Herbalife Achieves Third Quarter Net Sales Growth of 6.0%; Strong Profitability and Robust Operating Cash Flow; Fifth Consecutive Quarter of Expansion
Quarterly net interest expense fell $19.1 million following April refinancing, while nine-month earnings included a debt-extinguishment loss.
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“Our third quarter results demonstrate continued progress, with strong sales growth, profitability, and cash generation, enabling us to return capital to shareholders going forward, while we continue to strengthen our business and position Herbalife for sustainable, long-term growth.”
- John DeSimone, Interim CEO
Highlights
Third Quarter 2026
-
Net sales of
$1.35 billion 6.0% vs. Q3’25, underscores the progress of the Company’s transformation-
Up
7.6% year-over-year on constant currency basis2 -
North America net sales up1.7% , its second consecutive quarter of year-over-year growth
-
Up
-
Net income attributable to Herbalife of
$58.8 million 4.4% ; adjusted net income1 of$68.5 million 5.1% -
Adjusted EBITDA1 of
$182.4 million 13.5% , up 70 basis points year-over-year-
Adjusted EBITDA1 at constant currency2 of
$193.7 million -
Credit Agreement EBITDA1 of
$198.9 million
-
Adjusted EBITDA1 at constant currency2 of
-
Diluted EPS of
$0.55 $0.13 $0.64 $0.14 -
Year-to-date net cash provided by operating activities of
$298.0 million $40.7 million -
Net interest expense savings of
$19.1 million
Recent Developments
-
Board authorized new share repurchase program of up to
$250 million - Appointed Scott Schaefer Chief Financial Officer, effective November 1, 2026
Outlook
- Fourth quarter 2026 guidance provided
- Full-year 2026 guidance revised: net sales guidance increased on both reported and constant currency basis; adjusted EBITDA1 guidance maintained on a reported basis and increased on constant currency basis
1 Non-GAAP measure. Refer to Schedule A – “Reconciliation of Non-GAAP Financial Measures” for a detailed reconciliation of these measures to the most directly comparable 2 Non-GAAP measure. Refer to Schedule A – “Reconciliation of Non-GAAP Financial Measures” for a discussion of why the Company believes adjusting for the effects of foreign exchange is useful. |
Management Commentary
Herbalife reported third quarter 2026 net sales of
Gross profit margin was
For the quarter, net income attributable to Herbalife was
Net cash provided by operating activities was
“Third quarter net sales and adjusted EBITDA both exceeded guidance, and adjusted EBITDA margin expanded 70 basis points year-over-year,” said Scott Schaefer, CFO. “Our April refinancing reduced net interest expense by
As of September 30, 2026, the Company had cash and cash equivalents of
Leadership Update
John DeSimone was appointed interim CEO and Scott Schaefer was appointed CFO, both effective November 1, 2026.
The Board committee overseeing the succession process, supported by an executive search firm, continues its search for the Company's next Chief Executive Officer and will provide updates as appropriate.
“We delivered a fifth consecutive quarter of year-over-year net sales growth, and we continue to expect net sales growth for the remainder of the year,” said John DeSimone, Interim CEO. “Our priorities are clear: disciplined execution, profitable growth, and a focused roadmap for our business opportunity and digital platforms with measurable success metrics.”
Third Quarter 2026 Key Metrics
Regional Net Sales and FX Impact
|
Reported Net Sales |
|
YoY Growth (Decline) |
||||
$ million |
Q3 ‘26 |
Q3 ‘25 |
|
including FX |
excluding FX2 |
||
|
267.5 |
263.1 |
|
1.7 |
% |
1.7 |
% |
|
250.2 |
229.6 |
|
9.0 |
% |
5.1 |
% |
EMEA |
259.0 |
272.3 |
|
(4.9 |
)% |
(5.2 |
)% |
|
517.9 |
437.4 |
|
18.4 |
% |
26.1 |
% |
|
55.6 |
71.3 |
|
(22.0 |
)% |
(26.4 |
)% |
Worldwide |
1,350.2 |
1,273.7 |
|
6.0 |
% |
7.6 |
% |
|
Reported Net Sales |
|
YoY Growth (Decline) |
||||
$ million |
YTD ‘26 |
YTD ‘25 |
|
including FX |
excluding FX2 |
||
|
788.1 |
789.9 |
|
(0.2 |
)% |
(0.3 |
)% |
|
737.2 |
646.5 |
|
14.0 |
% |
6.6 |
% |
EMEA |
811.6 |
833.5 |
|
(2.6 |
)% |
(5.8 |
)% |
|
1,484.3 |
1,268.5 |
|
17.0 |
% |
23.4 |
% |
|
173.0 |
216.1 |
|
(19.9 |
)% |
(24.3 |
)% |
Worldwide |
3,994.2 |
3,754.5 |
|
6.4 |
% |
6.3 |
% |
Outlook
Fourth Quarter 2026 Guidance
$ million |
Net Sales |
Adjusted EBITDA1 |
CapEx |
Reported |
+ |
145-165 |
13 – 23 |
Constant Currency(a) |
+ |
155-175 |
|
Q4 ‘25 Actuals |
1,283.0 |
156.1
|
18.5 |
Full-Year 2026 Guidance – Revised
$ million |
Net Sales |
Adjusted EBITDA1 |
CapEx |
Reported Previous Guidance (Aug 5 ’26) |
+
+ |
670-690 670 – 690 |
55 – 65 50 – 70 |
Constant Currency(a) Previous Guidance (Aug 5 ’26) |
700-720 690 – 710 |
700-720 690 – 710 |
|
FY ‘25 Actuals |
5,037.5 |
657.6
|
80.4 |
| (a) |
Non-GAAP Measure. Represents projections using |
Guidance Assumptions
- Net sales and adjusted EBITDA1 use the average daily exchange rates for the first two weeks of October 2026 to translate local currency projections
Additional FY 2026 Expectations – Revised
-
Capitalized and prepaid SaaS implementation costs of
$35 million $45 million -
Depreciation and amortization, and amortization of SaaS implementation costs, of
$135 million $145 million -
Adjusted effective tax rate1 of approximately
35%
Earnings Webcast and Conference Call
Herbalife’s senior management team will host an audio webcast and conference call to discuss its third quarter 2026 financial results on Monday, November 2, 2026, at 5:00 p.m. ET (2:00 p.m. PT).
