# Usana Health Sciences Inc: Form 10-Q for the period ended Apr 4, 2026

- Company: [Usana Health Sciences Inc](/companies/usna.md) (CIK 896264)
- Form: 10-Q
- Filed: 2026-05-12
- Accepted by EDGAR: May 12, 2026, 16:35 ET
- Period: 2026-04-04
- Accession: 0000896264-26-000034
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/896264/000089626426000034/usna-20260404.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/896264/000089626426000034/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2026-04-04.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2026-01-04 to 2026-04-04 | $250.2m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Cost of revenue | 3 months, 2026-01-04 to 2026-04-04 | $59.4m | us-gaap:CostOfGoodsAndServicesSold |
| Gross profit | 3 months, 2026-01-04 to 2026-04-04 | $190.8m | us-gaap:GrossProfit |
| Selling, general and administrative | 3 months, 2026-01-04 to 2026-04-04 | $88.3m | us-gaap:SellingGeneralAndAdministrativeExpense |
| Operating income | 3 months, 2026-01-04 to 2026-04-04 | $13.9m | us-gaap:OperatingIncomeLoss |
| Interest expense | 3 months, 2026-01-04 to 2026-04-04 | $240.0k | us-gaap:InterestExpenseNonoperating |
| Income tax | 3 months, 2026-01-04 to 2026-04-04 | $8.5m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2026-01-04 to 2026-04-04 | $7.5m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2026-01-04 to 2026-04-04 | $0.41 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2026-01-04 to 2026-04-04 | $0.41 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2026-01-04 to 2026-04-04 | 18,411,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 3 months, 2026-01-04 to 2026-04-04 | $9.8m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 3 months, 2026-01-04 to 2026-04-04 | $2.6m | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Share repurchases | 3 months, 2026-01-04 to 2026-04-04 | $0 | us-gaap:PaymentsForRepurchaseOfCommonStock |
| Cash and equivalents | at 2026-04-04 | $162.8m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2026-04-04 | $294.2m | us-gaap:AssetsCurrent |
| Total assets | at 2026-04-04 | $739.0m | us-gaap:Assets |
| Current liabilities | at 2026-04-04 | $117.2m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2026-04-04 | $144.2m | us-gaap:Liabilities |
| Shareholders' equity | at 2026-04-04 | $543.5m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 27,901 characters.

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is designed to provide an understanding of USANA’s financial condition, results of operations and cash flows by reviewing certain key indicators and measures of performance.

The MD&A is presented in six sections as follows:

- Overview
- Products
- Customers
- Non-GAAP Financial Measures
- Results of Operations
- Liquidity and Capital Resources

This discussion and analysis from management's perspective should be read in conjunction with the Unaudited condensed consolidated financial statements and Notes thereto that are contained in this quarterly report, as well as Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended January 3, 2026 (“2025 Form 10-K”), filed with the SEC on March 16, 2026, and our other filings, including the Current Reports on Form 8-K, that have been filed with the SEC through the date of this report. Forward-looking statements in Part I, Item 2 may involve risks and uncertainties that could cause results to differ materially from those projected (refer to the section entitled “Cautionary Note Regarding Forward-Looking Statements and Certain Risks” on page 1 and the risk factors provided in Part II, Item 1A for discussion of these risks and uncertainties).

### Overview

We develop and manufacture high quality nutritional supplements, functional foods and personal care products that are sold throughout the world. 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. On December 23, 2024, we acquired a 78.85% controlling ownership interest in Hiya, a leading provider of high-quality children's health and wellness products. 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. In 2022, we acquired Rise and have expanded Rise's product offering, distribution channel, and customer base over the last three years. Consequently, through our Core Nutritional business, Hiya, and Rise, we now operate and sell products through an omni-channel platform, which includes direct selling, direct-to-consumer, third-party marketplace and retail channels and organize our business into three reportable segments: Core Nutritional, Hiya, and Rise.

