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DATE
Wednesday, May 6, 2026 at 11 a.m. ET
CALL PARTICIPANTS
- Chief Executive Officer — Kevin Guest
- Chief Commercial Officer — Brent L. Neidig
- Chief Science Officer — Kathryn Armstrong
- Chief Operating Officer — Walter Noot
- Chief Financial Officer — G. Douglas Hekking
- Investor Relations/Moderator — Andrew Masuda
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TAKEAWAYS
- Consolidated Net Sales -- $204 million, up 7% sequentially, with growth attributed primarily to increased active customers in China around the Lunar New Year.
- HYA Brand Net Sales -- $32 million, with active monthly subscribers tallying 186 thousand and a slight increase over the prior quarter; international launches in Canada and the United Kingdom were completed, and brick-and-mortar retail distribution began through Target.
- HYA Full-Year 2026 Guidance -- Management maintained projections of net sales between $140 million and $155 million for the HYA segment.
- Rise Wellness Net Sales -- $14 million, representing more than 8x the first quarter of the prior year and a 143% sequential increase, driven by the national rollout of Protein Pop Plus at Costco.
- Retail Channel Expansion -- Rise Wellness secured agreements with nine major U.S. retailers for 2026; Protein Pop is now in 500 Walmart stores, with new retailers to be added in Q2 and Q3.
- Consolidated Full-Year 2026 Guidance -- Management reaffirmed consolidated net sales guidance of $925 million to $1 billion, with omni-channel revenues expected to make up over 20% of total sales, compared to 16% in 2025.
- Products in Development -- Over 20 new products are currently under development across all segments and geographies, according to management statements in the Q&A.
- Technology Investments -- Incremental technology modernization is planned for 2026, to be funded through resource reallocation and cost efficiencies without additional fiscal outlay.
- R&D Focus -- The product pipeline is concentrated on women’s health, children’s health, gut health, and an updated active nutrition offering, with launches and upgrades in China’s weight management category already completed.
- Customer Acquisition Costs at HYA -- Management directly cited elevated short-term acquisition costs as a result of disruptions in the Meta advertising environment, contributing to higher SG&A expenses versus both prior quarter and prior year.
- Costco Sales for Rise Wellness -- Weekly reorders are occurring and inventory buildup for Costco is actively selling through, with ongoing rollouts and evolving sell-through rates acknowledged by management.
SUMMARY
USANA Health Sciences (USNA +3.89%) reported meaningful sequential improvement in net sales, with notable expansion in both omnichannel and retail distribution for HYA and Rise Wellness. The company highlighted the strategic rollout of over 20 new products spanning all brands and geographies, reflecting ongoing R&D investment particularly in women’s and children’s health as well as active nutrition. Management detailed new technology initiatives intended to drive operational efficiency and customer experience improvements, funded through internal savings rather than new capital spending.
- Management stated that full-year 2026 guidance across all metrics is being reaffirmed, citing stabilization in core nutrition, omnichannel growth acceleration, and technology modernization as drivers.
- Chief Commercial Officer Brent L. Neidig noted that Canada’s HYA launch exceeded the initial targets set by the company, while the UK rollout was just underway and described as a slow start.
- Protein Pop Plus’s rapid national rollout to Costco and continued expansion into additional Walmart stores were cited as evidence of the team’s ability to capitalize on speed and execution in the retail segment.
INDUSTRY GLOSSARY
- ERP system: Enterprise Resource Planning; a platform for integrating internal business processes such as inventory, orders, and operations.
- 3PL: Third-Party Logistics; external providers managing warehousing, fulfillment, and distribution for product companies.
- DTC: Direct-to-Consumer; a sales model where the company sells products directly to end customers, bypassing third-party retailers or distributors.
- Meta advertising environment: The ecosystem for digital advertising on social platforms owned by Meta Platforms, Inc., such as Facebook and Instagram.
- End cap: Prominent product display at the end of store aisles, frequently used in retail to drive attention and sales.
Full Conference Call Transcript
Kevin Guest: Thank you, Andrew, and good morning, everyone. Our first quarter results reflect USANA Health Sciences, Inc.'s continued and deliberate transformation from a single-channel direct sales business to a diversified omni-channel health and wellness platform. That evolution is the defining story of this company right now, and the progress we are making across our three business segments reinforces our confidence that this strategy will deliver sustained, compounding value over time. In our core nutritional business, we saw sequential improvement in Q1. Net sales of $204 million grew 7% sequentially, driven by active customer growth, particularly in our China market, which benefited from customer acquisition activity around the Lunar New Year.
