USANA Q3 2026 Earnings: Hiya Growth Comes at a Margin Cost

USANA Health Sciences (NYSE: USNA) reported fiscal Q3 2026 net sales of $205.9 million, down 4% from $213.7 million a year earlier, while its GAAP diluted loss per share narrowed to $0.30 from $0.36. Lower Core Nutritional and Rise Wellness sales outweighed Hiya’s return to year-over-year growth, and increased customer-acquisition spending at Hiya reduced consolidated profitability. Quarterly free cash flow nevertheless improved to $8.4 million from negative $5.2 million.

Core Financial Results

Gross profit declined faster than revenue, reducing gross margin by approximately 0.8 percentage points to 76.3%. Brand Partner incentives decreased to $71.9 million from $77.7 million, but selling, general and administrative expenses rose slightly to $86.7 million, contributing to a $1.4 million operating loss compared with $1.2 million of operating income a year earlier.

USANA’s attributable net loss narrowed partly because income tax expense fell to $6.1 million from $8.5 million. On a non-GAAP basis, adjusted EBITDA attributable to USANA declined 13%, while adjusted diluted loss per share improved to $0.11.

Adjusted diluted EPS, adjusted EBITDA and free cash flow are non-GAAP measures. The attributable earnings and adjusted EBITDA figures exclude the 21.2% noncontrolling interest in Hiya.

Business and Segment Performance

Core Nutritional remained USANA’s largest business, but its sales and active-customer base continued to contract. Hiya delivered the clearest growth, with sales increasing both year over year and sequentially, while Rise Wellness remained substantially below the prior-year period.

Within Asia Pacific, Greater China sales rose 1% on a reported basis but declined 3% at constant currency and 18% sequentially. North Asia sales fell 20% year over year, while Southeast Asia Pacific was the regional exception: sales increased 2% year over year and 4% sequentially, with active customers up 3% from the second quarter.

Rise Wellness launched Protein Pop Balance nationally at Target and online in September, and management reported stronger Target sales from the second quarter. That sequential progress was not sufficient to offset the segment’s 45% year-over-year sales decline.

Profitability, Cash Flow and the Balance Sheet

Core Nutritional expanded its operating margin despite lower sales, which management attributed to a leaner cost structure. At the consolidated level, however, lower gross profit and increased Hiya marketing investment caused adjusted EBITDA to decline both year over year and sequentially.

Operating cash flow improved to $12.0 million from negative $2.0 million in the quarter. For the first nine months of fiscal 2026, operating cash flow was $45.0 million and free cash flow was $35.7 million, compared with $25.7 million and $14.7 million, respectively, in the prior-year period.

USANA ended the quarter with $178.9 million in cash and cash equivalents and no debt. The company made no share repurchases during the quarter and had approximately $34 million remaining under its authorization.

The balance sheet lists inventories of $84.1 million at October 3, 2026, down from $102.6 million at the start of the fiscal year. The earnings release’s narrative separately states inventory of $93 million and a 13% reduction, which does not reconcile with the balance-sheet figures.

Hiya Subscriber Growth Came at a Near-Term Margin Cost

Hiya added approximately 29,500 net active monthly subscribers from the second quarter, taking the total to 195,500. Management said customer-acquisition costs declined from the first half of the year and that sales through Target and Amazon more than doubled sequentially, prompting the company to increase marketing spending.

That investment helped Hiya sales rise 12% sequentially and 2% year over year, but it also weighed on earnings. Consolidated adjusted EBITDA attributable to USANA declined 44% sequentially to $12.1 million, based on the corrected second-quarter figure, and fell 13% year over year. The key issue is whether subscriber additions can support future revenue and margin improvement after the near-term acquisition costs.

Fiscal 2026 Guidance

USANA reduced its fiscal 2026 outlook to consolidated net sales approaching $900 million and adjusted EBITDA of $77 million. Management attributed the reduction primarily to weaker expectations for Rise Wellness and the decision to invest more in Hiya subscriber acquisition, partially offset by stronger Core Nutritional profitability.

The previous adjusted EBITDA outlook was corrected to $80.5 million from the originally published $86.7 million after USANA identified an error involving Hiya’s noncontrolling interest. The correction affected only the non-GAAP measure and had no impact on GAAP results.

Core Nutritional guidance incorporates an expected favorable foreign-exchange contribution of approximately $20 million and one fewer operating week than fiscal 2025. For the fourth quarter, management expects Hiya to make sequential progress in both sales and adjusted EBITDA.

Recent Insider Transactions

The supplied six-month insider dataset shows 13,188 shares purchased across nine transactions and 32,545 shares sold across eight transactions, resulting in net sales of 19,357 shares. Only one of the 10 latest reported entries included complete transaction terms; nine July 2026 filings lacked a transaction type, amount and price in the supplied data.

The transaction data alone do not establish the insider’s view of USANA’s future performance.

Risks Investors Need to Watch

• Core Nutritional customer attrition: Active customers fell 8% year over year and 7% sequentially. Continued declines would limit the benefit of the segment’s leaner cost structure and expanded operating margin.
• Hiya’s growth-versus-margin tradeoff: Subscriber acquisition accelerated, but the associated marketing spending reduced near-term profitability. Future results depend on converting those subscribers into sustained revenue and improved unit economics.
• Rise Wellness execution: Sales declined 45% year over year, and full-year segment guidance was cut to $30 million from $35 million. The business still needs to translate retail expansion into consistent, profitable growth.
• Currency and regional weakness: Favorable exchange rates supported reported results, particularly in Greater China, where reported growth contrasted with a constant-currency decline. The outlook also incorporates a sizable expected currency benefit.

Summary

USANA’s fiscal third quarter showed improving cash generation and early subscriber traction at Hiya, but those positives did not offset declining Core Nutritional customers, weak Rise Wellness sales and higher acquisition spending. The lowered full-year outlook reflects that pressure. The main items to monitor are Core Nutritional customer trends, Hiya’s ability to turn subscriber growth into better margins, Rise Wellness retail execution and the expected sequential improvement at Hiya in the fourth quarter.