如新 (NUS) 2024 Q3 法說會逐字稿

Thank you for standing by. My name is [Priya] and I will be your conference operator today. At this time, I would like to Welcome everyone to the NU Skin Enterprises Q3, 2024 earnings conference call.

謝謝你的支持。我的名字是 [Priya]，今天我將擔任你們的會議操作員。此時此刻，我謹歡迎大家參加如新企業 2024 年第三季財報電話會議。

(Operator Instructions)

（操作員說明）

I would now like to hand the conference over to Scott Pond, Vice President of Investor relations. You may begin.

現在我想將會議交給投資者關係副總裁 Scott Pond。你可以開始了。

Thanks [Priya], and Good afternoon, Everyone. Today on the call with me are Ryan Napierski, President and CEO and James Thomas CFO.

謝謝[Priya]，大家下午好。今天與我通話的有總裁兼執行長 Ryan Napierski 和財務長 James Thomas。

On today's call, comments will be made that include forward-looking statements. These statements involve risks and uncertainties, and actual results may differ materially from those discussed or anticipated. Please refer to today's earnings release and our sec filings for a complete discussion of these risks. Also, during the call, certain financial numbers may be discussed that differ from comparable numbers obtained in our financial statements.

在今天的電話會議上，將發表包括前瞻性陳述的評論。這些陳述涉及風險和不確定性，實際結果可能與討論或預期的結果有重大差異。請參閱今天的收益報告和我們向美國證券交易委員會提交的文件，以了解對這些風險的完整討論。此外，在電話會議期間，可能會討論與我們財務報表中獲得的可比較數據不同的某些財務數據。

We believe these non-GAAP numbers assist in comparing period to period results in a more consistent manner. Please refer to our investor website for any required reconciliation of these non-GAAP numbers and with that, I'd like to turn the call now over to Ryan.

我們相信這些非公認會計原則數字有助於以更一致的方式比較不同時期的結果。請參閱我們的投資者網站，了解這些非 GAAP 數據所需的對帳信息，我想現在將電話轉給 Ryan。

Thanks Scott. Hello everyone. Thanks for joining our call. I'll start by providing a performance summary on Q3 sharing thoughts on our near-term priorities to improve operating performance followed by an update on our longer-term strategy to reenergize growth as we continue to evolve our core new skin traditional direct selling business towards a more expansive integrated beauty wellness and lifestyle ecosystem.

謝謝斯科特。大家好。感謝您加入我們的通話。我將首先提供第三季的業績摘要，分享我們對提高營運績效的近期優先事項的想法，然後更新我們的長期策略，以重振成長，因為我們將繼續發展我們的核心新皮膚傳統直銷業務更廣泛的綜合美容健康和生活方式生態系統。

Including our rise businesses the third quarter results were in line with our guidance range, reflecting continued headwinds in our core NU Skin business, partially offsite by ongoing strong performance from our rise segments. We delivered growth in a handful of markets in Latin America and Southeast Asia. As well as impressive growth from Maybelle our affiliate marketing platform.

包括我們的上升業務在內，第三季業績符合我們的指導範圍，反映出我們的核心如新業務持續面臨阻力，部分是由於我們上升業務的持續強勁表現而導致的。我們在拉丁美洲和東南亞的少數市場實現了成長。以及 Maybelle 我們的聯盟行銷平台帶來的令人印象深刻的成長。

We continue to face pressures in several of our larger markets including South Korea and China where ongoing macroeconomic factors are impacting consumer spending. I was recently in China with our team evaluating future opportunities in the market and continue to believe in the long-term potential of this market despite the near-term headwinds.

我們在包括韓國和中國在內的幾個較大市場繼續面臨壓力，這些市場持續的宏觀經濟因素正在影響消費者支出。我最近在中國與我們的團隊評估了市場的未來機會，並繼續相信該市場的長期潛力，儘管近期存在阻力。

In the US where the direct selling industry faces ongoing pressures, and many companies are evolving their business model to address the changing commercial landscape more towards social media driven product discovery and growing influencer and affiliate marketing we are introducing a new sales performance plan this month and are exploring innovative ways to make it even easier for affiliates to share new skin products via social media links both of which I will discuss in more in just a moment.

在美國，直銷行業面臨持續的壓力，許多公司正在發展其商業模式，以應對不斷變化的商業環境，更多地轉向社交媒體驅動的產品發現以及不斷增長的影響者和聯盟營銷，我們本月將推出一項新的銷售業績計劃，正在探索創新的方法，使附屬公司更容易透過社群媒體連結分享新的皮膚產品，我稍後將詳細討論這兩個問題。

Arise segments exceeded forecast and closed another record quarter up more than 20% year over year led by Male Maly is our affiliate marketing platform that enables approximately 1,200 brands and retailers to connect with consumers by more than 100,000 everyday influencers across most social media platforms.

Arise 細分市場超出了預期，並在Male 的帶領下創下了同比增長超過20% 的季度業績，Maly 是我們的聯屬營銷平台，使大約1,200 個品牌和零售商能夠通過大多數社交媒體平台上超過100,000 名日常影響者與消費者建立聯繫。

We've invested in the development of Maybelle over the past three years as the create our economy continues to expand and see tremendous potential looking forward. Manufacturing also continues to perform well, servicing a broad array of leading beauty and wellness brands across traditional CPG, direct to consumer and retail.

過去三年來，隨著我們的經濟不斷發展並看到了巨大的未來潛力，我們對 Maybelle 的開發進行了投資。製造業也持續表現良好，為傳統消費品領域的眾多領先美容和健康品牌提供直接面向消費者和零售的服務。

As we navigate the broader market uncertainties in the near term, we will be accelerating our efforts to drive cost efficiencies and improve margins and cash flow even under a scenario where topline headwinds persist into 2025.

當我們在短期內應對更廣泛的市場不確定性時，即使在營收逆風持續到 2025 年的情況下，我們也將加快努力提高成本效率、改善利潤率和現金流。

To that end, our near-term priorities are focused on the following three areas. First, on the product side, we will be accelerating our product portfolio optimization efforts that began earlier this year and are pleased with progress made to date of reducing approximately 20% of our suboptimized skews globally.