The audio webcast will be available at the following link: https://edge.media-server.com/mmc/p/hrbpxcoq
Participants joining via the conference call may obtain the dial-in information and personal PIN to access the call by registering at the following link: https://register-conf.media-server.com/register/BIbc86d3675fac41e6bb6e7213dc72cc0b
Senior management also plans to reference slides during the webcast and call, which will be available under the Investor Relations section of Herbalife’s website at https://ir.herbalife.com, where financial and other information is posted from time to time. The webcast will also be available at the same website, along with a replay of the webcast following the completion of the event and for three months thereafter.
About Herbalife Ltd.
Herbalife (NYSE: HLF) is a premier health and wellness company, community and platform that has been changing people's lives with great nutrition products and a business opportunity for its independent distributors since 1980. The Company offers science-backed products to consumers in more than 90 markets through entrepreneurial distributors who provide one-on-one coaching and a supportive community that inspires their customers to embrace a healthier, more active lifestyle to live their best life.
For more information, visit https://ir.herbalife.com.
Forward-Looking Statements
This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including any projections of earnings, revenue or other financial items; any statements of the plans, strategies and objectives of management, including for future operations, capital expenditures, or share repurchases; any statements concerning proposed new products, services, or developments; any statements regarding future economic conditions or performance; any statements of belief or expectation; and any statements of assumptions underlying any of the foregoing or other future events. Forward-looking statements may include, among others, the words “may,” “will,” “estimate,” “intend,” “continue,” “believe,” “expect,” “anticipate” or any other similar words.
Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results or outcomes could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and to inherent risks and uncertainties, many of which are beyond our control. Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in or implied by our forward-looking statements include the following:
- the potential impacts of current global economic conditions, including inflation, unfavorable foreign exchange rate fluctuations, and tariffs or retaliatory tariffs, on us; our Members, customers, and supply chain; and the world economy;
- our ability to attract and retain Members;
- our relationship with, and our ability to influence the actions of, our Members;
- our noncompliance with, or improper action by our employees or Members in violation of, applicable U.S. and foreign laws, rules, and regulations;
- adverse publicity associated with our Company or the direct-selling industry, including our ability to comfort the marketplace and regulators regarding our compliance with applicable laws;
- changing consumer preferences and demands and evolving industry standards, including with respect to climate change, sustainability, and other environmental, social, and governance matters;
- the competitive nature of our business and industry;
- legal and regulatory matters, including regulatory actions concerning, or legal challenges to, our products or network marketing program and product liability claims;
- the Consent Order entered into with the Federal Trade Commission, or FTC, the effects thereof and any failure to comply therewith;
- risks associated with operating internationally and in China;
- our ability to execute our growth and other strategic initiatives (such as restructuring efforts, increased market penetration in existing markets, and personalized product and related technology initiatives);
- the effectiveness and acceptance of new technology-driven initiatives;
- any material disruption to our business caused by natural disasters, other catastrophic events, acts of war or terrorism, including the wars in Ukraine and the Middle East, cybersecurity incidents, pandemics, and/or other acts by third parties;
- our ability to adequately source ingredients, packaging materials, and other raw materials and manufacture and distribute our products;
- our reliance on our information technology infrastructure, and our ability to successfully develop, deploy, and integrate artificial intelligence into our business;
- noncompliance by us or our Members with any privacy, artificial intelligence and data protection laws, rules, or regulations or any security breach involving the misappropriation, loss, or other unauthorized use or disclosure of confidential information;
- contractual limitations on our ability to expand or change our direct-selling business model;
- the sufficiency of our trademarks and other intellectual property;
- product concentration;
- our reliance upon, or the loss or departure of any member of, our senior management team;
- our ability to integrate and capitalize on acquisition transactions;
- restrictions imposed by covenants in the agreements governing our indebtedness;
- risks related to our convertible notes;
- changes in, and uncertainties relating to, the application of transfer pricing, income tax, customs duties, value added taxes, and other tax laws, treaties, and regulations, or their interpretation;
- our incorporation under the laws of the Cayman Islands; and
- share price volatility related to, among other things, speculative trading and certain traders shorting our common shares.
