USANA HEALTH SCIENCES INC

USANA Health Sciences, Inc. is a global direct selling and direct-to-consumer nutrition, personal health and wellness company. In 2024, we generated $855 million in net sales and finished the year with approximately 454,000 direct selling active Customers. We were founded in 1992 by Myron W. Wentz, Ph.D. and since that time, we have developed and manufactured high quality, science-based nutritional, personal care and skincare products with a primary focus on promoting long-term health and wellness. We are committed to continuous product innovation and sound scientific research. We have operations in 25 geographic markets worldwide. Historically, we have distributed our products through the direct selling channel, because we believe it is conducive to our vision of improving the overall health and nutrition of individuals and families around the world. In December 2024, we acquired a 78.85% ownership interest in Hiya Health Products, LLC ("Hiya"), a leading direct-to-consumer provider of high-quality children's health and wellness products (the "Hiya Acquisition"). We believe that the addition of Hiya to our business promotes our vision and adds a diversified layer of growth in the direct-to-consumer channel. Consequently, we now operate and sell products through both direct selling and direct-to-consumer channels.

Mainland China (“China”) is our largest direct selling market and single largest source of revenue, representing approximately 48.4% of net sales and approximately 50.2% of direct selling active Customers. As a U.S.-based multi-national corporation with an expanding international presence, our operating results are sensitive to currency fluctuations, as well as economic and political conditions in markets throughout the world. Additionally, we are subject to the various laws and regulations in the United States, China, and the other markets in which we operate with respect to the products that we manufacture, and sell, and our method of distribution. We are a U.S. public company listed on the New York Stock Exchange ("NYSE") and subject to the rules of the SEC.

This “Item 1. Business” provides detailed information about our world-wide business, including who we are, what we do and where we are headed. Unless otherwise specified, current information reported in this Annual Report on Form 10-K for the fiscal year ended December 28, 2024 (this “report” or “Annual Report”) is as of or for the fiscal year ended December 28, 2024. We also discuss the development of our company and the geographic areas where we do business. For the year ended December 28, 2024, other than the Hiya Acquisition, there were no material changes to our corporate structure or our method of conducting business.

Our Business

We organize our business into two reportable segments: Direct selling and Hiya direct-to-consumer.

Direct selling: The customer base for our direct selling segment is primarily comprised of two types of customers" "Associates" and "Preferred Customers" referred to collectively as "active Customers." Our Associates also sell our products to retail customers. Associates share in our company vision by acting as independent distributors of our products, in addition to purchasing our products for their personal use. In 2023, we launched our Affiliate program in the United States, Canada, and Mexico and are evaluating introducing the program in other markets. This program offers another sales and compensation opportunity to individuals who are interested in selling USANA products. Affiliates are discussed and reported in this report as part of our Associates. Preferred Customers purchase our products strictly for personal use and are not permitted to resell or to distribute the products. We only count as active Customers those Associates and Preferred Customers who have purchased from us at any time during the most recent three-month period.

Hiya direct-to-consumer: The customer base for our Hiya direct-to-consumer segment is primarily comprised of customers purchasing Hiya products for personal use through a subscription model, which is intended to provide a steady, predictable income stream. The ongoing nature of subscriptions fosters stronger relationships with customers by making it easier for them to receive products regularly, which leads to strong retention and loyalty. Hiya's subscription model also provides rich data on customer preferences and behaviors, which enables personalized offerings, efficient marketing and data-driven innovation insights.

Other: The customer base for our "other" category is comprised of customers of Rise Bar Wellness, Inc. ("Rise") and Oola Global, LLC "(Oola"), which are both businesses we acquired in 2022. Rise manufactures and sells high-quality protein bars and powdered drinks that are formulated to help customers achieve their health goals through clean and simple ingredients. Oola is a direct selling company that offers a personal development framework and nutritional products that helps individuals create a life of balance, growth, and purpose.

For more information relating to our reportable segments, see Note M to our consolidated financial statements.