為此，我們近期的重點工作集中在以下三個領域。首先，在產品方面，我們將加快今年稍早開始的產品組合優化工作，並對迄今為止在全球範圍內減少約 20% 的未優化偏差所取得的進展感到高興。

In 2025 we anticipate reducing another 30% of lower low performing skews, which will lead to more than 50% portfolio consolidation by year's end. Coupled with the work we've been doing on lowering raw material and manufacturing costs. We anticipate 150 to 200 basis point gross margin improvement to our core new skin business by the end of 2025. Second, selling expense in the core has risen over the past several quarters due in large part to shifts in both geographic market and salesforce mix.

到 2025 年，我們預計將再減少 30% 的低績效偏差，這將導致到年底超過 50% 的投資組合整合。再加上我們一直在降低原材料和製造成本所做的工作。我們預計到 2025 年底，我們的核心新皮業務毛利率將提高 150 至 200 個基點。其次，核心銷售費用在過去幾季有所上升，這在很大程度上是由於地理市場和銷售團隊結構的變化。

The new sales performance plan I mentioned earlier combines the best of affiliate marketing with the scaling power of our leadership driven business model by promoting healthy and sustainable growth in both direct consumer sales and teambuilding. It places an enhanced focus on product selling and referrals for others who do the same.

我之前提到的新銷售業績計畫透過促進直接消費者銷售和團隊建立的健康和永續成長，將聯盟行銷的最佳優勢與我們領導力驅動的業務模式的擴展能力結合起來。它更注重產品銷售和向其他這樣做的人推薦。

We'll start by introducing this in North America and South Korea this quarter with other markets to follow next year. These initiatives will help to improve channel activation while optimizing selling expense in the core as we work towards our historic 40% target by year's end in 2025 and third, we'll extend our operational optimization efforts to all underperforming markets as we strive to ensure balanced profitability across all market segments in 2025

我們將首先在本季在北美和韓國推出此產品，明年將在其他市場推出。這些舉措將有助於改善通路激活，同時優化核心銷售費用，因為我們致力於在2025 年底實現40% 的歷史目標；第三，我們將把營運優化工作擴展到所有表現不佳的市場，努力確保平衡2025 年所有細分市場的獲利能力

We initiated this process in Argentina earlier this year and have experienced significant improvements in both top and bottom line as we simplified and focused our business in the market. We anticipate improving annual profitability beyond $20 million across developing markets. As we work towards $50 million in annualized G&A savings over the coming year. Together, we believe these three near term operational optimization initiatives will enhance our ability to simplify and focus our business on the things that matter most in terms of returning our business to growth while ensuring operational profitability.

今年早些時候，我們在阿根廷啟動了這個流程，隨著我們簡化並專注於市場業務，營收和利潤都得到了顯著改善。我們預計發展中市場的年獲利能力將超過 2000 萬美元。我們致力於在來年實現 5,000 萬美元的年化管理費用節省。我們相信，這三項近期營運優化措施將增強我們簡化業務的能力，並將業務重點放在最重要的事情上，使我們的業務恢復成長，同時確保營運獲利能力。

Longer term, we remain focused on building out our enterprise vision of becoming the world's leading beauty wellness and lifestyle ecosystem. We've introduced several new initiatives that we believe will lead us towards this long-term vision including one, the introduction of mine 360 at our East and West live events this past quarter with global market launches continuing over the next few quarters.

從長遠來看，我們仍然專注於打造成為世界領先的美容健康和生活方式生態系統的企業願景。我們已經推出了幾項新舉措，我們相信這些舉措將引導我們實現這一長期願景，其中包括上個季度在我們的東西部現場活動中推出Mine 360​​，並在接下來的幾個季度繼續推出全球市場。

Cognitive health is a rapidly growing consumer category reported to be $9 billion globally and growing at 13% per year. While this burgeoning category is new to overall consumer behavior, we believe it will attract a new segment of customers to new skin in the future. Second, in addition, our product pipeline remains robust, and we are also exploring new innovations in our nutrition supplement business along with technologies that help demonstrate their efficacy.

認知健康是一個快速成長的消費類別，據報導全球價值 90 億美元，並以每年 13% 的速度成長。雖然這個新興類別對於整體消費者行為是新的，但我們相信它將在未來吸引新的客戶群使用新皮膚。其次，此外，我們的產品線仍然強勁，我們還在營養補充劑業務中探索新的創新以及有助於證明其功效的技術。

Our nutrition product lines including Pharmanex, Lifepak, G3 and others also hold some of the highest customer acquisition and retention rates in our portfolio. We anticipate some of these new innovations to hit the market in late 2025 and we'll discuss with you more in upcoming quarters.

我們的營養產品線，包括 Pharmanex、Lifepak、G3 等，在我們的產品組合中也擁有最高的客戶獲取率和保留率。我們預計其中一些新創新將於 2025 年底投放市場，我們將在接下來的幾季與您進行更多討論。

At live, we also introduced our exploration into integrated brand building, with our sales force as we strive to broaden NU Skin's accessibility wherever customers seek to find us, we're very early in the exploration of efforts but are beginning to see promising indicators as customers access our products via third party marketplaces and search engine advertisements.

在現場，我們也介紹了我們對綜合品牌建立的探索，我們的銷售團隊努力擴大如新的可及性，無論客戶在哪裡尋找我們，我們都處於探索工作的早期階段，但已經開始看到有希望的指標：客戶透過第三方市場和搜尋引擎廣告存取我們的產品。

For instance, approximately 80% of those purchasing via online ads are customers who found their way back to NU Skin to place an order through an advertisement. We believe there is untapped potential in invigorating customer activation and retention through integrated brand building.

例如，透過線上廣告購買的顧客中，大約 80% 是透過廣告回到 NU Skin 下訂單的顧客。我們相信，透過綜合品牌建立來激發客戶活力和保留客戶，還有尚未開發的潛力。

Fourth, we will be releasing a beta version of Maybelle initially in our US to our US brand affiliates later this month, our affiliates are authentic micro influencers, and we believe that the combination of Maybelle and NU Skin will further enhance their ability to engage with customers socially. The app will improve their ease of sharing new skin products as well as more than 1,200 additional beauty wellness and lifestyle brands on the Maybelle platform.

