Segment Information

9 Months Ended

Sep. 30, 2024

Segment Information [Abstract]

Segment Information

10. Segment Information

The Company reports revenue from nine segments, consisting of its seven geographic Nu Skin segments—Americas, Mainland China, Southeast Asia/Pacific, South Korea, Japan, Europe & Africa, and Hong Kong/Taiwan—and two Rhyz Investments segments—Manufacturing and Rhyz other. The Nu Skin other category includes miscellaneous corporate revenue and related adjustments. The Rhyz other segment includes other investments by our Rhyz business arm. These segments reflect the way the chief operating decision maker evaluates the Company’s business performance and allocates resources. Reported revenue includes only the revenue generated by sales to external customers.

Profitability by segment as determined under US GAAP is driven primarily by the Company’s transfer pricing policies. Segment contribution, which is the Company’s segment profitability metric presented in the table below, excludes certain intercompany charges, specifically royalties, license fees, transfer pricing, discrete charges and other miscellaneous items. These charges have been included in Corporate and other expenses. Corporate and other expenses also include costs related to the Company’s executive and administrative offices, information technology, research and development, and marketing and supply chain functions not recorded at the segment level.

The accounting policies of the segments are the same as those described in Note 2 – Summary of Significant Accounting Policies. The Company evaluates the performance of its segments based on revenue and segment contribution. Each segment records direct expenses related to its employees and its operations.

Summarized financial information for the Company’s reportable segments is shown in the following tables. Asset information is not reviewed or included with the Company’s internal management reporting. Therefore, the Company has not disclosed asset information for each reportable segment.

Revenue by Segment

	Three Months Ended September 30,					Nine Months Ended September 30,
(U.S. dollars in thousands)	2024		2023			2024		2023
Nu Skin
Americas	$	77,194	$	91,671		$	237,160	$	300,469
Southeast Asia/Pacific		59,515		68,743			179,921		200,317
Mainland China		53,020		70,225			178,797		226,563
Japan		47,222		53,399			134,045		156,867
South Korea		45,201		63,709			130,283		187,719
Europe & Africa		38,577		50,048			121,564		144,460
Hong Kong/Taiwan		33,749		40,724			98,061		112,380
Nu Skin other		2,518		(274	)		3,186		208
Total Nu Skin		356,996		438,245			1,083,017		1,328,983
Rhyz Investments
Manufacturing (1)		51,773		49,714			153,548		131,032
Rhyz other		21,376		10,813			49,967		20,476
Total Rhyz Investments		73,149		60,527			203,515		151,508
Total	$	430,145	$	498,772		$	1,286,532	$	1,480,491

(1) The Manufacturing segment had $10.9 million and $16.2 million of intersegment revenue for the three months ended September 30, 2024 and 2023, respectively, and $28.5 million and $44.3 million for the nine months ended September 30, 2024 and 2023, respectively. Intersegment revenue is eliminated in the consolidated financial statements, as well as the reported segment revenue in the table above.

Segment Contribution

	Three Months Ended September 30,						Nine Months Ended September 30,
(U.S. dollars in thousands)	2024			2023			2024			2023
Nu Skin
Americas	$	15,881		$	16,627		$	48,236		$	61,730
Southeast Asia/Pacific		9,997			13,190			31,787			37,057
Mainland China		7,277			15,223			32,903			48,192
Japan		13,491			14,617			37,201			40,033
South Korea		14,283			19,433			39,789			60,399
Europe & Africa		5,193			6,562			13,874			15,145
Hong Kong/Taiwan		9,225			10,146			25,006			28,128
Nu Skin contribution		75,347			95,798			228,796			290,684
Rhyz Investments
Manufacturing		542			4,838			4,266			7,683
Rhyz other		(2,923	)		(5,966	)		(14,338	)		(11,318	)
Rhyz Investments contribution		(2,381	)		(1,128	)		(10,072	)		(3,635	)
Total segment contribution		72,966			94,670			218,724			287,049
Corporate and other		(54,735	)		(121,035	)		(317,228	)		(254,844	)
Operating income		18,231			(26,365	)		(98,504	)		32,205
Interest expense		6,500			7,535			20,545			18,192
Other income, net		1,567			(551	)		1,800			3,237
Income (loss) before provision for income taxes	$	13,298		$	(34,451	)	$	(117,249	)	$	17,250

Depreciation and Amortization

	Three Months Ended September 30,				Nine Months Ended September 30,
(U.S. dollars in thousands)	2024		2023		2024		2023
Nu Skin
Americas	$	85	$	115	$	283	$	307
Southeast Asia/Pacific		227		257		650		813
Mainland China		2,697		2,742		8,197		8,127
Japan		65		93		217		1,241
South Korea		256		310		762		1,062
Europe & Africa		283		271		830		810
Hong Kong/Taiwan		451		715		1,348		1,990
Total Nu Skin		4,064		4,503		12,287		14,350
Rhyz Investments
Manufacturing		3,460		3,297		10,227		10,050
Rhyz other		1,679		2,048		5,531		3,816
Total Rhyz Investments		5,139		5,345		15,758		13,866
Corporate and other		8,118		8,344		25,316		24,123
Total	$	17,321	$	18,192	$	53,361	$	52,339

Capital Expenditures

	Three Months Ended September 30,				Nine Months Ended September 30,
(U.S. dollars in thousands)	2024		2023		2024		2023
Nu Skin
Americas	$	38	$	18	$	71	$	209
Southeast Asia/Pacific		7		130		25		321
Mainland China		690		3,496		4,957		12,265
Japan		101		81		122		84
South Korea		7		361		29		522
Europe & Africa		97		46		386		322
Hong Kong/Taiwan		174		90		410		698
Total Nu Skin		1,114		4,222		6,000		14,421
Rhyz Investments
Manufacturing		1,209		2,621		3,673		8,318
Rhyz other		490		20		1,559		20
Total Rhyz Investments		1,699		2,641		5,232		8,338
Corporate and other		5,783		5,043		17,768		15,346
Total	$	8,596	$	11,906	$	29,000	$	38,105