Additional factors and uncertainties that could cause actual results or outcomes to differ materially from our forward-looking statements are set forth in the Company’s filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the Securities and Exchange Commission on February 18, 2026, including under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and in our Consolidated Financial Statements and the related Notes included therein. In addition, historical, current, and forward-looking sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future.
Forward-looking statements in this release speak only as of the date hereof. We do not undertake any obligation to update or release any revisions to any forward-looking statement or to report any events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as required by law.
Results of Operations
| Herbalife Ltd. and Subsidiaries | |||||||||||||||||
| Condensed Consolidated Statements of Income | |||||||||||||||||
| (in millions, except per share amounts) | |||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||||
(unaudited) |
|||||||||||||||||
| Net sales | $ |
1,350.2 |
|
$ |
1,273.7 |
|
$ |
3,994.2 |
|
$ |
3,754.5 |
|
|||||
| Cost of sales |
|
306.1 |
|
|
284.2 |
|
|
893.5 |
|
|
826.3 |
|
|||||
| Gross profit |
|
1,044.1 |
|
|
989.5 |
|
|
3,100.7 |
|
|
2,928.2 |
|
|||||
| Selling expenses (1) |
|
473.5 |
|
|
450.7 |
|
|
1,401.3 |
|
|
1,330.0 |
|
|||||
| General and administrative expenses (1) |
|
432.1 |
|
|
413.0 |
|
|
1,299.7 |
|
|
1,221.8 |
|
|||||
| Other operating income (2) |
|
- |
|
|
- |
|
|
(5.5 |
) |
|
(4.8 |
) |
|||||
| Operating income |
|
138.5 |
|
|
125.8 |
|
|
405.2 |
|
|
381.2 |
|
|||||
| Interest expense, net |
|
31.9 |
|
|
51.0 |
|
|
116.1 |
|
|
156.6 |
|
|||||
| Other expense, net (3) |
|
- |
|
|
- |
|
|
94.6 |
|
|
- |
|
|||||
| Income before income taxes |
|
106.6 |
|
|
74.8 |
|
|
194.5 |
|
|
224.6 |
|
|||||
| Income taxes |
|
49.5 |
|
|
31.7 |
|
|
102.7 |
|
|
81.9 |
|
|||||
| Net income | $ |
57.1 |
|
$ |
43.1 |
|
$ |
91.8 |
|
$ |
142.7 |
|
|||||
| Net loss attributable to noncontrolling interest |
|
(1.7 |
) |
|
(0.1 |
) |
|
(2.6 |
) |
|
(0.2 |
) |
|||||
| Net income attributable to Herbalife | $ |
58.8 |
|
$ |
43.2 |
|
$ |
94.4 |
|
$ |
142.9 |
|
|||||
| Earnings per share attributable to Herbalife: | |||||||||||||||||
| Basic | $ |
0.56 |
|
$ |
0.42 |
|
$ |
0.90 |
|
$ |
1.39 |
|
|||||
| Diluted | $ |
0.55 |
|
$ |
0.42 |
|
$ |
0.88 |
|
$ |
1.38 |
|
|||||
| Weighted-average shares outstanding: | |||||||||||||||||
| Basic |
|
105.1 |
|
|
103.3 |
|
|
104.4 |
|
|
102.6 |
|
|||||
| Diluted |
|
107.3 |
|
|
104.0 |
|
|
107.7 |
|
|
103.2 |
|
|||||
| (1) Prior period amounts were reclassified to conform to current period presentation. Refer to Schedule B – “Reclassifications” for additional details. | |||||||||||||||||
| (2) Other operating income for the nine months ended September 30, 2026 and September 30, 2025 relates to certain |
|||||||||||||||||
| (3) Other expense, net for the nine months ended September 30, 2026 relates to loss on the extinguishment of the 2024 Credit Facility and the 2029 Secured Notes. | |||||||||||||||||
| Herbalife Ltd. and Subsidiaries | |||||||||
| Condensed Consolidated Balance Sheets | |||||||||
| (in millions) | |||||||||
| September 30, | December 31, | ||||||||
|
2026 |
|
|
2025 |
|
||||
| (unaudited) | |||||||||
| ASSETS | |||||||||
| Current assets: | |||||||||
| Cash and cash equivalents | $ |
409.2 |
|
$ |
353.1 |
|
|||
| Receivables, net |
|
116.9 |
|
|
91.9 |
|
|||
| Inventories |
|
508.3 |
|
|
511.7 |
|
|||
| Prepaid expenses and other current assets |
|
194.0 |
|
|
188.0 |
|
|||
| Total current assets |
|
1,228.4 |
|
|
1,144.7 |
|
|||
| Property, plant and equipment, net |
|
400.8 |
|
|
447.7 |
|
|||
| Operating lease right-of-use assets |
|
161.4 |
|
|
168.3 |
