other Liabilities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accrued Liabilities | Accrued liabilities consist of the following (in thousands):
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Operating Leases (Tables) |
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Mar. 31, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lessee, Operating Lease, Liability, Maturity | Future minimum lease payments subsequent to March 31, 2025 under the Company's non-cancelable operating leases with an initial lease term in excess of one year are as follows (in thousands):
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Fair Value Measurements (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The Company’s fair value hierarchy for its financial assets that are measured at fair value on a recurring basis as of March 31, 2025, is as follows (in thousands):
The Company’s fair value hierarchy for its financial assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2024, is as follows (in thousands):
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Stockholders’ Equity (Tables) |
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Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement, Option, Activity | Option activity (excluding the stock options granted to the CEO outlined above) is as follows (in thousands, except for weighted average exercise price and weighted average contractual term in years):
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Share-based Payment Arrangement, Option, Exercise Price Range | The options outstanding and exercisable as of March 31, 2025 (excluding the stock options granted to the CEO outlined above) have been aggregated into ranges for additional disclosure as follows (in thousands, except weighted average remaining contractual life and exercise price):
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Share-based Payment Arrangement, Restricted Stock Unit, Activity | RSU activity (excluding the performance RSUs outlined below) is as follows (in thousands, except for weighted average grant date fair value):
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Share-based Payment Arrangement, Expensed and Capitalized, Amount | The following table summarizes stock-based compensation expense for employees and nonemployees, by category, on the unaudited condensed consolidated statements of operations and comprehensive income for the three months ended March 31, 2025 and 2024 (in thousands):
|
Basic and Diluted Net Income per Share (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of the Company’s basic and diluted net income per share attributable to common stockholders for the three months ended March 31 (in thousands, except share and per share amounts):
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Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table discloses weighted-average Class A securities that were not included in the computation of diluted net income per share as their inclusion would have been anti-dilutive:
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Segments (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | The table below highlights the segment’s revenue, expenses, and net income for the three months ended March 31, 2025 and 2024 (in thousands):
______________ (*) Other segment items included in segment net income primarily consist of professional services, fulfillment, transaction processing, technology, and other general operating costs.
|
Summary of Significant Accounting Policies - Additional Information (Details) |
1 Months Ended | 3 Months Ended | |
---|---|---|---|
Feb. 28, 2025
USD ($)
|
Mar. 31, 2025
USD ($)
reportingUnit
|
Mar. 31, 2024
USD ($)
|
|
Disaggregation of Revenue [Line Items] | |||
Number of reporting unit | reportingUnit | 1 | ||
Goodwill impairment | $ 0 | $ 0 | |
Impairment of long-lived assets, (less than 1 million) | 0 | ||
Deferred revenue | 110,800,000 | $ 75,300,000 | |
Deferred revenue, increase | 35,500,000 | ||
Sigmund NJ, LLC, Trybe Labs | |||
Disaggregation of Revenue [Line Items] | |||
Goodwill, acquired during period | $ 5,000,000.0 | $ 5,000,000.0 |
Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
|
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 586,010 | $ 278,171 |
Online Revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 576,361 | 267,761 |
Wholesale Revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 9,649 | $ 10,410 |
Acquisitions - Narrative (Details) - USD ($) $ in Thousands |
1 Months Ended | 3 Months Ended | 12 Months Ended | |
---|---|---|---|---|
Feb. 28, 2025 |
Sep. 30, 2024 |
Mar. 31, 2025 |
Dec. 31, 2024 |
|
Business Acquisition [Line Items] | ||||
Property, equipment, and software, net | $ 155,707 | $ 82,083 | ||
Useful life | 10 years | |||
C S Bio Co. | ||||
Business Acquisition [Line Items] | ||||
Consideration transferred | $ 39,100 | |||
Payments for asset acquisitions | 32,700 | |||
Acquisition cost | 2,100 | |||
Property, equipment, and software, net | 41,200 | |||
C S Bio Co. | Maximum | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration transferred | 6,400 | |||
Earn out consideration transferred | 32,700 | |||
Sigmund NJ, LLC, Trybe Labs | ||||
Business Acquisition [Line Items] | ||||
Cash consideration | 5,100 | |||
Goodwill, acquired during period | $ 5,000 | $ 5,000 | ||
Seaview Enterprises LLC, MedisourceRx | ||||
Business Acquisition [Line Items] | ||||
Business combination, consideration | $ 31,000 | |||
Business combination, acquisition related costs | $ 1,400 | |||
Goodwill, acquired during period | $ 1,800 |
Acquisitions - Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands |
Mar. 31, 2025 |
Dec. 31, 2024 |
Sep. 30, 2024 |
---|---|---|---|
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | |||
Goodwill | $ 117,753 | $ 112,728 | |
Seaview Enterprises LLC, MedisourceRx | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | |||
503B pharmacy license | $ 28,596 | ||
Goodwill | 1,847 | ||
Other net assets | 557 | ||
Net assets acquired | $ 31,000 |
Investments - Short-term Investments (Details) - USD ($) $ in Thousands |
Mar. 31, 2025 |
Dec. 31, 2024 |
---|---|---|
Marketable Securities [Line Items] | ||
Adjusted Cost | $ 48,894 | $ 79,544 |
Unrealized Gains | 41 | 124 |
Unrealized Losses | 0 | (1) |
Fair Value | 48,935 | 79,667 |
U.S. Treasury bills | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | 41,501 | 60,040 |
Unrealized Gains | 40 | 120 |
Unrealized Losses | 0 | 0 |
Fair Value | 41,541 | 60,160 |
Corporate bonds | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | 7,393 | 18,058 |
Unrealized Gains | 1 | 3 |
Unrealized Losses | 0 | (1) |
Fair Value | $ 7,394 | 18,060 |
Government and government agency | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | 1,446 | |
Unrealized Gains | 1 | |
Unrealized Losses | 0 | |
Fair Value | $ 1,447 |
Inventory (Details) - USD ($) $ in Thousands |
Mar. 31, 2025 |
Dec. 31, 2024 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Raw materials | $ 48,958 | $ 29,350 |
Finished goods | 27,138 | 35,077 |
Total inventory | $ 76,096 | $ 64,427 |
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands |
Mar. 31, 2025 |
Dec. 31, 2024 |
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid expenses | $ 29,083 | $ 16,172 |
Wholesale trade and other receivables, net | 6,944 | 6,080 |
Other current assets | 12,170 | 8,901 |
Total prepaid expenses and other current assets | $ 48,197 | $ 31,153 |
Property, Equipment, and Software, Net (Details) - USD ($) $ in Thousands |
Mar. 31, 2025 |
Dec. 31, 2024 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Total property, equipment, and software | $ 185,366 | $ 106,582 |
Less: accumulated depreciation and amortization | (29,659) | (24,499) |
Property, equipment, and software, net | 155,707 | 82,083 |
Facility equipment and other tangible property | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment, and software | 71,503 | 27,785 |
Purchased and internal-use software and website development | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment, and software | 34,819 | 34,100 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment, and software | 11,402 | 10,933 |
Assets not placed in service | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment, and software | $ 67,642 | $ 33,764 |