***Core Nutritional:*** Core Nutritional is our primary business with approximately 82% of consolidated net sales during the three months ended April 4, 2026. Our Core Nutritional customer base is primarily comprised of two types of customers: “Brand Partners” and “Preferred Customers,” referred to together as “active Customers.” Our Brand Partners also sell our products to retail customers. Brand Partners 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, which offers another sales and compensation opportunity to individuals who are interested in selling USANA products. Affiliates are discussed and reported in the report as part of our Brand Partners. 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 Brand Partners and Preferred Customers who have purchased from us at any time during the most recent three-month period. As of April 4, 2026, we had approximately 404,000 active Customers worldwide in the Core Nutritional segment.

We have Core Nutritional operations in multiple markets, with sales and expenses being generated and incurred in multiple currencies. Our reported U.S. dollar sales and earnings can be significantly affected by fluctuations in currency exchange rates. In general, our operating results are affected positively by a weakening of the U.S. dollar and negatively by a strengthening of the U.S. dollar. During the three months ended April 4, 2026, net sales outside of the United States represented 91.3% of Core Nutritional net sales. In our net sales discussions that follow, we approximate the impact of currency fluctuations on net sales by translating current year sales at the average exchange rates in effect during the comparable periods of the prior year.

***Hiya:*** Hiya operates and sells products to customers in the United States, Canada, and the United Kingdom. Hiya's customers purchase Hiya products for personal use primarily through a subscription model, which is intended to provide a steady, predictable income stream for Hiya. The ongoing nature of subscriptions fosters stronger relationships with customers by making it easier for them to receive products regularly, which we believe leads to retention and loyalty. Hiya's subscription model also provides important data on customer preferences and behaviors, which enables personalized offerings, efficient marketing and data-driven innovation insights. We evaluate Hiya's customer counts and behavior through their monthly subscribers and only count as "active Monthly Subscribers" those Hiya customers who have purchased from Hiya at any time during the most recent month. Hiya expanded distribution into retail during the first quarter of 2026.

***Rise:*** Rise manufactures and sells high-quality protein bars, powdered drinks, and clear protein drinks that are formulated to help customers achieve their health goals through clean and simple ingredients. Rise's revenue is generated primarily from sales to large national retailers and club retailers.

The following tables summarize operating results as a percentage of net sales for the current and prior-year periods, as indicated:

|  | Three months ended April 4, 2026 Core Nutritional | Hiya | Rise | Consolidated | March 29, 2025 Core Nutritional | Hiya | Rise | Consolidated |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net sales | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% |
| Cost of sales | 18.0% | 31.1% | 92.9% | 23.8% | 17.7% | 38.0% | 65.1% | 21.0% |
| Gross profit | 82.0% | 68.9% | 7.1% | 76.2% | 82.3% | 62.0% | 34.9% | 79.0% |
| Operating expenses: |  |  |  |  |  |  |  |  |
| Brand Partner incentives | 43.4% | —% | —% | 35.4% | 42.7% | —% | —% | 36.1% |
| Selling, general and administrative | 29.7% | 77.0% | 20.0% | 35.3% | 31.6% | 63.4% | 79.2% | 36.6% |
| Total operating expenses | 73.1% | 77.0% | 20.0% | 70.7% | 74.3% | 63.4% | 79.2% | 72.7% |
| Earnings (loss) from operations | 8.9% | (8.1%) | (12.9%) | 5.5% | 8.0% | (1.4%) | (44.3%) | 6.3% |
| Amortization of acquired intangible assets | —% | 13.9% | 1.5% | 1.9% | —% | 12.0% | 13.0% | 1.9% |

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

### Products

The following table summarizes the approximate percentage of total product revenue for the Core Nutritional segment that has been contributed by major product lines and our top-selling products for the current and prior-year periods, as indicated:

| Product line USANA® Nutritionals | Three months ended April 4, 2026 | March 29, 2025 |
| --- | ---: | ---: |
| Optimizers | 72% | 72% |
| Essentials/CellSentials(1) | 14% | 16% |
| USANA Foods(2) | 7% | 6% |
| Personal care and Skincare | 6% | 5% |
| All other | 1% | 1% |
| **Key product** |  |  |
| USANA® Essentials/CellSentials | 8% | 9% |
| Proflavanol® | 7% | 9% |
| Probiotic | 6% | 7% |

(1) Represents a product line consisting of multiple products, as opposed to the actual USANA® Essentials / CellSentials product.

