UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED |
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ____________ TO ____________ |
Commission File Number: 001-12421
| |
| (Exact name of registrant as specified in its charter) |
| | | |
| (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
| |
| (Address of principal executive offices, including zip code) |
| ( |
| (Registrant’s telephone number, including area code) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| | | |
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 the registrant was required to file such reports), and (2) has been subject to such 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 such shorter period 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 filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | |
| Non-accelerated filer ☐ | Smaller reporting company |
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to
Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
As of October 31, 2026, 48,678,057 shares of the registrant’s Class A common stock, $.001 par value per share, were outstanding.
NU SKIN ENTERPRISES, INC.
QUARTERLY REPORT ON FORM 10-Q – THIRD QUARTER 2026
|
Page
|
|||
|
Part I.
|
Financial Information
|
||
|
Item 1.
|
|||
|
1
|
|||
|
2
|
|||
|
3
|
|||
|
4
|
|||
|
6
|
|||
|
7
|
|||
|
Item 2.
|
19
|
||
|
Item 3.
|
29
|
||
|
Item 4.
|
29
|
||
|
Part II.
|
Other Information
|
||
|
Item 1.
|
30
|
||
|
Item 1A.
|
30
|
||
|
Item 2.
|
30
|
||
|
Item 3.
|
30
|
||
|
Item 4.
|
30
|
||
|
Item 5.
|
30 | ||
|
Item 6.
|
31
|
||
|
32
|
|||
In this Quarterly Report on Form 10-Q, references to “dollars” and “$” are to United States (“U.S.”) dollars.
Nu Skin, Pharmanex, and ageLOC are our trademarks. The italicized product names used in this Quarterly Report on Form 10-Q are product names and also, in certain cases, our trademarks.
PART I. FINANCIAL INFORMATION
NU SKIN ENTERPRISES, INC.
(U.S. dollars in thousands)
|
September 30,
|
December 31,
|
|||||||
|
2026
|
2025
|
|||||||
|
ASSETS
|
||||||||
|
Current assets:
|
||||||||
|
Cash and cash equivalents
|
$
|
|
$
|
|
||||
|
Current investments
|
|
|
||||||
|
Accounts receivable, net
|
|
|
||||||
|
Inventories, net
|
|
|
||||||
|
Prepaid expenses and other
|
|
|
||||||
|
Total current assets
|
|
|
||||||
|
Property and equipment, net
|
|
|
||||||
|
Operating lease right-of-use assets
|
|
|
||||||
|
Goodwill
|
|
|
||||||
|
Other intangible assets, net
|
|
|
||||||
|
Other assets
|
|
|
||||||
|
Total assets
|
|
|
||||||
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
|
Current liabilities:
|
||||||||
|
Accounts payable
|
$
|
|
$
|
|
||||
|
Accrued expenses
|
|
|
||||||
|
Current portion of long-term debt
|
|
|
||||||
|
Total current liabilities
|
|
|
||||||
|
Operating lease liabilities
|
|
|
||||||
|
Long-term debt
|
|
|
||||||
|
Other liabilities
|
|
|
||||||
|
Total liabilities
|
|
|
||||||
|
Commitments and contingencies (Notes 6 and 12)
|
||||||||
|
Stockholders’ equity:
|
||||||||
| Class A common stock – |
|
|
||||||
|
Additional paid-in capital
|
|
|
||||||
| Treasury stock, at cost – |
( |
) |
( |
) |
||||
|
Accumulated other comprehensive loss
|
( |
)
|
( |
)
|
||||
|
Retained earnings
|
|
|
||||||
|
Total stockholders’ equity
|
|
|
||||||
|
Total liabilities and stockholders’ equity
|
$
|
|
$
|
|
||||
The accompanying notes are an integral part of these consolidated financial statements.
NU SKIN ENTERPRISES, INC.
(U.S. dollars in thousands, except per share amounts)
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||
|
2026
|
2025
|
2026
|
2025
|
|||||||||||||
|
Revenue
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Cost of sales
|
|
|
|
|
||||||||||||
|
Gross profit
|
|
|
|
|
||||||||||||
|
Operating expenses:
|
||||||||||||||||
|
Selling expenses
|
|
|
|
|
||||||||||||
|
General and administrative expenses
|
|
|
|
|
||||||||||||
|
Impairment expenses
|
|
|
|
|
||||||||||||
|
Total operating expenses
|
|
|
|
|
||||||||||||
|
Operating income (loss)
|
|
|
( |
)
|
|
|||||||||||
|
Interest expense
|
|
|
|
|
||||||||||||
|
Gain on sale of business
|
|
|
|
|
||||||||||||
|
Other income (expense), net
|
|
( |
)
|
|
( |
)
|
||||||||||
|
Income (loss) before provision for income taxes
|
|
|
( |
)
|
|
|||||||||||
|
Provision (benefit) for income taxes
|
|
( |
)
|
|
|
|||||||||||
|
Net income (loss)
|
$
|
( |
)
|
$
|
|
$
|
( |
)
|
$
|
|
||||||
|
Net income (loss) per share (Note 7):
|
||||||||||||||||
|
Basic
|
$
|
( |
)
|
$
|
|
$
|
( |
)
|
$
|
|
||||||
|
Diluted
|
$
|
( |
)
|
$
|
|
$
|
( |
)
|
$
|
|
||||||
|
Weighted-average common shares outstanding (000s):
|
||||||||||||||||
|
Basic
|
|
|
|
|
||||||||||||
|
Diluted
|
|
|
|
|
||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
NU SKIN ENTERPRISES, INC.
(U.S. dollars in thousands)
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||
|
2026
|
2025
|
2026
|
2025
|
|||||||||||||
|
Net income (loss)
|
$
|
( |
)
|
$
|
|
$
|
( |
)
|
$
|
|
||||||
|
|
||||||||||||||||
|
Other comprehensive income (loss), net of tax:
|
||||||||||||||||
|
Foreign currency translation adjustments
|
|
( |
)
|
|
|
|||||||||||
| Net unrealized gains/(losses) on cash flow hedges, net of taxes of $ |
|
|
|
|
||||||||||||
| Reclassification adjustment for realized losses/(gains) in current earnings, net of taxes of $ |
|
( |
) |
|
( |
) |
||||||||||
| |
( |
)
|
|
|
||||||||||||
|
Comprehensive income (loss)
|
$
|
|
$
|
|
$
|
( |
)
|
$
|
|
|||||||
The accompanying notes are an integral part of these consolidated financial statements.
NU SKIN ENTERPRISES, INC.
(U.S. dollars in thousands)
|
For the Three Months Ended September 30, 2026
|
||||||||||||||||||||||||
|
Accumulated
|
||||||||||||||||||||||||
|
Class A
|
Additional
|
Other
|
||||||||||||||||||||||
|
Common
|
Paid-in
|
Treasury
|
Comprehensive
|
Retained
|
||||||||||||||||||||
|
Stock
|
Capital
|
Stock
|
Loss
|
Earnings
|
Total
|
|||||||||||||||||||
|
Balance at July 1, 2026
|
$
|
|
|
( |
)
|
( |
)
|
|
|
|||||||||||||||
|
Net loss
|
|
|
|
|
( |
)
|
( |
)
|
||||||||||||||||
|
Other comprehensive income, net of tax
|
|
|
|
|
|
|
||||||||||||||||||
|
Repurchase of Class A common stock (Note 7)
|
|
|
|
|
|
|
||||||||||||||||||
| Exercise of employee stock options ( |
|
|
|
|
|
|
||||||||||||||||||
|
Stock-based compensation
|
|
|
|
|
|
|
||||||||||||||||||
|
Cash dividends
|
|
|
|
|
( |
)
|
( |
)
|
||||||||||||||||
|
Balance at September 30, 2026
|
$
|
|
|
( |
)
|
( |
)
|
|
|
|||||||||||||||
|
For the Three Months Ended September 30, 2025
|
||||||||||||||||||||||||
|
Accumulated
|
||||||||||||||||||||||||
|
Class A
|
Additional
|
Other
|
||||||||||||||||||||||
|
Common
|
Paid-in
|
Treasury
|
Comprehensive
|
Retained
|
||||||||||||||||||||
|
Stock
|
Capital
|
Stock
|
Loss
|
Earnings
|
Total
|
|||||||||||||||||||
|
Balance at July 1, 2025
|
$
|
|
|
( |
)
|
( |
)
|
|
|
|||||||||||||||
|
Net income
|
|
|
|
|
|
|
||||||||||||||||||
|
Other comprehensive loss, net of tax
|
|
|
|
( |
)
|
|
( |
)
|
||||||||||||||||
|
Repurchase of Class A common stock (Note 7)
|
|
|
( |
)
|
|
|
( |
)
|
||||||||||||||||
| Exercise of employee stock options ( |
|
( |
) |
|
|
|
( |
) |
||||||||||||||||
|
Stock-based compensation
|
|
|
|
|
|
|
||||||||||||||||||
|
Cash dividends
|
|
|
|
|
( |
)
|
( |
)
|
||||||||||||||||
|
Balance at September 30, 2025
|
$
|
|
|
( |
)
|
( |
)
|
|
|
|||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
NU SKIN ENTERPRISES, INC.
Consolidated Statements of Stockholders’ Equity (Unaudited)
(U.S. dollars in thousands)
|
For the Nine Months Ended September 30, 2026
|
||||||||||||||||||||||||
|
Accumulated
|
||||||||||||||||||||||||
|
Class A
|
Additional
|
Other
|
||||||||||||||||||||||
|
Common
|
Paid-in
|
Treasury
|
Comprehensive
|
Retained
|
||||||||||||||||||||
|
Stock
|
Capital
|
Stock
|
Loss
|
Earnings
|
Total
|
|||||||||||||||||||
|
Balance at January 1, 2026
|
$
|
|
|
( |
)
|
( |
)
|
|
|
|||||||||||||||
|
Net loss
|
|
|
|
|
( |
)
|
( |
)
|
||||||||||||||||
|
Other comprehensive income, net of tax
|
|
|
|
|
|
|
||||||||||||||||||
|
Repurchase of Class A common stock (Note 7)
|
|
|
( |
)
|
|
|
( |
)
|
||||||||||||||||
| Exercise of employee stock options ( |
|
( |
) |
|
|
|
( |
) |
||||||||||||||||
|
Stock-based compensation
|
|
|
|
|
|
|
||||||||||||||||||
|
Purchase of noncontrolling interest
|
|
( |
)
|
|
|
|
( |
)
|
||||||||||||||||
|
Cash dividends
|
|
|
|
|
( |
)
|
( |
)
|
||||||||||||||||
|
Balance at September 30, 2026
|
$
|
|
|
( |
)
|
( |
)
|
|
|
|||||||||||||||
|
For the Nine Months Ended September 30, 2025
|
||||||||||||||||||||||||
|
Accumulated
|
||||||||||||||||||||||||
|
Class A
|
Additional
|
Other
|
||||||||||||||||||||||
|
Common
|
Paid-in
|
Treasury
|
Comprehensive
|
Retained
|
||||||||||||||||||||
|
Stock
|
Capital
|
Stock
|
Loss
|
Earnings
|
Total
|
|||||||||||||||||||
|
Balance at January 1, 2025
|
$
|
|
|
( |
)
|
( |
)
|
|
|
|||||||||||||||
|
Net income
|
|
|
|
|
|
|
||||||||||||||||||
|
Other comprehensive income, net of tax
|
|
|
|
|
|
|
||||||||||||||||||
|
Repurchase of Class A common stock (Note 7)
|
|
|
( |
)
|
|
|
( |
)
|
||||||||||||||||
| Exercise of employee stock options ( |
|
( |
) |
|
|
|
( |
) |
||||||||||||||||
|
Stock-based compensation
|
|
|
|
|
|
|
||||||||||||||||||
|
Cash dividends
|
|
|
|
|
( |
)
|
( |
)
|
||||||||||||||||
|
Balance at September 30, 2025
|
$
|
|
|
( |
)
|
( |
)
|
|
|
|||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
NU SKIN ENTERPRISES, INC.
