《Hims & Hers Health (HIMS) 2024年10-K年度报告「NYSE」（英文版）（469页）.pdf》由会员分享，可在线阅读，更多相关《Hims & Hers Health (HIMS) 2024年10-K年度报告「NYSE」（英文版）（469页）.pdf（469页珍藏版）》请在三个皮匠报告上搜索。

1、Table of ContentsUNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549 FORM 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended December 31,2024OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE

2、ACT OF 1934 For the transition period from to _HIMS&HERS HEALTH,INC.(Exact name of registrant as specified in its charter)Delaware001-3898698-1482650(State or other jurisdiction of incorporation ororganization)(Commission File Number)(I.R.S.EmployerIdentification No.)2269 Chestnut Street,#523San Fra

3、nciscoCalifornia94123(Address of principal executive office)(ZIP Code)(415)851-0195Registrants telephone number,including area codeSecurities registered pursuant to Section 12(b)of the Act:Title of each classTrading symbol(s)Name of each exchange on which registeredClass A common stock,$0.0001 par v

4、alue per shareHIMSNew York Stock ExchangeSecurities registered pursuant to Section 12(g)of the Act:NoneIndicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No Indicate by check mark if the registrant is not required to file reports

5、 pursuant to Section 13 or Section 15(d)of the Act.Yes No Indicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12 months(or for such shorter period that theregistrant was required

6、to file such reports),and(2)has been subject to filing requirements for the past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months(or for

7、 such shorterperiod that the registrant was required to submit such files).Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a smaller reporting company,or an emerging growth company.See the definitions of“large accelerated

8、filer,”“accelerated filer,”“smaller reporting company,”and“emerging growth company”in Rule 12b-2 of the Exchange Act.Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company,indicate by check mark if the registran

9、t has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant toSection 13(a)of the Exchange Act Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the e

10、ffectiveness of its internal control over financial reporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accounting firm that prepared or issued its audit report.If securities are registered pursuant to Section 12(b)of the Act,indicate by check mark whethe

11、r the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financialstatements.Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by

12、 any of the registrants executive officers during the relevantrecovery period pursuant to 240.10D-1(b).Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act)Yes No The aggregate market value of voting stock held by non-affiliates of the registr

13、ant,as of June 28,2024,the last business day of the registrants most recently completed second fiscal quarter,was approximately$3.9 billion(based on the last reported sale price of the registrants Class A common stock of$20.19 per share on June 28,2024 on the New York Stock Exchange),excluding only

14、shares of Class A common stock held by executiveofficers and directors of the registrant as of such date.The registrant has no non-voting stock outstanding.As of February 21,2025,213,787,949 shares of Class A common stock,par value$0.0001,and 8,377,623 shares of Class V common stock,par value$0.0001

15、,were issued and outstanding.DOCUMENTS INCORPORATED BY REFERENCEPortions of the registrants definitive proxy statement to be delivered to stockholders in connection with the 2025 annual meeting of stockholders are incorporated by reference in response to Part III of this Annual Reporton Form 10-K to

16、 the extent stated herein.The 2025 Proxy Statement will be filed with the U.S.Securities and Exchange Commission within 120 days after the end of the fiscal year to which this report relates.Table of ContentsTABLE OF CONTENTS Item 1.Business2Item 1A.Risk Factors13Item 1B.Unresolved Staff Comments50I

17、tem 1C.Cybersecurity50Item 2.Properties51Item 3.Legal Proceedings51Item 4.Mine Safety Disclosures52Item 5.Market for Registrants Common Equity,Related Stockholder Matters and Issuer Purchases of Equity Securities53Item 6.Reserved54Item 7.Managements Discussion and Analysis of Financial Condition and

18、 Results of Operations(MD&A)54Item 7A.Quantitative and Qualitative Disclosures about Market Risk69Item 8.Financial Statements and Supplementary Data69Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure101Item 9A.Controls and Procedures101Item 9B.Other Informat

19、ion102Item 9C.Disclosures Regarding Foreign Jurisdictions that Prevent Inspections103Item 10.Directors,Executive Officers and Corporate Governance104Item 11.Executive Compensation104Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters104Item 13.Certa

20、in Relationships and Related Transactions,and Director Independence104Item 14.Principal Accountant Fees and Services104Item 15.Exhibits and Financial Statement Schedules105Item 16.Form 10-K Summary107Signatures108iTable of ContentsCAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTSThis Annual Repor

21、t on Form 10-K for the year ended December 31,2024(the“Form 10-K”),including,without limitation,statements under the heading“Managements Discussion and Analysis ofFinancial Condition and Results of Operations,”includes forward-looking statements within the meaning of Section 27A of the Securities Ac

22、t of 1933,as amended,(the“Securities Act”)and Section21E of the Securities Exchange Act of 1934,as amended,(the“Exchange Act”).These forward-looking statements can be identified by the use of forward-looking terminology,including the words“believe,”“estimate,”“anticipate,”“expect,”“assume”,“imply”,“

23、intend,”“plan,”“may,”“will,”“potential,”“project,”“predict,”“continue,”“could,”“confident,”“confidence,”or“should,”or,ineach case,their plural,their negative or other variations or comparable terminology.There can be no assurance that actual results will not materially differ from expectations.Such

24、statements include,but are not limited to,any statements relating to our financial and business performance,including with respect to the Hims&Hers platform,our marketing campaigns,investments in innovation,thesolutions accessible on our platform,and our infrastructure,and the underlying assumptions

25、 with respect to the foregoing;statements relating to events and trends relevant to us,including with respectto our regulatory environment,financial condition,results of operations,short-and long-term business operations,objectives,and financial needs;expectations regarding our mobile applications,m

26、arket acceptance,user experience,customer retention,brand development,our ability to invest and generate a return on any such investment,customer acquisition costs,operating efficiencies andleverage(including our fulfillment capabilities),the effect of any pricing decisions,changes in our product an

27、d offering mix,the timing and market acceptance of any new products or offerings,thetiming and anticipated effect of any pending or recently completed acquisitions,the success of our business model,our market opportunity,our ability to scale our business,the growth of certain of ourspecialties,our a

28、bility to innovate on and expand the scope of our offerings and experiences,including through the use of data analytics and artificial intelligence,our ability to reinvest into thecustomer experience,our ability to comply with the extensive,complex,and evolving legal and regulatory requirements appl

29、icable to our business,including without limitation state and federalhealthcare,privacy and consumer protection laws and regulations,and the effect or outcome of litigation or governmental actions in relation to any such legal and regulatory requirements.Thesestatements are based on managements curr

30、ent expectations,but actual results may differ materially due to various factors.The forward-looking statements contained in this Annual Report on Form 10-K are based on our current expectations and beliefs concerning future developments and their potential effects on us.Future developments affectin

31、g us may not be those that we have anticipated.These forward-looking statements involve a number of risks,uncertainties(some of which are beyond our control),andother assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-

32、looking statements.These risks and uncertainties include,but are not limited to,those factors described under Part I,Item 1A:“Risk Factors.”Should one or more of these risks or uncertainties materialize,or should any of our assumptions prove incorrect,actual results may vary in material respects fro

33、m those projected in these forward-looking statements.We undertake no obligation(and expressly disclaim any obligation)to update or revise anyforward-looking statements,whether as a result of new information,future events or otherwise,except as may be required under applicable securities laws.These

34、risks and others described under PartI,Item 1A:“Risk Factors”may not be exhaustive.By their nature,forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future.We caution you thatforward-looking statement

35、s are not guarantees of future performance and that our actual results of operations,financial condition and liquidity,and developments in the industry in which we operatemay differ materially from those made in or suggested by the forward-looking statements contained in this Annual Report on Form 1

36、0-K.In addition,even if our results of operations,financialcondition and liquidity,and developments in the industry in which we operate are consistent with the forward-looking statements contained in this Annual Report on Form 10-K,those results ordevelopments may not be indicative of results or dev

37、elopments in subsequent periods.1Table of ContentsPART IItem 1.BusinessOverviewLaunched in 2017,Hims&Hers Health,Inc.(and together with its subsidiaries,“Hims&Hers”,the“Company”,“we”,“us”or“our”)has built a consumer-first platform transforming the waycustomers fulfill their health and wellness needs

38、.We believe that the Company has the technical platform,distributed provider network,and access to clinical capabilities to lead the migration ofroutine office visits to a personalized,digital,accessible format.The Hims&Hers platform includes access to a highly-qualified and technologically-innovati

39、ve provider network,a clinically-focusedelectronic medical record system,digital prescriptions,cloud pharmacy fulfillment,and personalization capabilities.Our digital platform enables access to treatments for a broad range of chronicconditions,including those related to sexual health,hair loss,derma

40、tology,mental health,and weight loss.Hims&Hers connects patients to licensed healthcare professionals who can prescribemedications when appropriate and prescriptions are fulfilled online through licensed pharmacies on a subscription basis.In addition,we also offer access to a range of health and wel

41、lness productsdesigned to meet individual needs,which can include curated prescription and non-prescription products.Through the Hims&Hers mobile applications,consumers can access a range of educationalprograms,wellness content,community support,and other services that promote lifelong health and we

42、llness.Since our founding,we have facilitated over thirty million telehealth consultations,enabling greater access to high-quality,convenient,affordable,personalized care for people in all 50 states and the United Kingdom.The mission of Hims&Hers is to help the world feel great through the power of

43、better health.To fulfill this mission,our business strategy and market differentiation are centered around our trusted brand,innovative products and services,leading technology,and clinical excellence.We work to build a brand that is trusted by our customers,easy to use,and normalizes the practice o