第四，本月晚些時候，我們將首先在美國向我們的美國品牌附屬公司發布Maybelle 的Beta 版本，我們的附屬公司是真正的微影響者，我們相信Maybelle 和NU Skin 的結合將進一步增強他們與客戶社交。該應用程式將提高他們在 Maybelle 平台上分享新皮膚產品以及 1,200 多個其他美容健康和生活方式品牌的便利性。

And lastly, we continue to explore future market expansion into India, the world's second largest population and one of the fastest growing economies in the world. India is a complex market that holds significant potential as we strive to introduce new skin to this highly entrepreneurial beauty and wellness conscious $1.3 billion, billion-person population anticipated in late 2025.

最後，我們繼續探索未來向印度的市場擴張，印度是世界第二大人口國，也是世界上成長最快的經濟體之一。印度是一個複雜的市場，潛力巨大，預計到 2025 年末，印度人口將達 13 億美元，人口達 10 億美元，我們努力為這個具有高度創業精神的美容和健康意識推出新皮膚。

So, in summary, despite the challenging operating environment, we are making progress in several areas of our vision over the immediate term. We are pushing harder to drive operational efficiencies which will help to improve profitability and cash flow as well as free up additional resources to support our key growth initiatives. We also continue to evolve our business model as well as overall branding efforts to regenerate healthy and sustainable growth.

因此，總而言之，儘管營運環境充滿挑戰，但我們在短期內在願景的幾個領域取得了進展。我們正在更加努力地提高營運效率，這將有助於提高獲利能力和現金流，並釋放更多資源來支持我們的關鍵成長計劃。我們也繼續發展我們的業務模式以及整體品牌努力，以實現健康和永續的成長。

We remain focused on executing our long-term vision of becoming the world's leading integrated beauty wellness and lifestyle ecosystem. So, with that, I'll turn the time over to James to cover Q3 in more detail along with guidance and then we'll open it up for questions, James.

我們仍然專注於實現成為世界領先的綜合美容健康和生活方式生態系統的長期願景。因此，我將把時間交給詹姆斯，更詳細地介紹第三季度以及指導，然後我們將開放提問，詹姆斯。

Good afternoon and thank you for joining us to discuss NU Skin's financial results for the third quarter.

下午好，感謝您與我們一起討論如新第三季的財務表現。

I'll provide a brief update and then speak to Q4 and 2024 guidance. Our performance reflects our commitment to operational efficiency through our company wide efforts to optimize expenses across the P&L while navigating the macro environmental uncertainties and weak consumer sentiment in the direct sales industry.

我將提供簡短的更新，然後討論第四季和 2024 年的指導。我們的業績反映了我們對營運效率的承諾，透過我們公司的廣泛努力來優化整個損益表的費用，同時應對宏觀環境的不確定性和直銷行業疲軟的消費者情緒。

Before we dive into details, I'm pleased to share that we are on track with our plan to reduce [Qs] by 30% in 2024 and are accelerating this effort in Q4 to simplify our portfolio and focus on higher margin products within our core business. In our developing markets we're beginning to see positive margin improvements as we pivot toward a more profitable product mix.

在我們深入了解細節之前，我很高興地告訴大家，我們正在按照計劃在2024 年將[Qs] 減少30%，並在第四季度加快這一努力，以簡化我們的產品組合，並專注於我們核心業務中利潤率較高的產品商業。在我們的發展中市場，隨著我們轉向利潤更高的產品組合，我們開始看到利潤率的正面改善。

While we're still in the early stages of this transition in our lower tier markets, we have implemented strategic steps to enhance margin targets, reduce our operating overhead and streamline the business opportunity with a more attractive price target and commission structure to improve bottom line returns. In addition to these changes, we're progressing well with our 2024 cost efficiency initiatives and are on track to reach the upper end of our previously announced G&A savings targets of $45 to $65 million.

雖然我們在低線市場仍處於轉型的早期階段，但我們已經實施了策略步驟，以提高利潤目標，減少營運費用，並透過更具吸引力的價格目標和佣金結構來簡化業務機會，以提高利潤返回。除了這些變化之外，我們的 2024 年成本效率計劃進展順利，並且預計將達到我們先前宣布的 45 至 6500 萬美元的一般管理費用節省目標的上限。

Now on the third quarter results, we posted revenue of $430.1 million which landed within our prior guidance range and included a negative foreign currency impact of 3.4% or $16.7 million revenue for the prior year quarter was $498.8 million. Third quarter earnings per share of $0.17 also landed within our previous guidance range. This compares to negative $0.74 or $0.56 excluding an inventory write off in the prior year quarters.

現在，在第三季業績中，我們公佈的收入為 4.301 億美元，落在我們先前的指導範圍內，並包括 3.4% 的外匯負面影響，即 1,670 萬美元，去年同期的收入為 4.988 億美元。第三季每股收益 0.17 美元也落在我們先前的指導範圍內。相比之下，不包括去年各季度的庫存沖銷，則為負 0.74 美元或 0.56 美元。

Our gross margin was 70.1% compared to 58.6% or 71.8% excluding an inventory write off in the prior year quarter. Gross margin for the new skin core business was 76.5% compared to 61.8% with 76.8% excluding, excluding the inventory write off a reduction of 30 basis points due to geographic revenue shift from mainland China and South Korea.

我們的毛利率為 70.1%，而去年同期的毛利率為 58.6% 或 71.8%（不含庫存沖銷）。新皮核心業務的毛利率為 76.5%，相較之下，毛利率為 61.8%，剔除庫存沖銷後的毛利率為 76.8%，由於地理收入從中國大陸和韓國轉移而減少了 30 個基點。

Selling expense as a percentage of revenue was 39% compared to 37.6% in the prior year quarter. Selling expense for the core new skin business was 43.5% which was elevated due to our first in person sales convention since COVID compared to 41.7% in the prior year period.

銷售費用佔收入的百分比為 39%，去年同期為 37.6%。核心新皮膚業務的銷售費用為 43.5%，由於我們自新冠肺炎疫情以來首次舉行面對面銷售會議，該費用有所上升，而去年同期為 41.7%。

General administrative expenses declined approximately $15 million year over year due to the continuation of our cost efficiency program helping bring expenses more in line with current revenue levels. As a percent of revenue G&A for the quarter was 26.9% compared to 26.2% in Q3 of 2023. Our operating margin for the quarter was 4.2% compared to negative 5.3% or 7.9% excluding an inventory write off. Interest expense was $6.5 million for the quarter compared to $7.5 million in the prior year.