The sequential improvement is encouraging and consistent with our view that the actions we are taking to stabilize the business are beginning to take hold. These actions are organized around three clear priorities. First, we are advancing the rollout of our enhanced brand partner compensation plan, which is designed to strengthen the business opportunity and improve the productivity and retention of our distributor network. Second, we are accelerating new product launches, bringing a robust pipeline of new and upgraded formulations to market. And third, we are accelerating our technology initiatives to modernize our core systems and fundamentally improve how customers experience our brands while driving future cost efficiencies across our IT infrastructure.
Taken together, we remain confident that these initiatives will continue to stabilize active customer accounts and position the core nutritional business for a return to sustainable growth. Turning to our omni-channel brands, HYA and Rise Wellness, they are expanding the aperture of what USANA Health Sciences, Inc. can be, reaching consumers in new channels and through innovative formats. HYA generated $32 million in net sales in the first quarter, with active monthly subscribers of 186 thousand, reflecting modest sequential improvement from Q4. The business has been navigating a period of elevated customer acquisition costs stemming from disruptions in the Meta advertising environment beginning in 2025.
The HYA team is deploying the resources and capabilities needed to reaccelerate subscriber growth, and we expect 2026 to reflect stronger performance. Several important milestones position HYA well for that recovery. The brand launched in Canada in January and in the United Kingdom in March, establishing its first international direct-to-consumer markets. HYA also expanded into retail, and products are now available at Target, representing the brand's first partner in brick-and-mortar retail. Lastly, I want to point out we are leveraging USANA Health Sciences, Inc.'s assets to accelerate growth and improve margins.
Since the acquisition a little over a year ago, we have implemented a new ERP system, transitioned 3PLs, leveraged our R&D team to develop new products, leveraged our market expansion team to expand internationally, and brought manufacturing and packaging of HYA products in-house, a strategic shift that we expect will generate incremental margin efficiencies beginning in 2026. We continue to project full-year 2026 net sales of $140 million to $155 million for HYA. Rise Wellness delivered $14 million in net sales for the first quarter, more than eight times the prior year's first quarter, and a 143% sequential increase. This performance was driven by the national launch of Protein Pop Plus in Costco.
Protein Pop's journey from concept to national shelf placement in a matter of months is compelling proof of this team's ability to capitalize on speed and execution. While this has proven to be a competitive and evolving marketplace, Protein Pop has gained meaningful share and emerged as a leading brand that we expect to see on shelves across many more retailers in the coming months and years. Rise Bar also continues to benefit from the retail distribution relationships established last year. As with HYA, we have been able to leverage our significant assets and expertise to benefit the two Rise Wellness brands. We are manufacturing Rise Bars on USANA Health Sciences, Inc.'s high-speed, high-tech bar line.
Our world-class operations team is managing inventory and demand planning for both Rise and Protein Pop to create efficiencies. Lastly, our R&D team is reformulating existing products and developing future products for these brands to ensure our customers have an excellent experience while also receiving the best nutritional products possible. We are pleased with the market reception and remain confident in the long-term potential of this segment. We are reaffirming our full-year 2026 guidance across all metrics, projecting consolidated net sales of $925 million to $1 billion. Omni-channel net sales are on track to represent more than 20% of total net sales this year, up from 16% in 2025 and approximately 1% just two years ago.
That trajectory speaks to how quickly our omnichannel platform is taking shape. Please note that our guidance includes an incremental but modest investment for our technology modernization initiatives, which we are funding primarily through a repurposing of existing resources as well as savings generated from operational efficiencies and the initiatives, which underscore our commitment to innovate without sacrificing fiscal discipline. Let me close by putting this quarter in context. We came into 2026 with a clear strategy: stabilize the core nutritional business, scale our omni-channel brands, and modernize the platform that ties it all together. The first quarter showed progress on all three fronts. Active customers in the core business grew sequentially.
HYA reached new markets and a new retail channel. Rise Wellness delivered a strong launch in the quarter at Costco and Target. And we have formalized technology investment plans that will improve how we operate and how consumers experience our brand. None of this happens overnight. We are committed to making impactful investments that generate robust returns. Our balance sheet is strong, our people are aligned, and our strategy is clear. We have three solid segments, an evolving omni-channel platform, and a mission that resonates with health-conscious consumers around the world. We remain committed to executing with focus and delivering sustainable long-term value for our shareholders.
With that, I will now turn the call back over to the operator for Q&A.
Operator: Thank you. We will now be conducting a question and answer session. Our first question will come from Anthony Chester Lebiedzinski with Sidoti & Company.
Anthony Chester Lebiedzinski: Good morning, everyone, and thank you for taking the questions. Certainly nice to see the better-than-expected results, and specifically I wanted to start with China. So we saw some improvement there in Q1, which is good to see. Just wondering if you have seen any notable changes from a macro perspective in China, or maybe elsewhere, as it relates to increased fuel prices since the Iran conflict started. Just wondering what you have seen from a broader consumer perspective as it relates to higher fuel prices.
Kevin Guest: Yes. Brent, I would like you to respond to that. He is our Chief Commercial Officer. Brent?