44、f seeking and receiving treatment by empowering our customers with personalized careand an omnichannel experience.The Hims&Hers platform offers a streamlined,personalized patient and clinician experience facilitated by proprietary algorithms and a customizable and integrated technology stack,allowin

45、g us to give customers a seamless experience and to follow up programmatically and with precision.We can leverage these insights and feedback to offer access to personalized prescription and non-prescription treatments that are designed to meet individual needs.At the foundation of our broader platf

46、orm is the consumer trust we establish through our clinical excellence.Care accessed through the Hims&Hers platform is subject to evidence-basedclinical guidelines and delivered by highly-trained licensed healthcare providers to ensure consistency and quality.Our medical advisory board helps ensure

47、the utmost quality of care on ourplatform.With these measures in place,we are able to deliver access to quality care and treatment that is fast and convenient.Business StrategyWe are a consumer-first health and wellness platform focused on providing access to modern personalized health and wellness

48、solutions to consumers.We offer access to a range of health and wellnessproducts and services available for customers to purchase through our websites and mobile applications.The offerings generally focus on conditions where treatment typically involves use ofprescription medication on a recurring b

49、asis and ongoing care from healthcare providers.We offer access to certain prescription generic,brand-name and compounded medications,including certainsterile compounded medications.The majority of prescriptions for these medications are fulfilled through our affiliated pharmacies.We also offer over

50、-the-counter drug and device products and cosmetics and supplement products,which are primarily focused on general wellness,skincare,sexual health and wellness,and hair care.We offer many of these over-the-counter products through retail partnerships,in stores and online.The over-the-counter drug an

51、d device products and some of the cosmetics and supplement productswe sell are“white-labeled”products,where we sell the manufacturer-developed product under the Hims&Hers brand name or co-branded along with the manufacturers brand.Several cosmetics andsupplement products have been developed by us in

52、 partnership with the applicable manufacturers.For these products,the manufacturer develops the formulation with input from the internal Hims&Hers Product Research&Development team.2Table of ContentsMost of the offerings on our websites and mobile applications are sold to customers on a subscription

53、 basis.Subscription plans provide an easy and convenient way for customers to get the ongoingtreatment they need while simultaneously providing the Company with predictability through a recurring revenue stream.For subscription plans,in addition to a 30-day cadence or treatment term,we offer custome

54、rs the ability to select a desired cadence to receive products or treatments,which can range from every 60 to360 days,depending on the product.The customer is billed on a recurring basis based on the selected cadence and a specified quantity of product is shipped at each billing.Customers can cancel

55、 orsnooze subscriptions in accordance with our Terms and Conditions agreed to by customers to stop receiving additional products and can reactivate subscriptions to continue receiving additionalproducts.Our integrated technology platform allows us to serve our customers efficiently from start to fin

56、ish:initially from customer discovery and purchase of offerings on our websites and mobileapplication,to connecting customers with medical providers for telehealth consultations,to the fulfillment and delivery of customer orders,and finally through ongoing clinical management bymedical providers.We

57、believe this technology-driven efficiency provides cost advantages that allow us to offer customers affordable prices and to generate robust gross margins.We acquire new customers and drive brand awareness through various marketing channels,including social media,online search,television,radio,other

58、 media channels,presence in brick-and-mortarretail stores,and physical brand advertising campaigns.We intend to continue to invest in growth in our current offerings and additionally in new products and services.The Hims&Hers platform ispurpose-built to scale efficiently and to accommodate the seaml

59、ess addition of new products and services.As we implement our product roadmap,we expect to grow revenue through additionalsubscription-based recurring revenue offerings.The recent launches of new prescription products in weight loss,sexual health,dermatology,and mental health and launches of hair ca

60、re andsupplement retail products,demonstrate the scalability of the platform.Growth OpportunitiesContinue to acquire more customersOur brand awareness and innovative,personalized products are core to our ability to attract new customers.Customers serve as ambassadors for the Hims&Hers brand,further

61、driving organic growththrough word of mouth and user-generated content.The large majority of our first time customers to date indicate that they came to Hims&Hers to learn about and find options for their condition andare seeking treatment for their particular conditions for the first time.The conve

62、nience of our websites and mobile application allows us to reduce stigma and access-related barriers that frequentlyprevent consumers from seeking medical care,expanding the Companys market opportunity.Organic growth is enhanced by sophisticated omnichannel acquisition strategies meant to target fut

63、urecustomers with condition-specific on-ramps at profitable returns on investment.In addition,our brand positioning has afforded significant partnerships with leading talent whose promotional effortsdrive meaningful awareness of the products and services we make available.Based on externally reporte

64、d data,we believe our market share,both in terms of number of customers and total sales,ineach of our sexual health,dermatology,and mental health specialties has increased in recent years.As our portfolio of products and services grows across specialties,we believe that our marketpresence and brand

65、recognition will continue to expand,driving more consumers to seek out Hims&Hers for future healthcare needs.Grow within existing customer baseWe believe our expanded offerings that include more personalized products and clinical experiences across a broader range of conditions provide a large oppor

66、tunity for us to grow our revenue withinour existing customer base.Through ongoing robust customer engagement,we have the ability to deliver longer-term subscription adoption and drive more cross-sell opportunities.Specialty expansion into new conditionsWe are pursuing a roadmap of rapid specialty e

67、xpansion into new conditions that can be treated safely and effectively via telehealth,require ongoing and recurring customer relationships,andgenerally for which generic medication has been established as an effective means of treatment.For example,at the end of 2023 we launched access to certain w

68、eight loss offerings,which wecontinued to expand over the course of 2024.Future care opportunities that show high prevalence within our existing customer base and offer traits similar to our existing specialties in terms ofbusiness model characteristics include testosterone treatment,menopause,sleep

69、 disorders,post-traumatic stress disorder,fertility,diabetes,cholesterol,and hypertension,which we believe representsignificant opportunities.Given the prevalence of these conditions,we see a large market opportunity for our current and future offerings.3Table of ContentsLeverage existing capabiliti

70、es and continue to expand capabilities to penetrate new sales channels and further improve operationsOur pharmacy,affiliated pharmacies,and compounding outsourcing facility enable seamless drug delivery,and drive increased operating leverage across the platform by allowing us to furtherpersonalize a

71、nd consolidate shipping of orders as well as expand capabilities quickly for adjacent and other new conditions.These facilities allow us to lower our cost structure by reducing some of thecosts typically associated with contractual third-party pharmacy relationships.In 2020,we opened an approximatel

72、y 300,000 square foot facility in New Albany,Ohio.In 2021,this facility beganhousing a dedicated licensed mail order pharmacy,XeCare,LLC(or“XeCare”),that provides prescription fulfillment services solely to Hims&Hers customers.In July 2021,we completed ouracquisition of YoDerm,Inc.(“Apostrophe”),all

73、owing us to expand personalized dermatological offerings to our customers.Apostrophe Pharmacy LLC(“Apostrophe Pharmacy,”and together withXeCare,the“Pharmacies”),is an additional dedicated licensed mail order pharmacy located in Arizona that provides prescription fulfillment services solely to Hims&H

74、ers customers as part of ouracquisition of Apostrophe in 2021.In 2022,we expanded the Apostrophe Pharmacy facility and opened an approximately 25,000 square foot facility in Gilbert,Arizona.We have entered into servicesagreements with each of the Pharmacies.In 2024,we acquired Seaview Enterprises,LL

75、C(d/b/a MedisourceRx)(“MedisourceRx”),a licensed 503B compounding outsourcing facility,which compounds products primarily for Hims&Herscustomers(our“Outsourcing Facility”).Additionally,in February 2025,we acquired a peptide manufacturing facility and certain related assets from C S Bio,Co.,which wil

76、l allow us to expand our supply chain capabilities in the future(our“Peptide Facility”).Also in February 2025,we acquired Sigmund NJ,LLC,marketed as Trybe Labs,a lab testing services business,which will allow us to add lab testing capabilities to our platform inthe future(our“Lab Facility”).The faci

77、lities and operations of our Pharmacies,Outsourcing Facility,Peptide Facility,and Lab Facility are sometimes referred to collectively herein as our“Facilities”.Expand into new geographiesOur strong brand and digital-first,cloud-based business model has driven rapid adoption in the U.S.Additionally,o

78、ur model has been developed to be scalable and applicable across new markets andlanguages.We expanded into the United Kingdom in early 2021,and in June 2021,we completed our acquisition of U.K.-based Honest Health Limited,which is now Hims&Hers UK Limited(“HHL”),a company that offers health and well

79、ness products and services.The acquisition of HHL has allowed us to expand our operations in the United Kingdom further.We believe our model willafford us further international expansion opportunities in Europe and beyond.We believe the consumer-focused services our model provides are applicable to

80、a range of geographies across the world.Affiliated Medical Groups,Providers,Health System Partnerships,and Partner PharmaciesAffiliated Medical Groups and ProvidersDue to the prohibition on the corporate practice of medicine adopted by a majority of states in the U.S.,we have contractual arrangement

81、s with Affiliated Medical Groups to enable their provision ofclinical services to our customers.“Affiliated Medical Groups”are separate professional corporations or other professional entities owned solely by licensed physicians and that engage licensedhealthcare professionals to provide telehealth

82、consultations and related services,including applicable physician supervision of nurse practitioners and physician assistants.While we are prohibitedfrom owning a professional entity such as any of the Affiliated Medical Groups,the Affiliated Medical Groups were incorporated and established with our

83、 assistance for the specific purpose ofproviding clinical services to patients through the Hims&Hers platform and have no other operations or activities outside of the provision of services through the Hims&Hers platform.The Affiliated Medical Groups contract with or employ physicians,nurse practiti