(2) Includes our Active Nutrition line.

The following table summarizes the approximate percentage of total product revenue for our Hiya segment that has been contributed by major product lines for the current and prior-year periods, as indicated:

| Product line | Three months ended April 4, 2026 | March 29, 2025 |
| --- | ---: | ---: |
| Kids Daily Multivitamin | 55% | 52% |
| Kids Daily Probiotic | 14% | 14% |
| Kids Daily Greens and Superfoods | 12% | 17% |
| Kids Bedtime Essentials | 11% | 10% |
| Kids Daily Iron | 4% | 4% |
| Kids Daily Hydration | 2% | —% |
| Kids Daily Immune | 1% | 3% |
| Kids Daily Fiber+ | 1% | —% |

The following table summarizes the approximate percentage of total product revenue for our Rise segment that has been contributed by major product lines for the current and prior-year periods, as indicated:

| Product line | Three months ended April 4, 2026 | March 29, 2025 |
| --- | ---: | ---: |
| Protein Pop (1) | 75% | —% |
| Bars | 24% | 89% |
| Powders | 1% | 11% |

(1) Protein Pop was launched in the third quarter of 2025.

### Customers

### Core Nutritional

Because we primarily sell our products to a customer base of independent Brand Partners and Preferred Customers, we increase our sales by increasing the number of our active Customers, the amount they spend on average, or both. Our primary focus continues to be increasing the number of active Customers. We believe this focus is consistent with our vision of improving the overall health and nutrition of individuals and families around the world. Increases or decreases in product sales are typically the result of variations in the volume of product sold relating to fluctuations in the number of active Customers purchasing our products. The number of active Customers is, therefore, used by management as a key non-financial indicator to evaluate our operational performance.

Sales to Brand Partners accounted for approximately 50% of Core Nutritional segment sales during the three months ended April 4, 2026, with the remainder of our sales generated from Preferred Customers. As of April 4, 2026, Brand Partners and Preferred Customers represented approximately 41% and 59%, respectively, of the total active Customer base for the quarter in the Core Nutritional segment. The table below summarizes the changes in our active Customer base for the Core Nutritional segment by geographic region, rounded to the nearest thousand as of the dates indicated:

| Asia Pacific: | Total active customers by region As of April 4, 2026 |  | As of March 29, 2025 |  | Change from prior year | Percent change |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| Greater China | 235,000 | 58.2% | 254,000 | 55.3% | (19,000) | (7.5%) |
| Southeast Asia Pacific | 59,000 | 14.6% | 75,000 | 16.4% | (16,000) | (21.3%) |
| North Asia | 32,000 | 7.9% | 45,000 | 9.8% | (13,000) | (28.9%) |
| Asia Pacific total | 326,000 | 80.7% | 374,000 | 81.5% | (48,000) | (12.8%) |
| Americas and Europe | 78,000 | 19.3% | 85,000 | 18.5% | (7,000) | (8.2%) |
|  | 404,000 | 100.0% | 459,000 | 100.0% | (55,000) | (12.0%) |

### Hiya

Hiya's active Monthly Subscribers are comprised of two types: first-time customers and recurring customers. First-time customers are viewed as an investment as the customer is provided a discount, and shipping costs are higher due to the inclusion of a refillable glass bottle. Additionally, as a direct-to-consumer company, customer acquisition is heavily influenced by the level of marketing spend. Recurring customers are not provided the same discount, and shipping costs are lower on refill orders. Both gross margins as well as operating margins improve with recurring customer orders, therefore, profitability margins are affected by sales mix between these two types of customers. As of April 4, 2026 and March 29, 2025, Hiya had approximately 186,000 and 224,000 active Monthly Subscribers, respectively.

