USANA Health Sciences Reports Third Quarter 2026 Results

Kevin Guest, Chairman and Chief Executive Officer of USANA Health Sciences

“As we continue our transformation to an omnichannel health and wellness company, our third quarter results were mixed, with meaningful improvement in some areas and results that fell short of our expectations in others. We are investing across each of our businesses to strengthen their long-term competitive position and made clear progress in key areas. At Hiya, as customer acquisition began responding positively during the quarter, we increased marketing spend to build on that traction, which pressured margins but generated an 18% sequential increase in active subscribers and returned the segment to year-over-year net sales growth. Additionally, our Core Nutritional business expanded its operating margin from a year ago on a leaner cost structure despite lower net sales. While we have more work to do in growing Core Nutritional active customers and net sales at Rise Wellness, we believe we have the right strategies in place. In Core Nutritional, rebuilding our active customer base is our top priority and our single largest growth lever. For example, active customers in the Southeast Asia Pacific region grew 3% sequentially in the third quarter, demonstrating what works when our initiatives and execution align. We are evolving our Brand Partner incentive plan to more directly reward growth in active customers, investing in digital marketing to build awareness of the USANA brand, and advancing product innovation that we plan to begin introducing in 2027. At Hiya, our investment in customer acquisition is producing encouraging early returns. Notably, Hiya added approximately 29,500 net active monthly subscribers sequentially, customer acquisition costs declined noticeably from the first half of the year and net sales through Target and Amazon more than doubled from the second quarter. Because Hiya is predominantly a subscription business today, the subscribers we add support results in future quarters. Additionally, Hiya continues to make progress in broadening its reach beyond direct-to-consumer, and we look forward to providing updates in early 2027. At Rise Wellness, we are building on a strengthening retail foundation and working towards improved margins. As planned, we launched Protein Pop Balance nationally at Target and online in September, and Target sales grew strongly from the second quarter. Our focus is converting this progress into consistent, profitable growth.”

Doug Hekking, Chief Financial Officer of USANA Health Sciences

“Consolidated net sales declined 4% in the third quarter, as growth at Hiya was more than offset by lower sales in Core Nutritional and Rise. We made progress on improving profitability in our Core Nutritional segment during the quarter, while we chose to increase investment at Hiya to accelerate subscriber growth, which weighed on margins in the quarter but produced strong growth in active monthly subscribers. We generated $8 million of free cash flow in the quarter and $36 million year-to-date, reduced inventory 13% from year-end, and ended the period with $179 million in cash and no debt. That financial strength gives us the flexibility to continue investing in the initiatives we expect to drive future growth across our businesses, including our omnichannel strategy, while maintaining financial discipline. We are updating our fiscal 2026 outlook to consolidated net sales approaching $900 million and Adjusted EBITDA of $77 million. Compared with our prior outlook, as corrected, the change reflects lower expectations for Rise Wellness and our deliberate decision to invest resources at Hiya to drive increased active monthly subscribers, partially offset by stronger profitability in Core Nutritional. We expect continued sequential progress from Hiya during the fourth quarter on both net sales and Adjusted EBITDA. While these investments constrain near-term results, we believe they set the stage for renewed growth across our businesses, and we plan to enter 2027 with a strong balance sheet and clear priorities to deliver it.”