84、oners,physician assistants,and behavioral health providers(each,a“Provider”)to provide telehealth consultations andrelated services on the Hims&Hers platform.We enter into certain contractual agreements with the Affiliated Medical Groups and their physician owners,including administrative servicesag

85、reements and continuity agreements,under which we serve as an administrative services manager for the Affiliated Medical Groups for the non-clinical aspects of their operations and receive afixed administrative fee from each Affiliated Medical Group for these services.The administrative services and

86、 support we provide include IT products and support,including the Hims&Hersplatform and electronic medical record system,billing and collection services,non-clinical4Table of Contentspersonnel,customer service support,administrative support for provider credentialing and quality assurance,and other

87、non-clinical items and services,including access to a line of credit we makeavailable to the Affiliated Medical Groups as necessary to support their operations.The Affiliated Medical Groups retain sole control of clinical decision-making and the practice of medicine.We arethe exclusive administrativ

88、e services provider for the Affiliated Medical Groups,and the Affiliated Medical Groups provide services to patients exclusively through the Hims&Hers platform.Ourarrangements with the Affiliated Medical Groups generally have initial ten-year terms with renewal options.These arrangements are reviewe

89、d and updated periodically to address changing regulatoryor market conditions.Health System PartnershipsThe strength of the Hims&Hers brand affords us numerous opportunities to partner with and offer new solutions to help transform existing healthcare stakeholders.We have relationships with leadingh

90、ealth systems including,as of December 31,2024,Ochsner Health,Mount Sinai Health System,Carbon Health,ChristianaCare Health System,and Hartford Healthcare to provide a clinicallyfocused,telehealth-enabled patient care collaboration.These relationships offer our customers access to applicable in-pers

91、on care within these systems to enhance their overall healthcare experience.These collaborations,which are intended to help Hims&Hers customers obtain in-person care not accessible through the Hims&Hers platform,do not involve any monetary exchange,compensation,or other financial incentives between

92、the parties.Partner PharmaciesIn addition to fulfilling orders through the Pharmacies,we maintain contractual arrangements with three licensed pharmacies(sometimes referred to herein as“Partner Pharmacies”),EHT PharmacyLLC(d/b/a Curexa Pharmacy),ITC Inc.(d/b/a ITC Compounding Pharmacy),and The Londo

93、n Specialist Pharmacy Limited for fulfillment and distribution of certain prescription and non-prescriptionproducts available through the Hims&Hers platform.We are not bound by any exclusivity or minimum order requirements with respect to our use of any Partner Pharmacy,and have the ability toutiliz

94、e other pharmacies,including the Pharmacies,at our discretion.The contractual arrangements with the Partner Pharmacies are typically for one-year terms with automatic renewals,subject tostandard termination rights of the parties.The Partner Pharmacies rates are fixed in the contractual arrangements

95、and changes require the mutual agreement of the parties.Regulatory EnvironmentAs a consumer-focused health and wellness company delivering comprehensive telehealth technologies and services and health and wellness products such as prescription drugs,compounded drugs,over-the-counter drugs and device

96、s,cosmetics,and dietary supplements,in addition to the typical legal and regulatory considerations faced by a technology-based company,we are required to complywith complex healthcare laws and regulations,and consumer protection laws and regulations,all at both the state and federal level.Our busine

97、ss and operations are subject to extensive regulation,including with respect to the practice of medicine,the use of telehealth,relationships with healthcare providers,privacy and security of personal health information,product safety and pharmacyoperations.Regulatory and/or legal enforcement actions

98、 by the FDA,Department of Health and Human Services,or other federal,state,or foreign enforcement authorities could have material adverseconsequences on our business or its operations.Government regulation of healthcare generallyWe and other healthcare companies are subject to significant regulation

99、 in the United States.Healthcare-related businesses are subject to a broad array of governmental regulation at the federal,state,and local levels.While portions of our business are subject to significant regulations,such as those related to compounding practices,certain regulations do not apply to o

100、ur business because of theway our current operations are structured.For example,we currently accept payments only from our customersnot any third-party payors,such as government healthcare programs or healthinsurers.Because of this approach,we are not subject to many of the laws and regulations that

101、 impact other participants in the healthcare industry.If we begin accepting reimbursement payments frominsurance providers or other third-party payors such as a government program,we will become subject to some of these additional healthcare laws and regulations.Irrespective of our business model,th

102、e healthcare industry is subject to changing political,economic and regulatory influences that may affect health and wellness companies like Hims&Hers.During the past several years,the healthcare industry has been subject to an increase in governmental regulation and subject to potential disruption

103、due to legislative initiatives and governmentregulation,as well as judicial interpretations thereof,and changes in regulatory policy and leadership.For example,5Table of ContentsCongress has enacted the Modernization of Cosmetics Regulation Act of 2022(“MoCRA”),which created new compliance requireme

104、nts for manufacturers of cosmetic products in the U.S.and alsosignificantly expanded the FDAs authority to oversee and regulate cosmetics,though the FDA has yet to complete its development of implementing regulations for MoCRA.While these regulationsmay not directly impact us or our offerings in any

105、 given case,they will affect the healthcare industry as a whole and may impact customer use of the Companys solutions.If the government assertsbroader regulatory control over companies like us or if we accept payment from and/or participate in third-party payor programs in the future,the complexity

106、of our operations and our complianceobligations will materially increase.Government regulation of the practice of medicine and telehealthThe practice of medicine is subject to various federal,state,and local certification and licensing laws,regulations,approvals and standards,relating to,among other

107、 things,the qualifications of theprovider,the practice of medicine(including specific requirements when providing health care utilizing telehealth technologies and the provision of remote care),the continuity and adequacy ofmedical care,the maintenance of medical records,the supervision of personnel

108、,and the prerequisites for the prescription of medication and ordering of tests.Because the practice of telehealth isrelatively new and rapidly developing,regulation of telehealth is evolving and the application,interpretation and enforcement of these laws,regulations and standards can be uncertain

109、or uneven.Similarly,the ability of the Pharmacies to fulfill prescriptions and distribute pharmaceutical products,including compounded pharmaceutical products,is dependent upon the laws that govern licensedpharmacies and the fulfillment and distribution of prescription medication and other pharmaceu

110、tical products,which include in some cases requirements relating to telehealth.As a result,we mustcontinually monitor legislative,regulatory,and judicial developments regarding the practice of medicine,telehealth and pharmaceutical laws in order to support the Affiliated Medical Groups and thePharma

111、cies.Physicians,mid-level providers(e.g.,physician assistants,nurse practitioners),and behavioral health providers who provide professional clinical services via telehealth must,in most instances,hold avalid license to provide the applicable professional services in the state in which the patient is

112、 located.We have established systems to assist the Affiliated Medical Groups in ensuring that theirproviders are appropriately licensed under applicable state law and that their provision of telehealth to our customers occurs in each instance in compliance with applicable rules governing telehealth.

113、Additionally,there may be limitations placed on the modality through which telehealth services are delivered.For example,some states specifically require synchronous(or“live”)communicationsand restrict or exclude the use of asynchronous telehealth modalities,which is also known as“store-and-forward”

114、telehealth.However,other states do not distinguish between synchronous andasynchronous telehealth services.In response to the COVID-19 pandemic,some state and federal regulatory authorities lowered certain barriers to the practice of telehealth in order to make remotehealthcare services more accessi

115、ble.Due to our business model,these changes did not dramatically change our operations,but these changes did introduce many people to the practice of telehealth.Itis unclear whether these changes will have a long-term impact on the adoption of telehealth services by the general public or legislative

116、 and regulatory authorities.Corporate practice of medicine laws in the U.S.;Fee splittingIn certain jurisdictions,the corporate practice of medicine doctrine generally prohibits non-physicians from practicing medicine,including by employing physicians to provide clinical services,directing the clini

117、cal practice of physicians,or holding an ownership interest in an entity that employs physicians.Some states have similar doctrines with respect to other professional licensurecategories,including behavioral health services and providers.Other practices,such as professionals splitting their professi

118、onal fees with non-professional persons or entities,are also prohibited insome jurisdictions.Many states also limit the extent to which nurse practitioners and physician assistants can practice independently and require that they practice under the supervision of or incollaboration with a supervisin

119、g physician.These laws are intended to prevent unlicensed persons from interfering with or unduly influencing a physicians professional judgment.State laws andenforcement activities related to the corporate practice of medicine and fee-splitting vary dramatically.In some states,even activities not d

120、irectly related to the delivery of clinical services may beconsidered an element of the practice of medicine.For example,in some states the corporate practice of medicine restrictions may be implicated by non-clinical activities such as scheduling,contracting,setting rates,and the hiring and managem

121、ent of non-clinical personnel.Because of the restrictions on the corporate practice of medicine doctrine and fee-splitting in various jurisdictions,we do not employ the healthcare providers who provide clinical services on the Hims&Hers platform.Instead,the Affiliated Medical Groups provide services

122、 on the platform and we contract with but do not own the Affiliated Medical Groups.The Affiliated Medical Groups and theirproviders maintain exclusive authority regarding the provision of healthcare services(including6Table of Contentsconsults that may lead to the writing of prescriptions)and remain

123、 responsible for retaining and compensating their providers,credentialing decisions regarding their providers,maintaining professionalstandards,maintaining clinical documentation within medical records,establishing their own fee schedule,and submitting accurate information to us so that we can bill

124、customers.Despite our care instructuring arrangements with the Affiliated Medical Groups,it is possible that a regulatory authority or another party,including providers affiliated with Affiliated Medical Groups,could assert thatwe(or other organizations with similar business models)are engaged in th

125、e corporate practice of medicine or that the contractual arrangements with Affiliated Medical Groups violate a states fee-splitting prohibition.Failure to comply with these state laws could lead to materially adverse consequences for the Company.U.S.Federal and State fraud and abuse lawsParticipants

