Are individual distributors in North America becoming more productive, given the increase in net sales per distributor and active sales leaders?

Management confirmed increased productivity among North American distributors, particularly new ones, and highlighted that Nutrition Club productivity is specifically on the rise. “Nutrition Club productivity is up.”

What is driving the narrowed and slightly reduced CapEx guidance for the year?

Management explained that the reduction is due to a disciplined approach to reviewing capital expenditure projects, leading to reprioritization and underspending, rather than financial constraints or pushing projects to next year. They emphasized it's a result of good practices. “I think it's more of an underspend than it is a pushing out until next year. ... The important thing I want to make sure people take away is when we underspend in capital expenditures is because we are prioritizing projects in a way that can add value, not because of cash constraints, right? We generate plenty of cash.”

How does the increasing prevalence of protein in various food products affect Herbalife's business and distributors?

Management views the broader market trend of protein inclusion as a positive development, expanding consumer awareness for what Herbalife has championed for over 45 years. They see it as an opportunity to gain more market share and extend their leadership in the field. “More consumer awareness is always a positive thing.”

HLF

Herbalife (HLF) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Consumer Staples· Aug 5, 2026

Source: earnings call transcript

Executive summary

Herbalife Q2 FY26 — Strong Sales Growth Driven by Personalized Nutrition Strategy

Herbalife delivered its fourth consecutive quarter of net sales growth, exceeding guidance on a constant currency basis, driven by strong regional performance in Latin America and Asia Pacific. The company is actively advancing its personalized nutrition strategy through new product launches like Bioniq Go and the Pro2col platform, leveraging technology and its extensive distributor network. Despite a GAAP net loss due to debt extinguishment, the company demonstrated strong cash generation and reduced net interest expense, maintaining a disciplined focus on debt reduction and financial strength.

Highlights

Net sales of $1.3 billion, up 5.4% year-over-year, at the top end of guidance.
Constant currency net sales increased 5.8% year-over-year, approximately 80 basis points above the high end of guidance.
Fourth consecutive quarter of year-over-year net sales growth on both reported and constant currency bases.
Operating cash flow for the first half of 2026 was $147 million, up 52% year-over-year.
Net interest expense reduced to $37 million, down from $54 million in Q2 2025, due to successful debt refinancing.

Concerns

GAAP net loss attributable to Herbalife was $26 million, primarily due to a nearly $95 million pretax loss on debt extinguishment.
Adjusted diluted EPS of $0.51 included a $0.04 FX headwind and was unfavorably impacted by $0.14 due to a higher adjusted effective tax rate of 43.2% (vs. 27.7% in Q2 2025).
EMEA reported net sales declined 3.5% and constant currency net sales declined 5.6%, reflecting a 12% volume decrease.
China reported net sales declined 25% and constant currency net sales declined 29%, driven by a 29% decrease in volume.

Guidance & targets

Category	Target	Timeline	Confidence
Q3 Net Sales	increase 0.5% to 4.5% year-over-year high materiality	Q3 · FY26	High
Q3 Net Sales	increase 1.5% to 5.5% year-over-year high materiality	Q3 · FY26	High
Q3 Adjusted EBITDA	$160 million to $180 million high materiality	Q3 · FY26	High
Q3 Adjusted EBITDA	$165 million to $185 million high materiality	Q3 · FY26	High
Q3 Capital Expenditures	$15 million to $25 million medium materiality	Q3 · FY26	High
Full Year Net Sales	increase 2.5% to 5.5% year-over-year high materiality	FY26	High
Full Year Adjusted EBITDA	$670 million to $690 million high materiality	FY26	High
Full Year Adjusted EBITDA	$690 million to $710 million high materiality	FY26	High
Full Year Capital Expenditures	$50 million to $70 million medium materiality	FY26	High
Full Year Capitalized SaaS Implementation Costs	$35 million to $55 million medium materiality	FY26	High
Net Leverage Ratio	below 2x high materiality	by year-end · FY26	High
Debt Repayment	more than $600 million high materiality	by the end of 2028 · FY28	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
North America Returned to slight growth, with higher year-over-year pricing partially offset by volume decline. Volume growth: -2%	—	0.2%	—	—
Latin America Delivered fourth consecutive quarter of double-digit year-over-year growth, driven by favorable pricing, sales mix, and FX tailwind. Mexico reported net sales up 17% YoY. Volume growth: 2%FX tailwind: 840 bps	—	17% (reported), 8% (constant currency)	—	—
Asia Pacific Growth driven by strong volume and favorable pricing, partially offset by unfavorable country mix and FX. India reported net sales up 33% YoY and constant currency up 47%, with 45% volume growth. Volume growth: 26%	—	15% (reported), 23% (constant currency)	—	—
EMEA Declined due to volume decrease, which offset higher pricing, favorable sales mix, and FX tailwinds. Volume decline: 12%	—	-3.5% (reported), -5.6% (constant currency)	—	—
China Smallest region, less than 5% of worldwide net sales. Decline driven primarily by volume decrease. Volume decrease: 29%	—	-25% (reported), -29% (constant currency)	—	—

Product announcements

Product	Type	Timeline
Bioniq Go	launch	June (Europe and Africa), July (U.S.)
Pro2col	milestone	Expanded beta, new modules and capabilities through next year
Life I/O (Helio)	launch	July (North America)
Life I/O (Activate Energy)	launch	July (North America)
Blood Testing and Platform Integration (Pro2col)	milestone	—

Deals & partnerships

Bioniq Acquisition of personalized nutrition company

Acquisition completed in April, leading to the launch of Bioniq Go. The agreement includes a call option for Bioniq Lab, a peptide distribution business, allowing flexibility to evaluate that category over time.