### Rise

Rise sells its products primarily to large national retailers and club retailers throughout the United States. Rise does not operate under long-term supply agreements with any of its retail customers. Instead, sales are generally made pursuant to purchase orders. As a result, our revenue in any given period is dependent on ordering patterns and inventory management decisions made by our retail customers, which can be difficult to predict and may vary significantly from period to period. Rise offers trade promotions, discounts, spoilage, and other retailer deductions, which are recorded as reductions to gross revenue.

### Non-GAAP Financial Measures

We believe that presentation of certain non-GAAP financial information is meaningful and useful in understanding the activities and business metrics of our operations. Management believes these measures reflect an additional way of viewing aspects of our business that, when viewed with our U.S. GAAP results, provide a more complete understanding of factors and trends affecting our business. This non-GAAP financial information may be determined or calculated differently by other companies, limiting the usefulness of those measures for comparative purposes. We provide such non-GAAP financial information for informational purposes only. Readers should consider the information in addition but not instead of or superior to, our condensed consolidated financial statements prepared in accordance with U.S. GAAP, accompanying this report.

In analyzing business trends and performance, management uses “constant currency” net sales, “local currency” net sales, and other currency-related financial information terms to discuss our financial results in a way we believe is helpful in understanding the impact of fluctuations in foreign-currency exchange rates and facilitating period-to-period comparisons of results of operations and providing investors an additional perspective on trends and underlying business results. Changes in our reported revenue and profits in this report include the impacts of changes in foreign currency exchange rates. As additional information to the reader, we provide constant currency assessments in the tables and the narrative information in this MD&A to remove or quantify the impact of the fluctuation in foreign exchange rates and utilize constant currency results in our analysis of performance. Our constant currency financial results are calculated by translating the current period’s financial results at the same average exchange rates in effect during the applicable prior-year period and then comparing this amount to the prior-year period’s financial results.

### Results of Operations

#### Summary of Financial Results

Net sales for the first quarter of 2026 increased 0.3% to $250.2 million, an increase of $0.7 million, compared with the prior-year quarter. The modest increase in sales is the result of incremental net sales of $12.0 million for Rise, partially offset by a decline in both the Core Nutritional and Hiya segments of $6.4 million and $4.9 million, respectively. Additionally, favorable changes in currency exchange rates positively impacted net sales by an estimated $8.1 million in the current-year quarter.

Net earnings attributable to USANA for the first quarter of 2026 were $7.5 million, a decrease of 20.1% compared with $9.4 million during the prior-year quarter. The change is primarily attributable to a lower operating margin and a higher effective tax rate in the current-year quarter.

### Three months ended April 4, 2026 and March 29, 2025

#### Net Sales

The following table summarizes the changes in net sales by segment for the fiscal quarters ended as of the dates indicated:

| Core Nutritional: Asia Pacific | Net sales by region (in thousands) Three months ended April 04, 2026 |  | March 29, 2025 |  | Change from prior year | Percent change | Currency impact on sales | Percent change excluding currency impact |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Greater China | $123,334 | 49.3% | $118,746 | 47.6% | $4,588 | 3.9% | $4,986 | (0.3%) |
| Southeast Asia Pacific | 30,663 | 12.3% | 35,720 | 14.3% | (5,057) | (14.2%) | 1,942 | (19.6%) |
| North Asia | 15,352 | 6.1% | 18,941 | 7.6% | (3,589) | (18.9%) | (160) | (18.1%) |
| Asia Pacific total | 169,349 | 67.7% | 173,407 | 69.5% | (4,058) | (2.3%) | 6,768 | (6.2%) |
| Americas and Europe | 35,050 | 14.0% | 37,417 | 15.0% | (2,367) | (6.3%) | 1,323 | (9.9%) |
| Core Nutritional total | 204,399 | 81.7% | 210,824 | 84.5% | (6,425) | (3.0%) | 8,091 | (6.9%) |
| Hiya | 32,150 | 12.8% | 37,089 | 14.9% | (4,939) | (13.3%) | — | (13.3%) |
| Rise | 13,669 | 5.5% | 1,626 | 0.6% | 12,043 | 740.7% | — | 740.7% |
| Consolidated total | $250,218 | 100.0% | $249,539 | 100.0% | $679 | 0.3% | $8,091 | (3.0%) |