由於我們繼續實施成本效益計劃，幫助支出與當前收入水平更加一致，因此一般管理支出比去年同期下降了約 1500 萬美元。本季的一般管理費用佔收入的百分比為 26.9%，而 2023 年第三季為 26.2%。我們本季的營業利潤率為 4.2%，而不包括庫存沖銷的營業利潤率為負 5.3% 或 7.9%。本季利息支出為 650 萬美元，而去年同期為 750 萬美元。

From a cash utilization perspective, we made solid progress in strategically reducing inventories across our product portfolio which contributed to a healthy $31.4 million in operating cash flow this quarter. Additionally, we reduced our outstanding debt by $25 million and paid $3 million in dividends. We did not repurchase any stock this quarter and now have $162.4 million remaining under our current authorization.

從現金利用的角度來看，我們在策略性減少產品組合庫存方面取得了堅實進展，為本季帶來了 3,140 萬美元的健康營運現金流。此外，我們還減少了 2500 萬美元的未償債務，並支付了 300 萬美元的股息。本季我們沒有回購任何股票，目前我們的授權剩餘 1.624 億美元。

Our tax rate for the quarter was 37.6% compared to negative 7.3% or 10.1% excluding the inventory write off. Shifting attention now to guidance, given the results of the first nine months of 2024 and the current state of the business, we are expecting 2024 revenue in the $1.70 to $1.73 billion range. We anticipate earnings per share of negative $2.32 to negative $2.22 or adjusted earnings of $0.65 to $0.75.

我們本季的稅率為 37.6%，而不包括庫存沖銷的稅率為負 7.3% 或 10.1%。現在將注意力轉向指導，考慮到 2024 年前 9 個月的業績和當前的業務狀況，我們預計 2024 年的收入將在 170 至 17.3 億美元之間。我們預計每股收益為負 2.32 美元至負 2.22 美元，調整後收益為 0.65 美元至 0.75 美元。

Our guidance now assumes an increased foreign currency headwind of approximately 3% to 4%. We are projecting fourth quarter revenue of $410 million to $445 million assuming a foreign currency headwind of approximately 1% to 2% with reported earnings per share of negative $0.09 or $0.01 to or adjusted earnings of $0.19 to $0.29 excluding a planned cash restructuring charge of $15 to $20 million to align our operating costs to be more in line with the revised outlook on current revenue.

我們現在的指導假設外匯阻力增加約 3% 至 4%。我們預計第四季度營收為4.1 億至4.45 億美元，假設外匯逆風約為1% 至2%，報告每股收益為負0.09 美元或0.01 美元，或調整後收益為0.19 至0.29 美元，不包括計劃的現金重組費用15 美元2000 萬美元，以調整我們的營運成本，使其更符合修訂後的當前收入前景。

As you can see, we are acutely focused on optimizing our operations to strategically focus our resources on driving the key initiatives that Ryan discussed, which align to our long-term vision of becoming the world's leading beauty wellness and lifestyle ecosystem.

正如您所看到的，我們非常注重優化我們的運營，以策略性地集中我們的資源來推動 Ryan 討論的關鍵舉措，這些舉措符合我們成為世界領先的美容健康和生活方式生態系統的長期願景。

We remain committed to improving operating margins as we work through our enterprise transformation by improving overall gross margin contribution margin and operating margin in 2025 via these key initiatives which will drive improved shareholder return in the mid to long term. And with that operator, we'll now open the call for questions.

在我們進行企業轉型的過程中，我們仍然致力於提高營業利潤率，透過這些關鍵舉措提高 2025 年的整體毛利率貢獻率和營業利潤率，這將推動中長期股東回報的提高。現在，我們將與該接線員一起開始提問。

Thank you. We will now begin the question and answer session.

謝謝。我們現在開始問答環節。

(Operator Instructions)

（操作員說明）

Your first question comes from the line of Chasen Bender with Citigroup. Please go ahead.

你的第一個問題來自花旗集團的 Chasen Bender。請繼續。

Hey, thanks, operator and afternoon guys. I wanted to start high level. I mean, clearly there's been a lot of initiatives underway to stabilize the core direct selling business. You know whether that be new operating models, new product introductions, leveraging e-commerce marketplaces. And I guess, putting that all together in context of what a very challenging macro environment is still.

嘿，謝謝接線員和下午的朋友們。我想從高水準開始。我的意思是，顯然已經採取了許多措施來穩定核心直銷業務。您知道這是否是新的營運模式、新產品的推出、利用電子商務市場。我想，將所有這些放在一起，仍然是一個非常具有挑戰性的宏觀環境。

How should we be thinking about the timeline for stabilizing the core new skin businesses. Is that something that could happen in '25 based on the initiatives that you have underway or given how long it takes for some of those projects to build traction. Is it really more like a "26 story at this point?

我們該如何思考穩定核心新皮業務的時間表。根據您正在進行的計劃或考慮到其中一些項目需要多長時間才能形成吸引力，這是否可能在 25 年發生。現在它真的更像是一個「26故事」嗎？

Yes, Chasen, that's a good question. I'll come and maybe James can add his context as well, how we're looking at the business so the way I kind of split it right now is we've got the near term, which obviously is kind of a prolonged state of decline across the business in most sectors and therefore our primary focus right now is ensuring that we are getting as frankly as simplified and focused as we can operationally across the product portfolio, even our selling expense optimization as I mentioned then and then developing markets where profitability hasn't been as great, so very focused on that.

是的，查森，這是個好問題。我會來，也許詹姆斯也可以添加他的背景，我們如何看待業務，所以我現在的劃分方式是我們有近期的情況，這顯然是一種長期的狀態大多數行業的業務都在下降，因此我們現在的主要重點是確保我們在整個產品組合的運作中盡可能簡化和集中化，甚至是我們的銷售費用優化，正如我當時提到的，然後是盈利能力強的發展中市場還沒有那麼好，所以非常關注這一點。

And really eliminating wasteful or less effective cost in order for us to then take that money and invest it in new initiatives that are both, you know, directed towards like the new sales performance plan I mentioned, you know, directed towards channel activation, but also these new initiatives like integrated brand building, social sharing and the like so transformation and I do think those are more mid to long term.