Property, Equipment, and Software, Net - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
|
Property, Plant and Equipment [Line Items] | ||
Depreciation and amortization | $ 8,276 | $ 3,001 |
Impairment expense | 0 | |
Property, Equipment, and Software | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation and amortization | $ 6,200 | $ 2,300 |
Intangible Assets, Net - Amortization of Intangible Assets (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
Dec. 31, 2024 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense related to intangible assets | $ 2,100,000 | $ 700,000 | |
Impairment of intangible assets | 0 | $ 0 | |
The remainder of 2025 | 7,323,000 | ||
2026 | 7,973,000 | ||
2027 | 7,753,000 | ||
2028 | 3,841,000 | ||
2029 | 2,963,000 | ||
2030 and thereafter | 13,578,000 | ||
Net Carrying Value | $ 43,431,000 | $ 43,410,000 |
Accrued Liabilities (Details) - USD ($) $ in Thousands |
Mar. 31, 2025 |
Dec. 31, 2024 |
---|---|---|
Accrued Liabilities and Other Liabilities [Abstract] | ||
Marketing | $ 14,420 | $ 21,839 |
Tax | 11,904 | 2,152 |
Professional services | 9,696 | 8,463 |
Payroll | 8,042 | 12,067 |
Other accruals | 12,880 | 8,492 |
Total accrued liabilities | $ 56,942 | $ 53,013 |
Operating Leases - Additional Details (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
Dec. 31, 2024 |
|
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | $ 62,198 | $ 10,881 | |
Operating lease costs | 1,300 | $ 600 | |
Variable lease costs | 100 | ||
Operating lease, payments | $ 1,200 | $ 500 | |
Weighted average remaining lease term | 9 years 6 months | ||
Weighted average discount rate, percent | 6.80% | ||
Operating leases, future minimum payments due | $ 63,384 | ||
Mesa, Arizona | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | 20,900 | ||
Menlo Park, California | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | $ 31,500 |
Operating Leases - Lease Liability (Details) $ in Thousands |
Mar. 31, 2025
USD ($)
|
---|---|
Leases [Abstract] | |
The remainder of 2025 | $ 4,897 |
2026 | 9,315 |
2027 | 9,640 |
2028 | 9,586 |
2029 | 9,855 |
2030 and thereafter | 50,906 |
Gross lease payments | 94,199 |
Less: imputed interest | (26,473) |
Less: tenant improvement receivables | (4,342) |
Present value of net future minimum lease payments | $ 63,384 |
Variable Interest Entities (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
Dec. 31, 2024 |
|
Variable Interest Entity [Line Items] | |||
Assets | $ 891,711 | $ 707,539 | |
Liabilities | 342,450 | 230,823 | |
Net income (loss) | 49,485 | $ 11,128 | |
Variable Interest Entity, Primary Beneficiary | |||
Variable Interest Entity [Line Items] | |||
Assets | 75,400 | 56,100 | |
Liabilities | 23,100 | $ 16,600 | |
Net income (loss) | (7,700) | (800) | |
Variable Interest Entity, Primary Beneficiary | Consolidation, Eliminations | Service Agreements | |||
Variable Interest Entity [Line Items] | |||
Payments for services | $ 127,400 | $ 33,100 |
Commitments and Contingencies - (Details) $ in Millions |
Mar. 31, 2025
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
Purchase obligation | $ 21.2 |
Purchase obligation, to be paid, remainder of fiscal year | 2.3 |
Purchase obligation, 2026 | 10.1 |
Purchase obligation, 2027 | 8.5 |
Purchase obligation, 2028 | 0.2 |
Purchase obligation, 2029 | $ 0.1 |
Stockholders’ Equity - Common Stock (Details) |
Mar. 31, 2025
commonStockClass
|
---|---|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of classes of common stock | 2 |
Stockholders’ Equity - RSU Releases (Details) - RSUs - Common Class A - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock issued during period, shares, restricted stock award, gross (in shares) | 1,938,929 | 1,424,493 |
Share-based payment arrangement, shares withheld for tax withholding obligation (in shares) | 759,276 | 499,250 |
Stockholders’ Equity - RSUs Activity (Details) - RSUs shares in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2025
$ / shares
shares
| |
Shares | |
Beginning balance (in shares) | shares | 15,757 |
Granted (in shares) | shares | 3,359 |
Vested (in shares) | shares | (1,939) |
Forfeited and expired (in shares) | shares | (296) |
Ending balance (in shares) | shares | 16,881 |