|
|||
| Marketing-related intangibles and other intangible assets, net |
|
331.4 |
|
|
315.1 |
|
|||
| Goodwill |
|
128.0 |
|
|
100.5 |
|
|||
| Deferred income tax assets |
|
453.7 |
|
|
464.3 |
|
|||
| Other assets |
|
184.8 |
|
|
145.3 |
|
|||
| Total assets | $ |
2,888.5 |
|
$ |
2,785.9 |
|
|||
| LIABILITIES AND SHAREHOLDERS' DEFICIT | |||||||||
| Current liabilities: | |||||||||
| Accounts payable | $ |
93.7 |
|
$ |
99.8 |
|
|||
| Member compensation liabilities |
|
401.4 |
|
|
402.4 |
|
|||
| Current portion of long-term debt |
|
12.1 |
|
|
20.9 |
|
|||
| Other current liabilities |
|
524.3 |
|
|
489.8 |
|
|||
| Total current liabilities |
|
1,031.5 |
|
|
1,012.9 |
|
|||
| Non-current liabilities: | |||||||||
| Long-term debt, net of current portion |
|
1,917.1 |
|
|
1,971.7 |
|
|||
| Non-current operating lease liabilities |
|
145.7 |
|
|
155.7 |
|
|||
| Other non-current liabilities |
|
197.9 |
|
|
155.0 |
|
|||
| Total liabilities |
|
3,292.2 |
|
|
3,295.3 |
|
|||
| Commitments and contingencies | |||||||||
| Shareholders' deficit: | |||||||||
| Common shares |
|
0.1 |
|
|
0.1 |
|
|||
| Paid-in capital in excess of par value |
|
343.8 |
|
|
316.0 |
|
|||
| Accumulated other comprehensive loss |
|
(268.2 |
) |
|
(251.5 |
) |
|||
| Accumulated deficit |
|
(485.3 |
) |
|
(579.7 |
) |
|||
| Total Herbalife shareholders' deficit |
|
(409.6 |
) |
|
(515.1 |
) |
|||
| Noncontrolling interest |
|
5.9 |
|
|
5.7 |
|
|||
| Total shareholders' deficit |
|
(403.7 |
) |
|
(509.4 |
) |
|||
| Total liabilities and shareholders' deficit | $ |
2,888.5 |
|
$ |
2,785.9 |
|
|||
| Herbalife Ltd. and Subsidiaries | |||||||||
| Condensed Consolidated Statements of Cash Flows | |||||||||
| (in millions) | |||||||||
| Nine Months Ended September 30, | |||||||||
|
2026 |
|
|
2025 |
|
||||
| (unaudited) | |||||||||
| Cash flows from operating activities: | |||||||||
| Net income | $ |
91.8 |
|
$ |
142.7 |
|
|||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
| Depreciation and amortization |
|
91.3 |
|
|
91.9 |
|
|||
| Share-based compensation expenses |
|
29.4 |
|
|
33.2 |
|
|||
| Non-cash interest expense |
|
9.2 |
|
|
12.3 |
|
|||
| Deferred income taxes |
|
4.8 |
|
|
5.3 |
|
|||
| Inventory write-downs |
|
18.1 |
|
|
21.4 |
|
|||
| Foreign exchange transaction loss |
|
1.4 |
|
|
1.6 |
|
|||
| Loss on extinguishment of debt |
|
94.6 |
|
|
- |
|
|||
| Other |
|
2.3 |
|
|
(1.2 |
) |
|||
| Changes in operating assets and liabilities: | |||||||||
| Receivables |
|
(24.2 |
) |
|
(25.6 |
) |
|||
| Inventories |
|
(22.2 |
) |
|
(29.8 |
) |
|||
| Prepaid expenses and other current assets |
|
(3.2 |
) |
|
8.9 |
|
|||
| Accounts payable |
|
(5.1 |
) |
|
12.4 |
|
|||
| Member compensation liabilities (1) |
|
3.8 |
|
|
(5.0 |
) |
|||
| Other current liabilities (1) |
|
31.1 |
|
|
(13.1 |
) |
|||
| Other |
|
(25.1 |
) |
|
(20.0 |
) |
|||
| Net cash provided by operating activities |
|
298.0 |
|
|
235.0 |
|
|||
| Cash flows from investing activities: | |||||||||
| Purchases of property, plant and equipment |
|
(40.7 |
) |
|
(61.9 |
) |
|||
| Acquisition of business and assets |
|
(10.0 |
) |
|
(25.5 |
) |
|||
| Other |
|
(0.9 |
) |
|
(2.6 |
) |
|||
| Net cash used in investing activities |
|
(51.6 |
) |
|
(90.0 |
) |
|||
| Cash flows from financing activities: | |||||||||
| Borrowings from senior secured credit facility and other debt |
|
785.5 |
|
|
552.3 |
|
|||
| Principal payments on senior secured credit facility and other debt |
|
(884.1 |
) |
|
(543.9 |
) |
|||
| Proceeds from senior secured notes due 2033 |
|
800.0 |
|
|
- |
|
|||
| Repayment of senior secured notes due 2029 |
|
(849.0 |
) |
|
- |
|
|||
| Repayment of senior notes due 2025 |
|
- |
|
|
(262.3 |
) |
|||
| Debt issuance costs |
|
(21.9 |
) |
|
(0.1 |
) |
|||
| Share repurchases |
|
(10.2 |
) |
|
(8.1 |
) |
|||
| Other |
|