126、 in the United States healthcare industry are subject to extensive federal and state regulation with respect to kickbacks,physician self-referral arrangements,false claims,and other fraudand abuse issues.For example,the federal anti-kickback law(the“Anti-Kickback Law”)prohibits,among other things,kn

127、owingly and willfully offering,paying,soliciting,receiving,or providingremuneration,directly or indirectly,in exchange for or to induce either the referral of an individual,or the furnishing,arranging for,or recommending of an item or service that is reimbursable,inwhole or in part,by a federal heal

128、th care program.The federal False Claims Act imposes liability on any person or entity that,among other things,knowingly presents,or causes to be presented,afalse or fraudulent claim for payment to the federal government.The penalties for violating these laws can be severe,including criminal and civ

129、il penalties,imprisonment,and possible exclusion fromthe federal health care programs.In addition,the federal ban on physician self-referrals,commonly known as the“Stark Law,”prohibits,subject to certain exceptions,physician referrals of Medicarepatients to an entity providing certain“designated hea

130、lth services”if the physician or an immediate family member of the physician has any financial relationship with the entity.Given our current operations,the Anti-Kickback Law,the federal False Claims Act,the Stark Law,and other laws that are tied to federal health care programs or commercial insurer

131、 reimbursementshould not apply to our business.If the scope of these laws is extended to include a broader spectrum of activities or if we begin to accept reimbursement payments from insurance providers or otherthird-party payors such as a government program,we could become subject to these laws and

132、 need to modify our business model.Additionally,should we begin accepting reimbursement paymentsfrom insurance providers or other third-party payors,the Company will be subject to significantly increased compliance obligations and costs.Regulation of medical and wellness productsCertain of the produ

133、cts available through our platform,including prescription pharmaceuticals,over-the-counter drugs,over-the-counter devices,cosmetics,and dietary supplements,and the third-party suppliers and manufacturers of these products(“Manufacturing Suppliers,”)which manufacture and/or supply certain of our prod

134、ucts or product ingredients,including compounded glucagon-like peptide-1 receptor agonists(“GLP-1s”),to the Pharmacies,are subject to extensive regulation by the FDA and international,federal,state,and local authorities.These authorities enforceregulations related to methods and documentation of the

135、 testing,production,compounding,control,safety,quality assurance,labeling,packaging,sterilization,storage,and shipping of products andthe components of those products.The Federal Food,Drug and Cosmetic Act(“FDCA”),and FDAs implementing regulations,set forth,among other things,requirements for the te

136、sting,development,manufacture,quality control,safety,effectiveness,approval,labeling,storage,record-keeping,reporting,distribution,import,export,advertising,and promotion of many of the products offered on our platform.FDA enforcesregulations to ensure that the methods used in,and the facilities and

137、 controls used for,the manufacture,processing,packaging and holding of drugs conform to current good manufacturing practice(“cGMP”).The cGMP regulations are comprehensive and cover all aspects of manufacturing operations,from receipt of raw materials to finished product distribution,and are designed

138、 to ensure thatthe finished products meet all the required identity,strength,quality and purity characteristics.Compliance with cGMP includes adhering to requirements relating to organization and training ofpersonnel,buildings and facilities,equipment,control of components and drug product container

139、s and closures,production and process controls,quality control and quality assurance,packaging andlabeling controls,holding and distribution,laboratory controls,and records and reports.If,after receiving approval,a company makes a material change in manufacturing equipment,location,orprocess(all of

140、which are,to some degree,incorporated in the NDA),additional regulatory review and approval may be required.The FDA also conducts regular,periodic visits to re-inspectequipment,facilities,and processes following the initial approval of a product.Failure to comply with applicable cGMP requirements an

141、d conditions of product approval may lead the FDA to takeenforcement actions or seek sanctions,including fines,issuance of warning letters,civil penalties,injunctions,suspension of manufacturing operations,operating restrictions,withdrawal of FDAapproval,seizure or recall of products,and criminal pr

142、osecution.Although we periodically monitor the FDA compliance of our third-party manufacturers,we cannot be7Table of Contentscertain that our present or future third-party manufacturers will consistently comply with cGMP and other applicable FDA regulatory requirements.The over-the-counter drug and

143、device products and some of the cosmetics and supplement products we sell are“white-labeled”products,where we sell the manufacturer-developed product under theHims&Hers brand name or co-branded along with the manufacturers brand.Several cosmetics and supplement products have been developed by us in

144、partnership with the applicable manufacturers.For these products,the manufacturer is responsible for complying with the FDAs laws and regulations applicable to developing and manufacturing.There are also adverse event reportingrequirements,labeling requirements,and product quality requirements appli

145、cable to dietary supplements and cosmetics,although the product quality requirements are generally less stringent thanthose for drug products.However,in recent years,the FDA has issued warning letters to several cosmetic companies alleging improper claims regarding their cosmetic products.In additio

146、n,the FDAdoes not currently require pre-market approval for cosmetic products.The statutory and regulatory requirements applicable to drugs are extensive and require significant resources and time to ensurecompliance.While we periodically monitor the FDA compliance of our third-party manufacturers,w

147、e cannot be certain that our present or future third-party manufacturers will consistently complywith applicable FDA regulatory requirements.Furthermore,certain of the products available through the Hims&Hers platform require approval by the FDA and are subject to the limitations placed by the FDA o

148、n the approved uses in the productlabeling or are otherwise marketed under a“monograph,”which establishes conditions such as the active ingredient,uses,doses,routes of administration,labeling,and testing,for over-the-counterdrugs.Healthcare providers,including Providers prescribing on our platform,a

149、re permitted to prescribe drugs offered on the platform for“off-label”uses(i.e.,uses not approved by the FDA and notdescribed in the products labeling)because the FDA generally does not regulate the practice of medicine.While Providers are legally permitted to prescribe medications for off-label use

150、s,andalthough we believe our product promotion is conducted in material compliance with FDA and other regulations,if the FDA determines that our product promotion constitutes promotion of anunapproved use of an approved product or of an unapproved product,the FDA could request that we modify our pro

151、duct promotion or subject us to regulatory and/or legal enforcement actions,including the issuance of a warning letter,injunction,seizure,civil fine,and criminal penalties.It is also possible that other federal,state,or foreign enforcement authorities might take action if theyconsider the product pr

152、omotion to constitute promotion of an unapproved use of an approved product or of an unapproved product,which could result in significant fines or penalties under otherstatutes,such as laws prohibiting false claims for reimbursement.FDA regulations relating to the advertising and promotion of prescr

153、iption and over-the-counter drugs,including prescription compounded drugs,also require that promotional materials for prescriptiondrugs not be false or misleading.Failure to comply with FDA requirements can result in a prescription drug being deemed misbranded under the FDCA.Misbranding a drug in in

154、terstate commerce is aprohibited act and can result in regulatory and/or legal enforcement actions,including the issuance of an untitled letter or warning letter,injunctions,or in extreme instances,criminal prosecution.Inaddition,FDA findings of misleading promotional statements and practices can le

155、ad to private litigation under federal and state consumer protection and unfair trade practices laws.Regulation of compounded drugsCertain of the products available through our platform are compounded drug products under Section 503A or Section 503B of the FDCA,which provide exemptions from the requ

156、irements forpreapproval to market a new drug and labeling with adequate directions for use.To market our products under these exemptions,we must comply with the applicable requirements.Section 503A permits compounding of a drug that is not“essentially a copy”of a commercially available(or FDA-approv

157、ed)drug product by a licensed pharmacist or a licensed physician based onreceipt of a valid prescription for an individual patient or limited quantities before receipt of a valid prescription if certain conditions are met.503A pharmacies are not subject to current cGMPrequirements,and these faciliti

158、es are not inspected by FDA.Compounding under 503A is primarily regulated by state pharmacy laws and regulations governing pharmacy operations.These laws andregulations often include specific requirements for compounding operations,including requirements for licensing of pharmacists,pharmacy technic

159、ians and pharmacies,supervision and training,inspections,sterility assurance,and recordkeeping,among other requirements.Regulations are updated periodically,generally under the jurisdiction of individual state boards of pharmacy.Failure tocomply with the state pharmacy regulations of a particular st

160、ate could result in a pharmacy being prohibited from operating in that state,financial penalties and/or becoming subject to additionaloversight from that states board of pharmacy.In addition,many states are considering imposing,or have already begun to impose,more stringent requirements on compoundi

161、ng operations.8Table of ContentsWe also offer access to drugs compounded by facilities referred to as 503B outsourcing facilities,including MedisourceRx.Under Section 503B,outsourcing facilities may compound drugs without anindividual patient prescription.Outsourcing facilities must be registered wi

162、th FDA and are subject to cGMP requirements and regular FDA inspections.Section 503B also includes requirementsregarding adverse event reporting,use of bulk drug substances,and prohibitions on wholesaling and compounding“essentially a copy”of an FDA approved drug,unless the drug is on FDAs DrugShort

163、age List at the time of compounding,distribution,and dispensing.Sections 503A and 503B also prohibit compounding of drug products that present“demonstrable difficulties for compounding.”However,FDA must publish a list of such drugs,through notice andcomment rulemaking,before implementing this rule,a

164、nd FDA has never finalized the list for any drug products.In May 2024,we began offering access to GLP-1s,first in the form of compounded injectable semaglutide and in August 2024,in the form of branded(or FDA-approved)injectable semaglutide,aspart of our weight loss specialty.Certain aspects of our

165、GLP-1 compounding business are permitted by FDA based on current shortages of branded GLP-1s,and we cannot predict when such shortageswill be resolved.Additionally,all doses of semaglutide marketed under the trade names Ozempic and Wegovy became listed as available on the FDAs Drug Shortage List as

