Nu Skin(US:NUS)2025-11-06 23:29Revenue Performance - Revenue for Q3 2025 decreased 15% to $364.2 million, compared to $430.1 million in Q3 2024[83] - Revenue for the first nine months of 2025 decreased 13% to $1,114.8 million, compared to $1,286.5 million in the prior-year period[83] - Total revenue for the three months ended September 30, 2025, was $427.6 million, a decrease of 10% compared to $475.5 million in the same period of 2024[91] - The decline in revenue was attributed to a 10% drop in Customers, a 13% decline in Paid Affiliates, and a 19% decrease in Sales Leaders year-over-year[83] - The Americas segment revenue decreased by 17.1% to $63.994 million in Q3 2025, while the Mainland China segment saw a 19.8% decline to $42.519 million[88] - Total customers decreased by 10% year-over-year to 746,256, with significant declines in Mainland China (29%) and South Korea (29%)[93] - Total paid affiliates decreased by 13% year-over-year to 130,096, with the largest drop in Southeast Asia/Pacific (21%) and Mainland China (20%)[93] - Revenue from Latin America markets increased by 52.5% year-over-year, rising from $16.0 million to $24.4 million, with customer growth of 87%[97] - The Mainland China market generated approximately $7.2 million in revenue from the relaunched Tru Face line, compared to $4.1 million from the previous line in the same period[101] - The Rhyz Other segment experienced a significant revenue decline of 81.4% in Q3 2025, totaling $3.973 million[88] Earnings and Profitability - Earnings per share for Q3 2025 increased to $0.34, compared to $0.17 in Q3 2024, and for the first nine months increased to $2.91, compared to $(2.23) in the prior-year period[85] - The sale of the Mavely business generated a pre-tax gain of approximately $176.2 million, contributing to the increase in earnings per share[85] - Net income for Q3 2025 was $17.1 million, compared to $8.3 million in the prior year, and for the first nine months was $145.7 million, compared to a loss of $110.5 million in the prior year[130] - The overall segment contribution margin for the total business was 19.9% in Q3 2025[90] - The overall segment contribution for the first nine months of 2025 reflected a decline in revenue, partially offset by increased profitability in Latin America[98] Expenses and Margins - Gross profit margin for Q3 2025 was 70.5%, up from 70.1% in the prior year, while for the first nine months it was 69.0%, down from 70.2%[118] - Selling expenses as a percentage of revenue decreased to 35.8% for Q3 2025, compared to 39.0% in the prior year, and to 33.8% for the first nine months, down from 37.8%[120] - General and administrative expenses decreased to $104.8 million in Q3 2025 from $115.6 million in the prior year, and to $324.7 million for the first nine months from $358.1 million[121] Cash Flow and Capital Management - Cash generated from operations in the first nine months of 2025 was $63.7 million, down from $86.0 million in the prior year[131] - Working capital increased to $293.7 million as of September 30, 2025, compared to $242.0 million as of December 31, 2024[132] - Capital expenditures for the nine months ended September 30, 2025 were $23.5 million, with an estimated total of $30–35 million expected for 2025[133] - The company entered into a Credit Agreement providing for a $400 million term loan facility and a $500 million revolving credit facility, with a consolidated leverage ratio requirement not exceeding 2.75 to 1.00[134] - As of September 30, 2025, the company had $230 million and $0 in outstanding borrowings under the term loan and revolving credit facilities, respectively[134] - The company believes existing cash balances and future cash flows will be adequate to meet both short- and long-term cash needs[141] Shareholder Returns - The company repurchased 0.4 million shares of Class A common stock for $5 million during Q3 2025, with $152.4 million remaining available for repurchases[136] - Quarterly cash dividends of $0.06 per share were declared in February, May, and August 2025, totaling $3 million, with an additional dividend declared for December 2025[137] Market Challenges and Strategic Initiatives - The company anticipates nominal revenue from the India market pre-opening in Q4 2025, with a formal launch planned for the second half of 2026[84] - The South Korea market faced challenges from inflationary pressures and political instability, contributing to a decline in revenue and customer metrics[108] - The company introduced enhancements to the sales performance plan in Europe & Africa, which began in March 2025, to address market challenges[105] - The company is expanding the Rhyz plant to increase capacity and capabilities, along with upgrading facilities in various markets[140] Foreign Currency Impact - Foreign-currency fluctuations negatively impacted revenue by 0.4% in Q3 and 0.9% in the first nine months of 2025[83] - The Americas segment experienced a revenue decline due to unfavorable foreign currency fluctuations of 6.4% in Q3 2025[96] - The company monitors foreign currency risks and may use foreign currency exchange contracts to mitigate exposure[151] Other Notable Information - LifeDNA revenue grew 181% in Q3 2025 to $3.3 million and 150% for the first nine months to $7.9 million[115] - The sale of Mavely in January 2025 generated $230 million, with a pre-tax gain on disposition of $176.2 million recorded[126] - Cash and cash equivalents held by the company as of September 30, 2025, amounted to $253 million, including $162.4 million held outside the U.S.[138] - The company plans to repatriate undistributed earnings from non-U.S. operations as necessary, subject to withholding taxes in certain jurisdictions[139] - Net sales from the subsidiary in Argentina were less than 4% of consolidated net sales for the three- and nine-month periods ended September 30, 2025[150]