Brent L. Neidig: Yes, Anthony, good morning. It is good to hear from you. As of this point, I would say the macro environment in China is pretty stable relative to the rest of the globe. They have been somewhat insulated from different inflationary pressures that the rest of the markets have been under. I think it is still a little too early to tell in terms of the Iran conflict and what we might see with fuel prices there, but everything that we have seen and that I am hearing from our brand partners and from our leadership there is that there is no material impact as of yet.
Anthony Chester Lebiedzinski: That is good to hear. And as it relates to the core nutritional business, you talked about accelerating product development and also timelines for that. Can you share any more specifics as far as maybe the number of new products that are in the pipeline, or anything else that you can share as to what you have coming up as far as new product development?
Kevin Guest: Yes, Anthony. We have our Chief Science Officer, Dr. Kathryn Armstrong, here. Kathryn, will you go ahead and handle that question?
Kathryn Armstrong: Hi, Anthony. Good to talk with you. Good morning. For us, a lot of the focus has been on how we better leverage our skill sets internally and externally across all of the different product formats that we now offer, against the expanded brand portfolio. When we talk about the number of products under development, there are products under development in all of our sections, as well as in our team in China. It is certainly over 20. I would not go into specifics on launch dates and in which categories they fall, but we have a plethora of products we are developing for all of the brands and for all of the markets.
The focus for us is really on how we help more people ingest the products that we are making across the brands, and how we leverage things we have learned in our different channels that appeal to different types of consumers or to different types of use occasions, and how we expand each of the channels to allow for more of those consumers to engage across those channels.
For example, you can expect to see us bring in things to our direct sales channel that are aligned with key insights we have had around how consumers are evolving their desired product usage experiences, and really pulling those learnings together to make sure we have products in each of the channels that are appealing to the right consumers to meet them where they are on their health journey.
Kevin Guest: Hey, Anthony, this is Kevin. Just to jump in, and I am going to ask Walter to comment on this as well. To your point and what Kathryn just alluded to, one of the things that I have been very optimistic about is how we are leveraging the expertise and knowledge base from other sales channels into our core business, and the learnings that we are gaining from a direct-to-consumer approach and how that helps lend itself in other categories. Walter, just again to Anthony's point about our product strategy overall as it relates to omni-channel and how that is affecting each other.
Walter Noot: Yes, cross-platform, what it has done is, traditionally, we have been a direct sales business—and it is an international business—but with the rapid growth we have had with retail, for instance with Protein Pop launching that new product recently, we have seen how quickly trends change. Obviously, there are some really big trends around weight loss and using protein to be able to supplement that weight loss, and that has been a really big benefit. We have been able to leverage that and use product development and the teams we have to design and develop new products for the direct sales channel.
I think you are going to see some of the things that we do in retail and direct-to-consumer bleed over into the direct sales channel.
Anthony Chester Lebiedzinski: That sounds like you certainly are leveraging all your assets, which sounds promising. Now switching gears to HYA. It is good to see a sequential uptick in sales, though SG&A was higher than the fourth quarter and higher than last year. Is that just seasonality of the business as far as marketing costs, or is there anything else impacting SG&A?
G. Douglas Hekking: Yes, Anthony, this is Doug. As Kevin alluded to and Walter contributed as well, HYA is diversifying within its own channel. It had the initial foray into retail towards the latter part of the quarter and also entered both Canada and the UK, and so those things consumed some operational resources as well. The other aspect that you see is the Meta algorithm that we have talked about a few times. The higher short-term cost of acquiring a customer was definitely present there on a year-over-year comparison.
Anthony Chester Lebiedzinski: Mhmm. And can you give us an update as to how HYA is doing so far in Canada, the UK, and the selling at Target?
Brent L. Neidig: Canada has exceeded the initial targets we put in place. I think that is partly because a lot of people in Canada have probably seen HYA and understand the brand; it kind of bleeds over. With the UK, it is a new market for us. We are using Meta for advertising there, and I would say it is very new—we have been out about a month, maybe five weeks—so it is a slow start because it is a brand-new market. But we have very high hopes for the UK.
We looked across the world at what the best markets are for HYA products, and we believe that with the DTC appetite in the UK and the competitive landscape there, HYA is going to do really well. As far as Target goes, it has been a little more than two weeks on shelf. About a week ago, most of the Target stores put end caps in place with HYA products. We went live with Target, then put end caps in place, so we are going to see how that progresses. We really do not know yet; in the next few weeks, we will have a much better idea.
But the placement in the store and the amount of attention that Target has given us gives us high hopes, and that is why we have kept our guidance in place.
