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Overview
Nu Skin’s revenue for the first quarter of 2025 decreased 12.7% to $364.5 million, compared to $417.3 million in the prior-year period. This decline was largely driven by continued macroeconomic challenges in the company’s markets, which negatively impacted consumer spending and customer acquisition. Revenue was also impacted by a 3.0% negative impact from foreign-currency fluctuations.
The company’s Customers, Paid Affiliates and Sales Leaders declined 11%, 15% and 20% respectively on a year-over-year basis. The declines were seen across most geographic segments, with the largest drops in Mainland China, Europe & Africa, and South Korea.
However, earnings per share for the first quarter increased to $2.14, compared to $(0.01) in the prior-year period. This increase was primarily driven by the $176.2 million pre-tax gain from the sale of the Mavely business, partially offset by an intangible asset impairment, a non-cash investment loss, and the decline in revenue.
Segment Results
The company reports its business in nine segments - seven geographic Nu Skin segments and two Rhyz segments (Manufacturing and Rhyz Other).
Nu Skin Segments:
Americas: Revenue declined 8.0% (1.3% on a constant-currency basis), driven by continued weakness in North America, partially offset by growth in Latin America markets. Segment contribution increased due to improved profitability in Latin America.
Southeast Asia/Pacific: Revenue declined 13.1% (12.0% constant-currency), reflecting softening momentum across the region. Segment contribution increased due to cost savings initiatives.
Mainland China: Revenue declined 21.8% (20.6% constant-currency) amid macroeconomic challenges and consumer spending pressures. Segment contribution decreased due to lower revenue and margin compression.
Japan: Revenue declined 3.3% (0.8% constant-currency) due to foreign exchange impacts and consumer inflationary pressures. Segment contribution decreased with the revenue decline.
Europe & Africa: Revenue declined 21.9% (19.5% constant-currency) reflecting softening momentum and macroeconomic factors. Segment contribution increased due to cost savings and automation initiatives.
South Korea: Revenue declined 20.6% (13.3% constant-currency) amid macroeconomic issues and the impact of price increases. Segment contribution decreased with the revenue decline.
Hong Kong/Taiwan: Revenue declined 6.6% (4.0% constant-currency) due to macroeconomic pressures. Segment contribution increased from cost savings efforts.
Rhyz Segments:
Manufacturing: Revenue increased 9.9%, driven by the Elevate Manufacturing entity. Segment contribution decreased due to revenue mix and product mix.
Rhyz Other: Revenue declined 76.1%, primarily from the sale of the Mavely business. Segment contribution improved due to the Mavely sale and cost savings at BeautyBio.
Outlook and Initiatives
For 2025, the company’s priorities focus on business model optimization, including continued rollout of sales performance plan enhancements, the introduction of the Prysm iO connected device, and expansion into the India market. The company is currently anticipating nominal revenue from the India market pre-opening in the fourth quarter, as it prepares for the formal launch in mid-2026.
Financial Performance
Gross profit as a percentage of revenue was 67.8% for the first quarter of 2025, compared to 70.5% in the prior-year period. The decrease was driven by the lower gross margins of the company’s owned manufacturing entities, which represented a higher proportion of overall revenue.
Selling expenses as a percentage of revenue decreased to 32.5% from 36.8% in the prior-year period. This was partially attributable to the decline in revenue and Sales Leaders, as well as the sale of the Mavely business.
General and administrative expenses decreased to $113.2 million, down from $124.6 million in the prior-year period, primarily due to reductions in labor, promotional, and other expenses.
The company incurred restructuring charges of $67.7 million related to its 2023 strategic plan, which included workforce reductions and fixed asset impairments. These charges were largely recognized in 2024, with the remaining payments expected in the first half of 2025.
Analysis and Outlook
Nu Skin’s first-quarter 2025 results reflect the continued challenges the company is facing in its markets, with declines in revenue, Customers, Paid Affiliates, and Sales Leaders across most geographic segments. The macroeconomic headwinds, including softening consumer spending and inflationary pressures, have been a significant drag on the business.
However, the company’s focus on business model optimization and new initiatives, such as the sales performance plan enhancements, the Prysm iO device, and the India market expansion, could help drive future growth. The sale of the Mavely business and associated gain also provided a significant boost to earnings per share in the quarter.
The company’s gross margin compression, driven by the higher proportion of lower-margin manufacturing revenue, is a concern and will require ongoing monitoring and management. Likewise, the restructuring charges, while largely recognized in 2024, represent a significant one-time expense that will impact the company’s financial performance.
Looking ahead, Nu Skin’s success will depend on its ability to navigate the macroeconomic challenges, effectively implement its business model optimizations, and drive growth in both its core Nu Skin and Rhyz segments. Investors will be closely watching the company’s progress on these fronts, as well as any potential impact from factors such as trade policies and tariffs.
Overall, Nu Skin’s first-quarter 2025 results highlight the ongoing difficulties the company is facing, but also demonstrate its efforts to position the business for long-term success through strategic initiatives and operational improvements. The company’s ability to execute on its plans and adapt to the evolving market conditions will be crucial in determining its future performance.