(U.S. dollars in thousands)
|
Nine Months Ended
|
||||||||
|
September 30,
|
||||||||
|
2026
|
2025
|
|||||||
|
Cash flows from operating activities:
|
||||||||
|
Net income (loss)
|
$
|
( |
)
|
$
|
|
|||
|
Adjustments to reconcile net income to cash flows from operating activities:
|
||||||||
|
Gain on sale of business
|
|
( |
)
|
|||||
|
Impairment of goodwill, fixed assets and other intangibles
|
|
|
||||||
|
Unrealized losses on equity investments
|
|
|
||||||
|
Depreciation and amortization
|
|
|
||||||
|
Non-cash lease expense
|
|
|
||||||
|
Stock-based compensation
|
|
|
||||||
|
Inventory write-down
|
|
|
||||||
|
Foreign currency losses
|
|
|
||||||
|
Loss on disposal of assets
|
|
|
||||||
|
Deferred taxes
|
|
( |
)
|
|||||
|
Changes in operating assets and liabilities:
|
||||||||
|
Accounts receivable, net
|
( |
)
|
|
|||||
|
Inventories, net
|
( |
)
|
|
|||||
|
Prepaid expenses and other
|
|
|
||||||
|
Other assets
|
( |
)
|
( |
)
|
||||
|
Accounts payable
|
|
( |
)
|
|||||
|
Accrued expenses
|
( |
)
|
( |
)
|
||||
|
Other liabilities
|
( |
)
|
|
|||||
|
Net cash (used in) provided by operating activities
|
( |
)
|
|
|||||
|
Cash flows from investing activities:
|
||||||||
|
Purchases of property and equipment
|
( |
)
|
( |
)
|
||||
|
Purchases of investments
|
( |
)
|
|
|||||
|
Proceeds on investment sales
|
|
|
||||||
|
Proceeds from sale of business, net
|
|
|
||||||
|
Net cash (used in) provided by investing activities
|
( |
)
|
|
|||||
|
Cash flows from financing activities:
|
||||||||
|
Exercise of employee stock options and taxes paid related to the net shares settlement of stock awards
|
( |
)
|
( |
)
|
||||
|
Payment of cash dividends
|
( |
)
|
( |
)
|
||||
|
Repurchases of shares of common stock
|
( |
)
|
( |
)
|
||||
|
Finance lease principal payments
|
( |
)
|
( |
)
|
||||
|
Proceeds from debt
|
|
|
||||||
|
Payments of debt
|
( |
)
|
( |
)
|
||||
|
Payment of debt issuance costs
|
( |
)
|
|
|||||
|
Purchase of noncontrolling interest
|
( |
)
|
( |
)
|
||||
|
Other, net
|
|
|
||||||
|
Net cash used in financing activities
|
( |
)
|
( |
)
|
||||
|
Effect of exchange rate changes on cash
|
|
|
||||||
|
Net (decrease) increase in cash and cash equivalents
|
( |
)
|
|
|||||
|
Cash and cash equivalents, beginning of period
|
|
|
||||||
|
Cash and cash equivalents, end of period
|
$
|
|
$
|
|
||||
The accompanying notes are an integral part of these consolidated financial statements.
NU SKIN ENTERPRISES, INC.
1. The Company
Nu Skin Enterprises, Inc. (the “Company”) is a holding company, with Nu Skin being the primary operating unit. Nu Skin develops and distributes premium-quality, innovative beauty and wellness products that are sold worldwide. The Company reports revenue from nine segments, consisting of its seven geographic Nu Skin segments—Americas, which includes Canada, Latin America and the United States; Southeast Asia/Pacific, which includes Indonesia, Malaysia, the Philippines, Singapore, Thailand, Vietnam, Australia, New Zealand, and other markets; Mainland China; Japan; Europe and Africa, which includes markets in Europe as well as South Africa; South Korea; and Hong Kong/Taiwan, which also includes Macau—and two Rhyz segments—Manufacturing, which includes manufacturing and packaging subsidiaries it has acquired; and Rhyz Other, which includes other investments by its Rhyz strategic investment arm (the Company’s subsidiaries operating within each segment are collectively referred to as the “Subsidiaries”). During the fourth quarter of 2025, the Company began pre-market activities in India, setting the operational foundation and infrastructure ahead of a full market opening currently anticipated in the first half of 2027. This market’s financial results, which are included in the Southeast Asia/Pacific segment in this report, were insignificant for the third quarter and first nine months of 2026.
2. Summary of Significant Accounting Policies
Purchase of noncontrolling interest
During the three months ended March 31, 2026, the Company acquired the remaining 30 % equity interest in LifeDNA, Inc. (“LifeDNA”), for cash consideration of $6.5 million. The carrying amount of noncontrolling interest, which was previously included in other liabilities on the consolidated balance sheet, was reduced by $4.1 million, with the difference of $2.4 million recorded in additional paid-in capital. Following this transaction, LifeDNA became a wholly owned subsidiary. Due to the noncontrolling interest’s immaterial balance, the Company has historically not separately disclosed the noncontrolling interest balance or activity.
Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40). This standard requires disclosure of
specific information about costs and expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. The Company is currently evaluating the potential effect
that the updated standard will have on its financial statement disclosures.
In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The amendments remove
references to development “stages,” clarify the probable-to-complete threshold for capitalization of internal-use software costs, relocate website development guidance into Subtopic 350-40, and require that capitalized internal-use software costs
follow Topic 360 disclosure requirements regardless of balance-sheet presentation. The amendments are effective for annual periods beginning after December 15, 2027, and interim periods within those annual periods; early adoption is permitted as of
the beginning of an annual period. Entities may adopt the guidance prospectively, retrospectively, or using a modified prospective transition approach. The Company is evaluating the impact of this guidance and the available transition alternatives on
its consolidated financial statements and disclosures.
Inventories, net
Inventories, net consist of the following (U.S. dollars in thousands):
|
September 30,
|
December 31,
|
|||||||
|
2026
|
2025
|
|||||||
|
Raw materials
|
$
|
|
$
|
|
||||
|
Finished goods
|
|
|
||||||
|
Total inventory, net
|
$
|
|
$
|
|
||||
Reserves of inventories consist of the following (U.S. dollars in thousands):
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||
|
2026
|
2025
|
2026
|
2025
|
|||||||||||||
|
Beginning balance
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Additions
|
|
|
|
|
||||||||||||
|
Write-offs
|
( |
)
|
( |
)
|
( |
)
|
( |
)
|
||||||||
|
Ending balance
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Revenue Recognition
Contract Liabilities – Customer Loyalty Programs
Contract liabilities, recorded as deferred revenue within the accrued expenses line in the consolidated balance sheets, include loyalty point program deferrals with certain customers which are accounted for as a
reduction in the transaction price and are generally recognized as points are redeemed for additional products.
The balance of deferred revenue related to contract liabilities as of September 30, 2026 and December 31, 2025 was $5.8 million and $7.2 million, respectively. The contract liabilities’ impact to revenue for the three-month periods ended September 30, 2026 and 2025 was an increase of $0.5 million and an increase of $0.1 million, respectively. The impact to revenue for the nine-month periods ended September 30, 2026, and 2025 was an increase of $1.4 million and an increase of $0.5 million, respectively.
3. Gain on Sale
On January 2, 2025, the Company completed the sale of its entity to Clout.io Holdings, Inc. for $230 million in cash and shares of the purchaser’s common stock, subject to certain adjustments as set forth in the purchase agreement, including post-closing determination of net working capital and other elements of the purchase price. Following the completion of certain payments to other equity holders in Mavely and the payment of certain transaction expenses, the Company received net proceeds of $193.7 million and equity interest with an estimated fair value of $6.1 million. In the second quarter of 2025, the Company received an additional payment of $2.7 million and in the third quarter of 2025 received an additional $1.7 million. The estimated fair value was based on observable price changes and is classified as a level 3 fair value measurement and is accounted for under the measurement alternative described in ASC 321-10-35-2 for equity securities that lack readily determinable fair values. In the first quarter of 2025, the Company recorded a gain on sale of $176.2 million.
During the first quarter of 2025, the Company recorded $5.2 million of stock-based compensation expense related to profit interest units issued to the Mavely founders. This expense should have been recorded in the fourth quarter of 2024 when the performance conditions became probable of vesting. The impact of the adjustment to correct this item was immaterial to the current and prior period financial statements.
4. Goodwill and Intangibles
Goodwill
The Company’s reporting units for goodwill are its operating segments, which are also its reportable segments, with the exception of Rhyz Other. The Rhyz Other segment is made up of two reporting units, which had goodwill of $4.7 0.0
During the three months ended June 30, 2026, the Company determined that the continued decline in the Company’s stock price and corresponding market capitalization as well as declines in the manufacturing segment forecast was a triggering event that required the Company to perform a quantitative impairment analysis. Based on the analysis, the Company concluded the fair value of the manufacturing reporting unit was less than the carrying value. As a result, the Company recorded a non-cash goodwill impairment charge of $78.9 million within on the consolidated statement of income. As part of the Company’s impairment analysis, the fair value of the reporting unit was determined using the income and market approach. The income approach used level 3 inputs and utilized management’s estimates related to future cash flows, which assumed factors such as revenue growth rates, profitability margins, and discount rates.
The following table presents the change in carrying amount of goodwill by reporting unit for the nine months ended September 30, 2026 (U.S. dollars in thousands):
|
Nu Skin
|
Rhyz
|
|||||||||||||||||||||||||||||||||||||||
|
Southeast
|
Mainland
|
Europe &
|
Hong Kong/
|
Rhyz
|
Total
|
|||||||||||||||||||||||||||||||||||
|
Americas
|
Asia/Pacific
|
China
|
Japan
|
Africa
|
South Korea
|
Taiwan
|
Manufacturing
|
Other
|
Segments
|
|||||||||||||||||||||||||||||||
|
Goodwill as of December 31, 2025
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
|
Impairment
|
|
|
|
|
|
|
|
( |
)
|
|
( |
)
|
||||||||||||||||||||||||||||
|
Goodwill as of September 30, 2026
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Accumulated impairment losses for each segment as of September 30, 2026 and December 31, 2025 are as follows:
|
Nu Skin
|
Rhyz
|
|||||||||||||||||||||||||||||||||||||||
|
Southeast
|
Mainland
|
Europe &
|
Hong Kong/
|
Rhyz
|
Total
|
|||||||||||||||||||||||||||||||||||
|
Americas
|
Asia/Pacific
|
China
|
Japan
|
Africa
|
South Korea
|
Taiwan
|
Manufacturing
|
Other
|
Segments
|
|||||||||||||||||||||||||||||||
|
Accumulated impairment losses as of December 31, 2025
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
|
Impairment
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Accumulated impairment losses as of September 30, 2026
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Intangibles
The Company reviews long-lived assets for impairment when performance expectations, events or change in circumstances indicate that the assets’ carrying value may not be recoverable. The evaluation is performed at the
lowest level of identifiable cash flows by comparing the carrying value of the asset group to the net undiscounted cash flows. If the evaluation indicates that the carrying amount of the assets may not be recoverable, any potential impairment is
measured based upon the fair value of the related asset group.
During the first quarter of 2025, the Company decided to make a strategic shift in how it operates the BeautyBio asset group. These strategy changes included exiting certain sales channels, which reduced the forecasted revenues for BeautyBio. The Company concluded these actions were an interim impairment triggering event. As a result, the Company performed an interim impairment test of the asset group and assessed the recoverability of the related asset group by comparing the carrying value of the asset group to the net undiscounted cash flow expected to be generated. The recoverability test indicated that the asset group was impaired. The Company concluded the asset group’s carrying value exceeded its estimated fair value, which was determined utilizing the discounted projected future cash flows, which resulted in an impairment charge. The estimated fair value was based on expected future cash flows using level 3 inputs and utilized management estimates related to revenue growth rates, profitability margins and discount rates. As a result, during the three months ended March 31, 2025, the Company recorded an impairment charge of $25.1 million on the BeautyBio asset group, which is part of its Rhyz Other segment within impairment expenses on the consolidated statement of income. As of the impairment date, the BeautyBio asset group had a remaining carrying value of $2.3 million with a remaining weighted-average amortization period of approximately 7 years.
During the first quarter of 2026, the Company decided to wind down its separate BeautyBio business. As a result of this decision, the Company recorded an impairment charge of $1.8 million on the BeautyBio asset group, which is part of its Rhyz Other segment, within impairment expenses on the consolidated statement of income. As of March 31, 2026, the BeautyBio asset group has no remaining carrying value.
5. Debt
2022 Credit Agreement
On June 14, 2022, the Company entered into an Amended and Restated Credit Agreement (the “2022 Credit Agreement”) with several financial institutions as lenders and Bank of America, N.A., as administrative agent, which amended and restated the 2018 Credit Agreement. The 2022 Credit Agreement provided for a $400 million term loan facility and a $500 million revolving credit facility, each with a term of five years 0.175 % to 0.30 % on the unused portion of the total lender commitments then in effect. The term loan facility amortized in quarterly installments in amounts resulting in an annual amortization of 2.5 % during the first year and 5.0 65 % of the capital stock of certain foreign subsidiaries. The 2022 Credit Agreement required the Company to maintain a consolidated leverage ratio not exceeding 2.75 to 1.00 and a consolidated interest coverage ratio of no less than 3.00 to 1.00.
Credit Agreement
On March 27, 2026, the Company entered into an Amended and Restated Credit Agreement (the “Credit Agreement”) with several financial institutions as lenders and Bank of America, N.A., as administrative agent, which amended and restated the 2022 Credit Agreement. The Credit Agreement provides for a $175 million term loan facility and a $75 million revolving credit facility, each with a term of five years 0.175 % to 0.30 % on the unused portion of the total lender commitments then in effect. The term loan facility will amortize in equal quarterly installments in amounts resulting in an annual amortization of $20 million per annum, with the remainder payable at final maturity. The Credit Agreement is guaranteed by certain of the Company’s domestic subsidiaries and collateralized by assets of such subsidiaries, including a pledge of 65 % of the capital stock of certain foreign subsidiaries. The Credit Agreement requires the Company to maintain a consolidated leverage ratio not exceeding 2.25 to 1.00 and a consolidated interest coverage ratio of no less than 3.00 to 1.00. As of September 30, 2026, the Company was in compliance with all covenants under the Credit Agreement.
