Segment Information

12 Months Ended

Dec. 31, 2023

Segment Information [Abstract]

Segment Information

15. Segment Information

The Company reports revenue from nine segments, consisting of its seven geographic Nu Skin segments—Americas, Mainland China, Southeast Asia/Pacific, South Korea, Japan, Europe & Africa, and Hong Kong/Taiwan—and two Rhyz segments—Manufacturing and Rhyz other. The Nu Skin other category includes miscellaneous corporate revenue and related adjustments. The Rhyz other segment includes other investments by our Rhyz business arm. These segments reflect the way the chief operating decision maker evaluates the Company’s business performance and allocates resources. Reported revenue includes only the revenue generated by sales to external customers.

Profitability by segment as determined under US GAAP is driven primarily by the Company’s transfer pricing policies. Segment contribution, which is the Company’s segment profitability metric presented in the table below, excludes certain intercompany charges, specifically royalties, license fees, transfer pricing, discrete charges and other miscellaneous items. These charges have been included in Corporate and other expenses. Corporate and other expenses also include costs related to the Company’s executive and administrative offices, information technology, research and development, and marketing and supply chain functions not recorded at the segment level.

In the first quarter of 2023, the Company adjusted how it allocates certain corporate overhead costs to the segments. The prior-year segment information has been recast to comply with current presentation. Consolidated financial information is not affected.

Effective June 2023, the Company closed its Israel market. As a result the Europe, Middle East and Africa (“EMEA”) segment has been renamed Europe & Africa.

The accounting policies of the segments are the same as those described in Note 2, “Summary of Significant Accounting Policies.” The Company evaluates the performance of its segments based on revenue and segment contribution. Each segment records direct expenses related to its employees and its operations.

Summarized financial information for the Company’s reportable segments is shown in the following tables. Asset information is not reviewed or included with the Company’s internal management reporting. Therefore, the Company has not disclosed asset information for each reportable segment.

Revenue by Segment

	Year Ended December 31,
(U.S. dollars in thousands)	2023			2022		2021
Nu Skin
Americas	$	398,222		$	508,537	$	547,755
Mainland China		298,079			360,389		568,774
Southeast Asia/Pacific		267,206			344,411		336,651
South Korea		236,099			268,707		354,252
Japan		207,833			224,896		266,216
Europe & Africa		192,352			204,275		283,200
Hong Kong/Taiwan		153,589			157,197		162,611
Nu Skin Other		(858	)		3,959		3,653
Total Nu Skin		1,752,522			2,072,371		2,523,112
Rhyz
Manufacturing (1)		181,395			149,458		172,120
Rhyz Other		35,214			3,830		437
Total Rhyz		216,609			153,288		172,557
Total	$	1,969,131		$	2,225,659	$	2,695,669

(1) The Manufacturing segment had $56.5 million, $69.2 million and $84.5 million of intersegment revenue for the years ended December 31, 2023, 2022 and 2021, respectively.  Intersegment revenue is eliminated in the consolidated financial statements and in the table above.

Segment Contribution

	Year Ended December 31,
(U.S. dollars in thousands)	2023			2022			2021
Nu Skin
Americas	$	78,943		$	97,298		$	103,067
Mainland China		62,259			72,362			151,645
Southeast Asia/Pacific		47,743			75,902			72,774
South Korea		74,091			78,811			110,328
Japan		54,076			51,620			65,167
Europe & Africa		18,592			15,959			34,846
Hong Kong/Taiwan		40,582			32,584			34,065
Nu Skin contribution		376,286			424,536			571,892
Rhyz
Manufacturing		12,321			3,570			18,346
Rhyz Other		(20,564	)		(6,180	)		(1,813	)
Rhyz contribution		(8,243	)		(2,610	)		16,533
Total segment contribution		368,043			421,926			588,425
Corporate and other		(319,775	)		(311,079	)		(354,433	)
Operating income		48,268			110,847			233,992
Other income (expense)		(21,690	)		(21,877	)		(1,533	)
Income before provision for income taxes	$	26,578		$	88,970		$	232,459

Depreciation and Amortization

	Year Ended December 31,
(U.S. dollars in thousands)	2023		2022		2021
Nu Skin
Americas	$	449	$	591	$	871
Mainland China		11,048		12,177		13,345
Southeast Asia/Pacific		1,062		1,500		1,450
South Korea		1,399		1,616		3,279
Japan		1,327		1,011		906
Europe & Africa		1,093		854		1,106
Hong Kong/Taiwan		2,614		3,743		3,637
Total Nu Skin		18,992		21,492		24,594
Rhyz
Manufacturing		13,293		13,838		11,765
Rhyz Other		5,836		2,368		1,579
Total Rhyz		19,129		16,206		13,344
Corporate and other		32,802		34,808		38,382
Total	$	70,923	$	72,506	$	76,320

Capital Expenditures

	Year Ended December 31,
(U.S. dollars in thousands)	2023		2022		2021
Nu Skin
Americas	$	236	$	204	$	714
Mainland China		20,052		10,692		24,382
Southeast Asia/Pacific		645		263		1,330
South Korea		585		727		854
Japan		104		225		194
Europe & Africa		411		1,612		1,242
Hong Kong/Taiwan		1,212		3,338		736
Total Nu Skin		23,245		17,061		29,452
Rhyz
Manufacturing		11,162		7,301		14,022
Rhyz Other		34		—		—
Total Rhyz		11,196		7,301		14,022
Corporate and other		24,049		34,694		25,141
Total	$	58,490	$	59,056	$	68,615

Revenue by Major Market

A major market is defined as one with total revenue greater than 10% of consolidated total revenue. Based on this criteria, the Company has identified four major markets: Mainland China, South Korea, United States, and Japan. There are approximately 45 other markets, each of which individually is less than 10%. No single customer accounted for 10% or more of net sales for the periods presented. Sales are recorded in the jurisdiction in which the transactions occurred:

	Year Ended December 31,
(U.S. dollars in thousands)	2023		2022		2021
United States	$	514,089	$	537,081	$	540,253
Mainland China		298,079		360,389		568,774
South Korea		236,099		268,707		354,252
Japan		207,833		224,896		266,216
All others		713,031		834,586		966,174
Total	$	1,969,131	$	2,225,659	$	2,695,669

Revenue by Product Line

	Year Ended December 31,
(U.S. dollars in thousands)	2023		2022		2021
Beauty	$	858,625	$	1,069,714	$	1,442,659
Wellness		886,093		992,338		1,062,549
Other		224,413		163,607		190,461
Total	$	1,969,131	$	2,225,659	$	2,695,669

Long-Lived Assets by Major Market

A major market is defined as a market with long-lived assets greater than 10% of consolidated long-lived assets and also includes the Company’s country of domicile (the United States). Long-lived assets in Mainland China consist primarily of property, plant and equipment related to manufacturing, distribution facilities and the Mainland China headquarters. Long-lived assets in the United States consist primarily of property, plant and equipment, including the Company’s corporate offices and distribution facilities. Long-lived assets by major market are set forth below for the periods ended December 31, 2023, 2022 and 2021:

	Year Ended December 31,
(U.S. dollars in thousands)	2023		2022		2021
United States	$	339,163	$	343,482	$	335,020
Mainland China		122,728		132,148		149,124
South Korea		23,578		30,867		25,364
Japan		13,322		18,011		23,929
All others		35,451		33,291		47,687
Total	$	534,242	$	557,799	$	581,124