9.0 |
|
|
(0.7 |
) |
|||
| Net cash used in financing activities |
|
(170.7 |
) |
|
(262.8 |
) |
|||
| Effect of exchange rate changes on cash, cash equivalents, and restricted cash |
|
(18.9 |
) |
|
7.7 |
|
|||
| Net change in cash, cash equivalents, and restricted cash |
|
56.8 |
|
|
(110.1 |
) |
|||
| Cash, cash equivalents, and restricted cash, beginning of period |
|
375.3 |
|
|
438.1 |
|
|||
| Cash, cash equivalents, and restricted cash, end of period | $ |
432.1 |
|
$ |
328.0 |
|
|||
| (1) Prior period amounts were reclassified to conform to current period presentation. Refer to Schedule B – “Reclassifications” for additional details. | |||||||||
Supplemental Information
SCHEDULE A: RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited)
Adjusted Net Income, Adjusted Diluted EPS, Adjusted EBITDA, Credit Agreement EBITDA and Net Debt
In addition to its reported results calculated in accordance with
Management believes that such non-GAAP performance measures, when read in conjunction with the Company’s reported results, calculated in accordance with
Net debt is calculated as the aggregate outstanding principal amount of total debt less cash and cash equivalents. Management believes net debt is useful, when read in conjunction with the Company’s reported balance sheet, because it provides investors with information regarding the Company’s leverage profile, including its debt obligations that could not be repaid with cash and cash equivalents on hand. This measure is not meant, however, to imply that the Company intends to use all available cash to pay down debt.
The Company’s definitions and calculations as set forth in the tables below of adjusted net income, adjusted diluted EPS, adjusted EBITDA, credit agreement EBITDA and net debt may not be comparable to similarly titled measures used by other companies because other companies may not calculate them in the same manner as the Company does and should not be viewed in isolation from, nor as alternatives to, net income attributable to Herbalife, diluted EPS or total debt, as applicable, calculated in accordance with
The Company does not provide a reconciliation of forward-looking adjusted EBITDA or constant currency adjusted EBITDA guidance to net income attributable to Herbalife, and adjusted effective tax rate to GAAP tax rate, the comparable
Currency Fluctuation
The Company’s international operations have provided and will continue to provide a significant portion of its total net sales. As a result, total net sales will continue to be affected by fluctuations in the
The following is a reconciliation of net income (loss) attributable to Herbalife to adjusted net income:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| $ million |
|
2026 |
|
|
2025 |
|
2026 |
|
|
2025 |
|
|||||
| Net income attributable to Herbalife | $ |
58.8 |
|
$ |
43.2 |
$ |
94.4 |
|
$ |
142.9 |
|
|||||
| Expenses related to Technology Realignment Program (1) |
|
0.8 |
|
|
0.6 |
|
4.3 |
|
|
4.2 |
|
|||||
| Expenses related to Restructuring Program (1) |
|
- |
|
|
0.8 |
|
- |
|
|
4.8 |
|
|||||
| Expenses related to Optimization Program (1) |
|
5.6 |
|
|
- |
|
6.9 |
|
|
- |
|
|||||
| Digital technology program costs (1) |
|
- |
|
|
- |
|
- |
|
|
2.8 |
|
|||||
| Loss on extinguishment of debt (1) |
|
- |
|
|
- |
|
94.6 |
|
|
- |
|
|||||
| Charges related to |
|
1.2 |
|
|
- |
|
1.2 |
|
|
- |
|
|||||
| Income tax adjustments for above items (1) |
|
(1.9 |
) |
|
0.6 |
|
(23.4 |
) |
|
(2.0 |
) |
|||||
| Deferred income tax effects, net, related to corporate entity reorganization (2) |
|
4.1 |
|
|
6.3 |
|
12.8 |
|
|
19.2 |
|
|||||
| Adjusted net income (3) | $ |
68.5 |
|
$ |
51.5 |
$ |
190.8 |
|
$ |
171.9 |
|
|||||
The following is a reconciliation of diluted earnings per share to adjusted diluted earnings per share:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| $ per share |
