Several multilevel marketers (MLMs) of nutritional supplements and personal care products reported softer sales in the third quarter.
Nu Skin Enterprises Inc. (NYSE: NUS) posted third-quarter revenues of $641.2 million. That’s down 9% from $703.3 million in the three-month period the prior year.
Third-quarter revenues in mainland China declined 21% to $134.3 million, from $169.1 million in the prior-year period. Similarly, third-quarter revenues in Southeast Asia plunged 22% to $79.1 million, from $101.9 in the third quarter of 2020.
In its Nov. 3 earnings release, Nu Skin president and CEO Ryan Napierski attributed lower than expected revenues “to COVID delta variant disruptions as unexpected government restrictions interrupted selling and promotional activities in several markets, specifically in mainland China and Southeast Asia.”
COVID-19-related disruptions also impacted third-quarter operations at USANA Health Sciences Inc. (NYSE: USNA). Quarterly sales fell 8% to $274.4 million, compared to $298.5 million in the third quarter of 2020.
“As we indicated a month ago, the operating environment remains challenging across several of our key markets due, in great part, to disruptions and lockdowns related to the COVID-19 pandemic,” Kevin Guest, chairman and CEO of USANA Health Sciences, said in an Oct. 26 earnings release.
Herbalife Nutrition Inc. (NYSE: HLF) reported third-quarter net sales of $1.4 billion, a 6% decrease compared to the third quarter of 2020.
On a year-over-year (YoY) basis, third-quarter revenues in North America were down 11% to $354.8 million. Despite those results, “when comparing to a more normalized, pre-COVID third quarter 2019, the two-year stack increased 38%,” the company revealed in its Nov. 5 earnings release.
Although COVID-19 led to millions of job losses in the U.S., the direct selling industry seemed to benefit as more people looked to find ways to replace lost income.
Last year, Herbalife Nutrition’s third-quarter net sales increased 22.3% to $1.5 billion. And for all of 2020, Herbalife Nutrition reported its best year ever, with sales of $5.5 billion—a 13.6% increase over 2019.
In 2021, the company remains on pace to achieve “another record sales year,” according to Herbalife Nutrition chairman and CEO John Agwunobi.
“The fundamental tailwinds driving the global nutrition industry, along with demand for our science-based nutrition products, continue to benefit the company,” Agwunobi said in his company’s earnings release.
Herbalife Nutrition forecasts annual net sales growth of 4.5% to 8.5%. That range is fairly in line with a forecast for the broader direct selling market. In the U.S. this year, the direct selling industry is predicted to grow between 4% to 7% to a range between $41.7 billion and $42.9 billion, according to a recent forecast by the U.S. Direct Selling Association.
In the most recent quarter, one of the bright spots in the direct selling industry was Nature’s Sunshine Products Inc. (Nasdaq: NATR). Net sales rose 14% to $114.7 million, compared to $100.3 million in the prior-year period, according to the company’s Nov. 4 earnings release. Sales were especially strong in Asia ($48.4 million), reflecting 27.1% growth over the third quarter of 2020.