#### Core Nutritional Net Sales

Net sales in the Core Nutritional segment for the three-month period ended April 4, 2026 were $204.4 million, down 3.0% when compared to the corresponding period of 2025. On a constant currency basis, net sales in the Core Nutritional segment declined 6.9%. The decrease in Core Nutritional net sales was mainly due to a 12.0% decrease in active Customers, partially offset by a 5.6% increase in average spend per active Customer.

Asia Pacific: Net sales declined 2.3%, or 6.2% on a constant currency basis, in this region during the current-year quarter. Active Customers in this region declined 12.8% year-over-year, partially offset by an increase in average spend per active Customer. The net sales decline reflects a challenging economic and operating environment.

The following table summarizes changes in local currency net sales, active Customer counts, and average spend per active Customer for the markets primarily contributing to the decline in net sales within the Asia Pacific region:

| Market | Local currency net sales | Active Customers | Average spend per active Customer |
| --- | ---: | ---: | ---: |
| South Korea | (18.5%) | (29.5%) | 15.9% |
| Malaysia | (24.1%) | (36.0%) | 18.6% |
| The Philippines | (23.5%) | (26.3%) | 3.8% |
| Singapore | (25.9%) | (22.2%) | (4.7%) |
| China | (0.4%) | (7.6%) | 7.8% |

24

Americas and Europe: Net sales declined 6.3%, or 9.9% on a constant currency basis, in this region during the current-year quarter. Active Customers in this region declined 8.2% year-over-year and average spend per active Customer decreased 1.1% year-over-year. Year-over-year results in this region reflect a continued challenging environment to attract new customers.

The following table summarizes changes in local currency net sales, active Customer counts, and average spend per active Customer for the markets primarily contributing to the decline in net sales within the Americas and Europe region:

| Market | Local currency net sales | Active Customers | Average spend per active Customer |
| --- | ---: | ---: | ---: |
| United States | (6.0%) | (2.9%) | (3.2%) |
| Canada | (9.7%) | (6.9%) | (2.9%) |
| Mexico | (10.9%) | (7.1%) | (4.1%) |

#### Hiya Net Sales

Net sales in the Hiya segment for the three-month period ended April 4, 2026 were $32.2 million, down 13.3% when compared to the corresponding period of 2025. The decrease was primarily the result of a lower customer base and a decrease in customer acquisitions.

#### Rise Net Sales

Net sales in the Rise segment for the three-month period ended April 4, 2026 were $13.7 million, up 740.7% when compared to the corresponding period of 2025. The increase was primarily the result of the launch of Protein Pop in large national retailers and club retailers.

#### Gross Profit

Consolidated gross profit decreased 280 basis points to 76.2% of net sales, down from 79.0% in the prior-year quarter. The decrease in gross profit is largely attributed to an approximate 370 basis point unfavorable impact on consolidated results from incremental net sales for Rise, which carry lower gross margins relative to the Core Nutritional segment. Gross margins were also down for the Core Nutritional segment by 100 basis points due to production inefficiencies driven by lower production levels, as well as an increase in material costs. The overall decrease was partially offset by a positive contribution to the consolidated gross margin of 190 basis points from our Hiya segment, resulting primarily from a favorable shift in sales mix, and higher costs in the prior-year quarter related to the recognition of a step-up in basis of acquired inventory.