|
2026 |
|
|
2025 |
|
2026 |
|
|
2025 |
|
|||||
| Diluted earnings per share attributable to Herbalife | $ |
0.55 |
|
$ |
0.42 |
$ |
0.88 |
|
$ |
1.38 |
|
|||||
| Expenses related to Technology Realignment Program (1) |
|
0.01 |
|
|
0.01 |
|
0.04 |
|
|
0.04 |
|
|||||
| Expenses related to Restructuring Program (1) |
|
- |
|
|
0.01 |
|
- |
|
|
0.05 |
|
|||||
| Expenses related to Optimization Program (1) |
|
0.05 |
|
|
- |
|
0.06 |
|
|
- |
|
|||||
| Digital technology program costs (1) |
|
- |
|
|
- |
|
- |
|
|
0.03 |
|
|||||
| Loss on extinguishment of debt (1) |
|
- |
|
|
- |
|
0.88 |
|
|
- |
|
|||||
| Charges related to |
|
0.01 |
|
|
- |
|
0.01 |
|
|
- |
|
|||||
| Income tax adjustments for above items (1) |
|
(0.02 |
) |
|
0.01 |
|
(0.22 |
) |
|
(0.02 |
) |
|||||
| Deferred income tax effects, net, related to corporate entity reorganization (2) |
|
0.04 |
|
|
0.06 |
|
0.12 |
|
|
0.19 |
|
|||||
| Adjusted diluted earnings per share (3) | $ |
0.64 |
|
$ |
0.50 |
$ |
1.77 |
|
$ |
1.67 |
|
|||||
| (1) Based on interim income tax reporting rules, these expense items are not considered discrete items. The tax effect of the adjustments between our |
|||||||||||||||
| Excludes tax (benefit)/expense as follows: | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| $ million |
|
2026 |
|
|
2025 |
|
2026 |
|
|
2025 |
|
||||
| Expenses related to Technology Realignment Program | $ |
0.1 |
|
$ |
0.2 |
$ |
(1.0 |
) |
$ |
(0.8 |
) |
||||
| Expenses related to Restructuring Program |
|
- |
|
|
0.2 |
|
- |
|
|
(0.9 |
) |
||||
| Expenses related to Optimization Program |
|
(1.7 |
) |
|
- |
|
(2.1 |
) |
|
- |
|
||||
| Digital technology program costs |
|
- |
|
|
0.2 |
|
- |
|
|
(0.3 |
) |
||||
| Loss on extinguisment of debt |
|
- |
|
|
- |
|
(20.0 |
) |
|
- |
|
||||
| Charges related to |
|
(0.3 |
) |
|
- |
|
(0.3 |
) |
|
- |
|
||||
| Total income tax adjustments | $ |
(1.9 |
) |
$ |
0.6 |
$ |
(23.4 |
) |
$ |
(2.0 |
) |
||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| $ per share |
|
2026 |
|
|
2025 |
|
2026 |
|
|
2025 |
|
||||
| Expenses related to Technology Realignment Program | $ |
- |
|
$ |
- |
$ |
(0.01 |
) |
$ |
(0.01 |
) |
||||
| Expenses related to Restructuring Program |
|
- |
|
|
- |
|
- |
|
|
(0.01 |
) |
||||
| Expenses related to Optimization Program |
|
(0.02 |
) |
|
- |
|
(0.02 |
) |
|
- |
|
||||
| Digital technology program costs |
|
- |
|
|
0.01 |
|
- |
|
|
- |
|
||||
| Loss on extinguisment of debt |
|
- |
|
|
- |
|
(0.19 |
) |
|
- |
|
||||
| Charges related to |
|
- |
|
|
- |
|
- |
|
|
- |
|
||||
| Total income tax adjustments | $ |
(0.02 |
) |
$ |
0.01 |
$ |
(0.22 |
) |
$ |
(0.02 |
) |
||||
| (2) Non-cash net deferred tax effects related to an income tax benefit previously recognized due to changes to corporate entity structure in the fourth quarter of 2024. Refer to Supplemental Information included herein for further details. | |||||||||||||||
| (3) Amounts may not total due to rounding | |||||||||||||||
The following are reconciliations of net income (loss) attributable to Herbalife to EBITDA, adjusted EBITDA and Credit Agreement EBITDA and Credit Agreement total leverage ratio for the respective periods:
Three Months Ended |
TTM |
Year Ended |
||||||||||||||||||||||||
| $ million | Sep 30 '25 |
Dec 31 '25 |
Mar 31 '26 |
Jun 30 '26 |
Sep 30 '26 |
Sep 30 '26 |
Dec 31 '25 |
|||||||||||||||||||
| Net sales | $ |
1,273.7 |
|
$ |
1,283.0 |
|
$ |
1,317.2 |
|
$ |
1,326.8 |
|
$ |
1,350.2 |
|
$ |
5,277.2 |
|
$ |
5,037.5 |
|
|||||
| Net income (loss) attributable to Herbalife | $ |
43.2 |
|
$ |
85.4 |
|
$ |
61.9 |
|
$ |
(26.3 |
) |
$ |
58.8 |
|
$ |
179.8 |
|
$ |
228.3 |
|
|||||
| Interest expense, net |
|
51.0 |
|
|
49.3 |
|
|
46.8 |
|
|
37.4 |
|
|
31.9 |
|
|
165.4 |
|
|
205.9 |
|
|||||
| Income taxes |
|
31.7 |
|
|