The following table summarizes the Company’s debt facilities as of September 30, 2026 and December 31, 2025:
| Facility or Arrangement | Original Principal Amount | Balance as of September 30, 2026 (1)(2) | Balance as of December 31, 2025(1)(2) | Interest Rate | Repayment Terms | |||||
| 2022 Credit Agreement term loan facility | $ | - | $ | | | |||||
| 2022 Credit Agreement revolving credit facility | - | - | | | ||||||
| Credit Agreement term loan facility | $ | $ | | Variable | | |||||
| Credit Agreement revolving credit facility | $ | | Variable | | ||||||
| (1) | |
| (2) | |
6. Leases
As of September 30, 2026, the weighted-average remaining lease term was 6.0 and 3.1 years for operating and finance leases, respectively. As of September 30, 2026, the weighted-average discount rate was 3.8 % and 6.5 % for operating and finance leases, respectively.
The components of lease expense were as follows (U.S. dollars in thousands):
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||
|
2026
|
2025
|
2026
|
2025
|
|||||||||||||
|
Operating lease expense
|
||||||||||||||||
|
Operating lease cost
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Variable lease cost
|
|
|
|
|
||||||||||||
|
Finance lease expense
|
||||||||||||||||
|
Amortization of right-of-use assets
|
|
|
|
|
||||||||||||
|
Interest on lease liabilities
|
|
|
|
|
||||||||||||
|
Total lease expense
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Supplemental cash flow information related to leases was as follows (U.S. dollars in thousands):
|
Nine Months Ended
|
||||||||
|
September 30,
|
||||||||
|
2026
|
2025
|
|||||||
|
Operating cash outflow from operating leases
|
$
|
|
$
|
|
||||
|
Operating cash outflow from finance leases
|
$
|
|
$
|
|
||||
|
Financing cash outflow from finance leases
|
$
|
|
$
|
|
||||
|
Right-of-use assets obtained in exchange for operating lease obligations
|
$
|
|
$
|
|
||||
|
Right-of-use assets obtained in exchange for finance lease obligations
|
$
|
|
$
|
|
||||
Maturities of lease liabilities were as follows (U.S. dollars in thousands):
|
Operating
|
Finance
|
|||||||
|
Year Ending December 31,
|
Leases
|
Leases
|
||||||
|
2026
|
$
|
|
$
|
|
||||
|
2027
|
|
|
||||||
|
2028
|
|
|
||||||
|
2029
|
|
|
||||||
|
2030
|
|
|
||||||
|
Thereafter
|
|
|
||||||
|
Total
|
|
|
||||||
|
Less: Finance Charges
|
|
|
||||||
|
Total Principal Liability
|
$
|
|
$
|
|
||||
The Company has additional lease liabilities of $37.5 million which have as of September 30, 2026, and as such, have not been recognized on the consolidated balance sheets.
7. Capital Stock
Net income (loss) per share
Net income per share is computed based on the weighted-average number of common shares outstanding during the periods presented. Additionally, diluted earnings per share data gives effect to all potentially dilutive common shares that were outstanding during the periods presented. For the three-month periods ended September 30, 2026 and 2025, stock awards and options of 3.4 million and 1.0 million, respectively, and for the nine-month periods ended September 30, 2026 and 2025, stock awards and options of 2.5 million and 1.6 million, respectively, were excluded from the calculation of diluted earnings per share because they were anti-dilutive.
Dividends
In , , and 2026, the Company’s board of directors declared quarterly cash dividends of $0.06 2.9 March 11, 2026 and June 10, 2026 , and September 9, 2026 , respectively, to stockholders of record on February 27, 2026 and May 29, 2026 , and August 28, 2026 , respectively. In November 2026 , the Company’s board of directors declared a quarterly cash dividend of $0.06 per share to be paid on December 9, 2026 to stockholders of record on November 27, 2026 .
Repurchase of common stock
During the three-month period ended September 30, 2026, the Company repurchased no shares of its Class A common stock under its stock repurchase plan. For the three-month period ended September 30, 2025, the Company repurchased 0.4 million shares of its Class A common stock under its repurchase plan for $5.0 million. For the nine-month periods ended September 30, 2026 and 2025, the Company repurchased 0.5 million and 1.0 million shares of its Class A common stock under its stock repurchase plan for $5.0 million and $10.0 million, respectively. As of September 30, 2026, $137.3 million was available for repurchases under the Company’s stock repurchase plan.
8. Fair Value and Equity Investments
Fair Value
The carrying value of financial instruments including cash and cash equivalents, accounts receivable and accounts payable approximates fair values due to the short-term nature of these instruments. The carrying value of debt approximates fair value due to the variable 30 -day interest rate. Fair value estimates are made at a specific point in time, based on relevant market information.
The FASB Codification defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly
transaction between market participants at the measurement date. On a quarterly basis, the Company measures at fair value certain financial assets, including cash equivalents. Accounting standards specify a hierarchy of valuation techniques based on
whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs have
created the following fair-value hierarchy:
| ■ |
Level 1 – quoted prices in active markets for identical assets or liabilities;
|
| ■ |
Level 2 – inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
|
| ■ |
Level 3 – unobservable inputs based on the Company’s own assumptions.
|
Accounting standards permit companies, at their option, to measure certain financial instruments and other eligible items at fair value. The Company has elected not to apply the fair value option to existing eligible
items beyond what is required by US GAAP.
The following tables present the fair value hierarchy for those assets measured at fair value on a recurring basis (U.S. dollars in thousands):
|
Fair Value at September 30, 2026
|
||||||||||||||||
|
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
|
Financial assets:
|
||||||||||||||||
|
Cash equivalents and current investments
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Life insurance contracts
|
|
|
|
|
||||||||||||
|
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Fair Value at December 31, 2025
|
||||||||||||||||
|
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
|
Financial assets:
|
||||||||||||||||
|
Cash equivalents and current investments
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Life insurance contracts
|
|
|
|
|
||||||||||||
|
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
The following table provides a summary of changes in fair value of the Company’s Level 3 life insurance contracts (U.S. dollars in thousands):
|
2026
|
2025
|
|||||||
|
Beginning balance at January 1
|
$
|
|
$
|
|
||||
|
Actual return on plan assets
|
|
|
||||||
|
Sales and settlements
|
( |
)
|
|
|||||
|
Ending balance at September 30
|
$
|
|
$
|
|
||||
Life insurance contracts: Accounting Standards Codification (“ASC”) 820 preserves practicability exceptions to fair value measurements provided by other applicable provisions of
U.S. GAAP. The guidance in ASC 715-30-35-60 allows a reporting entity, as a practical expedient, to use cash surrender value or conversion value as an expedient for fair value when it is present. Accordingly, the Company determines the fair value of
its life insurance contracts as the cash-surrender value of life insurance policies held in its Rabbi Trust.
Equity Investments
The Company maintains equity investments in companies which are accounted for under the measurement alternative described in ASC 321-10-35-2 for equity securities that lack readily determinable fair values. The carrying amount of an equity security held by the Company without readily determinable fair values was $0 18.1 million of cumulative upward fair value adjustments, based on the valuation of additional equity issued by the investee which was deemed to be an observable transaction of a similar investment under ASC 321. During the year ended December 31, 2025, based on significant deterioration of the business prospects of the investment, the Company recorded a $28.1 million impairment of the investment. These charges were recorded within Other income (expense), net on the Consolidated Statement of Income. The 2025 estimated fair value was determined using a market-based method with level 3 inputs, including revenue and earnings multiples. The Company also had equity securities held without readily determinable fair values of $15.4 million as of September 30, 2026 and $14.3 million as of December 31, 2025.
9. Income Taxes
Provision (benefit) for income taxes for the three- and nine-month periods ended September 30, 2026 was $2.6 million and $190.0 million, respectively, compared to $(1.1 ) million and $32.3 million for the prior-year periods. The effective tax rates for the three- and nine-month periods ended September 30, 2026, were 139.3 % and (323.8 )% of pre-tax income, respectively, compared to (6.8 )% and 18.1 % in the prior-year periods. The change in the effective tax rate in the third quarter of 2026 is primarily due to a U.S. consolidated book loss and its impact on the annualized effective tax rate.
During the second quarter of 2026, the Company established a $167.5 million valuation allowance against its U.S. deferred tax assets as it was determined to be more likely than not that these assets will not be realized. This determination was made based on weighing all available evidence, positive and negative, including cumulative losses recognized in the U.S. entity over the past three years . These cumulative losses were mainly due to the impairment of goodwill and other intangible assets. Therefore, the Company recorded a full valuation allowance against these U.S. deferred tax assets as of June 30, 2026.
During the third quarter of 2026, the Company recorded a $2.8 million out-of-period adjustment to correct for an in the recognition of R&D credits related to the fourth quarter of 2025. This correction, which is immaterial , individually and in aggregate, to prior periods, increased the provision for income taxes for the third quarter of 2026.
The Company accounts for income taxes in accordance with ASC Topic 740 “Income Taxes.” These standards establish financial accounting and reporting standards for the effects of income taxes that result from an enterprise’s activities during the current and preceding years. The Company takes an asset and liability approach for financial accounting and reporting of income taxes. The Company pays income taxes in many foreign jurisdictions based on the profits realized in those jurisdictions, which can be significantly impacted by terms of intercompany transactions between the Company and its foreign affiliates. Deferred tax assets and liabilities are created in this process. The Company has netted these deferred tax assets and deferred tax liabilities by jurisdiction. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be ultimately realized. The Company had net deferred tax assets of $6.5 million and $171.4 million as of September 30, 2026 and December 31, 2025, respectively.
The Company evaluates its indefinite reinvestment assertions with respect to foreign earnings for each quarter. For all foreign earnings, the Company accrues the applicable foreign income taxes. For the earnings that have been indefinitely reinvested, the Company does not accrue foreign withholding taxes. Undistributed earnings that the Company has indefinitely reinvested, for which no foreign withholding taxes have been provided, aggregate to $60.0 million as of December 31, 2025. If the amount designated as indefinitely reinvested as of December 31, 2025 were repatriated to the United States, the amount of incremental taxes would be approximately $6.0 million. The Company intends to utilize the indefinitely reinvested offshore earnings to fund foreign investments, specifically capital expenditures.
The Company files income tax returns in the U.S. federal jurisdiction, and in various state and foreign jurisdictions. In 2009, the Company entered into a voluntary program with the IRS called Compliance Assurance Process (“CAP”). The objective of CAP is to contemporaneously work with the IRS to achieve federal tax compliance and resolve all or most of the issues prior to filing of the tax return. As of September 30, 2026, all tax years through 2024, with the exception of 2021, have been audited and are effectively closed to further examination. For tax year 2021, the Company was in the Bridge phase of the CAP program, pursuant to which the IRS will not accept disclosures, will not conduct reviews and will not provide letters of assurance for the Bridge years. There are limited circumstances that tax years in the Bridge phase will be opened for examination. For tax years 2025 and 2026, the Company has been accepted in the IRS’s Bridge Plus program. The Company may elect to continue participating in CAP for future tax years; the Company may withdraw from the program at any time. With a few exceptions, the Company is no longer subject to state and local income tax examination by tax authorities for the years before 2022. Foreign jurisdictions have varying lengths of statutes of limitations for income tax examinations. Some statutes are as short as three years and in certain markets may be as long as ten years . The Company is currently under examination in certain foreign jurisdictions; however, the outcomes of those reviews are not yet determinable.
In 2021, as part of the Organization for Economic Co-operation and Development’s (“OECD”) Inclusive Framework, 140 member countries agreed to the implementation of the Pillar Two Global Minimum Tax (“Pillar Two”) of
15%. The OECD continues to release additional guidance, including administrative guidance on how Pillar Two rules should be interpreted and applied by jurisdictions as they adopt Pillar Two. A number of countries have utilized the administrative
guidance as a starting point for legislation that went into effect January 1, 2024. On January 5, 2026, the OECD announced the acceptance of a “side-by-side” safe harbor election that exempts U.S.-parented multinational groups from certain minimum
taxes prescribed under the Pillar Two rules. Based on current enacted legislation, the Company anticipates the impact of Pillar Two to be immaterial for 2026.
On July 4, 2025, U.S. legislation formally titled “An Act to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14” (“the Act”) and commonly referred to as the One Big Beautiful Bill Act was signed into
law. The Act, among other things, extended key provisions of the 2017 Tax Cuts and Jobs Act and introduced targeted changes to the U.S. federal income tax regime. The Act has not materially impacted the Company’s effective tax rate.
10. Derivatives and Hedging Activities
Risk Management Objective of Using Derivatives
The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through
management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative
financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which
are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally
related to the Company’s borrowings.
