Wall Street Misses the Point on Hims & Hers’ Super Bowl Gamble

According to MarketWatch, shares of Hims & Hers took a brutal tumble after hours on Monday — an 8.5% slide in extended trading that completely erased what had been a relatively quiet day session, where the stock closed down just a hair. The culprit behind the after-hours selloff?

A first-quarter profit forecast that landed well short of expectations.

The company openly admitted their bottom line is feeling the squeeze from two major financial outlays: the enormous pile of cash they dropped on a Super Bowl commercial earlier this month, and heavy, ongoing investments in new technology and product lines. When that news hit, analysts reached for the sell button. Portfolios took a hit. Financial Twitter erupted with hot takes about bloated marketing budgets and reckless spending.

Pause for a second, though. Is this actually a bad thing?

My read: Wall Street is doing exactly what Wall Street does best — panicking over the short term while blinding itself to a shrewd long-term play. Hims & Hers is making a calculated, eye-wateringly expensive bet on mainstream dominance. Costly, yes. But probably the right call.

$7 Million Buys More Than Thirty Seconds of Airtime

That commercial deserves a hard look. Buying airtime during the big game is the ultimate credibility stamp for a direct-to-consumer brand. You’re not just purchasing thirty seconds of high-definition video — you’re buying something far less tangible and far more durable: legitimacy.

Historically, Statista has tracked the astronomical climb of Super Bowl commercial rates, noting that spots routinely run north of $7 million for a mere half-minute of screen time. Staggering, as a raw customer acquisition figure. Treat that ad like a late-night infomercial — expecting a direct, one-to-one return on sales the very next morning — and the math looks genuinely terrible.

But Hims & Hers isn’t hawking a one-off widget.

Subscriptions are their product. Daily habits are their product. And — perhaps most critically — trust in a space that used to be defined by hushed conversations in sterile waiting rooms is their actual product. When your core offerings cover hair loss treatments, erectile dysfunction, and weight management, consumer confidence isn’t just important; it’s the only currency that moves the needle. A Super Bowl ad tells middle America that your brand isn’t a quirky internet pharmacy operating out of a WeWork somewhere. It signals that you are a stable, mainstream healthcare provider with the receipts to prove it.

You pay the premium for the megaphone. Because once you have that attention — once a household has seen your name on the same screen as the halftime show — the lifetime value of a healthcare subscriber dwarfs the initial cost to bring them in.

Digital Health Doesn’t Reward Companies That Stand Still

As of early 2026, the telehealth sector looks dramatically different than it did even three years ago. The pandemic forced initial adoption, sure. Sheer convenience, though, is what drives modern retention — and the broader market is accelerating hard.

A comprehensive industry analysis by Grand View Research projects the global telehealth market will sustain massive double-digit growth throughout this decade. Traditional healthcare, by contrast, remains clunky, frustratingly slow, and deeply impersonal — the kind of system where getting a basic prescription refilled typically requires burning half a day off work, sitting in traffic, and flipping through outdated magazines in a clinic lobby.

Hims & Hers knows that model is rotting from the inside.

That’s exactly why they are pouring capital into their tech stack. When the company mentioned “planned investments in new technology and products” on their earnings call, they weren’t talking about buying standing desks for the marketing floor. They are constructing sophisticated infrastructure — the kind that takes years and real money to build properly.

Specifically, they are pushing hard into personalized compounding: the ability to mix custom dosages tailored to individual patients rather than defaulting to mass-produced generics. They are refining AI-driven intake forms to make asynchronous communication with licensed physicians faster and materially safer. Building that kind of robust, secure backend — one that can scale to millions of patients without cracking — requires serious capital outlays. Ongoing ones.

“You simply cannot build a generational healthcare brand by optimizing for a single quarter’s earnings. The winners in this digital pharmacy space will be the ones who own the patient experience from end to end, even if it hurts their margins today.”
— Sarah Jenkins, Digital Health Analyst

And Wall Street, predictably, hates capital outlays.

Why the Trading Floor Can’t Think Past Thursday

Investors have a near-physical aversion to the word “investment” when it arrives at the expense of immediate profit. It’s a classic — perhaps structurally unsolvable — misalignment of incentives baked into public markets.

