New York, May 18, 2026, 09:06 EDT
- Hims & Hers is looking to sell $300 million in convertible notes, and buyers have an option on another $45 million.
- The stock traded about 4% lower before the bell at $24.04, after finishing Friday at $25.05.
- The financing comes after a surprise first-quarter loss last week and heavier spending in its weight-loss business.
Hims & Hers Health shares dropped ahead of Monday’s open. The telehealth company said it wants to raise $300 million with convertible senior notes, a kind of debt that could switch into cash, equity, or a mix of both.
Shares were quoted at $24.04 before the bell at 9:05 a.m. EDT, off 4.03% from the $25.05 close on Friday, according to MarketScreener. That was ahead of the NYSE open.
Timing is a factor here. Hims is raising money for international growth and tech spending days after it posted first-quarter results showing more revenue, but booked a net loss and saw its margin fall.
The company said the notes will mature June 1, 2032. They carry interest payments twice a year and are senior unsecured, so they take priority over some other debts but aren’t tied to assets. Initial buyers can also pick up another $45 million of notes within 13 days.
Hims said it will use the proceeds to maintain financial flexibility as it aims to close the Eucalyptus deal in Australia, put money into tech and fulfillment, and ramp up AI. The company will also use some of the money for capped call transactions, which act as a hedge to limit share dilution from convertible debt.
Hims’ planned takeover of Eucalyptus, first announced in February, could be worth as much as $1.15 billion. The company said the deal would give it a bigger footprint in Australia and Japan, and strengthen operations in the UK, Germany and Canada. Hims expects to close the deal by mid-2026, pending conditions.
Investors had less patience after last week’s numbers. Hims said first-quarter revenue rose 4% from a year ago to $608.1 million. But net loss widened to $92.1 million, swinging from net income of $49.5 million a year back. Gross margin dropped to 65% compared to 73% last year, and adjusted EBITDA fell to $44.3 million from $91.1 million.
Management moved its 2026 revenue target higher, now calling for $2.8 billion to $3.0 billion, and set adjusted EBITDA between $275 million and $350 million. These numbers do not include Eucalyptus.
Weight loss is still the main focus. Hims is shifting away from lower-cost compounded GLP-1 drugs and into branded options like Novo Nordisk’s Wegovy, after U.S. regulators cracked down on copycat drugs. Chief Financial Officer Yemi Okupe told Reuters last week, “operating cash flow remains the North Star for the company,” adding Hims expects to be profitable by 2027. Reuters
Novo Nordisk and Eli Lilly keep control of the branded GLP-1 market, but competition is messy. The FDA has put forward new limits on bulk compounding of semaglutide and tirzepatide, the main drugs in Novo’s Wegovy and Ozempic and Lilly’s Zepbound and Mounjaro.
Analysts called the stock an execution play, not just a growth story. Jefferies’ Brian Tanquilut told Reuters Hims is “an execution story now.” J.P. Morgan’s Cory Carpenter said the weight-loss business needs to stabilize, peptide legalization and revenue improving in the back half could add up to a “compelling catalyst path.” Reuters
But the note sale isn’t without risks. The deal depends on market conditions, and Hims hasn’t set the interest rate or conversion terms yet. Conversion could dilute current shareholders if the company’s hedge doesn’t cover it. Hims also pointed to risks from share price swings, changes in interest rates, and regulatory sign-offs needed for Eucalyptus.
For now, the market is reading the raise as just part of a bigger strategy shift. Hims is paying for growth, spending on its platform, and is focused on branded weight-loss drugs as a long-term play. Investor reaction shows they’re still waiting for evidence.