真正消除浪費或效率較低的成本，以便我們能夠將這筆錢投資於新舉措，這些舉措都是針對我提到的新銷售績效計劃，您知道，針對渠道激活，但是還有這些新舉措，如綜合品牌建立、社群分享等轉型，我確實認為這些都是中長期的。

So I think when we look into 2025 trying to read out what's going to happen, hard to know with political landscapes here in the and the like, but inflation seems to be leveling off and, and, you know, calming down which, which we believe is going to help with more premium beauty and wellness as we look into later 2025 I think we're still a few quarters away from that.

因此，我認為，當我們展望 2025 年，試圖了解將會發生什麼時，很難知道這裡的政治局勢等，但通膨似乎正在趨於平穩，而且，你知道，我們正在平靜下來。年晚些時候時，相信這將有助於提供更優質的美容和健康，我認為距離這一目標還有幾個季度的時間。

So it's we're not as transparent, it's the future is not as transparent now on that side. But I think for us, when we look at the model, we're, we're saying, hey, it's going to be near term. And I think moving into early part of 25 I think it's still going to be rough towards the second half. We're, you know, we have a few initiatives that we'll be talking about next quarter that will come in.

所以，我們的情況不那麼透明，未來的情況現在也不那麼透明。但我認為對我們來說，當我們查看模型時，我們會說，嘿，這將是近期的。我認為進入 25 年初，我認為下半年仍然會很艱難。你知道，我們有一些舉措，我們將在下個季度討論這些舉措。

We'll have a little more transparency post-election here in the US of where we think the economy will go and we'll see kind of how that plays out in late 2025 for us now though it's very cost optimization focused near term while we then lean into these innovations that are a little more mid, mid to long term focus James. Would you any other thoughts.

我們將在美國選舉後對經濟走向有更多的透明度，我們將看到 2025 年末對我們的影響如何，儘管短期內非常注重成本優化，而我們現在然後專注於這些更關注中、中長期的創新，詹姆斯。你還有其他想法嗎？

I'd say, Chasen with, with what we saw with where we finished Q3 and where we're forecasting Q4, we're showing that softness in the back half of this year and going into '25 will be cautious about our forecast. We'll give guidance at our, after the end of the year, how we're looking at '25. But in the meantime, what we're doing is we're really working under the, through the P&L to make sure from an operating profit perspective that we're maximizing all of those opportunities and trying to really forecast, profitability going forward.

我想說，Chasen，根據我們對第三季的結束情況和對第四季度的預測，我們顯示出今年下半年的疲軟狀態，進入 25 年將對我們的預測持謹慎態度。年底後，我們將就如何看待「25」提供指導。但同時，我們正在做的是，透過損益表，確保從營業利潤的角度來看，我們正在最大限度地利用所有這些機會，並嘗試真正預測未來的獲利能力。

Got it. I appreciate that color and then just switching gears on the other hand, rise just absolutely continues to be a bright spot. So I was hoping you could provide a little additional context, particularly on the non-manufacturing side. I know you mentioned maybe but just how are the various pieces like Maybelline and Beauty Bio contributing and bigger picture?

知道了。我很欣賞這種顏色，但另一方面，上升絕對仍然是亮點。所以我希望你能提供一些額外的背景信息，特別是在非製造業方面。我知道你可能提到過，但像美寶蓮和 Beauty Bio 這樣的各種產品是如何貢獻和更大的圖像的呢？

I know you've talked about rise mixing up to 20% to 25% of sales by '25 it seems like you could get there much sooner given decay in the direct selling side. So maybe just provide some perspective on how to think about the organic growth rate across both manufacturing and other, you know, particularly in context that the manufacturing growth did slow pretty meaningfully this quarter on, you know, what was a difficult comp?

我知道您曾談到 25 年銷售額將成長 20% 至 25%，鑑於直銷方面的衰退，您似乎可以更快地實現這一目標。因此，也許只是提供一些關於如何思考製造業和其他領域的有機成長率的觀點，特別是在本季製造業成長確實大幅放緩的背景下，你知道，什麼是困難的比較？

Yeah, No, I think is doing really well as you said, and we continue to invest in that platform. I mean, it is very much an investment, you know, in that platform as we as we look to allocate resources there Maybelle if you break it down manufacturing is kind of that steady business that for us is strategic.

是的，不，我認為正如您所說，我們做得非常好，我們將繼續投資該平台。我的意思是，這在很大程度上是對該平台的一項投資，因為我們希望在那裡分配資源，如果你把它分解的話，製造業是一種穩定的業務，對我們來說是戰略性的。

I mean, a lot of people ask why do we hold manufacturing? I'll be honest. I mean, we have, we serve hundreds of other customers across multiple channels from DTCCPG traditional retail e-commerce. It's, really interesting for us to be able to observe trends and be able to see how innovation is going into market and what channels are winning frankly.

我的意思是，很多人問我們為什麼要持有製造業？我會說實話。我的意思是，我們透過 DTCCPG 傳統零售電子商務的多個管道為數百名其他客戶提供服務。對我們來說，能夠觀察趨勢並能夠看到創新如何進入市場以及哪些管道坦率地獲勝，這真的很有趣。

So, for us, it's more than just an operational vertical play. It really is helpful and insightful in the beauty and wellness space. But yes, it continues to go well, we need to continue to invest to fuel that growth. Maybelle has been continues to be a really interesting investment I mentioned it.

因此，對我們來說，這不僅僅是一個可操作的垂直遊戲。它在美容和健康領域確實很有幫助且富有洞察力。但是，是的，它繼續進展順利，我們需要繼續投資來推動成長。Maybelle 一直是我提到的一項非常有趣的投資。

So, it's only been three years, the business continues to perform well. It plays right in the sweet spot of the creator economy. There's a and there's a lot of interest in that sector with recent deals there. So, we'll continue to invest on Maybelle we want to make sure it has the best opportunity for continued growth there. We do have brands, as you mentioned, the likes of Beauty Bio, we have investments in a few other brands as well and we'll see how those go. I mean, I think the world of Omni Channel is transitioning.

