USANA Health Sciences (NYSE:USNA) expects 2026 net sales approaching $900 million and adjusted EBITDA of approximately $77 million, down from its prior adjusted EBITDA outlook of $80.5 million, as weaker sales at Rise Wellness and increased marketing investment at Hiya offset stronger profitability in its core nutrition business.
Chairman and Chief Executive Officer Kevin Guest described the third quarter as mixed, pointing to subscriber growth at Hiya and improving sales in Southeast Asia Pacific while acknowledging declines in core nutrition customers and disappointing results at Rise Wellness.
USANA is seeking to evolve from a single-channel direct seller into an omnichannel health and wellness company. Its strategy includes acquiring and retaining customers in core nutrition while expanding Hiya and Rise Wellness through retailers and Amazon.
Core nutrition faces customer declines
Active customers in USANA’s core nutrition business fell 8% year over year, Guest said. Greater China, the company’s largest market, accounted for most of the sequential decline in net sales and active customers amid lighter incentive and promotional activity. Outside Southeast Asia Pacific, every region posted a decline in constant-currency sales.
Chief Financial Officer Doug Hekking said USANA now expects roughly $740 million in core nutrition sales for 2026, $10 million below its most recent outlook because of fewer active customers. The revised figure remains within the range provided at the start of the year.
There were signs of improvement in Southeast Asia Pacific, where net sales rose 2% year over year after a 13% decline in the prior quarter. Active customers increased 3% sequentially. Chief Commercial Officer Brent Neidig attributed the improvement to leadership changes, a successful incentive program and renewed engagement among Brand Partner leaders.
Neidig cautioned that he would not necessarily call the results a new trend. He said USANA plans to phase in adjustments to its Brand Partner incentive plan throughout 2027, including changes to qualification criteria and the timing of some payouts, with the aim of improving customer retention and loyalty.
Chief Scientific Officer Kathryn Armstrong said new product initiatives focused on women and children are expected to reach the market in 2027.
Hiya adds subscribers as marketing costs pressure margins
Hiya’s active monthly subscribers rose 18% from the second quarter, an increase of about 29,500 net subscribers, and its net sales returned to year-over-year growth, Guest said. Combined sales through Target and Amazon more than doubled sequentially, although he noted that the comparison was from a small base and benefited from back-to-school seasonality.
After difficulties with digital advertising earlier in the year, Hiya diversified its customer acquisition efforts through creator and affiliate programs and TikTok Shop. Lower customer acquisition costs prompted the company to increase digital marketing spending, which pressured near-term margins. USANA raised its Hiya net sales outlook to $130 million.
Hekking said the company expects sequential growth in Hiya sales and adjusted EBITDA in the fourth quarter as newly acquired subscribers contribute for a full quarter and retail and Amazon sales build.
Chief Operating Officer Walter Noot said the cost of acquiring customers, including a discounted first order, can create fluctuations in Hiya’s profitability. He expects margins to rise substantially in the fourth quarter and said the brand plans to enter the club channel in early 2027.
Rise outlook cut again
USANA lowered its outlook for Rise Wellness again after club-channel orders fell short of expectations. Guest said the prior-year quarter included a large Rise Bar club order that did not repeat. He also cited improving gross margin and broadening distribution beyond clubs as priorities.
Hekking said the outlook assumes certain retail orders scheduled for the fourth quarter ship as planned. If they move into the first quarter of 2027, he said, 2026 results could be modestly below the outlook, with the associated sales and earnings expected in 2027.
Noot said Rise expects to be in 4,100 grocery and other non-club retail stores by the end of 2026. He identified Protein Pop Balance, which launched at Target in September, as a focus for the following year.
Cash flow and balance sheet
USANA generated $45 million in cash from operations through the first three quarters, up from $26 million a year earlier. Free cash flow was $36 million, more than double the prior-year figure, while inventory fell 13% from year-end, Hekking said.
The company ended the quarter with $179 million in cash and no debt. Asked about the tax rate, Hekking said the amortization of Hiya intangibles was a headwind and that better execution and traction at the venture businesses offered an opportunity to address the issue.
About USANA Health Sciences (NYSE:USNA)
USANA Health Sciences, Inc develops and sells nutritional supplements, healthy foods and personal-care products through a direct-selling business model. Its product portfolio includes vitamins and mineral supplements, meal-replacement and snack products, sports nutrition offerings, and skincare products marketed under the USANA and related brands.
Founded in 1992 by microbiologist and immunologist Myron W. Wentz, the company is headquartered in Salt Lake City, Utah. USANA distributes its products through a network of independent associates and preferred customers rather than primarily through traditional retail channels.
The company serves customers in markets across the Americas, Asia-Pacific and Europe, with a significant presence in countries including the United States, Canada, Australia, New Zealand, China, Hong Kong, Japan, South Korea, the Philippines, Singapore, Malaysia and Thailand.
