USANA Health Sciences Reports 9.5% Net Sales Increase in Q1 2025, Net Earnings Down 43.1%

USANA Health Sciences, Inc. reported a net sales increase of 9.5% for the first quarter of 2025, reaching $249.5 million compared to $227.8 million in the same period last year. The growth was primarily driven by the acquisition of Hiya Health Products, which contributed $37.1 million in sales. However, the direct selling segment experienced a decline, with net sales falling 6.7% to $212.5 million, attributed to a decrease in active customers and unfavorable currency exchange rates that negatively impacted sales by approximately $5.6 million.

Net earnings attributable to USANA for the quarter were $9.4 million, a significant decrease of 43.1% from $16.5 million in the prior-year quarter. This decline was influenced by increased amortization costs related to the Hiya acquisition, lower net interest income, and the adverse effects of a strong U.S. dollar on the company's operating model. Diluted earnings per share fell to $0.49 from $0.86 in the previous year, reflecting the overall decrease in profitability.

Operationally, USANA reported approximately 459,000 active customers in its direct selling segment as of March 29, 2025, down from 494,000 a year earlier. The decline was particularly pronounced in the Americas and Europe, where active customers decreased by 14.1%. In contrast, Hiya reported approximately 224,000 active monthly subscribers, indicating a successful integration of the direct-to-consumer model. The company continues to focus on expanding its customer base and enhancing engagement through its Affiliate program launched in 2023.

In terms of financial health, USANA's cash and cash equivalents decreased slightly to $179.6 million from $181.8 million at the end of December 2024. The company generated $15.5 million in cash flow from operating activities during the quarter, which was offset by cash used in financing and investing activities. USANA maintains a line of credit with a balance of $23 million, which provides additional liquidity for operational needs and potential future acquisitions.

Looking ahead, USANA acknowledges the challenges posed by a competitive market and fluctuating economic conditions. The company aims to leverage its recent acquisition of Hiya to diversify its revenue streams and enhance its direct-to-consumer offerings. Management remains focused on improving customer retention and engagement while navigating the complexities of international markets and currency fluctuations.