(34.6 |
) |
|
30.4 |
|
|
22.8 |
|
|
49.5 |
|
|
68.1 |
|
|
47.3 |
|
|||||
| Depreciation and amortization |
|
30.7 |
|
|
29.3 |
|
|
29.4 |
|
|
31.4 |
|
|
30.5 |
|
|
120.6 |
|
|
121.2 |
|
|||||
| EBITDA |
|
156.6 |
|
|
129.4 |
|
|
168.5 |
|
|
65.3 |
|
|
170.7 |
|
|
533.9 |
|
|
602.7 |
|
|||||
| Amortization of SaaS implementation costs |
|
5.0 |
|
|
4.9 |
|
|
4.8 |
|
|
4.3 |
|
|
4.1 |
|
|
18.1 |
|
|
21.3 |
|
|||||
| Expenses related to Technology Realignment Program |
|
0.6 |
|
|
4.9 |
|
|
2.4 |
|
|
1.1 |
|
|
0.8 |
|
|
9.2 |
|
|
9.1 |
|
|||||
| Expenses related to Optimization Program |
|
- |
|
|
- |
|
|
- |
|
|
1.3 |
|
|
5.6 |
|
|
6.9 |
|
|
- |
|
|||||
| Expenses related to Restructuring Program |
|
0.8 |
|
|
2.2 |
|
|
- |
|
|
- |
|
|
- |
|
|
2.2 |
|
|
7.0 |
|
|||||
| Digital technology program costs |
|
- |
|
|
3.4 |
|
|
- |
|
|
- |
|
|
- |
|
|
3.4 |
|
|
6.2 |
|
|||||
| Transition charge related to Sep ‘25 India Goods and Services Tax amendments |
|
- |
|
|
11.3 |
|
|
- |
|
|
- |
|
|
- |
|
|
11.3 |
|
|
11.3 |
|
|||||
| Loss on extinguishment of debt |
|
- |
|
|
- |
|
|
- |
|
|
94.6 |
|
|
- |
|
|
94.6 |
|
|
- |
|
|||||
| Charges related to |
|
- |
|
|
- |
|
|
- |
|
|
1.2 |
|
|
1.2 |
|
|
- |
|
||||||||
| Adjusted EBITDA |
|
163.0 |
|
|
156.1 |
|
|
175.7 |
|
|
166.6 |
|
|
182.4 |
|
|
680.8 |
|
|
657.6 |
|
|||||
| Interest income |
|
2.0 |
|
|
2.1 |
|
|
2.7 |
|
|
2.6 |
|
|
2.3 |
|
|
9.7 |
|
|
8.5 |
|
|||||
| Inventory write-downs |
|
6.5 |
|
|
4.5 |
|
|
5.9 |
|
|
6.1 |
|
|
6.1 |
|
|
22.6 |
|
|
25.9 |
|
|||||
| Share-based compensation expenses |
|
11.2 |
|
|
10.9 |
|
|
10.6 |
|
|
10.1 |
|
|
8.7 |
|
|
40.3 |
|
|
44.1 |
|
|||||
| Other expenses (income) (1) |
|
1.5 |
|
|
(0.2 |
) |
|
(0.9 |
) |
|
5.3 |
|
|
(0.6 |
) |
|
3.6 |
|
|
5.9 |
|
|||||
| Credit Agreement EBITDA | $ |
184.2 |
|
$ |
173.4 |
|
$ |
194.0 |
|
$ |
190.7 |
|
$ |
198.9 |
|
$ |
757.0 |
|
$ |
742.0 |
|
|||||
| Credit Agreement total debt (2) | $ |
1,951.9 |
|
$ |
2,050.0 |
|
||||||||||||||||||||
| Less: cash and cash equivalents (3) |
|
(409.2 |
) |
|
(353.1 |
) |
||||||||||||||||||||
| Net debt | $ |
1,542.7 |
|
$ |
1,696.9 |
|
||||||||||||||||||||
| Credit Agreement total leverage ratio (4) | 2.6x | 2.8x | ||||||||||||||||||||||||
| Net leverage ratio (5) | 2.0x | 2.3x | ||||||||||||||||||||||||
| Net income margin |
|
3.4 |
% |
|
6.7 |
% |
|
4.7 |
% |
|
-2.0 |
% |
|
4.4 |
% |
|
3.4 |
% |
|
4.5 |
% |
|||||
| Adjusted EBITDA margin |
|
12.8 |
% |
|
12.2 |
% |
|
13.3 |
% |
|
12.6 |
% |
|
13.5 |
% |
|
12.9 |
% |
|
13.1 |
% |
|||||
|
||||||||||||||||||||||||||
(1) |
Other expenses (income) include certain non-cash items such as bad debt expense, unrealized foreign currency gains and losses, and other gains and losses | |
(2) |
Represents the aggregate outstanding principal amount of total debt as of the respective period end | |
(3) |
Represents cash and cash equivalents as of the respective period end | |
(4) |
Represents the ratio of credit agreement total debt to the trailing twelve months of credit agreement EBITDA for the respective period as calculated pursuant to the Credit Agreement | |
(5) |
Represents the ratio of net debt to the trailing twelve months of credit agreement EBITDA for the respective period |
| Nine Months Ended September 30, | Year Ended Dec 31, | |||||||||||
| $ million | 2026 |
|
|
2025 |
|
|
2025 |
|
||||
| Net sales | $ |
3,994.2 |
|
$ |
3,754.5 |
|
$ |
5,037.5 |
|
|||
| Net income attributable to Herbalife | $ |
94.4 |
|
$ |
142.9 |
|
$ |
228.3 |
|
|||
| Interest expense, net |
|
116.1 |
|
|
156.6 |
|
|
205.9 |
|
|||
| Income taxes |
|
102.7 |
|
|
81.9 |
|
|
47.3 |
|
|||
| Depreciation and amortization |
|
91.3 |
|
|
91.9 |
|
|
121.2 |
|
|||
| EBITDA |
|
404.5 |
|
|
473.3 |
|
|
602.7 |
|
|||
| Amortization of SaaS implementation costs |
|
13.2 |
|
|
16.4 |
|
|
21.3 |
|
|||