#### Brand Partner Incentives

Brand Partner incentives expense is incurred only in the Core Nutritional segment. Brand Partner incentives on a consolidated basis decreased 70 basis points to 35.4% of consolidated net sales, down from 36.1% in the prior-year quarter. This decrease can be attributed to the increase in net sales within our Rise segment where no Brand Partner incentives are incurred. For our Core Nutritional segment, Brand Partner incentives increased 70 basis points to 43.4% of segment net sales, up from 42.7% in the prior-year quarter. The relative increase was primarily driven by an unfavorable shift in market mix to a higher payout, an increase in incentive promotions, partially offset by lower accruals for incentive trips and events, and benefits from price increases.

#### Selling, General and Administrative Expenses

Selling, general and administrative expenses decreased $3.2 million in absolute terms during the current-year quarter, or 130 basis points relative to net sales. The overall decrease reflects an approximate 165 basis point favorable impact on consolidated results from the Core Nutritional segment attributed to cost realignment strategies implemented in the fourth quarter of fiscal year 2025, which were primarily related to employee costs and facility lease expense. Rise impacted consolidated selling, general and administrative favorably by 115 basis points as a result of leverage gained on higher net sales. However, Hiya negatively impacted consolidated selling, general and administrative expenses by 150 basis points due to higher spending on lower sales.

#### Income Taxes

The year-to-date effective tax rate increased to 55.0% from the 44.5% reported in the comparable period of fiscal 2025. The higher effective tax rate is due to lower consolidated earnings projections and an unfavorable change in mix of taxable income by market. Earnings before income taxes for the current-year quarter totaled $15.5 million with income tax expense of $8.5 million, or 55% of pretax income.

#### Diluted Earnings per Share Attributable to USANA

Diluted earnings per share attributable to USANA decreased to $0.41 as compared to $0.49 reported in the prior-year quarter primarily as a result of the substantially higher income tax provision as well as lower earnings from operations in the current-year quarter.

### Liquidity and Capital Resources

We have historically met our working capital and capital expenditure requirements by using net cash flow from operations and by drawing on our line of credit. Our principal source of liquidity is our operating cash flow. Although we are required to maintain cash deposits with banks in certain of our markets, there are currently no material restrictions on our ability to transfer and remit funds among our international markets. In China, however, our compliance with Chinese accounting and tax regulations promulgated by the State Administration of Foreign Exchange (“SAFE”) results in transfer and remittance of our profits and dividends from China to the United States on a delayed basis. If SAFE or other Chinese regulators introduce new regulations or change existing regulations which allow foreign investors to remit profits and dividends earned in China to other countries, our ability to remit profits or pay dividends from China to the United States may be limited in the future.

We believe our current liquidity, through cash flow from operations along with our line of credit, is adequate to meet our cash requirements and sustain our operations. Maintaining a capital structure that emphasizes sufficient liquidity and adaptability in the prevailing economic climate is our top priority. We actively assess potential acquisition opportunities and investments in complementary ventures. While we continuously aim to preserve ample liquidity and ensure business continuity amid uncertainties, we also explore initiatives such as stock repurchases. These strategic decisions have the potential to impact our liquidity and the ability to navigate these challenging times effectively.

#### Cash and Cash Equivalents

Cash and cash equivalents increased to $162.8 million as of April 4, 2026, from $158.4 million as of January 3, 2026. Cash flow provided by operating activities was $9.8 million, offset by cash used in financing activities of $3.6 million, and cash used in investing activities of $2.6 million. Additionally, favorable changes in currency exchange rates have impacted cash and cash equivalents, and restricted cash by $0.9 million.