Pruvit Acquisition of exogenous ketone product company

Acquisition completed last year, leading to the launch of Activate Energy as part of the Life I/O brand.

Risks & headwinds

Foreign Exchange (FX) Rates Q2 FY26

40 basis point year-over-year headwind to net sales; $8 million headwind to adjusted EBITDA and 53 basis point headwind to adjusted EBITDA margin.

Higher Adjusted Effective Tax Rate Q2 FY26

43.2% in Q2 FY26, up from 27.7% in Q2 FY25, resulting in an approximately $0.14 unfavorable impact to adjusted diluted EPS.

Country Mix Impact on Net Sales Q2 FY26

Approximately $38 million headwind to net sales.

Gross Profit Margin Decline Q2 FY26

Down 30 basis points year-over-year.

Mitigation:Partially offset by 60 basis points of pricing benefits.

Input Cost Inflation Near-term

Pressure from whey, packaging, and freight (due to oil prices).

Mitigation:Expected to recover costs with normal price increase structure next year; manageable impact compared to other companies.

What to watch in Q3 FY26

Life I/O Products Sales Performance

next quarter

Current Just launched in July

Target Quantified sales figures and distributor adoption trends

Why it matters

To assess the initial market reception and contribution of new products like Helio and Activate Energy to North America growth and broader consumer reach.

I think it's really better to hold this question until next quarter and not ask about the Q2 results. It really is -- look, I think you were at the event, lots of excitement. But before we start giving figures out, I think we should get through Q3 and do it on the next call.

Find out whether HLF delivers this. Inve re-checks your case every morning.

Q&A highlights

How does Herbalife ensure strong distributor retention during rapid growth phases, especially in Asia Pacific and India?

Management attributed the growth to strong business models and customer support systems implemented by distributors. They noted India's consistent 18 years of growth, which indicates underlying discipline, and expressed confidence in the systems to support continued growth.

“India has had 18 straight years of growth. And so they were able to accomplish that because they've been able to build in the discipline underneath that growth. So that also gives us confidence.”

asked by Nicholas Sherwood · answered by John DeSimone

2 min read 6 chapters

Detailed narrative

Advancing Personalized Nutrition Strategy

Herbalife is strategically investing in capabilities to drive its next phase of growth, focusing on personalized nutrition, a $34 billion global market. The company aims to combine technology, science, and human connection, leveraging AI-assisted technology, biomarker insights, and individualized formulations to amplify the customer and distributor experience. This approach builds on Herbalife's 45+ years of experience in personalization.

New Product Launches: Bioniq Go and Life I/O Expansion

The company launched Bioniq Go, its first product from the Bioniq acquisition, in 11 European markets in June and the U.S. in July. This personalized daily supplement offers 1 of 40 formulas based on individual profiles. Additionally, the Life I/O brand, targeting the healthy lifespan market, expanded in North America with the launch of Helio, a comprehensive supershake, and Activate Energy, an exogenous ketone product from the Pruvit acquisition, broadening the product portfolio and consumer reach.

Pro2col Personalized Health Operating System Development

Pro2col, Herbalife's AI-assisted personalized health operating system, is currently in expanded beta. This platform is designed to integrate all elements of personalized nutrition, including what to measure, what to take, what to do, and who to do it with. New modules and capabilities, such as smart device integrations and evolved biomarker support, are expected to be introduced through next year, with a beta program for blood testing and platform integration also underway.

Strong Regional Performance and Volume Growth

Herbalife reported its fourth consecutive quarter of year-over-year net sales growth. India delivered a particularly strong quarter with reported net sales up 33% and constant currency net sales up 47%, driven by a 45% increase in volume. Latin America achieved its fourth consecutive quarter of double-digit growth, with reported net sales up 17%. North America also returned to slight growth, increasing 0.2% year-over-year.

Financial Strength and Capital Allocation Priorities

The company demonstrated strong financial health, with operating cash flow for the first half of 2026 reaching $147 million, a 52% increase year-over-year. A successful debt refinancing in April significantly reduced net interest expense to $37 million. Herbalife's primary capital allocation priority remains debt reduction, targeting a net leverage ratio below 2x by year-end and committing to repay over $600 million by the end of 2028.

CFO Transition and Leadership Continuity

CFO John DeSimone announced his retirement at the end of the year, with Scott Schaefer, Senior Vice President of Finance and Transformation, appointed as his successor. A seamless transition is planned over the next five months, with management emphasizing continuity in financial leadership and strategic direction, particularly regarding capital allocation priorities.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.