Cash Flow Hedges of Interest Rate Risk
The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses
interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over
the life of the agreements without exchange of the underlying notional amount. During 2025, such derivatives were used to hedge the variable cash flows associated with existing variable-rate debt.
For derivatives designated and that qualify as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in Accumulated Other Comprehensive Income and subsequently reclassified into
interest expense/income in the same period(s) during which the hedged transaction affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense/income as interest payments
are made/received on the Company’s variable-rate debt.
During July of 2025, the Company’s four interest rate derivatives with a total notional amount of $200 million matured, leaving no
Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Loss
The tables below present the effect of cash flow hedge accounting on Accumulated Other Comprehensive Loss.
|
Amount of Gain Recognized in
|
||||||||||||||||
|
Other Comprehensive Income (Loss) on Derivatives
|
||||||||||||||||
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||
|
Derivatives in Cash Flow Hedging Relationships:
|
2026
|
2025
|
2026
|
2025
|
||||||||||||
|
Interest Rate Swaps
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Amount of Gain Reclassified from
|
||||||||||||||||||
|
Accumulated Other Comprehensive Income (Loss) into Income
|
||||||||||||||||||
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||||
|
Derivatives in Cash Flow Hedging Relationships:
|
Income Statement Location
|
2026
|
2025
|
2026
|
2025
|
|||||||||||||
|
Interest Rate Swaps
|
Interest expense
|
$
|
|
$
|
|
$
|
|
$
|
|
|||||||||
11. Segment Information
The Company reports revenue from nine segments, consisting of its seven geographic Nu Skin segments—Americas, Southeast Asia/Pacific, Mainland China, Japan, Europe & Africa, South Korea, and Hong Kong/Taiwan—and two Rhyz segments—Manufacturing and Rhyz Other. The Nu Skin Other category includes miscellaneous corporate revenue and related adjustments. The Rhyz Other segment includes two operating segments that are aggregated into one reporting segment and includes other investments by our Rhyz business arm. The Chief Executive Officer is the chief operating decision maker (“CODM”). These segments reflect the way the CODM evaluates the Company’s business performance and allocates resources. Reported revenue includes only the revenue generated by sales to external customers.
Profitability by segment as determined under US GAAP is driven primarily by the Company’s transfer pricing policies. Segment contribution, which is the Company’s segment profitability metric presented in the table
below, excludes certain intercompany charges, specifically royalties, license fees, transfer pricing, discrete charges and other miscellaneous items. These charges have been included in Corporate and other expenses. Corporate and other expenses also
include costs related to the Company’s executive and administrative offices, information technology, research and development, and marketing and supply chain functions not recorded at the segment level.
The accounting policies of the segments are the same as those described in Note 2, “Summary of Significant Accounting Policies.” The Company evaluates the performance of its segments based on segment
contribution. Each segment records direct expenses related to its employees and its operations.
Summarized financial information for the Company’s reportable segments is shown in the following tables. Asset information is not reviewed or included with the Company’s internal management reporting. Therefore, the Company has not disclosed asset information for each reportable segment.
| Three Months Ended September 30, 2026 |
||||||||||||||||||||||||||||||||||||||||
| Nu Skin |
Rhyz |
|||||||||||||||||||||||||||||||||||||||
| Southeast Asia/ |
Mainland |
Europe & |
Hong Kong/ |
South |
Rhyz |
Total |
||||||||||||||||||||||||||||||||||
| Americas |
Pacific |
China |
Japan |
Africa |
Taiwan |
Korea |
Manufacturing(1) |
Other |
Segments |
|||||||||||||||||||||||||||||||
|
Revenue
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
|
Cost of sales
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Other segment items(2)
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Segment contribution
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
( |
)
|
$
|
|
|||||||||||||||||||
| Three Months Ended September 30, 2025 |
||||||||||||||||||||||||||||||||||||||||
| Nu Skin |
Rhyz |
|||||||||||||||||||||||||||||||||||||||
| Southeast Asia/ |
Mainland |
Europe & |
Hong Kong/ |
South |
Rhyz |
Total |
||||||||||||||||||||||||||||||||||
| Americas |
Pacific |
China |
Japan |
Africa |
Taiwan |
Korea |
Manufacturing(1) |
Other |
Segments |
|||||||||||||||||||||||||||||||
|
Revenue
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
|
Cost of sales
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Other segment items(2)
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Segment contribution
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
( |
)
|
$
|
|
|||||||||||||||||||
| Nine Months Ended September 30, 2026 |
||||||||||||||||||||||||||||||||||||||||
| Nu Skin |
Rhyz |
|||||||||||||||||||||||||||||||||||||||
| Southeast Asia/ |
Mainland |
Europe & |
Hong Kong/ |
South |
Rhyz |
Total |
||||||||||||||||||||||||||||||||||
| Americas |
Pacific |
China |
Japan |
Africa |
Taiwan |
Korea |
Manufacturing(1) |
Other |
Segments |
|||||||||||||||||||||||||||||||
|
Revenue
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
|
Cost of sales
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Other segment items(2)
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Segment contribution
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
( |
)
|
$
|
( |
)
|
$
|
|
||||||||||||||||||
| Nine Months Ended September 30, 2025 |
||||||||||||||||||||||||||||||||||||||||
| Nu Skin |
Rhyz |
|||||||||||||||||||||||||||||||||||||||
| Southeast Asia/ |
Mainland |
Europe & |
Hong Kong/ |
South |
Rhyz |
Total |
||||||||||||||||||||||||||||||||||
| Americas |
Pacific |
China |
Japan |
Africa |
Taiwan |
Korea |
Manufacturing(1) |
Other |
Segments |
|||||||||||||||||||||||||||||||
|
Revenue
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
|
Cost of sales
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Other segment items(2)
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Segment contribution
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
( |
)
|
$
|
|
|||||||||||||||||||
| (1) | |
| (2) | |
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||
|
2026
|
2025
|
2026
|
2025
|
|||||||||||||
|
Total segment revenue
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Core Nu Skin Adjustments
|
|
|
|
|
||||||||||||
|
Total revenue
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||
|
2026
|
2025
|
2026
|
2025
|
|||||||||||||
|
Total segment contribution
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Corporate and Other
|
( |
)
|
( |
)
|
( |
)
|
( |
)
|
||||||||
|
Operating income (loss)
|
|
|
( |
)
|
|
|||||||||||
|
Interest expense
|
|
|
|
|
||||||||||||
|
Gain on sale of business
|
|
|
|
|
||||||||||||
|
Other income (expense), net
|
|
( |
)
|
|
( |
)
|
||||||||||
|
Income (loss) before provision for income taxes
|
$
|
|
$
|
|
$
|
( |
)
|
$
|
|
|||||||
Depreciation and Amortization
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||
|
(U.S. dollars in thousands)
|
2026
|
2025
|
2026
|
2025
|
||||||||||||
|
Nu Skin
|
||||||||||||||||
|
Americas
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Southeast Asia/Pacific
|
|
|
|
|
||||||||||||
|
Mainland China
|
|
|
|
|
||||||||||||
|
Japan
|
|
|
|
|
||||||||||||
|
Europe & Africa
|
|
|
|
|
||||||||||||
|
Hong Kong/Taiwan
|
|
|
|
|
||||||||||||
|
South Korea
|
|
|
|
|
||||||||||||
|
Total Nu Skin
|
|
|
|
|
||||||||||||
|
Rhyz
|
||||||||||||||||
|
Manufacturing
|
|
|
|
|
||||||||||||
|
Rhyz Other
|
|
|
|
|
||||||||||||
|
Total Rhyz
|
|
|
|
|
||||||||||||
|
Corporate and Other
|
|
|
|
|
||||||||||||
|
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Capital Expenditures
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||
|
(U.S. dollars in thousands)
|
2026
|
2025
|
2026
|
2025
|
||||||||||||
|
Nu Skin
|
||||||||||||||||
|
Americas
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
Southeast Asia/Pacific
|
|
|
|
|
||||||||||||
|
Mainland China
|
|
|
|
|
||||||||||||
|
Japan
|
|
|
|
|
||||||||||||
|
Europe & Africa
|
|
|
|
|
||||||||||||
|
Hong Kong/Taiwan
|
|
|
|
|
||||||||||||
|
South Korea
|
|
|
|
|
||||||||||||
|
Total Nu Skin
|
|
|
|
|
||||||||||||
|
Rhyz
|
||||||||||||||||
|
Manufacturing
|
|
|
|
|
||||||||||||
|
Rhyz Other
|
|
|
|
|
||||||||||||
|
Total Rhyz
|
|
|
|
|
||||||||||||
|
Corporate and other
|
|
|
|
|
||||||||||||
|
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
12. Commitments and Contingencies
The Company is subject to government regulations pertaining to product formulation, labeling and packaging, product claims and advertising, and the Company’s direct selling system. The Company is also subject to the
jurisdiction of numerous foreign tax and customs authorities. Any assertions or determination that either the Company or the Company’s sales force is not in compliance with existing statutes, laws, rules or regulations could have a material adverse
effect on the Company’s operations. In addition, in any country or jurisdiction, the adoption of new statutes, laws, rules or regulations or changes in the interpretation of existing statutes, laws, rules or regulations could have a material adverse
effect on the Company and its operations. No assurance can be given that the Company’s compliance with applicable statutes, laws, rules and regulations will not be challenged by foreign authorities or that such challenges will not have a material
adverse effect on the Company’s financial position, results of operations or cash flows. The Company and its Subsidiaries are defendants in litigation, investigations and other proceedings involving various matters. Management believes that the
ultimate liability arising from such claims and contingencies, if any, is not likely to have a material adverse effect on the Company’s consolidated financial condition, results of operations or cash flows.
The Company is subject to regular audits by federal, state and foreign tax authorities. These audits may result in additional tax liabilities. The Company believes it has appropriately provided for income taxes for all
years. Several factors drive the calculation of its tax reserves. Some of these factors include: (i) the expiration of various statutes of limitations; (ii) changes in tax law and regulations; (iii) issuance of tax rulings; and (iv) settlements with
tax authorities. Changes in any of these factors may result in adjustments to the Company’s reserves, which would impact its reported financial results.
| ITEM 2. |
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
This Quarterly Report on Form 10-Q (this “Quarterly Report”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E
of the Securities Exchange Act of 1934, as amended, that represent our current expectations and beliefs. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws and
include, but are not limited to, statements of management’s expectations regarding our performance, growth, initiatives, strategies, products, ingredients, product introductions and offerings, product portfolio optimization, restructuring and exit
activities, acquisitions, the integration and performance of acquired companies, divestitures, opportunities and risks; statements of management’s expectations, plans and beliefs regarding global economic conditions and our markets (including
India), sales force, sales compensation plan and customer base; statements regarding government policies and regulations relating to our industry, including government policies and regulations in or related to the United States and Mainland China;
statements regarding tariffs and trade policies; statements regarding the outcome of litigation, audits, investigations, and other legal or regulatory matters; statements of projections and expectations regarding future sales, expenses, operating
results, taxes, duties, capital expenditures, sources and uses of cash, foreign-currency fluctuations or devaluations, repatriation of undistributed earnings, and other financial items; statements regarding the payment of future dividends and stock
repurchases; accounting estimates and assumptions; statements of belief; and statements of assumptions underlying any of the foregoing. In some cases, you can identify these statements by forward-looking words such as “believe,” “expect,” “enable,”
“project,” “anticipate,” “determine,” “estimate,” “intend,” “plan,” “goal,” “objective,” “targets,” “become,” “likely,” “will,” “would,” “could,” “may,” “might,” the negative of these words and other similar words. Forward-looking statements speak
only as of the date of this Quarterly Report, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law. We caution and
advise readers that these statements are based on assumptions that may not be realized and involve important risks and uncertainties that could cause actual results to differ materially from the expectations and beliefs contained herein. For a
summary of these risks, see the risk factors included in our Annual Report on Form 10-K for the 2025 fiscal year and in any of our subsequent Securities and Exchange Commission filings, including this Quarterly Report.
The following Management’s Discussion and Analysis should be read in conjunction with our consolidated financial statements and related notes and Management’s Discussion and Analysis included in our Annual Report on
Form 10-K for the 2025 fiscal year, and our other reports filed with the Securities and Exchange Commission through the date of this Quarterly Report.
Overview
Revenue for the three-month period ended September 30, 2026 decreased 14.6% to $311.0 million, compared to $364.2 million in the prior-year period, and revenue for the nine-month period ended September 30, 2026
decreased 14.6% to $951.7 million, compared to $1,114.8 million in the prior-year period. Our revenue in the third quarter and first nine months of 2026 was negatively impacted by 1.1% and 0.3%, respectively, from foreign-currency fluctuations. Our
Customers, Paid Affiliates and Sales Leaders declined 18%, 10% and 13%, respectively, on a year-over-year basis.
