REVENUE

12 Months Ended

Dec. 31, 2022

Revenue from Contract with Customer [Abstract]

REVENUE

REVENUE

The Company disaggregates its revenue from customers by sales channel, as well as by revenue source and geographic region, based on the location of the end customer, as it believes it best depicts how the nature, amount, timing and uncertainty of its revenue and cash flows are affected by economic factors.

Revenue by Sales Channel

The Company’s revenue is primarily generated from product sales. Direct Sales revenue listed in the table below includes (i) sales to physicians through the Physician Channel Provider, (ii) DTC sales via the Company’s e-commerce platforms, and (iii) sales directly to retailers. Distributors revenue includes products sold through distributors other than the Physician Channel Provider.

Total revenue by sales channel was as follows for the periods indicated:

	Period from July 28 to December 31, 2022
	Successor
(In thousands)	Obagi Skincare		Milk Makeup		Total
Revenue by Sales Channel
Direct sales	$	30,276	$	30,192	$	60,468
Distributors	28,826		1,091		29,917
Net product sales	$	59,102	$	31,283	$	90,385
Royalties	1,988		—		1,988
Net revenue	$	61,090	$	31,283	$	92,373

	Period from January 1 to July 27, 2022		Year ended December 31, 2021		Year ended December 31, 2020
			(As Restated)		(As Restated)
(In thousands)	Predecessor
Revenue by Sales Channel
Direct sales	$	39,649	$	68,181	$	54,343
Distributors	31,080		68,578		34,181
Net product sales	$	70,729	$	136,759	$	88,524
Royalties	3,031		5,713		5,904
Net revenue	$	73,760	$	142,472	$	94,428

During the period from July 28 to December 31, 2022 (Successor Period), three customers accounted for 29%, 18% and 16% of the Company’s revenue, respectively. During the period from January 1 to July 27, 2022, (Predecessor Period), two customers accounted for 44% and 20% of the Company’s revenue. For the year ended December 31,

2021 (Predecessor Period), two customers accounted for 44% and 17% of the Company’s revenue. For the year ended December 31, 2020 (Predecessor Period), one customer accounted for 57% of the Company’s revenue.

The Physician Channel Provider is an authorized wholesale distributor and service provider for the Company in the U.S. Revenue from sales to physicians and e-commerce customers made through this provider are considered direct sales revenue. The Physician Channel Provider is also a distributor of the Company’s products to other channels, such as the spa channel, and the related sales are considered distributor revenue (in which instances it is referred to as the “Spa Channel Distributor”). Revenue generated from products sold to physicians and the DTC channel via the Company’s e-commerce platform through the Physician Channel Provider was $26.3 million during the period from July 28 to December 31, 2022 (Successor Period), $32.2 million during the period from January 1 to July 27, 2022, (Predecessor Period), $58.8 million during the year ended December 31, 2021 (Predecessor Period), and $51.6 million during the year ended December 31, 2020 (Predecessor Period). Revenue generated from products sold to the Spa Channel Distributor was $0.3 million during the period from July 28 to December 31, 2022 (Successor Period), $0.4 million during the period from January 1 to July 27, 2022, (Predecessor Period), $3.6 million during the year ended December 31, 2021 (Predecessor Period), and $2.5 million during the year ended December 31, 2020 (Predecessor Period).

Revenue by Geographic Region

Total revenue by geographic region, based on the location of the end customer, was as follows for the periods indicated:

	Period from July 28 to December 31, 2022
(In thousands)	Successor
Revenue by Geographic Region
North America	$	56,630
Rest of the World	33,755
Net product sales	$	90,385
Royalties	1,988
Total:	$	92,373

	Period from January 1 to July 27, 2022		Year ended December 31, 2021		Year ended December 31, 2020
			(As Restated)		(As Restated)
(In thousands)	Predecessor
Revenue by Geographic Region
North America	$	44,443	$	79,122	$	64,040
Rest of the World	26,286		57,637		24,484
Net product sales	$	70,729	$	136,759	$	88,524
Royalties	3,031		5,713		5,904
Total:	$	73,760	$	142,472	$	94,428

During the period from July 28 to December 31, 2022 (Successor Period), the two countries that accounted for more than 10% of the Company’s total revenues were the United States and China, respectively, with net product sales amounting to $54.3 million and $17.0 million, respectively.

During the period from January 1 to July 27, 2022, (Predecessor Period) the two countries that accounted for more than 10% of the Company’s total revenues were the United States and Vietnam, with net product sales amounting to $43.8 million and $14.9 million, respectively.

For the year ended December 31, 2021 (Predecessor Period), the countries that accounted for more than 10% of the Company’s total revenues were the United States, China, and Vietnam, with net product sales amounting to $76.7 million, $16.2 million, and $18.6 million, respectively.

For the year ended December 31, 2020 (Predecessor Period), the United States was the country that accounted for more than 10% of the Company’s total revenues, amounting to net product sales of $63.4 million.