所以，僅僅三年的時間，業務仍然表現良好。它正好處於創作者經濟的最佳位置。最近的交易對該行業產生了極大的興趣。因此，我們將繼續投資美貝爾，我們希望確保它擁有持續成長的最佳機會。正如您所提到的，我們確實有品牌，例如 Beauty Bio，我們也投資了其他一些品牌，我們將看看這些品牌的進展如何。我的意思是，我認為全通路的世界正在轉變。

Now, if we watch companies like [Ulta] and others Sephora et cetera. There's a lot of shifting in how their business mix goes from bricks and mortar to online and I think we're experiencing and learning the same thing as we play with these businesses and understand them better. I think Beauty Bioscience is an amazing brand that has great from a customer standpoint, great traction there.

現在，如果我們觀察像 [Ulta] 和其他 Sephora 等公司。他們的業務組合從實體到線上的方式發生了很大的轉變，我認為我們在與這些企業合作並更好地了解它們的過程中正在經歷和學習相同的事情。我認為 Beauty Bioscience 是一個了不起的品牌，從客戶的角度來看，它具有很大的吸引力，並且具有很大的吸引力。

And we want to figure out how to best bring it to market in the most effective way. So, a lot of those other businesses I think are very much around. I don't want to say in any way, a private equity model, but there's a little bit of a of a quartile type of look where, we anticipate over time that that some of the brands will do extremely well and some will be moderate and then there will be some that don't work as well. I think our commitment is to learn this omni channel way and then again, take those learnings and apply them across the core business.

我們希望找出如何以最有效的方式將其推向市場。因此，我認為很多其他業務都存在。我不想以任何方式說私募股權模型，但有一點四分位類型的外觀，我們預計隨著時間的推移，一些品牌會表現得非常好，而另一些品牌會表現一般然後會有一些效果不太好。我認為我們的承諾是學習這種全通路方式，然後再次將這些知識應用到整個核心業務中。

For instance, the integrated brand building, a lot of our [Ryse] our return on ad spend models that we're running right now on the integrated brand building of the core originated or at least the insights came from some of these other brands. And so, we see this when we look out three years, four years, five years from now having a lot of learnings that come through this ecosystem of brands and we got the brands, we've got the affiliates, we've got the manufacturing, all of these, you have to have learnings there. So that's kind of how we're seeing it.

例如，綜合品牌建設，我們現在正在運行的許多[Ryse]廣告支出回報模型都源於核心的綜合品牌建設，或者至少是來自其他一些品牌的見解。因此，當我們展望三年、四年、五年後，我們會看到這一點，我們從這個品牌生態系統中學到了很多東西，我們擁有了品牌，我們擁有了附屬公司，我們擁有了製造業，所有這些，你都必須在那裡學習。這就是我們的看法。

I think the last thing I'll say is organic versus inorganic. [Ryse] obviously has come through a lot of investments that we've made across smaller brands and then we scale them up and I would imagine that will continue to be mostly the case. But I do think that that [Ryse] is beginning to have capabilities there where future state over the next few years, we could see brands being launched inside that ecosystem actually originated organically from all of the insights that we have.

我想我要說的最後一件事是有機與無機。 [Ryse] 顯然我們已經對較小的品牌進行了大量投資，然後我們擴大了它們的規模，我想這種情況將繼續下去。但我確實認為，[Ryse] 開始具備未來幾年的能力，我們可以看到在該生態系統內推出的品牌實際上源自於我們擁有的所有見解。

Got it. Thanks for that and then just for my last one, I wanted to ask about profitability. You've obviously been on a journey now to reduce costs and have expanded some of the initiatives to take out additional costs through the remainder of this year and next year. But as I look at the core direct selling gross margin, it's still down 30 bits on a of your basis.

知道了。謝謝你，就我的最後一個問題，我想問一下獲利能力。顯然，你們現在已經開始降低成本，並擴大了一些舉措，以在今年剩餘時間和明年消除額外成本。但當我查看核心直銷毛利率時，它仍然比你們的基礎下降了 30 位。

And you've been taking out costs and managing promos more efficiently and doing the skew rationalization yet, it just seems like we're not seeing that show up in the P&L I know you mentioned mix, but maybe just unpack for us in some greater detail how all of that's coming together and why we're not seeing that in the P&L just yet.

而且您一直在更有效地扣除成本和管理促銷活動，並進行傾斜合理化，似乎我們沒有在損益表中看到這一點，我知道您提到了混合，但也許只是為我們打開一些更大的包裝詳細說明所有這些是如何結合在一起的，以及為什麼我們還沒有在損益表中看到這一點。

Yeah, I'll probably so this will be a good one for James and I to tag team on maybe my optimism and James' pragmatic views will be helpful the way I look at it very much so is it's really hard with the top line being what it has been to counter some of the effects. And then I think geographic mix for us has been difficult when we look at some higher margin businesses in China, for instance, as that business has reset down, it's really impacted our gross margins globally.

是的，我可能會這樣，這對詹姆斯和我來說是一個很好的選擇，也許我的樂觀態度和詹姆斯的務實觀點會對我的看法很有幫助，所以這真的很難嗎？了什麼措施來抵消某些影響。然後，我認為，當我們看到中國的一些利潤率較高的業務時，地理組合對我們來說一直很困難，例如，隨著該業務的重置，它確實影響了我們在全球的毛利率。

A lot of the cleanup work we started in 2024 has been really getting around kind of the periphery of, suboptimized skews. Like I said, we've hit, you know, a little more than 20% our skews out this year, but they don't really affect significantly any sort of scaled revenue, what we're really talking about next year in this additional 30% we really do start to get into more of the margin of products and skews that, do have revenue.

我們在 2024 年開始的許多清理工作實際上都在繞過未優化的偏差的外圍。就像我說的，你知道，今年我們的偏差超過了 20%，但它們並沒有真正對任何規模的收入產生重大影響，這是我們明年在這個附加項目中真正討論的內容。開始獲得更多的產品利潤，並且確實有收入。

And so there's a shift of customer behavior that needs to happen, but it's also the more impactful side of the margin model that I think will play out. And so, you know, part of it is cleaning up the fringes so that we can go after the more meaty components of margin that we're focused on and I'm optimistic and this is why, I stated in my opening remarks that 150 to 200 basis points for our core business is really what we're lasering in on to do. And I think that opportunity exists if we're prudent and vigilant on it. But James, what are your?