The declines for the three- and nine-month periods ended September 30, 2026 were largely driven by the continued macroeconomic challenges we have been facing in our markets, which have negatively impacted consumer
spending and customer acquisition. Our priorities for 2026 focus on business model optimization, driven by the continued rollout of enhancements to our sales performance plan, the continued launch of our Prysm iO
intelligent wellness platform and business expansion into India. Our early learnings from the Prysm iO have resulted in a shift in the strategy from a device placement focus to an assessment model that is
more conducive to in-person engagement. In addition, from our preview in India we have identified the need to simplify the model in advance of our full market opening, which is slated for the first half of 2027.
Earnings per share for the third quarter of 2026 decreased to $(0.02), compared to $0.34 in the prior-year period. Earnings per share for the first nine months of 2026 decreased to $(5.13),
compared to $2.91 in the prior-year period. Our third quarter 2026 earnings per share were negatively impacted by severance charges, as well as the decline in revenue. Our earnings per share for the first nine months of 2026 were negatively
impacted by the second quarter impairment charge of $78.9 million, second quarter valuation allowance of $167.5 million associated with our U.S. deferred tax assets, charges associated with our first quarter of 2026 wind down of our separate
BeautyBio business and decline in revenue. In addition, our 2025 earnings per share benefited from the January 2025 sale of our Mavely business, which generated a pre-tax gain of approximately $176.2 million, partially offset by the associated
taxes, an intangible asset group impairment of $25.1 million in our Rhyz Other segment and a non-cash loss on equity investment of $28.1 million.
Segment Results
We report our business in nine segments to reflect our current management approach. These segments consist of our seven geographic Nu Skin segments—Americas, Mainland China, Southeast Asia/Pacific, Japan, Europe &
Africa, South Korea and Hong Kong/Taiwan—and our two Rhyz segments—Manufacturing and Rhyz Other. The Nu Skin Other category includes miscellaneous corporate revenue and related adjustments.
The following table sets forth revenue for the three- and nine-month periods ended September 30, 2026 and 2025 for each of our reportable segments (U.S. dollars in thousands):
|
Three Months Ended
|
Constant-
|
Nine Months Ended
|
Constant-
|
|||||||||||||||||||||||||||||
|
September 30,
|
Currency
|
September 30,
|
Currency
|
|||||||||||||||||||||||||||||
|
2026
|
2025
|
Change
|
Change(1)
|
2026
|
2025
|
Change
|
Change(1)
|
|||||||||||||||||||||||||
|
Nu Skin
|
||||||||||||||||||||||||||||||||
|
Americas
|
$
|
53,092
|
$
|
63,994
|
(17.0
|
)%
|
(15.9
|
)%
|
$
|
170,673
|
$
|
205,998
|
(17.1
|
)%
|
(14.8
|
)%
|
||||||||||||||||
|
Southeast Asia/Pacific
|
43,032
|
56,285
|
(23.5
|
)%
|
(23.2
|
)%
|
131,763
|
159,291
|
(17.3
|
)%
|
(18.8
|
)%
|
||||||||||||||||||||
|
Mainland China
|
37,888
|
42,519
|
(10.9
|
)%
|
(16.1
|
)%
|
128,992
|
143,518
|
(10.1
|
)%
|
(15.0
|
)%
|
||||||||||||||||||||
|
Japan
|
38,627
|
44,545
|
(13.3
|
)%
|
(6.5
|
)%
|
116,509
|
131,860
|
(11.6
|
)%
|
(5.5
|
)%
|
||||||||||||||||||||
|
Europe & Africa
|
27,898
|
38,002
|
(26.6
|
)%
|
(25.4
|
)%
|
91,433
|
108,351
|
(15.6
|
)%
|
(18.7
|
)%
|
||||||||||||||||||||
|
Hong Kong/Taiwan
|
25,739
|
31,799
|
(19.1
|
)%
|
(15.2
|
)%
|
79,270
|
87,773
|
(9.7
|
)%
|
(8.5
|
)%
|
||||||||||||||||||||
|
South Korea
|
24,410
|
35,202
|
(30.7
|
)%
|
(29.3
|
)%
|
75,359
|
101,785
|
(26.0
|
)%
|
(23.3
|
)%
|
||||||||||||||||||||
|
Nu Skin Other
|
1,888
|
244
|
673.8
|
%
|
673.8
|
%
|
1,733
|
1,200
|
44.4
|
%
|
44.3
|
%
|
||||||||||||||||||||
|
Total Nu Skin
|
252,574
|
312,590
|
(19.2
|
)%
|
(18.0
|
)%
|
795,732
|
939,776
|
(15.3
|
)%
|
(14.9
|
)%
|
||||||||||||||||||||
|
Rhyz
|
||||||||||||||||||||||||||||||||
|
Manufacturing
|
56,831
|
47,648
|
19.3
|
%
|
19.3
|
%
|
148,125
|
163,338
|
(9.3
|
)%
|
(9.3
|
)%
|
||||||||||||||||||||
|
Rhyz Other
|
1,604
|
3,973
|
(59.6
|
)%
|
(59.6
|
)%
|
7,872
|
11,725
|
(32.9
|
)%
|
(32.9
|
)%
|
||||||||||||||||||||
|
Total Rhyz
|
58,435
|
51,621
|
13.2
|
%
|
13.2
|
%
|
155,997
|
175,063
|
(10.9
|
)%
|
(10.9
|
)%
|
||||||||||||||||||||
|
Total
|
$
|
311,009
|
$
|
364,211
|
(14.6
|
)%
|
(13.5
|
)%
|
$
|
951,729
|
$
|
1,114,839
|
(14.6
|
)%
|
(14.3
|
)%
|
||||||||||||||||
| (1) |
Constant-currency revenue change is a non-GAAP financial measure. See “Non-GAAP Financial Measures,” below.
|
The tables below set forth summarized financial information for each of our reportable segments for the three- and nine-month periods ended September 30, 2026 and 2025 (U.S. dollars
in thousands). Segment contribution excludes certain intercompany charges, specifically royalties, license fees, transfer pricing and other miscellaneous items. We use segment contribution to measure the portion of
profitability that the segment managers have the ability to control for their respective segments. For additional information regarding our segments and the calculation of segment contribution, see Note 11 to the consolidated financial statements
contained in this report.
|
Three Months Ended September 30, 2026
|
||||||||||||||||||||||||||||||||||||||||
|
Nu Skin
|
Rhyz
|
|||||||||||||||||||||||||||||||||||||||
|
Southeast Asia/
|
Mainland
|
Europe &
|
Hong Kong/
|
South
|
Rhyz
|
Total
|
||||||||||||||||||||||||||||||||||
|
Americas
|
Pacific
|
China
|
Japan
|
Africa
|
Taiwan
|
Korea
|
Manufacturing
|
Other
|
Segments
|
|||||||||||||||||||||||||||||||
|
Revenue
|
$
|
53,092
|
$
|
43,032
|
$
|
37,888
|
$
|
38,627
|
$
|
27,898
|
$
|
25,739
|
$
|
24,410
|
$
|
56,831
|
$
|
1,604
|
$
|
309,121
|
||||||||||||||||||||
|
Cost of sales
|
12,732
|
10,352
|
7,106
|
8,192
|
6,805
|
4,073
|
5,242
|
49,388
|
228
|
104,118
|
||||||||||||||||||||||||||||||
|
Other segment items
|
30,364
|
24,229
|
25,779
|
18,865
|
17,495
|
13,942
|
12,272
|
6,100
|
1,701
|
150,747
|
||||||||||||||||||||||||||||||
|
Segment contribution
|
$
|
9,996
|
$
|
8,451
|
$
|
5,003
|
$
|
11,570
|
$
|
3,598
|
$
|
7,724
|
$
|
6,896
|
$
|
1,343
|
$
|
(325
|
)
|
$
|
54,256
|
|||||||||||||||||||
|
Segment contribution as a percentage of revenue
|
18.8
|
%
|
19.6
|
%
|
13.2
|
%
|
30.0
|
%
|
12.9
|
%
|
30.0
|
%
|
28.3
|
%
|
2.4
|
%
|
(20.3
|
)%
|
17.6
|
%
|
||||||||||||||||||||
|
Three Months Ended September 30, 2025
|
||||||||||||||||||||||||||||||||||||||||
|
Nu Skin
|
Rhyz
|
|||||||||||||||||||||||||||||||||||||||
|
Southeast Asia/
|
Mainland
|
Europe &
|
Hong Kong/
|
South
|
Rhyz
|
Total
|
||||||||||||||||||||||||||||||||||
|
Americas
|
Pacific
|
China
|
Japan
|
Africa
|
Taiwan
|
Korea
|
Manufacturing
|
Other
|
Segments
|
|||||||||||||||||||||||||||||||
|
Revenue
|
$
|
63,994
|
$
|
56,285
|
$
|
42,519
|
$
|
44,545
|
$
|
38,002
|
$
|
31,799
|
$
|
35,202
|
$
|
47,648
|
$
|
3,973
|
$
|
363,967
|
||||||||||||||||||||
|
Cost of sales
|
16,682
|
13,734
|
7,365
|
9,319
|
9,717
|
5,218
|
6,952
|
36,795
|
890
|
106,672
|
||||||||||||||||||||||||||||||
|
Other segment items
|
33,908
|
29,708
|
28,594
|
21,989
|
22,449
|
16,548
|
19,131
|
8,254
|
4,360
|
184,941
|
||||||||||||||||||||||||||||||
|
Segment contribution
|
$
|
13,404
|
$
|
12,843
|
$
|
6,560
|
$
|
13,237
|
$
|
5,836
|
$
|
10,033
|
$
|
9,119
|
$
|
2,599
|
$
|
(1,277
|
)
|
$
|
72,354
|
|||||||||||||||||||
|
Segment contribution as a percentage of revenue
|
20.9
|
%
|
22.8
|
%
|
15.4
|
%
|
29.7
|
%
|
15.4
|
%
|
31.6
|
%
|
25.9
|
%
|
5.5
|
%
|
(32.1
|
)%
|
19.9
|
%
|
||||||||||||||||||||
|
Nine Months Ended September 30, 2026
|
||||||||||||||||||||||||||||||||||||||||
|
Nu Skin
|
Rhyz
|
|||||||||||||||||||||||||||||||||||||||
|
Southeast Asia/
|
Mainland
|
Europe &
|
Hong Kong/
|
South
|
Rhyz
|
Total
|
||||||||||||||||||||||||||||||||||
|
Americas
|
Pacific
|
China
|
Japan
|
Africa
|
Taiwan
|
Korea
|
Manufacturing
|
Other
|
Segments
|
|||||||||||||||||||||||||||||||
|
Revenue
|
$
|
170,673
|
$
|
131,763
|
$
|
128,992
|
$
|
116,509
|
$
|
91,433
|
$
|
79,270
|
$
|
75,359
|
$
|
148,125
|
$
|
7,872
|
$
|
949,996
|
||||||||||||||||||||
|
Cost of sales
|
41,993
|
32,055
|
23,394
|
24,607
|
22,596
|
12,648
|
16,169
|
129,150
|
5,060
|
307,672
|
||||||||||||||||||||||||||||||
|
Other segment items
|
96,538
|
74,295
|
79,434
|
58,043
|
56,899
|
42,380
|
37,528
|
97,166
|
11,292
|
553,575
|
||||||||||||||||||||||||||||||
|
Segment contribution
|
$
|
32,142
|
$
|
25,413
|
$
|
26,164
|
$
|
33,859
|
$
|
11,938
|
$
|
24,242
|
$
|
21,662
|
$
|
(78,191
|
)
|
$
|
(8,480
|
)
|
$
|
88,749
|
||||||||||||||||||
|
Segment contribution as a percentage of revenue
|
18.8
|
%
|
19.3
|
%
|
20.3
|
%
|
29.1
|
%
|
13.1
|
%
|
30.6
|
%
|
28.7
|
%
|
(52.8
|
)%
|
(107.7
|
)%
|
9.3
|
%
|
||||||||||||||||||||
|
Nine Months Ended September 30, 2025
|
||||||||||||||||||||||||||||||||||||||||
|
Nu Skin
|
Rhyz
|
|||||||||||||||||||||||||||||||||||||||
|
Southeast Asia/
|
Mainland
|
Europe &
|
Hong Kong/
|
South
|
Rhyz
|
Total
|
||||||||||||||||||||||||||||||||||
|
Americas
|
Pacific
|
China
|
Japan
|
Africa
|
Taiwan
|
Korea
|
Manufacturing
|
Other
|
Segments
|
|||||||||||||||||||||||||||||||
|
Revenue
|
$
|
205,998
|
$
|
159,291
|
$
|
143,518
|
$
|
131,860
|
$
|
108,351
|
$
|
87,773
|
$
|
101,785
|
$
|
163,338
|
$
|
11,725
|
$
|
1,113,639
|
||||||||||||||||||||
|
Cost of sales
|
52,849
|
38,758
|
26,152
|
27,109
|
27,622
|
14,932
|
20,451
|
128,733
|
3,264
|
339,870
|
||||||||||||||||||||||||||||||
|
Other segment items
|
107,182
|
83,318
|
85,797
|
67,707
|
64,311
|
44,789
|
51,387
|
26,527
|
12,254
|
543,272
|
||||||||||||||||||||||||||||||
|
Segment contribution
|
$
|
45,967
|
$
|
37,215
|
$
|
31,569
|
$
|
37,044
|
$
|
16,418
|
$
|
28,052
|
$
|
29,947
|
$
|
8,078
|
$
|
(3,793
|
)
|
$
|
230,497
|
|||||||||||||||||||
|
Segment contribution as a percentage of revenue
|
22.3
|
%
|
23.4
|
%
|
22.0
|
%
|
28.1
|
%
|
15.2
|
%
|
32.0
|
%
|
29.4
|
%
|
4.9
|
%
|
(32.3
|
)%
|
20.7
|
%
|
||||||||||||||||||||
The following table provides information concerning the number of Customers, Paid Affiliates and Sales Leaders in our core Nu Skin business for the three-month periods ended September 30, 2026 and 2025.
