Nature's Sunshine Products, Inc.

Net sales in Q2 were $117 million, up 2% year over year and up 4% in constant currency. APAC sales were $53 million, up 1% reported and 5% constant currency, with Japan up 50% and China down 20%; North America sales were $36 million, up 3%; Europe sales were $26.7 million, up 4%. Gross margin was 73.7%, nearly 200 basis points higher than a year ago. SG&A was $44.9 million versus $43.7 million a year ago, and adjusted EBITDA was $11.3 million, up nearly 1%. Cash and cash equivalents were $82.5 million with no debt, and operating cash flow was a use of $1.1 million versus $6.9 million provided last year. For 2026, the company lowered net sales guidance to $490 million-$500 million from $500 million-$515 million and EBITDA guidance to $48 million-$52 million from $50 million-$54 million.

Ken Romanzi sounded upbeat about the quarter and framed it as proof that the company’s strategic initiatives are taking hold. He emphasized digital growth, consultant engagement, autoship adoption and geographic expansion, while also saying the company is beginning to invest in its "Vision for Growth" plan. He laid out ambitious long-term goals of doubling sales to $1 billion and improving EBITDA margin to 15%, and said the company is building toward that through digital, product, market and M&A initiatives.

Jon Lanoy highlighted record second-quarter sales, gross margin expansion to 73.7%, and adjusted EBITDA of $11.3 million. He said margin gains came from renegotiated logistics contracts, improved manufacturing efficiency, improved sourcing and more disciplined pricing, while SG&A rose to $44.9 million as the company invested in growth. He also noted a clean balance sheet with $82.5 million in cash, no debt, and $14.8 million remaining under the share repurchase program after buying back 113,000 shares for about $2.5 million at $22.55 per share. He cut full-year revenue and EBITDA guidance because of recent FX changes and a slowdown in China, and said quarterly SG&A should remain around $45 million to $47 million for the rest of the year.

Analysts focused on the strength of North America digital versus the softer core direct-selling business, and management said North America was up about 3% in total, with direct selling soft for several years while digital continues to perform well. Management said it plans a reinvigoration of the direct-selling program in early 2027, including new product, compensation and incentives. Questions also centered on Germany and M&A: management said Germany is just starting, expects about $1 million there this year, and is recruiting consultants, while any acquisition would need to fit the supplement business, be self-manufactured, and be accretive through supply-chain and margin synergies.