Hims & Hers Shuts Down Dermatology Business Apostrophe: What You Need to Know
In a significant move, Hims & Hers, a well-known telehealth company, has announced the discontinuation of its dermatology business, Apostrophe, which it acquired in 2021 for $190 million. The decision to shut down Apostrophe is part of a broader strategy to centralize its teledermatology offerings and streamline its skincare services under one unified platform. As of Friday, the direct-to-consumer skincare startup has ceased operations, and all subscriptions have been canceled. Customers will lose access to their provider teams and patient accounts after a 30-day grace period. The company has directed its customers to visit the Hims & Hers platform for continued skincare treatment.
Simplifying Dermatology Services: The Reasoning Behind the Shutdown
Hims & Hers stated that the decision to discontinue Apostrophe was made "after careful consideration" and is aimed at simplifying its dermatology products and operations into a single, seamless experience for customers. While Apostrophe was a significant acquisition for the company, Hims & Hers already had its own dermatology services in place before the acquisition and has continued to provide them since. By centralizing its skincare offerings, the company hopes to create a more cohesive and integrated platform for its users. This move is not directly related to the recent pressures on its weight-loss business or the fluctuation in its stock price, which has seen significant volatility this year.
Restructuring and Job Impact: A Closer Look
The shutdown of Apostrophe has also led to some restructuring within Hims & Hers. While the company did not specify the exact number of roles eliminated, it confirmed that some positions were cut as part of the decision. However, some Apostrophe employees will be reassigned to new roles within Hims & Hers’ broader business lines, ensuring that their expertise and experience are retained within the company. This approach reflects Hims & Hers’ commitment to maintaining its workforce while adapting to the evolving needs of its business.
A Year of Growth and Challenges: Financial Overview
Despite the challenges posed by the shutdown of Apostrophe, Hims & Hers has seen significant growth in other areas of its business. In 2024, the company experienced a strong financial performance, with revenue jumping by 69% to $1.48 billion. Its weight-loss business, in particular, has been a major driver of growth, contributing $225 million in revenue. The company has also seen a 40% increase in its subscriber count last year, highlighting the growing demand for its telehealth services. However, the weight-loss business is now facing new pressures, particularly with the end of the semaglutide shortage, which has impacted the company’s ability to prescribe compounded versions of the drug.
Stock Market Volatility and the Road Ahead
Hims & Hers’ stock has experienced wild swings this year, reflecting the uncertainty surrounding its business. In February, the stock saw a significant peak after the company ran a controversial Super Bowl commercial for its weight-loss platform and announced the acquisition of Trybe Labs, a company offering at-home lab testing. However, the stock fell by 27% last month after the FDA declared an end to the semaglutide shortage, which has implications for the company’s weight-loss business. Despite this setback, Hims & Hers remains optimistic about its future, with plans to continue offering weight-loss pills and personalized weight-loss support, including nutrition plans and coaching.
The Future of Hims & Hers: Centralization and Expansion
Moving forward, Hims & Hers is focused on centralizing its skincare offerings and consolidating its services into a single, user-friendly platform. The shutdown of Apostrophe is a key step in this process, allowing the company to streamline its operations and provide a more integrated experience for its customers. At the same time, Hims & Hers is exploring new opportunities for growth, such as the recent acquisition of Trybe Labs, which expands its capabilities in at-home lab testing. With its strong financial performance, growing subscriber base, and strategic moves, Hims & Hers is well-positioned to navigate the challenges ahead and continue its trajectory of growth in the telehealth industry.