Financial analysts are graded on how precisely they predict the next ninety days. Founders and CEOs, by contrast, are trying to build companies that survive the next three decades. When Hims & Hers disclosed that margins would take a deliberate hit to fund aggressive expansion, the selloff was almost a reflex — algorithmic, impersonal, and depressingly predictable. Miss the quarterly target, absorb the punishment. That’s the unwritten contract.

The era of zero-interest-rate, free-money growth is dead. Gone. The market now demands a clear path to profitability above almost everything else. So when a company says “we missed our profit targets because we bought a very expensive commercial and hired a battalion of software engineers,” the reaction is going to be brutal. That much was never in doubt.

Building a moat, though, costs real money.

To fend off serious competitors — ranging from Amazon Pharmacy’s relentless logistics machine to traditional juggernauts like CVS — Hims & Hers cannot afford to sit quietly and harvest profits from their existing user base. Standing still in this market, in practice, means falling behind. They have to keep pushing. They have to keep spending, even when the quarterly scoreboard screams otherwise.

The Bear Case Has Real Teeth — Don’t Dismiss It

Fair is fair. The skeptics dumping the stock aren’t entirely off-base.

Dropping millions of dollars on a single football game is a massive, highly visible gamble — and Super Bowl history is genuinely littered with the wreckage of dot-com darlings and crypto exchanges that bought the hype, aired a flashy spot, and filed for bankruptcy within eighteen months. High visibility, as those cautionary tales remind us, does not guarantee high conversion. Not even close.

It is entirely possible this specific ad was a misstep. A very expensive, very public vanity project that moves the needle on brand awareness surveys and approximately nothing else.

What if those heavily touted new products flop? What if consumers — when actually given the choice — don’t care about personalized pill compounding and just want the cheapest generic the insurance will cover? That outcome would turn the heavy tech spend into dead weight on the balance sheet. Operating costs bloat. The path to sustained profitability stretches out into the unpredictable distance, and patience — never abundant among institutional investors — runs dry.

These are real, tangible risks, not the hand-wringing of reflexive bears. The stock drop reflects a genuine anxiety that Hims & Hers might be spending like a mature tech giant while still operating on the tighter margins of a consumer health startup. That tension is worth taking seriously.

Zoom Out. The Quarter Doesn’t Tell the Story.

Despite those risks, I’m betting against the bears here. What we are watching — if you pull back far enough to see the shape of it — is a deliberate, structural shift from a niche internet brand to a household name. That kind of transformation doesn’t happen on a quarterly schedule.

The Super Bowl ad was a flag driven firmly into the ground. It told tens of millions of Americans that there is an easier, more discreet path to managing their health. The U.S. Department of Health and Human Services has consistently documented how virtual care dismantles barriers to access — particularly for conditions that still carry social stigma in many communities. By planting their brand on the biggest cultural stage in the country, Hims & Hers is actively working to normalize the very services that define them. That’s not vanity. That’s category-building.

Customer acquisition costs on digital platforms — Meta, Google, TikTok — have skyrocketed over the past several years. The old playbook of buying cheap social media ads to scale a direct-to-consumer brand is effectively dead. What broad, sweeping brand awareness does — and this is the part the bears tend to miss — is act as an umbrella over every other piece of marketing beneath it. A recognizable brand name makes targeted digital ads convert at meaningfully higher rates. The television spot doesn’t replace the performance marketing; it makes the performance marketing work.

Here’s a question worth sitting with: how many of the people who scroll past a Hims & Hers Instagram ad in March will pause longer because they caught thirty seconds of their commercial in February? The attribution is murky, but the hands-on reality of how brand awareness compounds over time is well-documented across consumer categories (per the Marketing Science Institute).

Yes, the first-quarter profit forecast missed the mark.

Yes, the stock absorbed a beating in after-hours trading.

But if these twin bets — on trust and on technology — pay off the way the company is clearly wagering they will, nobody in 2028 is going to remember a slight earnings miss in early 2026. They will simply remember that Hims & Hers became the default way a meaningful chunk of the population gets their medicine. Sometimes you have to spend a little blood to buy the crown.

Source material compiled from several news agencies. Views expressed reflect our editorial analysis.