因此，客戶行為需要轉變，但我認為這也是利潤模型中更具影響力的一面將會發揮作用。所以，你知道，其中一部分是清理邊緣，以便我們可以追求我們關注的利潤中更重要的組成部分，我很樂觀，這就是為什麼，我在開場白中指出，150將我們的核心業務提高到200 個基點確實是我們正在努力做的事情。我認為，如果我們對此保持謹慎和警惕，機會就存在。但是詹姆斯，你的是什麼？

Yeah, I mean, it's a great question and it's one that we grapple with, over the last two years, we've worked on trying to get that gross margin improvement. Ryan touched on it. I mean, the majority of the shift away from China in the last two years has moved from at 1.40% of our business now to the current quarter at 12%.

是的，我的意思是，這是一個很好的問題，也是我們努力解決的問題，在過去的兩年裡，我們一直在努力提高毛利率。瑞安談到了這一點。我的意思是，過去兩年大部分業務從中國轉移，從現在占我們業務的 1.40% 上升到本季的 12%。

And then in addition to that the other market of South Korea with the declines that we've seen in that market, they tend to overshadow some of the wins that we're making through the portfolio optimization. And a large of that upside is in a lot of the developing markets where we're focused through Latin America, also through Southeast Asia, where we're starting to see good signs of improvement in our developing market strategy where we've really reduced the overall skew count to that higher profile margin mix.

然後，除了我們在韓國看到的其他市場的下滑之外，它們往往會掩蓋我們透過投資組合優化所取得的一些勝利。其中很大一部分好處是在許多發展中市場，我們重點關注拉丁美洲和東南亞，我們開始看到發展中市場策略改善的良好跡象，我們確實減少了總體偏斜計數較高的利潤率組合。

So, as we continue to scale and move to that, I believe we'll start to see those improvements. We have held steady from Q1, Q2, we showed a 40-basis improvement sequentially from Q2 to Q3. So, we are getting small wins with different product launches and mix and we're really starting to target with our future product launches that targeting that profile margin that we want to move forward to take us back to that 78% to 80% as we move through '25 and '26.

因此，隨著我們繼續擴大規模並朝著這一目標邁進，我相信我們將開始看到這些改進。我們從第一季、第二季開始保持穩定，從第二季到第三季我們連續顯示了 40 個基點的改善。因此，我們透過不同的產品發布和組合取得了小小的勝利，並且我們真正開始以未來的產品發佈為目標，以我們希望向前邁進的目標，使我們回到 78% 到 80% 的水平。穿過“25”和“26”。

Got it very helpful. Appreciate all the detail. I'll pass it on.

得到它非常有幫助。欣賞所有的細節。我會把它傳遞下去。

Thanks, Chasen

謝謝，查森

Your next question comes from the line of Ashley Huggins with Jeffries. Please go ahead.

你的下一個問題來自阿什利·哈金斯和傑弗里斯的對話。請繼續。

Hi, thanks for taking our questions. So, we actually we asked about this last quarter, but I just wanted to get an update here. You talked about some kind of affordable luxury launches and I know those were still early days last quarter, but any update there and then curious on the nutrition side, just how it's expanding your customer base, maybe you can talk about your customer base in the nutrition side versus the legacy business. And then last any additional color on China and any expectations now that the government is putting stimulus into the market? Thanks so much. Yeah.

您好，感謝您回答我們的問題。所以，實際上我們在上個季度詢問過這個問題，但我只是想在這裡了解最新情況。您談到了某種負擔得起的奢侈品的推出，我知道上個季度還處於早期階段，但是那裡有任何更新，然後對營養方面感到好奇，它如何擴大您的客戶群，也許您可以以在營養方面與傳統業務。那麼最後還有關於中國的任何其他色彩以及對政府正在向市場推出刺激措施的任何期望嗎？非常感謝。是的。

Yeah. No, all really meaty topics, Ashley. So, I'll connect on those. So, regarding affordable luxury, we are focusing a lot of our attention on affordable luxury, but more from a point of view that the products we're bringing to market, we want to make sure they're priced, right. So, for example, the mine 360 line that we're just starting to introduce.

是的。不，都是很有意義的話題，艾希莉。那麼，我將連接這些。因此，關於平價奢侈品，我們將大量注意力集中在平價奢侈品上，但更多的是從我們推向市場的產品的角度來看，我們希望確保它們的定價正確。例如，我們剛開始介紹的mine 360​​ 系列。

Now, most of those products really fit in what I would define as masstige pricing, maybe slight prestige but not premium and so that line coming out, that's new. We're doing there we have some social selling products like [peptide pout]

現在，這些產品中的大多數確實符合我所定義的大眾定價，也許有一點聲望，但不是溢價，所以該系列的出現，這是新的。我們在那裡做一些社交銷售產品，例如[勝肽噘嘴]

We've had lash and brow serums and others types of topical treatments that have really been built to be in that affordable luxury or that of the [press Masti] to prestige area. And I think that as inflation was, the hyperinflation was rolling through that, that definitely has been a focus of ours to orient that way. I'm hopeful with inflation around the globe, tempering and hopefully stabilizing much better. We'll start to see that are prestige to not quite premium, but prestige product categories will perform better as we move into 2025.

我們有睫毛和眉毛精華液以及其他類型的局部治療產品，這些產品確實是為經濟實惠的奢侈品或 [press Masti] 的聲望領域而設計的。我認為，正如通貨膨脹一樣，惡性通貨膨脹正在席捲而來，這絕對是我們以這種方式定位的重點。我對全球通膨抱有希望，通膨會有所緩和，並且有望更好地穩定下來。我們將開始看到那些不是很高端的產品，但隨著我們進入 2025 年，高端產品類別將會表現得更好。

So, continue to focus on affordable luxury, but also making certain that products that that by the new ones we put in the market, but also making certain that we're investing in the brands that have kind of broader potential as the economy stabilizes on the nutritional supplement side. This is where I get pretty interested and maybe it applies to Chason's outlook question for 2025.