| Expenses related to Technology Realignment Program |
|
4.3 |
|
|
4.2 |
|
|
9.1 |
|
|||
| Expenses related to Optimization Program |
|
6.9 |
|
|
- |
|
|
- |
|
|||
| Expenses related to Restructuring Program |
|
- |
|
|
4.8 |
|
|
7.0 |
|
|||
| Digital technology program costs |
|
- |
|
|
2.8 |
|
|
6.2 |
|
|||
| Transition charge related to Sep ‘25 India Goods and Services Tax amendments |
|
- |
|
|
- |
|
|
11.3 |
|
|||
| Loss on extinguishment of debt |
|
94.6 |
|
|
- |
|
|
- |
|
|||
| Charges related to |
|
1.2 |
|
|
- |
|
||||||
| Adjusted EBITDA |
|
524.7 |
|
|
501.5 |
|
|
657.6 |
|
|||
| Interest income |
|
7.6 |
|
|
6.4 |
|
|
8.5 |
|
|||
| Inventory write-downs |
|
18.1 |
|
|
21.4 |
|
|
25.9 |
|
|||
| Share-based compensation expenses |
|
29.4 |
|
|
33.2 |
|
|
44.1 |
|
|||
| Other expenses (income) (1) |
|
3.8 |
|
|
6.1 |
|
|
5.9 |
|
|||
| Credit Agreement EBITDA | $ |
583.6 |
|
$ |
568.6 |
|
$ |
742.0 |
|
|||
| Credit Agreement Total Debt (2) | $ |
2,050.0 |
|
|||||||||
| Less: cash and cash equivalents (3) |
|
(353.1 |
) |
|||||||||
| Net debt | $ |
1,696.9 |
|
|||||||||
| Credit Agreement Total Leverage Ratio (4) | 2.8x | |||||||||||
| Net leverage ratio (5) | 2.3x | |||||||||||
| Net income margin |
|
2.4 |
% |
|
3.8 |
% |
|
4.5 |
% |
|||
| Adjusted EBITDA margin |
|
13.1 |
% |
|
13.4 |
% |
|
13.1 |
% |
|||
(1) |
Other expenses (income) include certain non-cash items such as bad debt expense, unrealized foreign currency gains and losses, and other gains and losses |
(2) |
Represents the aggregate outstanding principal amount of total debt as of the respective period end |
(3) |
Represents cash and cash equivalents as of the respective period end |
(4) |
Represents the ratio of credit agreement total debt to the trailing twelve months of credit agreement EBITDA for the respective period as calculated pursuant to the Credit Agreement |
(5) |
Represents the ratio of net debt to the trailing twelve months of credit agreement EBITDA for the respective period |
SCHEDULE B: RECLASSIFICATIONS
Reclassifications
Effective in the fourth quarter of 2025, the Company retrospectively separated selling expenses from selling, general, and administrative expenses in the consolidated statements of income and combined those selling expenses with royalty overrides in the consolidated statements of income to simplify its financial statement presentation. Specifically, the Company’s Member compensation payments recognized as operating expenses, previously reported as royalty overrides, have been combined with the service fees to China’s independent service providers which were previously reported as selling expense within selling, general, and administrative expenses, and the two categories of expense are now collectively being presented in selling expenses within the condensed consolidated statements of income. As a result,
As a result of the above, the Member compensation previously reported as royalty overrides within the operating activities in the condensed consolidated statements of cash flows is now presented as Member compensation liabilities. In addition,
These reclassifications did not impact the amounts of the prior period total assets, total liabilities, operating income, net income attributable to Herbalife, and net cash provided by operating activities, investing activities and financing activities, and did not impact the Company’s condensed consolidated statements of comprehensive income and condensed consolidated statements of changes in shareholders’ deficit.
View source version on businesswire.com: https://www.businesswire.com/news/home/20261102380224/en/
Media Contact:
Miguel Lopez-Najera
Director, Global Corporate Communications
miguellope@herbalife.com
Investor Contact:
Samantha Holway
Vice President, Head of Investor Relations
samanthagou@herbalife.com
Source: Herbalife Ltd.