166、of October 30,2024.OnFebruary 21,2025,the FDA resolved the semaglutide shortage,which could constrain our ability to continue providing access to compounded semaglutide on our platform once our current inventoryhas been sold.While we believe the compounded drug products available through our platfor

167、m meet the requirements for exemption under Section 503A or Section 503B of the FDCA,as applicable,if the FDAwere to determine that such products do not meet the requirements for exemption,the FDA could subject us,the Pharmacies,Partner Pharmacies,Affiliated Medical Groups,Providers,Facilities,orMan

168、ufacturing Suppliers to regulatory and/or legal enforcement actions,including the issuance of a warning letter,injunction,seizure,civil fine,and criminal penalties.Other federal,state,or foreignenforcement authorities might also take action against us or the Pharmacies,Partner Pharmacies,Affiliated

169、Medical Groups,Providers,Facilities,or Manufacturing Suppliers if they determine thatcompounded drug products available through our platform do not meet applicable legal or regulatory requirements.New regulatory requirementsWe recently announced two acquisitions of(i)a peptide manufacturing facility

170、(and related assets)and(ii)a laboratory business.These are both new operational areas where we have not operatedpreviously as an organization.These operations present regulatory requirements to which we have not previously been subject for us to comply with once we have integrated the acquisitions a

171、nd havecommenced operations.For example,with respect to the peptide manufacturing business,we will now be subject to provisions governing FDA-registered manufacturers of active pharmaceuticalingredients(“API”),as well as federal regulations regarding cGMP applicable to API manufacturers.We will also

172、 be subject to CDPH Food&Drug Branch oversight as a CDPH-registered drugmanufacturer and will be required to comply with certain rules and regulations from the departments of health,boards of pharmacy,or other regulatory authorities of other states to which we ship orotherwise introduce API.Addition

173、ally,with respect to our expansion into laboratory testing services,we will now be subject to new licensure and certification requirements and federal,state,and local laws and regulationsapplicable to laboratory testing including the FDCA the Clinical Laboratory Improvement Amendments of 1988(“CLIA”

174、),and similar state laws.This will also result in additional oversight byvarious regulatory agencies,including the Centers for Medicare&Medicaid Services(“CMS”)and the FDA within the United States Department of Health and Human Services(“HHS”)on thefederal side,as well as state and local departments

175、 of health responsible for regulating clinical laboratory testing within the jurisdictions where we will conduct laboratory testing.We may also besubject to additional state licensure requirements applicable to entities engaging in the distribution of prescription medical devices and products depend

176、ing on how we integrate the laboratory servicesinto our current customer offerings.Furthermore,we may also become subject to certain FDA premarket review requirements relating to the diagnostic testing products that are used in the newly acquired laboratory-developed tests(“LDTs”),including but not

177、limited to 510(k)clearance,de novo classification,premarket approval,and others.There remains some uncertainty over whether the FDA has the authority under theFDCA to regulate LDTs.The FDA asserts that it does have authority and has issued a final rule regarding the regulation of LDTs.The final rule

178、 is currently being challenged by the American ClinicalLaboratory Association(“ACLA”)in a lawsuit pending in the United States District Court for the Eastern District of Texas.9Table of ContentsFurther,the FDA revises its regulations and guidance in light of new legislation in ways that may affect o

179、ur business or products.It is impossible to predict whether other changes to legislation,regulation,or guidance will be enacted,or what the impact of such changes,if any,may be.Health information privacy and security lawsNumerous U.S.state and federal laws and regulations govern the collection,disse

180、mination,use,privacy,confidentiality,security,availability,integrity,and other processing of health information andother types of personal data or personally identifiable information(“PII”).We believe that,because of our operating processes,we are not a covered entity or a business associate with re

181、spect to ourcustomers or services provided through our platform under the Health Insurance Portability and Accountability Act and the implementing regulations(“HIPAA”),which establishes a set of nationalprivacy and security standards for the protection of protected health information by health plans

182、,healthcare clearinghouses,and certain healthcare providers,referred to as covered entities,and thebusiness associates with whom such covered entities contract for services.However,to the extent we begin accepting payment from third parties or insurance providers,we may become subject toHIPAA in rel

183、ation to our customers and could face penalties and fines if we fail to comply with applicable requirements of HIPAA and its implementing regulations.Regardless of whether or not wemeet the definition of a covered entity or business associate under HIPAA,we have executed business associate agreement

184、s with certain other parties and have assumed obligations that are based uponHIPAA-related requirements.Because we need to use and disclose customers health and personal information in order to provide our services,we have developed and maintain policies andprocedures to protect that information,inc

185、luding the adoption of administrative,physical and technical safeguards.As our business operations continue to develop,including through the launch of newproduct offerings or the development of new services,we may collect additional sensitive health and personal information from our customers that c

186、ould create additional compliance obligations andmay increase our exposure to compliance and regulatory risks regarding the protection and dissemination of such information.In addition to HIPAA,numerous other federal,state,and foreign laws and regulations protect the confidentiality,privacy,availabi

187、lity,integrity and security of health information and other types of PII,including the California Confidentiality of Medical Information Act,and these laws and regulations are rapidly evolving and likely to remain in flux for the foreseeable future.These laws andregulations in many cases are more re

188、strictive than,and may not be preempted by,HIPAA and its implementing rules,particularly with respect to highly sensitive PII involving behavioral health orsexually transmitted diseases.These laws and regulations are often uncertain,contradictory,and subject to changing or differing interpretations,

189、and we expect new laws,rules and regulationsregarding privacy,data protection,and information security to be proposed and enacted in the future.This complex,dynamic legal landscape regarding privacy,data protection,information security,and artificial intelligence creates significant compliance issue

190、s for us,the Affiliated Medical Groups,the Pharmacies,Facilities,and the Providers,and potentially exposes us to additional expense,adverse publicity,and liability.Various government and consumer agencies have also called for new regulation and changes in industry practices.Practices regarding the r

191、egistration,collection,processing,storage,sharing,disclosure,use,and security of personal and other information by companies offering an online service like our platform have recently come under increased publicscrutiny,and federal and state governmental authorities have increased their enforcement

192、activity and demonstrated varying interpretations of existing laws.The privacy and data protection laws inmany states in which we operate are more restrictive than HIPAA and/or may apply more broadly than HIPAA.For example,the California Consumer Privacy Act(“CCPA”)and the California Privacy Rights

193、Act(“CPRA”)require,among other things,covered companies to provide specific disclosures toCalifornia consumers and afford such consumers new abilities to opt-out of certain sales of personal information.Similar legislation has been proposed or adopted in other states.Aspects of these newand emerging

194、 state privacy laws and regulations,as well as their interpretation and enforcement,are dynamic and evolving.These laws and regulations each require particular assessment forcompliance,and we may be required to modify our practices in an effort to comply with them,which may impact demand for our off

195、erings.Where state laws are more protective than HIPAA or apply more broadly than HIPAA,we must comply with the state laws to which we are subject.In certain cases,it may be necessary to modify ourplanned operations and procedures to comply with these more stringent state laws.Not only may some of t

196、hese state laws impose fines and penalties upon violators,but also some,unlike HIPAA,mayafford private rights of action to individuals who believe their personal information has been misused.We expect new laws,rules and regulations regarding privacy,data protection,and informationsecurity to be prop

197、osed and enacted in the future;state laws are changing rapidly,numerous states are currently reviewing legislation that is similar to the CCPA and/or CPRA,and there is discussionof a new federal privacy law or federal breach notification law.Additionally,we are subject to the General Data Protection

198、 Regulation(“GDPR”)as implemented in the United Kingdom(the“UK GDPR”).The GDPR became effective in the European Union(“EU”)on May 25,2018.Under the GDPR,data protection authorities in the EU have the power to impose significant administrative fines for violations,which may also lead to damages claim

199、s bydata controllers and data subjects.The UK GDPR sits alongside the UK Data Protection Act 2018 which implements10Table of Contentscertain derogations in the GDPR into UK law.Under the UK GDPR,companies not established in the UK but who process personal data in relation to the offering of goods or

200、 services to individuals inthe UK,or to monitor their behavior,are subject to the UK GDPR-the requirements of which are(at this time)largely aligned with those under the GDPR and may lead to significant compliance andoperational costs.Additionally,in July 2023,the European Commission adopted an adeq

201、uacy decision concluding that the United States ensures an adequate level of protection for personal datatransferred from the EEA to the United States under the EU-U.S.Data Privacy Framework(followed in October 2023 with the adoption of an adequacy decision in the UK for the UK-United StatesData Bri

202、dge).However,the adequacy decision does not foreclose,and is likely to face,future legal challenges.MarketingWe are building a trusted brand focused on empowering consumers to feel great by providing modern personalized health and wellness experiences to consumers to address their health and wellnes

203、sneeds.From our launch,we have used a diverse marketing strategy to reach our customers.We advertise on digital media,social media,television,radio,out-of-home media,and various other mediachannels.We believe advertising in a diversified set of media channels is important to prevent overreliance on

204、any single channel and to maximize the exposure of our brands to our desired customers.We also reach our customers through our own social media accounts,press coverage and public relations,internally developed educational and lifestyle content,presence in brick-and-mortar retailstores,and physical b

205、rand advertising campaigns.This overall strategy drives significant customer traffic to our platform,including direct type-in traffic and organic online search traffic.Our marketing strategy is underpinned by a focus on analytics and data.We have built our team and systems to measure consumer behavi

206、or,including which types of consumers generate more revenuein their first purchase,generate more revenue over time,generate more gross profit from their purchases,and which types of consumers are most valuable over their lifetime.We also rigorouslymeasure the effectiveness of our marketing budgets a