| ● |
“Customers” are persons who have purchased directly from the Company during the three months ended as of the date indicated. Our Customer numbers include members of our sales force who made such a purchase, including Paid Affiliates and
those who qualify as Sales Leaders, but they do not include consumers who purchase directly from members of our sales force.
|
| ● |
“Paid Affiliates” are any Brand Affiliates, as well as members of our sales force in Mainland China, who earned sales compensation during the three-month period. In all of our markets besides Mainland China, we refer to members of our
independent sales force as “Brand Affiliates” because their primary role is to promote our brand and products through their personal social networks.
|
| ● |
“Sales Leaders” are the three-month average of our monthly Brand Affiliates, as well as sales employees and independent marketers in Mainland China, who achieved certain qualification requirements as of the end of each month of the
quarter.
|
|
Three Months Ended
|
||||||||||||
|
September 30,
|
||||||||||||
|
2026
|
2025
|
Change
|
||||||||||
|
Customers
|
||||||||||||
|
Americas
|
162,865
|
224,013
|
(27
|
)%
|
||||||||
|
Southeast Asia/Pacific
|
66,791
|
74,672
|
(11
|
)%
|
||||||||
|
Mainland China
|
90,469
|
106,062
|
(15
|
)%
|
||||||||
|
Japan
|
99,256
|
107,543
|
(8
|
)%
|
||||||||
|
Europe & Africa
|
100,615
|
127,993
|
(21
|
)%
|
||||||||
|
Hong Kong/Taiwan
|
36,903
|
41,613
|
(11
|
)%
|
||||||||
|
South Korea
|
52,570
|
64,360
|
(18
|
)%
|
||||||||
|
Total Customers
|
609,469
|
746,256
|
(18
|
)%
|
||||||||
|
Paid Affiliates
|
||||||||||||
|
Americas
|
26,023
|
28,128
|
(7
|
)%
|
||||||||
|
Southeast Asia/Pacific
|
17,587
|
21,144
|
(17
|
)%
|
||||||||
|
Mainland China
|
17,121
|
18,197
|
(6
|
)%
|
||||||||
|
Japan
|
19,278
|
20,559
|
(6
|
)%
|
||||||||
|
Europe & Africa
|
12,646
|
14,803
|
(15
|
)%
|
||||||||
|
Hong Kong/Taiwan
|
9,370
|
10,154
|
(8
|
)%
|
||||||||
|
South Korea
|
14,424
|
17,111
|
(16
|
)%
|
||||||||
|
Total Paid Affiliates
|
116,449
|
130,096
|
(10
|
)%
|
||||||||
|
Sales Leaders
|
||||||||||||
|
Americas
|
4,635
|
5,642
|
(18
|
)%
|
||||||||
|
Southeast Asia/Pacific
|
3,900
|
4,360
|
(11
|
)%
|
||||||||
|
Mainland China
|
5,889
|
6,543
|
(10
|
)%
|
||||||||
|
Japan
|
6,154
|
6,686
|
(8
|
)%
|
||||||||
|
Europe & Africa
|
2,111
|
2,663
|
(21
|
)%
|
||||||||
|
Hong Kong/Taiwan
|
1,956
|
2,174
|
(10
|
)%
|
||||||||
|
South Korea
|
2,350
|
3,082
|
(24
|
)%
|
||||||||
|
Total Sales Leaders
|
26,995
|
31,150
|
(13
|
)%
|
||||||||
Following is a narrative discussion of our results in each segment, which supplements the tables above.
Americas. The results in our Americas segment primarily
reflect a continued decline in our North America markets. For the third quarter of 2026, our Latin America markets’ revenue declined 2.2% on a reported basis,
while on a constant-currency basis revenue increased 0.5%. For the first nine of months of 2026, our Latin America markets’ revenue increased 1.7% on a reported
basis and 8.8% on a constant-currency basis. As our Sales Leaders prioritized Prysm iO and associated wellness products during the first
nine months of 2026, we experienced switching costs as many of our Sales Leaders began adapting to a greater focus on wellness products than previously. During the second quarter of 2026, we released enhancements to our sales compensation plan,
with a higher focus on aligning incentives around Sales Leader development and retention. In addition, our reported revenue reflects negative impacts from unfavorable foreign currency fluctuations of 1.1% and 2.4% for the third quarter and first
nine months of 2026, respectively.
The year-over-year decrease in segment contribution for the third quarter and first nine months of 2026 primarily reflects the overall decline in revenue, as well as a 1.6 and 2.8
percentage-point increase for the third quarter and first nine months of 2026, respectively, in selling expenses from additional incentives aimed at assisting the transition associated with the sales compensation plan enhancements, partially offset
by a 2.1 and 1.1 percentage-point increase in gross margin for the third quarter and first nine months of 2026, respectively, partially attributable to fewer sales promotions and improvements in cost saving initiatives in fulfillment and freight.
Mainland China. Our Mainland China market continued to be
challenged during the third quarter and first nine months of 2026, with ongoing macroeconomic factors, the associated decrease in consumer spending and a continued shift of market consumer awareness and demand to online product marketplaces. In
addition, our reported revenue reflects a benefit from favorable foreign currency fluctuations of 5.2% and 4.9% for the third quarter and first nine months of 2026, respectively. During the second quarter of 2026, we released enhancements to the
business model, as well as additional incentives for our sales force, which were designed to stabilize sales force in the market.
The decrease in segment contribution for the third quarter and first nine months of 2026 primarily reflects the decline in revenue. For the third quarter of 2026 segment contribution was impacted by a 1.4
percentage-point decline in gross margin primarily from the fixed cost pressures from our manufacturing facility on declining revenue. For the first nine months of 2026 segment contribution was impacted by the fixed cost pressures on general and
administrative expenses.
Southeast Asia/Pacific. The decline in revenue, Customers, Paid Affiliates and Sales Leaders for the third quarter and first nine months of 2026 is primarily attributable to ongoing
softness in consumer demand driven by the general macroeconomic factors in the markets. In addition, our reported revenue reflects a benefit from favorable foreign currency fluctuations of 1.5% for the first nine months of 2026.
The year-over-year decrease in segment contribution for the third quarter and first nine months of 2026 primarily reflects the decline in revenue as well as an increase in selling expenses and general and
administrative cost associated with our pre-market activities in India in preparation for the full market opening in the first half of 2027.
Japan. The reduction in revenue, Customers, Paid Affiliates and Sales Leaders is partially attributable to consumer inflationary pressures which depressed spending. In addition, our reported revenue reflects
negative impacts from unfavorable foreign currency fluctuations of 6.8% and 6.1% for the third quarter and first nine months of 2026.
The year-over-year decrease in segment contribution is primarily attributable to the decreased revenue.
Europe & Africa. The reduction in revenue, Customers, Paid Affiliates and Sales Leaders reflects continued softness in these markets, as well as the macroeconomic factors that have led to a decline in the
purchasing power of our customers. In addition, our reported revenue for the third quarter of 2026 reflects negative impact from unfavorable foreign currency fluctuations of 1.2% while for the first nine months of 2026 our reported revenue reflects a
benefit of 3.1%.
The year-over-year decline in segment contribution for the third quarter of 2026 primarily reflects the decline in revenue and the fixed cost pressures on general and administrative expenses, partially offset by a 1.2
percentage point increase in gross margin from a favorable product mix. The decline in segment contribution for the first nine months of 2026 is primarily from the decline in revenue and the fixed cost pressures on general and administrative
expenses.
Hong Kong/Taiwan. The declines in our Hong Kong/Taiwan segment for the third quarter and first nine months of 2026 are attributable to macroeconomic issues, which are resulting in less
purchasing power for our customers. In addition, our reported revenue for the third quarter and first nine months of 2026 reflects negative impact from unfavorable foreign currency fluctuations of 3.9% and 1.2%, respectively.
The decrease in segment contribution for the third quarter and first nine months of 2026 is primarily attributable to the decline in revenue as well as a 1.2 and 1.4 percentage-point increase in selling expenses
associated with our recent compensation plan enhancements.
South Korea. Our South Korea market was challenged by difficult macroeconomic trends, including inflationary pressures, and our associated price increases which negatively impacted our
revenue, Customers, Paid Affiliates and Sales Leaders for the third quarter and first nine months of 2026. In addition, in the first quarter of 2026, we lowered our commission to remain in compliance with the local law. Our reported revenue
reflects negative impacts from unfavorable foreign currency fluctuations of 1.4% and 2.7% for the third quarter and first nine months of 2026, respectively.
The year-over-year decline in segment contribution for the third quarter and first nine months of 2026 primarily reflects the decline in revenue as well as the fixed cost
pressures on general and administrative expenses, partially offset by a 7.1 and 2.3 percentage-point decline in selling expenses associated with the lower commissions.
Manufacturing. Our Manufacturing segment revenue increased 19.3% for the third quarter of 2026 and declined 9.3% for the first nine months of 2026. We experienced a
decline in orders for the first half of 2026 partially attributable to the challenging comparison with a strong first half of 2025, as well as customer order delays related to the tariff and associated economic uncertainty. Our third quarter revenue
benefited from normalization of orders across our entities.
The decrease in segment contribution for the third quarter and first nine months of 2026 is primarily attributable to the mix of revenue between our entities and product mix. The decrease in segment contribution for
the first nine months was also negatively impacted from the decline in revenue.
Rhyz Other. The decrease in revenue for the third quarter and first nine months of 2026 is primarily from our decision to wind down our separate BeautyBio business. In addition, for the third quarter of 2026,
our LifeDNA, Inc. (“LifeDNA”) entity, a DNA assessment and recommendation technology company, was challenged by elevated customer acquisition cost.
During the three months ended March 31, 2026, we acquired the remaining 30% equity interest in LifeDNA, for cash consideration of $6.5 million. The carrying amount of noncontrolling interest, which was previously
included in other liabilities on the consolidated balance sheet, was reduced by $4.1 million, with the difference of $2.4 million recorded in additional paid-in capital. Following this transaction, LifeDNA became a wholly owned subsidiary. Due to the
noncontrolling interest’s immaterial balance, we have not historically separately disclosed the noncontrolling interest balance or activity.
The increase in segment contribution for the third quarter is primarily from the decision to wind down our separate BeautyBio business, which was historically operating at a loss. The
decrease in segment contribution for the first nine months of 2026 is primarily due to our decision to wind down our separate BeautyBio business and the associated $3.1 million inventory charge, $1.8 million of intangible impairment and $1.0
million in other associated costs recorded in the first quarter of 2026, as well as elevated customer acquisition costs for LifeDNA.
Consolidated Results
Revenue
Revenue for the three-month period ended September 30, 2026 decreased 14.6% to $311.0 million, compared to $364.2 million in the prior-year period. Revenue for the nine-month period ended
September 30, 2026 decreased 14.6% to $951.7 million compared to $1,114.8 million in the prior-year period. Our revenue in the third quarter and first nine months of 2026 was negatively impacted by 1.1% and 0.3%, respectively, from foreign-currency
fluctuations. For a discussion and analysis of these decreases in revenue, see “Overview” and “Segment Results,” above.
Gross profit
Gross profit as a percentage of revenue was 65.0% for the third quarter of 2026, compared to 70.5% for the prior-year period, and 66.7% for the first nine months of 2026, compared to 69.0%
for the prior-year period. The decrease in gross profit for the third quarter is primarily from the increase in Rhyz manufacturing revenue in proportion to the core Nu Skin business, which has a lower gross margin. In addition, our Rhyz
manufacturing gross margin decreased for the third quarter from product mix and revenue mix among the manufacturing entities. Gross profit as a percentage of revenue for our Nu Skin business decreased 1.1 percentage points to 76.6% for the
third quarter of 2026 and decreased 0.2 percentage points to 77.1% for the first nine months of 2026. The third quarter gross profit decline for the Nu Skin business was primarily attributable to higher inventory write-offs in the period.
Selling expenses
Selling expenses decreased $27.1 million, or 20.8%, to $103.2 million for the third quarter of 2026 and decreased $55.9 million, or 14.8%, to $321.2 million for the first nine months of 2026.
