USANA Health Sciences Signals Confident 2026 Growth Path

USANA Health Sciences Inc ((USNA)) has held its Q1 earnings call. Read on for the main highlights of the call.

USANA Health Sciences’ latest earnings call painted a cautiously optimistic picture, with management emphasizing tangible progress across its core nutrition, Rise Wellness and HYA businesses. While margins and cash flow face near‑term pressure from higher customer acquisition costs and retail inventory builds, reaffirmed guidance and accelerating omni‑channel growth underpinned an overall constructive tone.

Sequential Recovery in Core Nutritional Business

USANA reported Q1 2026 net sales of $204 million in its core nutritional segment, a 7% sequential increase that signals early stabilization after a challenging period. Growth was supported by rising active customers, particularly in China where Lunar New Year acquisition campaigns helped lift volumes, though management cautioned the business remains in recovery rather than in a clear growth phase.

Explosive Rise Wellness Momentum in Retail

Rise Wellness emerged as a key growth engine, generating $14 million in Q1 sales, more than eight times the prior‑year quarter and up 143% sequentially. The surge was driven by the national launch of Protein Pop Plus at Costco and expanding placements at Target and roughly 500 Walmart stores, underscoring the brand’s potential as USANA pushes deeper into mainstream retail.

HYA Expansion and International Traction

HYA delivered $32 million in Q1 sales with 186,000 active monthly subscribers, showing modest sequential improvement but highlighting its scale as a growing pillar in USANA’s portfolio. The brand expanded beyond the U.S., launching in Canada in January and the U.K. in March while also entering Target stores, marking a strategic move into both international and brick‑and‑mortar channels.

Reaffirmed 2026 Guidance and Omni‑Channel Mix Shift

Management reaffirmed 2026 consolidated net sales guidance of $925 million to $1.0 billion, underscoring confidence despite macro uncertainties and investment needs. They expect omni‑channel brands, including Rise and HYA, to contribute more than 20% of total sales in 2026, a dramatic shift from about 1% two years ago and 16% in 2025, signaling a structural evolution in USANA’s revenue mix.

Operational Upgrades and Margin Initiatives

USANA outlined several back‑office and supply chain initiatives designed to support scale and margin recovery over time, including the rollout of a new ERP system and transitions to new third‑party logistics partners. The company also brought HYA manufacturing and packaging in‑house and flagged that incremental margin efficiencies are expected to start materializing in 2026, with technology modernization funded mainly by repurposed resources.

R&D Pipeline and Product Innovation Focus

Management highlighted a robust R&D pipeline of more than 20 products in development across its brands, with emphasis on women’s health, children’s health, gut health and active nutrition. In China, USANA launched upgraded active nutrition shakes supported by in‑house filling equipment, underscoring a push to deepen its product moat and sustain pricing and mix over the long term.

Retail Execution and Costco Sell‑Through

Retail execution was a recurring theme, with Costco reorders for Protein Pop occurring weekly, suggesting healthy sell‑through of initial inventory. USANA is also executing rapid retail rollouts and has agreements with nine additional major U.S. retailers for Protein Pop expansion, which could meaningfully broaden shelf presence if performance remains consistent.

Higher HYA Customer Acquisition Costs

Despite HYA’s growth, management flagged elevated customer acquisition costs as a key headwind, tied partly to disruptions in the Meta advertising environment that began in 2025. These issues have pushed SG&A higher compared with both Q4 and the prior year, pressuring short‑term profitability even as the company continues to prioritize building HYA’s subscriber base.

Near‑Term HYA Profitability Pressure

HYA remains in an early build phase and is absorbing higher SG&A from international launches in Canada and the U.K., Target distribution and stepped‑up marketing. With only modest sequential sales improvement so far, the brand is not yet contributing its full profit potential, and management signaled that investors should expect near‑term margin drag before in‑house production efficiencies begin to show.

Cash Deployed for Costco Inventory Build

USANA used a meaningful amount of cash to build initial Costco inventory for Rise’s Protein Pop, which temporarily reduced liquidity and weighed on near‑term cash metrics. However, management emphasized that ongoing sell‑through and weekly reorders support the decision, framing it as an investment in a high‑visibility retail platform rather than a structural balance sheet issue.

Uncertain Long‑Term Costco Cadence

While Costco demand has been encouraging, the sales ramp has not been entirely smooth, with initial discounting and multiple iterations creating variability in sell‑through trends. This has left some uncertainty around the long‑term cadence and sustainability of reorder patterns, a key factor investors will watch to assess how durable Rise’s big‑box momentum really is.

Core Business Stabilization and Ongoing Risks

Management described the core nutritional business as stabilizing instead of firmly back in a growth trajectory, signaling that execution risk remains despite sequential improvement. They also highlighted exposure to macroeconomic and geopolitical risks, including potential fuel price shocks linked to regional conflicts, noting that China is currently stable but not immune to future volatility.

Guidance and Outlook Emphasize Scale and Efficiency

Looking ahead, USANA expects consolidated net sales of $925 million to $1.0 billion in 2026, with HYA targeted at $140 million to $155 million and omni‑channel brands surpassing 20% of total sales. The company anticipates margin improvements at HYA from in‑house manufacturing and packaging as well as technology modernization funded by operational savings, positioning the business for better profitability once current investment waves subside.

USANA’s earnings call framed a company in transition, leaning into omni‑channel retail, digital brands and innovation while managing near‑term cost and cash pressures. For investors, the key takeaway is a mix of encouraging top‑line momentum and structural initiatives set against lingering execution, retail cadence and macro risks, with 2026 guidance serving as the primary scorecard for management’s strategy.