207、nd the rate of return we generate from our marketing campaigns.The marketing team is accountable for driving a sufficient rate of return fromtheir budgets.We view our marketing capabilities as a core strength of the Company and a key differentiator in the market.SeasonalityWe expect our weight loss

208、specialty will drive new seasonality considerations for our business.Specifically,we expect individuals health and wellness-based New Years resolutions to result inadditional traffic to our platform and thus increase the number of Subscribers utilizing one of our weight loss offerings.This may resul

209、t in higher Subscriber and Monthly Online Revenue per AverageSubscriber growth in the first quarter compared to the remainder of the year.See Part II,Item 7:“Managements Discussion and Analysis of Financial Condition and Results of Operations”of thisAnnual Report on Form 10-K for definitions of Subs

210、cribers and Monthly Online Revenue per Average Subscriber.Human Capital ManagementPeople and CultureAt Hims&Hers,we are focused on providing an exceptional experience to our employees,while focusing on serving our customers.Our team is central to our mission to help the world feel greatthrough the p

211、ower of better health.We believe that celebrating multiple approaches and perspectives allows us to better meet the challenge of providing access to affordable,accessible,personalizedhealth and wellness solutions.We continue to look for intentional ways to expand our programs and initiatives to not

212、only attract,develop,and retain top talent,but also to center the well-being of ourpeople.We strive to hire the best and brightest talent across the industry with a focus on individuals determined to improve access to health and wellness solutions for millions.As of December 31,2024,ourteam was comp

213、rised of 1,637 employees across various functions.We have had an official remote-first policy for all corporate functions since June 2020.We have heavily invested in the software,tools,and culture that allow our company to be a leading force in thenew remote-work environment.Not only has this allowe

214、d us to maintain and enhance our commitment to quality,our management team believes it has also provided a real competitive advantage byattracting diverse talent and garnering new geographic exposure.We prioritize hiring team members with a diversity of lived experiences,and we believe we get the be

215、nefit of more multi-faceted andnuanced insight into the customers we serve.This also ensures that our internal community reflects our vision for an equity-centered,inclusive workforce.11Table of ContentsWe aim to create an environment of mutual trust,confidence,and inclusion to provide opportunity f

216、or growth and recognition,with the ultimate goal of helping more customers feel great throughproviding access to better health and wellness solutions.We are a company with a growth mindset.To that end,we gauge our employees level of engagement and satisfaction through ongoingengagement surveys.We le

217、verage these surveys to gather information to ensure we hear directly from our employees on their personal work experiences and how we can continue working to manifestour value set.We evaluate the data obtained through employee feedback to architect learning pathways and experiences that are truly v

218、aluable to our employees.We have regular people managertraining and labs as well as effective communication training across the organization.We are continually working to improve our processes and policies to align with our growing and evolvingworkforce.Further,we have committed to,and formalized,em

219、ployee development programs that are focused on feedback,coaching and employee development.Programming includes a formalized performancereview process that includes a self-evaluation process,peer-evaluation process and a manager self-evaluation process,together with training and resources on how to

220、approach these evaluations.We also offer our employees a holistic total rewards package with premier benefit and well-being programs intended to fit the needs of our employees and their family members.In addition to standardmedical coverage,we offer employees dental and vision coverage,health saving

221、s and flexible spending accounts,employee assistance programs,short-term and long-term disability coverage,lifeinsurance,and certain fertility benefits.We offer a 401(k)Savings Plan and the ability to participate in our Employee Stock Purchase Plan to all U.S.employees.The majority of our employees

222、areeligible for equity awards,depending on function,to align incentives and provide the opportunity to share in the Companys financial success.Our paid time off programs enable and encourage ourworkforce to enjoy personal time away from their job responsibilities.We also offer generous parental leav

223、e benefits for eligible employees as well as a variety of perks including backup childcare,family forming resources,fitness and coworking space reimbursements,providing support for our employees needs.Commitment to highest standards of provider qualityIn addition to our employees,as of December 31,2

224、024,1,307 medical providers located throughout all 50 states in the U.S.provided services on the Hims&Hers platform through the AffiliatedMedical Groups.All credentials,licenses,and qualifications of these medical professionals are cross-checked against federal,state,and other agencies.The Affiliate

225、d Medical Groups implementcomprehensive processes,to ensure adequate clinical skill and quality.Only the most qualified applicants are approved by the Affiliated Medical Groups to provide consultations on the Hims&Hersplatform.This rigor in provider selection ensures a strong culture of high standar

226、ds focused around improving health and wellness outcomes for our customers.CompetitionConsumers have historically accessed the healthcare system in the U.S.through an antiquated model focused around brick-and-mortar healthcare providers and cost coverage through commercial andgovernment payor progra

227、ms.At the same time,many consumers are not aware of the relative affordability,convenience,and accessibility of care through telehealth.Much of our marketing effortssince our founding have thus focused on consumer education around these capabilities and the underlying conditions that providers on ou

228、r platform can help treat.The relatively low(albeit rapidlyincreasing)penetration of telehealth implies that there is a significant market opportunity as consumers continue to shift their behavior.While we believe there are currently no direct competitors that offer the full suite of solutions and d

229、irect-to-consumer touch points as we do,there are several companies that offer components oftelehealth or address conditions that compete with our solutions.In direct-to-consumer health and wellness,we compete with traditional healthcare providers,pharmacies,and large retailers that sell non-prescri

230、ption products,including,for example,nutritional supplements,dermatology products,and hair care treatments.In direct-to-consumer healthcare,our competition is largely fragmented and consists of many competitors that are smaller in scale and/or are more niche in focus with respect to the conditionsth

231、ey treat.Within parts of the sexual health and hair loss market,we also compete mostly with private organizations with similar product offerings for consumers and/or similarpharmacological capabilities,including compounding capabilities.12Table of ContentsIn telehealth and health and wellness manage

232、ment,we compete with other providers that are larger in scale and generally provide telehealth on behalf of self-insured employers and insuranceplans.Within parts of the behavioral health market,we also compete with public and private organizations with similar product offerings for consumers.Intell

233、ectual PropertyOur ability to obtain and maintain intellectual property protection for our proprietary technology platform,preserve the confidentiality of our trade secrets,and operate without violating the intellectualproperty rights of others is important to our success.We have a number of measure

234、s to protect our intellectual property and brand,including trademarks,confidentiality procedures,non-disclosureagreements,and employee non-disclosure and invention assignment agreements,to establish and protect our proprietary rights.Despite these efforts,there can be no assurance that we will adequ

235、atelyprotect our intellectual property.Hims&Hers owns or is licensed to use valuable intellectual property,including trademarks,service marks,patents,copyrights,trade secrets,and other proprietary information.We consider thetrademarks“HIMS,”“HERS,”“H,”and“HIMS&HERS”to be of material importance to ou

236、r business.Depending on the jurisdiction,trademarks,and service marks generally are valid as long asthey are used and/or registered.Patents,copyrights,and licenses are of varying durations.In addition,we have registered and maintain numerous Internet domain names,including“”and“.”Additional Informat

237、ionOur products and services are available through the following websites:,www.forhims.co.uk and .We make available free of charge at theInvestor Relations section of the website our Annual Reports on Form 10-K,Quarterly Reports on Form 10-Q,Current Reports on Form 8-K,and amendments to those report

238、s filed orfurnished pursuant to Sections 13(a)and 15(d)of the Securities Exchange Act of 1934,as amended,as soon as reasonably practicable after we file or furnish such materials with the Securities andExchange Commission(the“SEC”).The SEC also maintains a website located at www.sec.gov that contain

239、s reports and other information regarding issuers that file electronically with the SEC.Theinformation on our websites is not,and will not be deemed to be,a part of this Annual Report on Form 10-K or incorporated into any of our other filings with the SEC,except where we expresslyincorporated such i

240、nformation.Item 1A.Risk FactorsA description of the risks and uncertainties associated with our business and ownership of our Class A common stock is set forth below.You should carefully consider the risks described below,as wellas the other information in this Annual Report on Form 10-K,including o

241、ur consolidated financial statements and the related notes and“Managements Discussion and Analysis of FinancialCondition and Results of Operations.”The occurrence of any of the events or developments described below could materially and adversely affect our business,financial condition,results ofope

242、rations,and growth prospects.In such an event,the market price of our Class A common stock could decline.Additional risks and uncertainties not presently known to us or that we currently deemimmaterial may also impair our business operations.This Annual Report on Form 10-K also contains forward-look

243、ing statements that involve risks and uncertainties.Our actual results could differmaterially from those anticipated in the forward-looking statements as a result of a number of factors,including the risks described below.See“Cautionary Note Regarding Forward-LookingStatements.”Summary of Principal

244、Risk FactorsWe have experienced rapid growth in recent fiscal years and expect to continue to invest in our growth for the foreseeable future.High levels of growth may not be achieved in future periodsand may not generate a corresponding improvement in our results of operations.We may not be able to

245、 maintain our profitability.Our results of operations,as well as the performance of our key metrics,may fluctuate on a quarterly and annual basis,which may result in us failing to meet the expectations of industry andsecurities analysts or our investors.If we are unable to expand or maintain the sco

246、pe of our offerings,including the number and type of products and services that we offer,the number and quality of Providers serving ourcustomers,and the number and types of13Table of Contentsconditions capable of being treated through our platform,our business,financial condition,and results of ope

247、rations may be materially and adversely affected.If we are unable to successfully market to new customers and retain existing customers,or if evolving privacy,healthcare,or other laws or regulations prevent or limit our marketingactivities,our business,financial condition,and results of operations c

