A：Herbalife Limited's vision is to be the world's premier health and wellness company, community, and platform.

A：In 2025, Herbalife Limited reduced its total leverage ratio, achieved a strong and resilient financial foundation, executed with discipline, and saw a meaningful step down in the ratio. The company also generated year-over-year net sales growth, with the fourth quarter marking the second consecutive quarter of such growth. Adjusted EBITDA for the quarter and the full year was $156 million and $658 million, respectively, and the company exceeded guidance for both the fourth quarter and full year on these metrics. Additionally, Herbalife generated $369 million in operating cash flows and continued to strengthen its balance sheet by repaying $203 million of debt.

A：Herbalife Limited's distributor network experienced a growing engaged network, with particular growth noted in North America and Latin America. New distributors worldwide grew 19% in North America and achieved its seventh consecutive quarter of year-over-year growth in Latin America. Even with a 5% decrease in new distributors worldwide compared to a very strong prior year, the current year's stack provided a more meaningful view on a quest year basis. New distributors in all regions reported increases, reflecting sustained multi-year momentum.

A：Key product innovations for Herbalife Limited in 2025 included the successful launch of Multi Burn in July for weight management, the broadening of the skin care portfolio with the introduction of HL Skin in EMEA backed by an AI-powered facial analysis tool, and the expansion into the healthy lifespan category with Life IO baseline in December. The company continued to optimize its global product portfolio to align with evolving consumer trends and preferences while tailoring offerings to local market needs.

A：Protocol is Herbalife Limited's health and wellness operating system, which is a key strategic component of its platform vision. It is designed as a connective digital layer to enhance distributor engagement, support customers, build sustainable nutrition and healthy lifestyle habits, and generate data to assist distributors in providing effective support. Since acquiring the protocol technology in April 2025, Herbalife has implemented a phased beta rollout to integrate market insights from distributors and customers, and enhance capabilities and introduce new features. The second phase of the beta program was released in December, which included enhancements to distributor marketing pages and the Coach Dashboard. The availability of beta access has been expanded to distributors and customers in the US, Canada, Puerto Rico, and select EMEA markets. Personalized nutritional supplements for the beta group will be available by the end of the first half of 2026.

A：Cristiano Ronaldo has acquired a script equity stake in HB protocol software, a subsidiary of Herbalife that holds the protocol technology, for 7.5 million dollars, along with a commitment to provide services and sponsorship rights to protocol.

A：For the fourth quarter, net sales were $1.3 billion, representing 6.3% growth versus the prior year and exceeding the high end of guidance. Adjusted EBITDA was $156 million, exceeding the high end of the guidance range, with an adjusted EBITDA margin of 12.2%, down 20 basis points year over year. Fourth quarter net income attributable to Herbalife included non-cash deferred tax benefits of $54 million related to the release of valuation allowances, resulting in an adjusted net income of $48 million and adjusted diluted EPS of 45 cents.

A：Operating cash flow for the fourth quarter was $98 million, up 41% year over year, and for the full year, operating cash flow totaled $333 million, up 17% versus 2024. The company also maintained a total leverage ratio of 2.8 times and increased its cash balance by approximately $50 million.

A：Three of the five regions, namely Latin America, EMEA, and India, delivered year-over-year growth in net sales for the fourth quarter. Specifically, Latin America reported 18% net sales growth and a 11% increase in local currency results, while EMEA had reported net sales up 9% and local currency net sales up 5%. India had the highest quarterly net sales with a reported increase of 12% year over year and 21% in local currency.

A：Net sales in China were down 4% year over year on a reported basis and 6% on a local currency basis, driven primarily by an 11% year over year decline in volume.

A：The fourth quarter adjusted EBITDA was $156 million with margins of 12.2% on a constant currency basis, despite an approximately 100 basis point FX headwind and an approximately $11 million employee bonus accrual headwind.

A：A presentation change was made to simplify the reporting of distributor-related compensation and to align with internal modeling and historical presentation methods. Selling expenses were separated from SGA, and service fees of China independent service providers were combined with distributive compensation previously reported as royalty overrides, now presented within selling expenses.

A：The company ended the quarter with $353 million of cash, made a scheduled $5 million amortization payment on the term loan B, and repaid the $25 million outstanding under the revolving credit facility. As of December 31, the revolver was undrawn, and over the last two years, the company paid down over $530 million of debt, reducing the leverage ratio from 3.9 times to 2.8 times.