Selling expenses as a percentage of revenue decreased to 33.2% for the third quarter of 2026, compared to 35.8% for the prior-year period, and decreased to 33.7% for the first nine months of 2026, compared to 33.8% for the prior-year period. Core
Nu Skin selling expenses as a percentage of revenue decreased 0.8 percentage points to 40.9% for the third quarter of 2026 and increased 0.3 percentage points to 40.4% for the first nine months of 2026. Selling expenses for our core Nu Skin
business are driven by the specific performance of our individual Sales Leaders. Given the size of our sales force and the various components of our compensation and incentive programs, selling expenses as a percentage of revenue typically
fluctuate plus or minus approximately 100 basis points from period to period. In the third quarter of 2026, we held our global Nu Skin LIVE! event in Japan. As a result of the global LIVE! event, we spent an approximate incremental $5.4 million in
selling expenses for the third quarter of 2026. The third quarter of 2026 decline in the consolidated selling expenses reflects the increase in Rhyz revenue in proportion to the core Nu Skin business, as our Rhyz segment carries lower selling
expenses than the core business.
General and administrative expenses
General and administrative expenses decreased to $93.9 million in the third quarter of 2026, compared to $104.8 million in the prior-year period, and decreased to $283.3 million in the first
nine months of 2026, compared to $324.7 million in the prior-year period. The $10.9 million decline for the third quarter is primarily from an $8.0 million contraction in labor expenses primarily from lower incentive compensation from a decline in
performance and a $4.0 million decline in software and related contracts from continued cost management, partially offset by a $5.1 million increase in cash severance expense in the period associated with recent cost saving efforts. The $41.5
million decline for the first nine months of 2026 is primarily from a $22.3 million reduction in labor expense and an $11.8 million decline in software and related contracts, partially offset by a $6.7 million increase in cash severance expense in
the period associated with recent cost saving efforts. General and administrative expenses as a percentage of revenue increased to 30.2% for the third quarter of 2026, from 28.8% for the prior-year period, and increased to 29.8% for the first nine
months of 2026, from 29.1% for the prior-year period.
Impairment expenses
Intangibles and fixed asset impairment. During the three months ended March 31, 2025, we decided to make a strategic shift in how we operate the BeautyBio asset group. These strategic changes included exiting
certain sales channels, which reduced the forecasted revenues for BeautyBio. We concluded these actions were an interim impairment triggering event that required us to perform an interim impairment analysis on our BeautyBio asset group. We assessed
the recoverability of the related asset group comparing the carrying value to the undiscounted cash flows expected to be generated. The recoverability test indicated the asset group was impaired. We concluded that the carrying value of the asset
group exceeded the estimated fair value, which resulted in an impairment charge of $25.1 million in our Rhyz Other segment during the three months ended March 31, 2025.
During the three months ended March 31, 2026, we decided to wind down our separate BeautyBio business. As part of this exit, we incurred an impairment charge of $1.8 million.
Goodwill. During the three months ended June 30, 2026, we determined that the continued decline in our stock price and corresponding market capitalization as well as the decline in our manufacturing reporting
unit’s forecast were triggering events that required us to perform a quantitative impairment analysis. When we performed an impairment test during the second quarter of 2026, we concluded the estimated fair value of the manufacturing reporting unit
was less than the carrying value of equity as of June 30, 2026. As a result, we recorded a non-cash goodwill impairment charge of $78.9 million in the second quarter of 2026.
Interest expense
Interest expense decreased to $3.5 million in the third quarter of 2026, compared to $4.1 million in the prior-year period. Interest expense for the
first nine months of 2026 increased to $11.1 million compared to $10.0 million for the prior-year period. The increase for the first nine months of 2026 is primarily due to the maturity on July 31, 2025 of our interest rate swap arrangements,
which increased our effective interest rate, partially offset by lower average outstanding borrowings. The decrease for the third quarter of 2026 is primarily due to lower average outstanding borrowings, which were $216.7 million compared to
$250.0 million in the prior-year period, and lower variable interest rates.
Gain on sale of business
In January 2025, we completed the sale of our Mavely entity for $230 million in cash and shares of the purchaser’s common stock, subject to certain adjustments as set forth in the purchase agreement,
including post-closing determination of net working capital and other elements of purchase price. Following the completion of certain payments to other equity holders in Mavely and the payment of certain transaction expenses, we received $193.7
million of cash and equity interest with an estimated fair value of $6.1 million. Following the finalization of net working capital, we received additional cash payments of $2.7 million and $1.7 million in the second and third quarter of 2025,
respectively. In the first quarter of 2025, we recorded a pre-tax gain on disposition of $176.2 million.
Other income (expense), net
Other income (expense), net was $0.3 million for the third quarter of 2026 compared to $(1.5) million for the prior-year period, and $2.6 million for the first nine months of 2026 compared to $(30.7) million for the
prior-year period. In the first quarter of 2025, we recorded a $28.1 million unrealized loss on investment. See Note 8 to the consolidated financial statements contained in this report for more information on the unrealized equity investment and the
associated loss.
Provision for income taxes
Provision (benefit) for income taxes for the three- and nine-month periods ended September 30, 2026 was $2.6 million and $190.0 million, respectively,
compared to $(1.1) million and $32.3 million for the prior-year periods. The effective tax rates for the three- and nine-month periods ended September 30, 2026 were 139.3% and (323.8)% of pre-tax income, respectively, compared to (6.8)% and 18.1%
in the prior-year periods. The change in the effective tax rate in the third quarter of 2026 is primarily due to a U.S. consolidated book loss and its impact on the annualized effective tax rate. The change in the effective tax rate in the first
nine months of 2026 is primarily due to the valuation allowance established on our U.S. deferred tax assets.
During the second quarter of 2026, we established a $167.5 million valuation allowance against our U.S. deferred tax assets as it was determined to be more likely than not that these assets will not be realized. This
determination was made based on weighing all available evidence, positive and negative, including cumulative losses recognized in the U.S. entity over the past three years. These cumulative losses were mainly due to the impairment of goodwill and
other intangibles assets. Therefore, we recorded a full valuation allowance against these U.S. deferred tax assets as of June 30, 2026.
During the third quarter of 2026, we recorded a $2.8 million out-of-period adjustment to correct for an error in the recognition of R&D credits related to the fourth quarter of 2025. This
correction, which is immaterial, individually and in aggregate, to prior periods, increased our provision for income taxes for the third quarter of 2026.
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of
the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and
others implemented through 2027. We completed the initial assessment of the OBBBA corporate tax provisions as they relate to our financial statements in the third quarter of 2025. The enactment of the OBBBA did not have a material impact to our
income tax expense for the three months ended September 30, 2026. We will continue to evaluate the impacts of OBBBA and do not expect the OBBBA to have a material impact to our total tax provision.
Net income (loss)
As a result of the foregoing factors, net income (loss) for the third quarter of 2026 was $(0.7) million compared to $17.1 million in the prior-year period. Net income (loss) for the first nine months of 2026 was
$(248.7) million, compared to $145.7 million for the first nine months of 2025.
Liquidity and Capital Resources
Historically, our principal uses of cash have included operating expenses (particularly selling expenses) and working capital (principally inventory purchases), as well as capital
expenditures, stock repurchases, dividends, and debt repayment. We have at times incurred long-term debt, or drawn on our revolving line of credit, to fund strategic transactions, stock repurchases, capital investments and short-term operating
needs. Historically, we have typically generated positive cash flow from operations due to favorable margins and have generally relied on cash from operations to fund operating activities; however, our operating activities used cash in the first
nine months of 2026, as described below. In the first nine months of 2026, we had a net outflow of $1.4 million in cash from operations, compared to $63.7 million of cash provided by operations in the prior-year period. The decrease in cash flow
from operations primarily reflects incremental inventory purchases, lower collections of accounts receivable, and higher payments of accrued expenses. Cash and cash equivalents, including current investments, as of September 30, 2026 and December
31, 2025 were $166.6 million and $239.8 million, respectively, with the decrease being primarily driven by $30.7 million of capital expenditures, $20.0 million in net debt payments, $6.5 million for the purchase of noncontrolling interest in
LifeDNA, $8.7 million of dividend payments and $5.0 million in share repurchases.
Working capital. As of September 30, 2026, working capital was $244.2 million, compared to $284.0 million as of December 31, 2025. Our decrease in working capital is primarily
attributable to changes in our cash balance as explained above, as well as a $20.0 million decline in prepaid expenses attributable to timing of prepayments and associated amortization.
Capital expenditures. Capital expenditures for the nine months ended September 30, 2026 were $30.7 million. Our capital expenditures in 2026 primarily relate to:
| ● |
Rhyz plant expansion to increase capacity and capabilities;
|
| ● |
purchases and expenditures for computer systems and equipment, software, and application development; and
|
| ● |
the expansion and upgrade of facilities in our various markets.
|
We estimate that capital expenditures for the uses listed above will total approximately $40–60 million for 2026.
2022 Credit Agreement. On June 14, 2022, we entered into an Amended and Restated 2022 Credit Agreement (the “2022 Credit Agreement”) with various financial institutions as lenders and Bank of America, N.A., as
administrative agent. The 2022 Credit Agreement provided for a $400.0 million term loan facility and a $500.0 million revolving credit facility, each with a term of five years. We used the proceeds of the term loan and the draw on the revolving
facility to pay off the 2018 Credit Agreement. The interest rate applicable to the facilities was subject to adjustments based on our consolidated leverage ratio. The term loan facility amortized in quarterly installments in amounts resulting in an
annual amortization of 2.5% during the first year and 5.0% during the subsequent years after the closing date of the 2022 Credit Agreement, with the remainder payable at final maturity. As of December 31, 2025, we had $0.0 million of outstanding
borrowings under our revolving credit facility, and $225.0 million on our term loan facility. The carrying value of the debt also reflected debt issuance costs of $0.8 million as of December 31, 2025, related to the 2022 Credit Agreement. The 2022
Credit Agreement required us to maintain a consolidated leverage ratio not exceeding 2.75 to 1.00 and a consolidated interest coverage ratio of no less than 3.00 to 1.00. As of December 31, 2025, we were in compliance with all debt covenants under
the 2022 Credit Agreement.
Credit Agreement. On March 27, 2026, the Company entered into an Amended and Restated Credit Agreement (the “Credit Agreement”) with several financial institutions as lenders and Bank of America, N.A., as
administrative agent, which amended and restated the 2022 Credit Agreement. The Credit Agreement provides for a $175.0 million term loan facility and a $75.0 million revolving credit facility, each with a term of five years. Both facilities bear
interest at the SOFR, plus a margin based on the Company’s consolidated leverage ratio. Commitment fees payable under the Credit Agreement are also based on the consolidated leverage ratio as defined in the Credit Agreement and range from 0.175% to
0.30% on the unused portion of the total lender commitments then in effect. The term loan facility amortizes in equal quarterly installments in amounts resulting in an annual amortization of $20.0 million per annum, with the remainder payable at
final maturity. The Credit Agreement is guaranteed by certain of the Company’s domestic subsidiaries and collateralized by assets of such subsidiaries, including a pledge of 65% of the capital stock of certain foreign subsidiaries. As of September
30, 2026, we had $40.0 million of outstanding borrowings under our revolving credit facility, and $165.0 million on our term loan facility. The carrying value of the debt also reflected debt issuance costs of $1.3 million as of September 30, 2026,
related to the Credit Agreement. The Credit Agreement requires the Company to maintain a consolidated leverage ratio not exceeding 2.25 to 1.00 and a consolidated interest coverage ratio of no less than 3.00 to 1.00.
The Credit Agreement also includes other covenants, including covenants that, subject to certain exceptions, restrict the ability of the Company and its subsidiaries (i) to create, incur, assume or permit to exist any
liens, (ii) to incur additional indebtedness, (iii) to make investments and acquisitions, (iv) to enter into mergers, consolidations or similar transactions, (v) to make certain dispositions of assets, (vi) to make dividends, distributions and
prepayments of certain indebtedness, (vii) to change the nature of the Company’s business, (viii) to enter into certain transactions with affiliates, (ix) to enter into certain burdensome agreements, (x) to make certain amendments to certain
agreements and organizational documents and (xi) to make certain accounting changes.
As of September 30, 2026, the Company was in compliance with all covenants under the Credit Agreement.
Derivative Instruments. During the third quarter of 2025, we had four interest rate swaps mature, with a total notional principal amount of $200 million. We entered into these interest rate swap arrangements
during the third quarter of 2020 to hedge the variable cash flows associated with our variable-rate debt under the Credit Agreement.
Stock repurchase plan. In 2018, our board of directors approved a stock repurchase plan authorizing us to repurchase up to $500.0 million of our outstanding shares of Class A common stock on the open market or
in private transactions. During the third quarter of 2026, we repurchased no shares of our Class A common stock under the plan. As of September 30, 2026, $137.3 million was available for repurchases under the plan. Our stock repurchases are used
primarily to offset dilution from our equity incentive plans and for strategic initiatives.