248、ould be harmed.We operate in highly competitive markets and face competition from large,well-established healthcare providers,traditional retailers,pharmaceutical providers and technology companieswith significant resources,and,as a result,we may not be able to compete effectively.Our brand is integ

249、ral to our success.If we fail to effectively maintain,promote,and enhance our brand in a cost-effective manner,our business and competitive advantage may be harmed.If the Affiliated Medical Groups are unable to attract and retain high-quality Providers to perform services on our platform,or if we ar

250、e unable to develop or maintain satisfactory relationshipswith these Providers or the Affiliated Medical Groups,our business,financial condition,and results of operations may be materially and adversely affected.We operate in a highly regulated,dynamic,environment and are subject to an increasing nu

251、mber of laws and regulations as a result of the various components of our existing business,including telehealth,pharmacy,and compounding,as well as our expansion into new areas such as peptide development and lab services and operations.The breadth and scale of our servicesand operations increases

252、the complexity and extent of our compliance and regulatory obligations.If any of our Facilities are unable to obtain and/or maintain necessary licenses and permits,or if any of the Facilities or our operations fail to comply with applicable laws and regulatory requirements,our business,financial con

253、dition,and results of operations may be materially andadversely affected.If we fail to comply with applicable healthcare and other laws and governmental regulations,we could face substantial penalties,our business,financial condition,and results of operationscould be materially and adversely affecte

254、d,and we may be required to restructure our operations.Evolving government regulations and enforcement activities may require increased costs or adversely affect our results of operations.Security breaches,loss of data,and other disruptions could compromise sensitive information related to our busin

255、ess or customers,or prevent us from accessing critical information andexpose us to liability,which could adversely affect our business and our reputation.From time to time we are subject to legal proceedings in the ordinary course of business,which can include intellectual property disputes or claim

256、s relating to our marketing or sale ofproducts,any of which may be costly to defend and could materially harm our business and results of operations.We may require additional capital to support business growth,and this capital might not be available on acceptable terms,if at all.Our dual class commo

257、n stock structure has the effect of concentrating voting power with our Chief Executive Officer and Co-Founder,Andrew Dudum,which limits an investors ability toinfluence the outcome of important transactions,including a change in control.The market price of our Class A common stock may be volatile.R

258、isks Related to Our BusinessWe have experienced rapid growth in recent fiscal years and expect to continue to invest in our growth for the foreseeable future.High levels of growth may not be achieved in future periods andmay not generate a corresponding improvement in our results of operations.We ha

259、ve recently experienced a period of rapid growth in our revenue,operations and headcount.We grew our revenue from$526.9 million for the year ended December 31,2022,to$872.0 millionfor the year ended December 31,2023,to$1,476.5 million for the year ended December 31,2024.Our number of employees has a

260、lso increased significantly over the last14Table of Contentsfew years,from 651 employees as of December 31,2022 to 1,637 employees as of December 31,2024.We have also completed multiple acquisitions,expanded into new specialties,and significantlyincreased the size of our customer base.We have encoun

261、tered and will continue to encounter significant risks and uncertainties frequently experienced by growing companies in rapidly changing and heavily regulated industries,such asattracting new customers and Providers to our platform,retaining our customers and encouraging them to utilize new offering

262、s we make available,increasing the number of conditions that can betreated by Providers through our platform,operating our Facilities and the compounding and distribution of pharmaceutical products,competition from other companies,including online healthcareproviders and traditional healthcare provi

263、ders,hiring,integrating,training,and retaining skilled personnel,verifying the identity of customers and credentials of Providers serving our customers,developing new solutions,determining prices for our solutions,unforeseen expenses,challenges in forecasting accuracy,and new or adverse regulatory d

264、evelopments affecting the use of telehealth,pharmaceutical products or operations,including compounding,data privacy,use of artificial intelligence,peptide development,laboratory services or other aspects of the healthcare industry.Additional risks include our ability to effectively manage growth an

265、d process,store,protect,and use personal data in compliance with governmental regulation,contractual obligations,and other legalobligations related to privacy and security.If our assumptions regarding these and other similar risks and uncertainties that relate to our business,which we use to plan ou

266、r business,are incorrect orchange as we gain more experience operating our platform or continue to expand into the treatment of new conditions,or if we do not address these challenges successfully,our operating and financialresults could differ materially from our expectations and our business could

267、 suffer.We anticipate that we will continue to significantly expand our operations and headcount in the near term.This growth has placed,and future growth will place,a significant strain on our management,administrative,operational,and financial infrastructure.Our success will depend in part on our

268、ability to continue to manage this growth effectively and execute our business plan.There can be noassurance that these efforts will be successful or that we will not encounter operational difficulties that may have a negative impact on growth and profitability.To manage the expected growth of ourop

269、erations and personnel,we will need to continue to improve our operational,financial,and management controls and our reporting systems and procedures,and we will need to ensure that wemaintain high levels of customer support.Failure to effectively manage growth and execute our business plan could re

270、sult in difficulty or delays in increasing the size of our customer base,declines inquality of customer support or customer satisfaction,increases in costs,difficulties in introducing new products or services,or other operational difficulties,and any of these difficulties couldadversely affect our b

271、usiness performance and results of operations.If we are unable to expand or maintain the scope of our offerings,including the number and type of products and services that we offer,the number and quality of Providers serving ourcustomers,and the number and types of conditions capable of being treate

272、d through our platform,our business,financial condition,and results of operations may be materially and adverselyaffected.We provide customers with access to non-prescription products,telehealth-based consultations with Providers,and certain prescription medications that may be prescribed by Provide

273、rs in connectionwith telehealth consultations.In order for our business to continue growing,we need to maintain and continue expanding the scope of products and services we offer our customers,includingtelehealth consultations,prescription medication for additional conditions,and non-prescription he

274、alth and wellness products and services.The introduction of new products,services,or technologies,including disruptive technologies by market participants,including us,can quickly make our products and services obsolete and unmarketable.Additionally,changes in laws and regulations(orinterpretation o

275、r enforcement thereof)could impact the usefulness of our platform or offerings and could necessitate changes or modifications to our platform or offerings to accommodate suchchanges.Alternatively,the introduction of new products,services or technologies could expose us to new or increased regulatory

276、 risks,including with respect to healthcare,privacy,or consumerprotection laws,either through the provision of such products,services,or technologies,or by virtue of the new or expanded personal and health information we acquire from customers to supportsuch offerings.We invest substantial resources

277、 in researching and developing new offerings and enhancing our solutions by incorporating additional features,improving functionality,and adding otherimprovements to meet our customers evolving demands.The success of any enhancements or improvements to our services or any new offerings depends on a

278、number of factors,including timelycompletion,competitive pricing,adequate quality testing,integration with new and existing technologies,regulatory compliance,and overall market acceptance.We may not succeed in developing,marketing,and delivering on a timely and cost-effective basis enhancements or

279、improvements to our products or services or any new offerings that respond to continued changes in market demands ornew customer requirements,and any enhancements or improvements to our products or services or any new offerings may not achieve market acceptance.Since developing enhancements to ourpr

280、oducts and services and the launch of new offerings can be complex,the timetable for the release of new offerings and15Table of Contentsenhancements to our existing products and services is difficult to predict,and we may not launch new offerings and updates as rapidly as our current or prospective

281、customers require or expect.For example,in May 2024,we began providing access to compounded injectable semaglutide,a glucagon-like peptide-1 receptor agonist(GLP-1),on our platform as part of our weight loss specialty.GLP-1s are subject to elevated consumer demand,related global drug shortages,feder

282、al and state-specific regulatory limitations,limited manufacturing capacity and potential supply chain disruptions,all of which could affect our ability to provide continuing access to such GLP-1s.Increasing consumer demand could further increase prices and/or constrain supply,and an evolving regula

283、torylandscape could impact our ability to continue offering access to such products.For example,while we do not provide access to compounded tirzepatide,the FDA removed tirzepatide from itsshortage list in October 2024,and then reconsidered that decision less than two weeks later,before finally remo

284、ving tirzepatide from the shortage list on December 19,2024.Additionally,all doses ofsemaglutide branded under Ozempic and Wegovy became listed as available on the FDAs shortage list as of October 30,2024.On February 21,2025,the FDA resolved the semaglutide shortage,which could constrain our ability

285、 to continue providing access to compounded semaglutide on our platform once our current inventory has been sold.While we do not provide access to compoundedtirzepatide,the regulatory landscape applicable to GLP-1s continues to rapidly evolve.If regulatory or market conditions change,or we are unabl

286、e to meet our customers demand for our offerings,orif they do not otherwise meet customer expectations,our brand,reputation and results of operations could be adversely affected.Any new offerings or product or service enhancements that we develop may not be introduced in a timely or cost-effective m

287、anner,may contain errors or defects,or may not achieve the marketacceptance necessary to generate sufficient revenue.In addition,any failure,or perceived failure,by us to comply with any federal,state,or local laws or regulations with respect to any new offeringor product or service enhancement coul

288、d adversely affect our reputation,brand,and business,and may result in claims,proceedings,or actions against us by governmental entities,consumers,suppliers,or others or other liabilities that may require us to change our operations and/or cease offering certain products or services.Moreover,even if

289、 we introduce new offerings,we may experiencea decline in revenue of our existing offerings that is not offset by revenue from the new offerings.In addition,we may lose existing customers who choose a competitors products and services.Thiscould result in a temporary or permanent revenue shortfall an

290、d adversely affect our business.If we are unable to successfully market to new customers and retain existing customers,or if evolving privacy,healthcare,or other laws or regulations prevent or limit our marketing activities,our business,financial condition,and results of operations could be harmed.W

