Good morning, CFOs. Ralph Lauren will raise prices more than previously planned to offset tariffs; Hims & Hers CFO weighs in on debt and tariffs; plus, U.S. business recovery ahead?

Please note: The Morning Ledger newsletter won't be published Monday in observance of Memorial Day. We will be back Tuesday.

Ralph Lauren said its customers are still spending on luxury goods despite the rocky economic backdrop, and that it will raise prices more than previously planned in order to offset tariffs.

The luxury apparel-and-accessories company on Thursday reported a bigger profit and a jump in revenue for the first three months of the year, citing higher prices and lower cotton costs.

The brand has been successful in drawing in customers that are younger and less skittish when prices go up, according to Chief Financial Officer Justin Picicci.

Management had already been planning to increase prices again on some items for the fall, but is now looking at bigger hikes for the fall and for the following spring in response to tariffs.

The new levies are expected to cut into Ralph Lauren’s gross margin, though the company said it will try to minimize the impact by making adjustments to its supply chain.

📈 Economic Indicators

The Census Bureau reports new home sales for April.

Designed for the ascending C-suite, The Future of Everything is an exclusive, invite-only event offering your rising leaders unparalleled access to insights from influential speakers and emerging technologies that are transforming industries.

Empower your team to bring back fresh perspectives, innovative ideas and meaningful connections to drive growth and position your organization for long-term success.

Featured speakers include:

• Chris Cocks, CEO, Hasbro
• Ron Howard, filmmaker; founder & executive chairman, Imagine Entertainment
• Scott Kirby, CEO, United Airlines
• Brad Lightcap, COO, OpenAI
• Alexis Ohanian, founder & general partner, Seven Seven Six; co-founder, Reddit
• Charles Scharf, president & CEO, Wells Fargo
• Emma Walmsley, CEO, GSK

…and more.

If you would like to request an invitation for you or your team, please visit our website or contact foe@wsj.com.

Yemi Okupe, finance chief at telehealth company Hims & Hers Health, talked to CFO Journal about its recent $1 billion convertible debt offering and how the company is responding to tariffs. Edited excerpts follow.

WSJ: Did economic uncertainty drive your decision to raise $1 billion through convertible senior notes?

Okupe: That was more for positioning us to accelerate during a period of macroeconomic uncertainty, as opposed to necessarily being worried about something. The genesis of that was wanting to actually go raise $450 million of capital. When we look at some of the macroeconomic uncertainty going on right now, we take a longer-term view that that creates more opportunity as opposed to risk. We have observed, in the last 12-18 months, valuations for many private companies around the world coming down. Many companies that operate in other geographic areas are pulling back. This is the moment for us, where we have the strength of positive free cash flow and a very robust balance sheet to lean in. Acquiring that capital will enable us to do so.

What we probably didn't have an appreciation for is the level of demand for our securities, particularly when there's downside risk prevention. Someone was willing to give us interest-free terms at a baseline conversion premium of 37.5%. These are terms that our bankers said they've almost never seen in the market over the course of the last four to six years, or only with a handful of names. Given the overwhelming demand that we had at $450 million while still being able to keep those terms, we actually opted to take additional capital to $1 billion. We'll be very disciplined around how we deploy it. The upsize was mainly just opportunistic, and the terms were exceptionally favorable.

WSJ: What exposure do you have to tariffs?

Okupe: Any organization is probably going to be impacted by tariffs in some form or fashion. The degree to which we are impacted is not necessarily meaningful. Things like packaging costs may go up slightly, but if we look at how our overall model runs, it's very doubtful at this point in time that tariffs will make our business do anything structurally different. If anything, it could potentially create an opportunity to elevate the profile of our value to consumers.

WSJ: How do you think about price increases?

Okupe: There's no plan at this point in time to do any structural across-the-board pricing increases. From product to product, we look and assess, but there's nothing imminent on the radar that would require us to do that.

—Mark Maurer

U.S. business recovered a little this month after the Trump administration rolled back some of its higher trade tariffs, despite activity remaining subdued by historic standards as concerns persist on the impact of recent trade policy on demand, supply chains and inflation.

The S&P Global Flash U.S. Composite PMI–which gauges activity in the manufacturing and services sectors–rose to 52.1 in May from the 19-month low of 50.6 in April. A reading above 50 suggests overall activity continued to expand.

Both the component manufacturing and services gauges that make up the overall index were higher than consensus estimates from economists polled by The Wall Street Journal.

• Europe and Japan See Drops in Business Activity as U.S. Rebounds

• U.S. antitrust enforcers for the first time are arguing that large institutional investors who own shares in rival companies may violate antitrust laws if they use their influence to affect how those firms compete.

📰 Other headlines

• Bond Market Shows Signs of Stabilizing; Nasdaq Rises
• Bond Market to Washington: We’ll Make You Pay
• Home Sales in April Fell for the Second Straight Month
• Senate Votes to End California’s EV Mandate
• Exclusive: A Crypto Billionaire Who Feared Arrest in the U.S. Returns for Dinner With Trump
• Hinge Health Gains in Market Debut, Providing a Favorable Sign for IPOs
• What the Era of ‘Sovereign AI’ Means for Chip Makers

Here is our weekly roundup of stories from across WSJ Pro that we think you'll find useful.

• A more humanlike generation of customer-service voice bots is here, spurred by advances in artificial intelligence and a flood of cash.
• PepsiCo is pushing back its climate goals. Its sustainability chief says the world “was a very different place” when it set its targets.
• An AI-generated PR pitch succeeded in generating attention—and hostility.
• Former audit regulators, academics and investors are preparing to fight the proposed elimination of an accounting oversight board created after Enron.

IDEX Corp., the Northbrook, Ill.-based industrial manufacturer, said its top finance executive, Abhishek Khandelwal, is leaving the company to pursue a new opportunity and Akhil Mahendra, currently vice president of corporate development, will serve as interim finance chief. IDEX said Khandelwal, who returned to the company as senior vice president and CFO in November 2023, has resigned effective May 30. IDEX said it has hired a search firm to identify candidates for the chief financial officer role.

Autodesk, the San Francisco-based software company, said that Stephen Hope, senior vice president and chief accounting officer, will step down as principal accounting officer following the filing of the company's quarterly 10-Q report for the quarter ended April 30. At that time, Janesh Moorjani, its CFO and principal financial officer, will also serve as principal accounting officer. Hope will leave at the end of August and will assist in transition activities until his departure.

—Colin Kellaher contributed to today’s Ledger.

The Wall Street Journal's CFO Journal offers corporate leaders and professionals CFO analysis, advice and commentary to make informed decisions. We cover topics including corporate tax, accounting, regulation, capital markets, management and strategy.

Follow us on X @WSJCFO. The WSJ CFO Journal Team comprises reporters Kristin Broughton, Mark Maurer and Jennifer Williams, and Bureau Chief Walden Siew.

You can reach us by replying to any newsletter, or email Walden at walden.siew@wsj.com.