Kevin Guest: And I would say, Anthony, things are going according to plan. As we step into this area, we are even expanding into Amazon a little bit more than we have in the past. Things are going according to plan, but we expect it to be a build as we go, and we are at a very early stage. The other thing that Walter and the business development team have worked with the HYA team on—and what they communicate—is diversification within their advertising and consumer spend, different ways to reach the consumer, and being a little bit more insulated relative to being too committed to just one form of advertising.
They have always been diversified, but they continue to work on that aspect as well.
Anthony Chester Lebiedzinski: Okay. And then switching gears to Rise, you spoke highly of your relationship with Costco. After the initial sell-in to Costco, have you seen reorder activity from them? And as far as any other retailers, have you seen new order placements?
G. Douglas Hekking: Yes, we are seeing reorder placements on a weekly basis with Costco, so we are selling through. If you look at our balance sheet, we used up a lot of cash, and a lot of that was building up Costco inventory, and we are selling through that to Costco. That is ongoing. Target has been in place for a while—we have had Target since around August or September—so Target has been very consistent for us, and we know the cadence and what that business looks like. Costco is still evolving; we have gone through multiple iterations.
We had a discount for a couple of weeks that we agreed to upfront with Costco, and that gave us a lot of sell-through, and you see a little bit of up and down as you go through that process. I would not say we know exactly how that is going to go in the long term, but we have a lot of conversations with them about new products and different types of Protein Pop products that they are interested in. The relationship is really good, and I think the opportunity continues.
Anthony Chester Lebiedzinski: And just to follow up, as far as other retailers, will you be selling to others in this quarter or in the second half of the year?
Brent L. Neidig: Yes. We have already agreed with nine more major U.S. retailers that we have set up for this year—some will be in the second quarter and some in the third quarter—so Protein Pop will continue to expand. We are in 500 Walmart stores already, and that has been good. The Walmart buyers like us, and they feel like it is a good product for them, so we hope to expand that, and we will be adding more retailers throughout the U.S.
Anthony Chester Lebiedzinski: Okay. Sounds good. Thank you very much, and best of luck.
Kevin Guest: Thank you. Thanks, Anthony.
Operator: Our next question will come from Ivan Philip Feinseth with Tigris Financial Partners.
Ivan Philip Feinseth: Congratulations on the great results and the success with HYA and Rise. Can you give me some insight into your R&D initiatives and where you see some new growth opportunities going forward?
Kathryn Armstrong: Hi, Ivan. It is good to talk with you again. Our focus continues to really deepen into women’s health and children’s health, and, looking across our brands and the integration of OOLA into our direct sales brand, I think that is a very logical place for us to be across all of the channels we are in. You can expect to see us continuing to push further into the real science behind women’s health and children’s health. We have done a lot of investment in terms of true research and working on clinical research to really understand how we more meaningfully impact health for both of those segments of the population.
We also have a strong focus on our direct sales business and how we can ensure that product pipeline is continually updated as well as streamlined to help people navigate it more efficiently and really get the health benefits that they are seeking. I would say those are our big focus areas right now, Ivan—women’s, kids, and ensuring that our core product line is updated and streamlined to enable consumer efficiency.
Ivan Philip Feinseth: And how about additional focus on gut health, which seems to be a major driver of overall health? And also any updates or insight to products in your active nutrition category?
Kathryn Armstrong: When we think about gut health and the impact across all segments, women have some unique gut health topics that need to be addressed. People tend to think about gut health in less-developed microbiome-focused markets in terms of just digestion, and obviously there is expansion to all possible health benefits beyond digestion and immunity. For women, you will see us putting a focus on what gut health looks like for them in all of the various aspects of what addressing gut health can do holistically and physiologically. For children, we have probiotic lines and fiber lines, and those will continue to expand and continue to be leveraged as appropriate across our channels.
On active nutrition, we are hearing, as referenced earlier, a lot of focus on protein and how to help consumers consume protein in ways that are more aligned with their needs and their desired consumption profile. You can expect to see more products in those categories as well, coming to market to ensure that people are supported both on their weight loss journeys as well as on their health and muscle-building journeys.
Brent L. Neidig: And, Ivan, this is Brent here, just to add a little bit more color in terms of active nutrition. In the first quarter of this year, we relaunched new active nutrition shakes—weight management and weight loss shakes—in China. We made an investment into manufacturing equipment, filling equipment in that facility so that we could do it in-house and upgraded our formulas. That was launched in Q1 with a lot of excitement from our brand partners. We have a really strong weight management campaign currently running there. It is still a big focus for us, and we will continue to invest in that area.
Ivan Philip Feinseth: Alright. Thanks, and congratulations again. Good luck for ’26.
Operator: Thanks, Ivan. This now concludes our question-and-answer session. I would like to turn the floor back over to Andrew Masuda for closing comments.
Andrew Masuda: Thanks for your questions and participation on today's conference call. If you have any remaining questions, please feel free to contact Investor Relations at (801) 954-7210.
Operator: Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines. Have a wonderful day.