Dividends. In February 2026, our board of directors declared
quarterly cash dividends of $0.06 per share. This quarterly cash dividend of $2.9 million was paid on March 11, 2026 to stockholders of record on February 27, 2026. In May 2026, our board of directors declared quarterly cash dividends of $0.06
per share. This quarterly cash dividend of $2.9 million was paid on June 10, 2026 to stockholders of record on May 29, 2026. In August 2026, our board of directors declared a quarterly cash dividend of $0.06 per share. This quarterly cash
dividend of $2.9 million was paid on September 9, 2026 to stockholders of record on August 28, 2026. In November 2026, our board of directors declared a quarterly cash dividend of $0.06 per share to be paid on December 9, 2026 to stockholders of
record on November 27, 2026. Currently, we anticipate that our board of directors will continue to declare quarterly cash dividends and we expect that cash flows
from operations, together with existing cash balances and available borrowings under our revolving credit facility, will be sufficient to fund our future dividend payments. However, the continued declaration of dividends is subject to the
discretion of our board of directors and will depend upon various factors, including our net earnings, financial condition, cash requirements, future prospects and other relevant factors.
Cash from foreign subsidiaries. As of September 30, 2026 and December 31, 2025, we held $166.6 million and $239.8 million, respectively, in cash and cash equivalents, including current investments. These amounts
include $125.9 million and $170.7 million as of September 30, 2026 and December 31, 2025, respectively, held in our operations outside of the U.S. Substantially all of our non-U.S. cash and cash equivalents are readily convertible into U.S. dollars
or other currencies, subject to procedural or other requirements in certain markets, as well as an indefinite-reinvestment designation, as described below.
We typically fund the cash requirements of our operations in the U.S. through intercompany dividends, intercompany loans and intercompany charges for products, use of intangible property, and corporate services.
However, some markets impose government-approval or other requirements for the repatriation of dividends. For example, in Mainland China, we are unable to repatriate cash from current operations in the form of dividends until we file the necessary
statutory financial statements for the relevant period. As of September 30, 2026, we had $28.2 million in cash denominated in Chinese RMB. We also have experienced delays in repatriating cash from Argentina. As of September 30, 2026 and December 31,
2025, we had $30.6 million and $23.9 million, respectively, in intercompany receivables with our Argentina subsidiary. We also have intercompany loan arrangements in some of our markets, including Mainland China, that allow us to access available
cash, subject to certain limits in Mainland China and other jurisdictions. We also have drawn on our revolving line of credit to address cash needs until we can repatriate cash from Mainland China or other markets, and we may continue to do so.
Except for $60.0 million of earnings in Mainland China that we designated as indefinitely reinvested during the second quarter of 2018, we currently plan to repatriate undistributed earnings from our non-U.S. operations as necessary, considering the
cash needs of our non-U.S. operations and the cash needs of our U.S. operations for dividends, stock repurchases, capital investments, debt repayment and strategic transactions. Repatriation of non-U.S. earnings is subject to withholding taxes in
certain foreign jurisdictions. Accordingly, we have accrued the necessary withholding taxes related to the non-U.S. earnings.
We currently believe that existing cash balances, future cash flows from operations and existing lines of credit will be adequate to fund our cash needs on both a short- and long-term basis. The majority of our
historical expenses have been variable in nature, and as such, a potential reduction in the level of revenue would reduce our cash flow needs. In the event that our current cash balances, future cash flow from operations and current lines of credit
are not sufficient to meet our obligations or strategic needs, we would consider raising additional funds in the debt or equity markets or restructuring our current debt obligations. Additionally, we would consider realigning our strategic plans,
including a reduction in capital spending, stock repurchases or dividend payments.
Contingent Liabilities
Please refer to Note 12 to the consolidated financial statements contained in this Quarterly Report for information regarding our contingent liabilities.
Critical Accounting Policies and Estimates
There were no significant changes in our critical accounting policies or estimates during the third quarter of 2026.
Seasonality and Cyclicality
In addition to general economic factors, we are impacted by seasonal factors and trends such as major cultural events and vacation patterns. For example, most Asian markets celebrate their respective local New Year in
the first quarter, which generally has a negative impact on that quarter. We believe that direct selling is also generally negatively impacted during the third quarter, when many individuals, including our sales force, traditionally take vacations.
Prior to making a product generally available for purchase in a market, we often do one or more introductory offerings of the product, such as a preview of the product to our Sales Leaders or other product introduction
or promotion. These offerings sometimes generate significant activity and a high level of purchasing, which can result in a higher-than-normal increase in revenue, Sales Leaders, Paid Affiliates and/or Customers during the quarter and can skew
year-over-year and sequential comparisons.
Non-GAAP Financial Measures
Constant-currency revenue change is a non-GAAP financial measure that removes the impact of fluctuations in foreign-currency exchange rates, thereby facilitating period-to-period comparisons of the Company’s
performance. It is calculated by translating the current period’s revenue at the same average exchange rates in effect during the applicable prior-year period and then comparing that amount to the prior-year period’s revenue. We believe that
constant-currency revenue change is useful to investors, lenders and analysts because such information enables them to gauge the impact of foreign-currency fluctuations on our revenue from period to period.
Available Information
Our website address is www.nuskin.com. We make available, free of charge on our Investor Relations website, ir.nuskin.com, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K,
and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and
Exchange Commission.
We also use our Investor Relations website, ir.nuskin.com, as a channel of distribution of additional Company information that may be deemed material. Accordingly, investors should monitor this channel, in addition to
following our press releases, Securities and Exchange Commission filings and public conference calls and webcasts. The contents of our website shall not be deemed to be incorporated herein by reference.
Currency Risk and Exchange Rate Information
A majority of our revenue and many of our expenses are recognized outside of the United States, except for inventory purchases, a significant portion of which are primarily transacted in U.S. dollars from vendors in
the United States. The local currency of each of our Subsidiaries’ primary markets is considered the functional currency with the exception of our Asia product-distribution subsidiary in Singapore and, as discussed below, our subsidiary in Argentina.
All revenue and expenses are translated at weighted-average exchange rates for the periods reported. Therefore, our reported revenue and earnings will be positively impacted by a weakening of the U.S. dollar and will be negatively impacted by a
strengthening of the U.S. dollar. These impacts may be significant because a large portion of our business is derived from outside of the United States. Given the uncertainty of exchange rate fluctuations, it is difficult to predict the effect of
these fluctuations on our future business, product pricing and results of operations or financial condition.
In the second quarter of 2018, published inflation indices indicated that the three-year cumulative inflation in Argentina exceeded 100 percent, and as of July 1, 2018, we elected to adopt highly inflationary
accounting for our subsidiary in Argentina. Under highly inflationary accounting, the functional currency for our subsidiary in Argentina became the U.S. dollar, and the income statement and balance sheet for this subsidiary have been measured in
U.S. dollars using both current and historical rates of exchange. The effect of changes in exchange rates on peso-denominated monetary assets and liabilities has been reflected in earnings in Other income (expense), net and was not material. As of
September 30, 2026, our subsidiary in Argentina had a small net peso monetary position. Net sales of our subsidiary in Argentina were less than 4% of our consolidated net sales for the nine-month periods ended September 30, 2026.
We may seek to reduce our exposure to fluctuations in foreign currency exchange rates through the use of foreign currency exchange contracts and through intercompany loans of foreign currency. We do not use derivative
financial instruments for trading or speculative purposes. We regularly monitor our foreign currency risks and periodically take measures to reduce the impact of foreign exchange fluctuations on our operating results. As of September 30, 2026 and
2025, we did not hold material non-designated mark-to-market forward derivative contracts to hedge foreign denominated intercompany positions or third party foreign debt. As of September 30, 2026 and 2025, we did not hold any material forward
contracts designated as foreign currency cash flow hedges. We continue to evaluate our foreign currency hedging policy.
For additional information about our market risk see Note 10 to the consolidated financial statements contained in this Quarterly Report.
Evaluation of Disclosure Controls and Procedures
As of the end of the period covered by this Quarterly Report, under the supervision and with the participation of our management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), we
evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based on that evaluation, our
CEO and our CFO concluded that our disclosure controls and procedures were effective as of September 30, 2026.
Changes in Internal Controls Over Financial Reporting.
We made no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) during the fiscal quarter ended September 30, 2026 that materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting.
PART II. OTHER INFORMATION
From time to time, we are involved in legal proceedings arising in the ordinary course of business.
There have been no material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the 2025 fiscal year.
Purchases of Equity Securities by the Issuer
|
(a)
|
(b)
|
(c)
|
(d)
|
|||||||||||||
|
Total Number of
|
Approximate Dollar
|
|||||||||||||||
|
Total
|
Shares Purchased
|
Value of Shares that May
|
||||||||||||||
|
Number
|
Average
|
as Part of Publicly
|
Yet Be Purchased Under
|
|||||||||||||
|
of Shares
|
Price Paid
|
Announced Plans
|
the Plans or Programs
|
|||||||||||||
|
Period
|
Purchased
|
per Share
|
or Programs
|
(in millions)(1)
|
||||||||||||
|
July 1 - 31, 2026
|
-
|
$
|
-
|
-
|
$
|
137.30
|
||||||||||
|
August 1 - 31, 2026
|
-
|
-
|
-
|
$
|
137.30
|
|||||||||||
|
September 1 - 30, 2026
|
-
|
-
|
-
|
$
|
137.30
|
|||||||||||
|
Total
|
-
|
$
|
-
|
-
|
||||||||||||
| (1) |
In August 2018, we announced that our board of directors approved a stock repurchase plan. Under this plan, our board of directors authorized the repurchase of up to $500 million of
our outstanding Class A common stock on the open market or in privately negotiated transactions. The program has no expiration date and may be utilized over time, with no obligation to repurchase any specific number of shares.
|
None.
Not Applicable.
Trading Plans
Other
On
November 4, 2026, the Company and Justin Keisel determined that Mr.
Keisel will step down from his position as Executive Vice President and
President of Global Sales, effective as of November 6, 2026. Pursuant to
the Company’s Executive Severance Policy, it is anticipated that
Mr. Keisel will sign a Separation and Release Agreement and receive a
severance payment of $608,101. The Company wishes Mr. Keisel well and
extends its appreciation to him for his
many years of service to the Company.
|
Exhibits
Regulation S-K
Number
|
Description
|
|
|
Certification by Ryan S. Napierski, Chief Executive Officer, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.
|
||
|
Certification by Chelsea K. Lantz, Chief Financial Officer, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.
|
||
|
Certification by Ryan S. Napierski, Chief Executive Officer, pursuant to Section 1350, Chapter 63 of Title 18, United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
|
||
|
Certification by Chelsea K. Lantz, Chief Financial Officer, pursuant to Section 1350, Chapter 63 of Title 18, United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
|
||
|
101.INS
|
Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
|
|
|
101.SCH
|
Inline XBRL Taxonomy Extension Schema Document
|
|
|
101.CAL
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
101.DEF
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
101.LAB
|
Inline XBRL Taxonomy Extension Label Linkbase Document
|
|
|
101.PRE
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
104
|
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
|
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
November 5, 2026
|
NU SKIN ENTERPRISES, INC.
|
||
|
By:
|
/s/ Chelsea K. Lantz
|
|
|
Chelsea K. Lantz
|
||
|
Chief Financial Officer
|
||
|
(Duly Authorized Officer and Principal Financial Officer)
|
||
32
EXHIBIT 31.1
SECTION 302 CERTIFICATION OF CHIEF EXECUTIVE OFFICER
I, Ryan S. Napierski, certify that:
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Nu Skin Enterprises, Inc.;
|
| 2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;
|
| 3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and
for, the periods presented in this report;
|
| 4. |
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting
(as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and
|
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in
the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
| 5. |
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of
directors (or persons performing the equivalent functions):
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record,
process, summarize and report financial information; and
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
Date: November 5, 2026
|
/s/ Ryan S. Napierski
|
|
|
Ryan S. Napierski
|
||
|
Chief Executive Officer
|
EXHIBIT 31.2
SECTION 302 CERTIFICATION OF CHIEF FINANCIAL OFFICER
I, Chelsea K. Lantz, certify that:
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Nu Skin Enterprises, Inc.;
|
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial
condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange
Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that
material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal
quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the
registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to
adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial
reporting.
|
|
Date: November 5, 2026
|
/s/ Chelsea K. Lantz
|
|
|
Chelsea K. Lantz
|
||
|
Chief Financial Officer
|
EXHIBIT 32.1
SECTION 906 CERTIFICATION OF CHIEF EXECUTIVE OFFICER
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the quarterly report of Nu Skin Enterprises, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2026 (the “Report”), I, Ryan S.
Napierski, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
Date: November 5, 2026
|
/s/ Ryan S. Napierski
|
|
|
Ryan S. Napierski
|
||
|
Chief Executive Officer
|
EXHIBIT 32.2
SECTION 906 CERTIFICATION OF CHIEF FINANCIAL OFFICER
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the quarterly report of Nu Skin Enterprises, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2026 (the “Report”), I, Chelsea K.
Lantz, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
Date: November 5, 2026
|
/s/ Chelsea K. Lantz
|
|
|
Chelsea K. Lantz
|
||
|
Chief Financial Officer
|