The table below presents concentrations of cash and cash equivalents by market for the periods indicated:

|  | Cash and cash equivalents (in millions) As of April 4, 2026 | As of January 3, 2026 |
| --- | ---: | ---: |
| United States | $16.1 | $28.6 |
| China | 111.0 | 89.3 |
| All other markets | 35.7 | 40.5 |
| Total cash and cash equivalents | $162.8 | $158.4 |

#### Cash Flows Provided by Operations

As discussed above, our principal source of liquidity comes from our net cash flow from operations.

Net cash flow provided by operating activities was $9.8 million for the first three months of 2026. Net earnings combined with adjustments of non-cash items and a decrease in inventory purchases contributed positively to our net cash flow provided by operating activities, partially offset by an increase in trade accounts receivable, reflecting higher sales to retail customers in the Rise segment, as well as cash used to pay the 2025 annual employee bonus and accrued Brand Partner incentives.

Net cash flow provided by operating activities was $15.5 million for the first three months of 2025. Net earnings combined with adjustments of non-cash items contributed positively to our net cash flow provided by operating activities, partially offset by cash used to pay the 2024 annual employee bonus and accrued Brand Partner incentives and the purchase of inventories.

#### Line of Credit

Information with respect to our line of credit may be found in Note F to the condensed consolidated financial statements included in Item 1 of Part I of this report.

#### Share Repurchases

Information with respect to share repurchases may be found in Note I to the condensed consolidated financial statements included in Item 1 of Part I of this report.

#### Summary

We believe our current cash balances, future cash provided by operations, and amounts available under our line of credit will be sufficient to cover our operating and capital needs in the ordinary course of business for the foreseeable future. If we experience an adverse operating environment or unanticipated and unusual capital expenditure requirements, additional financing may be required. No assurance can be given, however, that additional financing, if required, would be available to us at all or on favorable terms. We might also require or seek additional financing for the purpose of expanding into new markets, growing our existing markets, mergers and acquisitions, or for other reasons. Such financing may include the use of debt or the sale of additional equity securities. Any financing which involves the sale of equity securities or instruments that are convertible into equity securities could result in immediate and possibly significant dilution to our existing shareholders.

### Critical Accounting Policies

There were no changes during the quarter to our critical accounting policies as disclosed in our 2025 Form 10-K. Our significant accounting policies are disclosed in Note A to our Consolidated Financial Statements filed with our 2025 Form 10-K.

## Market risk

As filed, 293 characters.

We have no material changes to the disclosures on this matter made in our 2025 Form 10-K. For a discussion of our exposure to market risk, refer to our market risk disclosures set forth in the section entitled “Quantitative and Qualitative Disclosures About Market Risk” in the 2025 Form 10-K.

## Controls and procedures

As filed, 2,128 characters.

### Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information that is required to be disclosed in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods that are specified in the SEC’s rules and forms and that such information is accumulated and communicated to management, including our Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer), as appropriate, to allow timely decisions regarding any required disclosure. In designing and evaluating these disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

As of the end of the period covered by this report, our Chief Executive Officer and Chief Financial Officer evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures were effective to provide reasonable assurance as of April 4, 2026.

### Changes in Internal Control Over Financial Reporting

During the quarter, the Company integrated Rise into its enterprise resource planning system. As a result, the Company implemented changes to business processes and related internal controls over financial reporting related to Rise. We believe we maintained appropriate internal control over financial reporting during the integration. These changes have been and will continue to be subject to our evaluation of the design and operating effectiveness of our internal control over financial reporting. Other than the changes related to Rise, there were no changes in our internal control over financial reporting during the fiscal quarter ended April 4, 2026, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

## Risk factors

As filed, 264 characters.

Our business, results of operations, and financial condition are subject to various risks. Our material risk factors are disclosed in Part I, Item 1A of our 2025 Form 10-K. The risk factors identified in our 2025 Form 10-K have not changed in any material respect.

Filed May 12, 2026.
Source: SEC EDGAR, the filing index for accession 0000896264-26-000034. Last ingested by Listed: Nov 3, 2026, 19:18 ET. No prices; not investment advice.