Weighted Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 11.45 |
Granted (in dollars per share) | $ / shares | 37.33 |
Vested (in dollars per share) | $ / shares | 10.35 |
Forfeited and expired (in dollars per share) | $ / shares | 11.81 |
Ending balance (in dollars per share) | $ / shares | $ 16.72 |
Stockholders’ Equity - Warrants Narrative (Details) - Vendor Warrants $ / shares in Units, $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2025
USD ($)
$ / shares
shares
| |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding (in shares) | 271,962 |
Exercisable (in shares) | 271,962 |
Exercisable and outstanding (in dollars per share) | $ / shares | $ 1.75 |
Exercisable and outstanding (in years) | 7 years 3 days |
Exercisable and outstanding, intrinsic value | $ | $ 7.6 |
Class of warrant or right, number securities called by warrants or rights (in shares) | 26,603 |
Stockholders’ Equity - Summary of Stock-Based Compensation Expense for Employees and Nonemployees (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
|
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | $ 24,858 | $ 19,032 |
Share-based payment arrangement, amount capitalized | 700 | 600 |
Marketing | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 2,774 | 1,904 |
Operations and support | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 3,006 | 2,155 |
Technology and development | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 4,045 | 2,205 |
General and administrative | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | $ 15,033 | $ 12,768 |
Related-Party Transactions (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
|
Vouched | ||
Related Party Transaction [Line Items] | ||
Related party transaction, expenses from transactions with related party | $ 1.4 | $ 1.2 |
Basic and Diluted Net Income per Share - Additional Information (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
|
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Dividends, common stock | $ 0 | $ 0 |
Common Class V | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0 | 0 |
Basic and Diluted Net Income per Share - Schedule of Excluded Antidilutive Securities (Details) - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
|
RSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 913,504 | 5,264,985 |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0 | 1,456,985 |
Segments - Segment Information By Segment (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
|
Segment Reporting Information [Line Items] | ||
Total revenue | $ 586,010 | $ 278,171 |
Less: | ||
Cost of revenue | 155,321 | 49,076 |
Customer acquisition costs | 201,590 | 113,176 |
Depreciation and amortization expense included within operating expenses | 7,536 | 2,857 |
Interest income and expense, net | (2,596) | (2,540) |
Provision for income taxes | 11,010 | 1,275 |
Other segment items | 76,312 | 39,953 |
Net income | 49,485 | 11,128 |
Adjustments and reconciling items | 0 | 0 |
Employee Compensation | ||
Less: | ||
Marketing | 10,512 | 8,693 |
Operations and support | 23,823 | 16,635 |
Technology and development | 13,490 | 8,047 |
General and administrative | 14,669 | 10,839 |
Stock-Based Compensation | ||
Less: | ||
Marketing | 2,774 | 1,904 |
Operations and support | 3,006 | 2,155 |
Technology and development | 4,045 | 2,205 |
General and administrative | $ 15,033 | $ 12,768 |
Segments (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
|
Segment Reporting [Abstract] | ||
Payments to acquire productive assets | $ 59.0 | $ 14.0 |
Income Taxes (Details) |
3 Months Ended | |
---|---|---|
Mar. 31, 2025 |
Mar. 31, 2024 |
|
Income Tax Disclosure [Abstract] | ||
Effective income tax rate reconciliation, percent | 18.20% | 10.30% |
Subsequent Events (Details) $ in Thousands |
1 Months Ended | ||
---|---|---|---|
Apr. 30, 2025
USD ($)
Facility
|
Mar. 31, 2025
USD ($)
|
Dec. 31, 2024
USD ($)
|
|
Subsequent Event [Line Items] | |||
Operating lease right-of-use assets | $ 62,198 | $ 10,881 | |
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Number of facilities | Facility | 1 | ||
Extended lease term | 122 months | ||
Operating lease right-of-use assets | $ 10,400 |