因此，繼續專注於平價奢侈品，但也要確保我們將新產品投放市場，同時也要確保我們投資於隨著經濟穩定而具有更廣泛潛力的品牌。這是我非常感興趣的地方，也許它也適用於 Chason 的 2025 年展望問題。

NU Skin has historically been a very evenly weighted, relatively evenly weighted business between new skin, our personal care business and our wellness or nutrition business. Over the course of the last seven or eight years, the vast majority of our innovation has come around the personal care side, which is, kind of where social commerce is thriving.

NU Skin 歷史上一直是新皮膚、我們的個人護理業務和我們的健康或營養業務之間權重非常均勻、權重相對均勻的業務。在過去的七、八年裡，我們的絕大多數創新都圍繞著個人護理方面，這也是社交商務蓬勃發展的地方。

And so, there's a lot of sense and logic in doing that. But as we look at the portfolio performance, nutrition, and we look across business categories or product categories, nutrition generally holds in almost every market segment, higher customer active acquisition and retention for the nutritional supplements. And that might partially be due to just the nature of you design supplements on 30-day models. We have a lot of subscription-based revenue with nutrition more so than in the personal care side.

因此，這樣做是有很多意義和邏輯的。但當我們審視產品組合的表現、營養以及跨業務類別或產品類別時，營養通常在幾乎每個細分市場中都佔有一席之地，營養補充劑的客戶積極獲取和保留率更高。這可能部分是由於您在 30 天模型上設計補充劑的性質。我們有很多基於訂閱的收入，營養方面的收入比個人護理方面的收入更多。

So, we just see longer tail customer lifetime value through the nutrition side. So, we've really kind of as on an innovation-based basis for 2025. We've shifted more innovation to go into that nutrition business which I think will bolster that back up to a more even split. And I think from a customer acquisition and including our affiliates and our leadership acquisition retention, we should see improvements there. So strategically, we think it's a it's an important move for us to balance the portfolio a little bit better and that's what we'll be doing. Your last question was on, I'm trying to remember.

因此，我們只是透過營養方面看到長尾客戶的終身價值。所以，我們確實是在 2025 年以創新為基礎。我們已經將更多創新轉向營養業務，我認為這將有助於實現更均勻的分配。我認為，從客戶獲取，包括我們的附屬公司和我們的領導力獲取保留來看，我們應該看到那裡的改進。因此，從策略上講，我們認為這是我們更好地平衡投資組合的重要舉措，這就是我們將要做的。你的最後一個問題已經提出，我正在努力記住。

I wrote on China, I wrote color and, but you said color on China. So I stopped. Yeah. So China is interesting, obviously, as you said, there's a lot of money being placed into the economy there by the local government, it's primarily going into sectors that probably don't directly drive to consumer spending in the market perse and I'm not sure how that's going to play out longer term.

我寫了中國，我寫了顏色，但你說的是中國的顏色。所以我停了下來。是的。因此，中國很有趣，顯然，正如您所說，地方政府向那裡的經濟投入了大量資金，這些資金主要投入到可能不會直接推動市場本身消費者支出的領域，我認為不知道從長遠來看這將如何發揮作用。

We're, focusing really on the consumer in China and hoping to see shifts in spending there as opposed to the savings rates that we're seeing right now. So I, a little too early to tell, I was there a couple of weeks ago meeting with our management team and some of our top leaders and it was interesting because there's still a lot of energy and frankly, there's some optimism at the local market level that the economy is going to look up because the government is investing in the economy.

我們真正關注中國的消費者，希望看到那裡的支出發生變化，而不是我們現在看到的儲蓄率。所以我，現在說還為時過早，幾週前我在那裡與我們的管理團隊和一些高層領導會面，這很有趣，因為仍然充滿活力，坦率地說，當地市場有一些樂觀情緒因為政府正在對經濟進行投資，所以經濟將會上升。

And so, my hope is that consumer sentiment will follow suit and that the savings will start to be spent and spent particularly in premium beauty and the like. But I think based on some of other peers in the area, people aren't baking a lot into China in 2025. And for us, I think we're being fairly cautious right now with hope that some of this stimulus will improve consumer confidence and sentiment overall will drive purchasing back up, at least in the prestige area if not premium.

因此，我希望消費者的情緒能夠跟上，節省下來的錢將開始花在高端美容等領域。但我認為，根據該地區其他一些同行的情況，到 2025 年，人們不會對中國產生太多興趣。對我們來說，我認為我們現在相當謹慎，希望這些刺激措施中的一些能提高消費者信心，整體情緒將推動購買量回升，至少在聲望領域（如果不是高端領域）。

Thank you so much for that. Help, talk to someone else. Yes, very helpful. Thank you. I'll pass it off to someone else.

非常感謝你。幫忙，和別人談談。是的，非常有幫助。謝謝。我會把它轉給別人。

Thanks Ashley.

謝謝阿什利。

I think we're actually keeping it fairly short and sweet today. So, I just wanted to maybe wrap up by thanking you all for being on the call and for continuing to monitor and observe our, our transformational story here at NU Skin.

我認為我們今天實際上保持得相當簡短和甜蜜。因此，我想在結束演講時感謝大家的參與以及繼續監督和觀察我們在 NU Skin 的轉型故事。

I think absolutely, you know, the headwinds that have, that have been here over the last couple of years as we look out to the future, we continue to see a lot of opportunity for new skin in the world based on what we provide, which is opportunities for people to look, feel and live better lives.

我絕對認為，你知道，在我們展望未來的過程中，過去幾年一直存在的逆風，我們繼續看到基於我們提供的產品，世界上有很多新皮膚的機會，這是人們看到、感受和過更好生活的機會。

And that is something that's in need today, how we get there and how we get that to market is the area where we're focusing a lot in terms of exploring integrated brand building new product offerings and new opportunities throughout our broader rise ecosystem to make that happen. So, we appreciate you tuning in and look forward to updating you quarter by quarter as we go. Have a good day.

這是今天所需要的，我們如何實現這一目標以及如何將其推向市場是我們非常關注的領域，在我們更廣泛的崛起生態系統中探索整合品牌建立新產品和新機會，那會發生。因此，我們感謝您的收聽，並期待我們每個季度為您提供最新資訊。祝你有美好的一天。

Thank you. And this continues today's conference call. Thank you all for participating. You may now disconnect.

謝謝。今天的電話會議繼續進行。感謝大家的參與。您現在可以斷開連線。