A：For the first quarter, foreign exchange is expected to have a positive impact of approximately $31 million on net sales, and it's expected to be neutral to EBITDA. For the full year, net sales growth is expected to be 1% to 6% year over year, with a currency tailwind of 100 basis points. Adjusted EBITDA is expected to be in the range of $670 million to $710 million or 665 to $705 million on a constant currency basis.

A：The company expects capital expenditures to be in the range of 50 to $80 million, with capitalized SaaS implementation costs of 40 million to 60 million, incremental to CapEx. The expected adjusted effective tax rate for the full year is approximately 30%.

A：The expectations for fiscal year 26 are not explicitly stated in the transcript, but it is mentioned that the number of distributor events has been increased over the last two years and that the company tries to stay in line with spending based on the region.

A：The company plans to support distributor events by tracking increases in event costs on an annual basis, coming out of Covid where there were no events. The event costs are expected to go up slightly, but the company is funding it through sales and some other lines in the advertising promotion area, so it is not a material change overall.

A：The strategy for evolving the product portfolio includes expanding the range of offerings to attract more people, especially in markets with sophisticated customers with higher expectations. The company is also aiming to attract a new type of customer, possibly higher-income households or more intense users of supplements, while complementing the evolving product offering with an expanding consumer base to maximize revenue opportunity.

A：The company plans to engage more of its current customers and existing markets by expanding and deepening the product lines it has. This includes leveraging the new product offerings, such as personally formulated products, to attract a broader range of customers, including those who may not have been previously interested. The company also aims to engage with the existing customer base to offer more personalized solutions.

A：Cristiano Ronaldo is seen as a figure who embodies health, wellness, and performance, which aligns with the company's approach to health and wellness. The company believes that having precise data on health and wellness, along with personalized nutrition, is crucial for long-term change and results. The strategy involves leveraging Ronaldo's reputation and aligning with the company's mission to help people achieve their health and wellness goals.

A：The company expects the reduction in GST to be a tailwind until late September 2026, and possibly a declining tailwind after that. The effect of the reduced GST will continue to support volume growth until the company's expectations lap this event. The impact is expected to be a tailwind for the next 9 months.

A：Distributor growth and member growth are both important aspects of the company's strategy. While there is a need for financial opportunity and interest in the distributor model due to people seeking extra income, at the same time, health and wellness and personal goals also play a major role in why individuals join as members. The growth in distributors reflects both the interest in earning potential and the importance of health and wellness for the customers.

A：The focus shift from distributors to preferred customers in Herbalife's programs was prompted by the recognition that in many markets and business models, preferred customers played a leading role. The company made an adjustment in 2025 to account for this and to ensure balance in focusing on both distributor and preferred customer models.

A：Herbalife's acquisition strategy supports its distribution reach and business expansion by acquiring companies that have great content but lack the reach to distribute it. The company plans to use its extensive distribution network in 90+ countries to market and sell the acquired content, which can be technology or product-related. Partnerships that align with the company's vision are also sought to expand business in a economically sensible way, enhancing the value proposition for both distributors and customers.

A：The vision behind Herbalife's offerings is to measure health and wellness inputs, track progress, and provide beneficial products and technologies. The company is shifting towards a digital approach to health and wellness, offering guidance through digital applications that inform customers on 'what to do' in terms of measurements and supplements. These applications also provide reminders and guidance, such as ensuring adequate water intake and protein consumption, thereby supporting customers in their health and wellness journeys.

A：The rationale behind Herbalife's acquisition and partnership strategy is to support and enhance its core business without significantly impacting cash flow. The company aims to maintain its focus on direct sales and not stray from its model. The strategy is to acquire small businesses or technology that can add value to the existing platform and provide more interested products and opportunities for distributors. The ultimate goal is to deliver more value to the 2 million distributors in 95 markets, thereby increasing their efficiency and customer value.

A：The key achievements of the year highlighted in the closing remarks include the company's disciplined fiscal responsibility, which led to strengthened financial foundations, expanded profit margins, generation of strong cash flows, a fortified balance sheet, and a reduction in total leverage from 3.9 to 2.8. These achievements position the company for sustainable and profitable growth. The company also announced a partnership with Cristiano Ronaldo to enhance brand visibility and introduced acquisitions aimed at future leadership in nutrition.