291、e generate revenue from our platform by selling non-prescription health and personal care products to consumers and offering consumers a technology driven platform to access telehealthconsultations with Providers,who may prescribe customers certain prescription medications.We also rely on selling ou

292、r non-prescription products through wholesale partnerships.Unless we are ableto attract new customers,retain existing customers,and maintain our wholesale partnerships,our business,financial condition,and results of operations may be harmed.In order to attract new customers and incentivize existing

293、customers to purchase our offerings,we use social media,emails,text messages,celebrity influencers,television commercials,and othermarketing strategies to reach potential and existing customers.State and federal laws and regulations governing the privacy and security of personal information,includin

294、g healthcare data,areevolving rapidly and could impact our ability to identify and market to potential and existing customers.Similarly,certain federal and state laws regulate,and in some cases limit,the use of discounts,promotions,and other marketing strategies in the healthcare industry.If federal

295、,state,or local laws or regulations governing our marketing activities become more restrictive or are interpreted bygovernmental authorities to prohibit or limit these activities,our ability to attract new customers and retain customers would be affected and our business could be materially harmed.I

296、n addition,anyfailure,or perceived failure,by us or other telehealth companies to comply with any federal,state,or local laws or regulations governing our marketing activities could adversely affect the perceptionof our industry,our reputation,brand,and business.We have received,and may in the futur

297、e face,claims alleging violations of federal,state or local laws related to tracking technologies.While we donot expect any such claims of violations to have a material impact on our business,financial condition,or results of operations,any claims,proceedings,or actions against us by governmental en

298、tities,consumers,suppliers,competitors,or others,or other liabilities,may require us to change our operations and/or cease using certain marketing strategies.Changes to social networking,advertising platforms or mobile device or other operating systems terms of use;terms of service or traffic algori

299、thms that limit promotional communications or imposerestrictions that would limit our ability or our customers ability to send communications through their platforms;disruptions or downtime experienced by these platforms;or reductions in the use of orengagement with social networking or advertising

300、platforms by customers and potential customers could also harm our business.Additionally,changes in regulations or the business practices of third-parties could limit our16Table of Contentsability,and the ability of search engines and social media platforms,to collect data from users and engage in t

301、argeted advertising,which could negatively impact the effectiveness of our digitalmarketing.For example,in 2024,Meta announced changes to the use of certain types of health-related data for ad targeting purposes.The regulation of the use of cookies and other current onlinetracking and advertising pr

302、actices,or a loss in our ability to make effective use of services that employ such practices,could adversely affect our business if we are unable to adjust our marketingpractices accordingly.As laws and regulations rapidly evolve to govern the use of these channels,the failure by us,our employees o

303、r third parties acting at our direction to abide by applicable laws andregulations in the use of these channels could adversely affect our reputation or subject us to fines or other penalties.In addition,our employees or third parties acting at our direction may knowinglyor inadvertently make use of

304、 social media in ways that could lead to the loss or infringement of intellectual property,as well as the public disclosure of proprietary,confidential,or sensitive personalinformation of our business,employees,consumers or others.Any such inappropriate use of social media,emails,and text messages c

305、ould also cause reputational damage and adversely affect ourbusiness.Additionally,we collect consumer data,including email addresses and phone numbers,to further our marketing efforts with such consumers.If we fail to adequately or accurately collect such data orif our data collection systems are br

306、eached or information therein is misused,our business,financial condition,and results of operations could be harmed.Further,any failure,or perceived failure,byus,or any third parties processing such data,to comply with privacy policies or with any federal or state healthcare,privacy or consumer prot

307、ection-related laws,regulations,industry self-regulatoryprinciples,industry standards or codes of conduct,regulatory guidance,orders to which we may be subject or other legal obligations relating to privacy,consumer consent,or consumer protectioncould adversely affect our reputation,brand,and busine

308、ss,and may result in claims,proceedings or actions against us by governmental entities,consumers,suppliers,or others,or other liabilities,ormay require us to change our operations and/or cease using certain data sets.Use of social media and celebrity influencers may materially and adversely affect o

309、ur reputation or subject us to fines or other penalties.We use third-party social media platforms as part of our marketing strategy.For example,our brands maintain Instagram,Facebook,YouTube and TikTok accounts.We also maintain relationships withmany social media and celebrity influencers and engage

310、 in sponsorship initiatives.As existing e-commerce and social media platforms continue to rapidly evolve and new platforms develop,weexpect to maintain a presence on these existing platforms and an important part of our marketing strategy is to establish and maintain a presence on new or emerging po

311、pular social media platforms.Ifwe are unable to cost-effectively use social media platforms as marketing tools,if the social media platforms we use change their policies or algorithms,or if evolving laws and regulations limit howwe can market through these channels,if at all,we may not be able to fu

312、lly optimize our use of such platforms and our ability to retain current customers and acquire new customers may suffer.Anysuch failure could adversely affect our reputation,revenue,and results of operations.In addition,an increase in our use of social media for product promotion and marketing may i

313、ncrease the burden on us to monitor compliance of such materials,and increase the risk that suchmaterials could contain problematic product or marketing claims in violation of applicable regulations.For example,in some cases,the Federal Trade Commission has sought enforcement actionwhere an endorsem

314、ent has failed to clearly and conspicuously disclose a financial relationship or material connection between an influencer and an advertiser.FDA may also bring enforcement actionsfor false or misleading advertising and promotion of prescription drugs,including compounded drugs.In recent years,FDA ha

315、s issued multiple untitled letters related to false or misleading promotionby influencers and/or using social media.Although we contract with and monitor our influencers posts on social media,they may fail to comply with our content-related requirements,and if we wereheld responsible for any false,m

316、isleading,or otherwise unlawful content of their posts or their actions,we could be fined or subjected to other monetary liabilities or required to alter our practices,which could have an adverse impact on our business and reputation.A failure to accurately identify promising celebrity influencers t

317、o use and endorse our products or a failure to enter into cost-effective celebrity influencer arrangements may have an adverse effect onour reputation or business.Moreover,the cost to enter into arrangements with celebrity influencers may increase over time,which could have an adverse impact on our

318、financial condition and resultsof operations.In order to maintain and grow our business,we must maintain credibility and confidence among customers,analysts,investors,and other parties in our long-term financial viability and businessprospects.In particular,our products,business,results of operation

319、s,and statements and actions of our company and management are subject to significant amounts of commentary by a range of thirdparties.Negative commentary or publicity regarding our business,the industry in which we operate,our offerings,members of our management team,or celebrity influencers who en

320、dorse ourproducts and other third parties who are17Table of Contentsaffiliated with or endorse us,may also be posted on social media platforms or appear in other media.Celebrity influencers with whom we maintain endorsement arrangements could engage inbehavior or use their platforms to communicate w

321、ith our customers in a manner that reflects poorly on our brand and may be attributed to us or otherwise adversely affect our reputation.Any suchcommentary could impact our reputation or brand and affect our ability to attract and retain customers,which could have a material adverse effect on our bu

322、siness and results of operations.If we are unable to continue to expand our marketing infrastructure,we may fail to increase the usage of our platform to meet our forecasts.We first launched our services in 2017 and we have experienced rapid growth since that time.As a result,we have limited experie

323、nce marketing our offerings and engaging customers at our currentscale.We derive a substantial majority of our revenue from customers subscription-based purchases of prescription products made available through our platform.We expect to continue to expand theconditions for which customers can seek t

324、reatment from Providers through our platform,and as a result,new customer acquisition is integral to our business.Our financial condition and results ofoperations are and will continue to be highly dependent on the ability of our marketing function to adequately promote,market,and attract customers

325、to our platform and offerings in a manner thatcomplies with applicable laws and regulations and at a cost that does not exceed our current budget allocated to marketing.A key element of our business strategy is the continued expansion of our marketing infrastructure to drive customer enrollment.As w

326、e increase our marketing efforts in connection with the expansionof our platform offerings,we will need to further expand the reach of our marketing networks.Our future success in this area will depend on our ability to continue to hire,train,retain,and motivate askilled marketing workforce with sig

327、nificant industry-specific knowledge in various areas,including direct-to-consumer business models,e-commerce,technology,healthcare,and the regulatoryrestrictions related thereto,as well as the competitive landscape for our solutions.If we are unable to continue to expand our marketing capabilities,

328、we may not be able to effectively expand the scope of our platform to attract new customers and give our existing customersadditional treatment options.Relatedly,if any of our marketing platforms significantly increase their advertising fees,our ability to expand our marketing reach will be greatly

329、impeded.Any suchfailure could adversely affect our reputation,revenue,and results of operations.Our brand is integral to our success.If we fail to effectively maintain,promote,and enhance our brand in a cost-effective manner,our business and competitive advantage may be harmed.We believe that mainta

330、ining and enhancing our reputation and brand recognition is critical to our relationships with existing customers,Providers,strategic partners,Pharmacies,Partner Pharmacies,and other suppliers,and to our ability to attract new customers,Providers,strategic partners,Pharmacies,Partner Pharmacies,and

331、other suppliers.The promotion of our brand may require us to makesubstantial investments,and we anticipate that,given the highly competitive nature of our market,these marketing initiatives may become increasingly difficult and expensive.Brand promotion andmarketing activities may not be successful

332、or yield increased revenue,and to the extent that these activities yield increased revenue,the increased revenue may not offset the expenses we incur and ourresults of operations could be harmed.In addition,any factor that diminishes our reputation or that of our management,including failing to meet

333、 the expectations of our customers,Providers,orpartners,could harm our reputation and brand and make it substantially more difficult for us to attract new customers,Providers,and partners.(See“Use of social media and celebrity influencersmay materially and adversely affect our reputation or subject us to fines or other penalties”).Additionally,unexpected side effects or safety or efficacy concern