Revenue

12 Months Ended

Jun. 30, 2023

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

Revenue is recognized when control of the promised goods or services are transferred to the customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Sales, value add, and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue.

The Company generates the majority of its revenue through product sales to customers. These products include the Protandim® line of dietary supplements, LifeVantage® Omega+, ProBio, Daily Wellness, Rise AM, Reset PM, and D3+ dietary supplements, TrueScience® skin, hair, bath & body and targeted relief, IC Bright®, Petandim®, Axio® nootropic energy drink mixes, and the PhysIQ smart weight management system. The Company ships most of its product directly to the consumer and receives substantially all payment for product sales in the form of credit card receipts. Revenue from direct product sales to customers is recognized upon shipment, which is when passage of title and risk of loss occurs. For items sold in packs and bundles, the Company determines the standalone selling price at contract inception for each distinct good, and then allocates the transaction price on a relative standalone selling price basis. Any discounts are accounted for as a direct reduction to the transaction price. Shipping and handling revenue is recognized upon shipment when the performance obligation is completed.

The Company also charges amounts to independent consultants to attend events that it holds. Tickets to events are sold as standalone items or included within packs. For event tickets sold in packs, the Company allocates a portion of the transaction price to the ticket on a relative standalone selling price basis, adjusted for the probability of the tickets being redeemed for attendance at a future event. Any discounts are accounted for as a direct reduction to the transaction price. Fee revenue associated with ticket sales is recorded in the month that the event is held, which is when the Company has performed its obligations under the contract.

Deferred Revenue

On March 1, 2023, the Company launched its Rewards Circle loyalty program. Contract liabilities, recorded as deferred revenue, include these loyalty program credit deferrals with certain customers which are accounted for as a reduction in the transaction price and are generally recognized as credits are redeemed for additional products at a later date.

The Company also records deferred revenue when cash payments are received or due in advance of performance, including amounts which are refundable. The Company pre-sells tickets to its events. When cash payments are received in advance of events, the cash received is recorded to deferred revenue until the event is held, at which time the Company has performed its obligations under the contract and the revenue is recognized.

Deferred revenue is included in accrued expenses in the consolidated balance sheets. The balance of deferred revenue related to contract liabilities was $0.8 million and $0.1 million as of June 30, 2023 and 2022, respectively. The contract liabilities impact to revenue for the years ended June 30, 2023 and 2022 was a decrease of $0.7 million and an increase of $0.2 million, respectively.

Sales Returns and Allowances

Estimated returns are recorded when product is shipped. Subject to some exceptions based on local regulations, the Company’s return policy is to provide a full refund for product returned within 30 days. After 30 days of purchase, only unopened product that is in a resalable and restockable condition may be returned within twelve months of purchase and shall receive a 100% refund, less a 10% handling and restocking fee and any shipping and handling costs. The Company establishes a refund liability reserve, and an asset reserve for its right to recover products, based on historical experience. The returns asset reserve and returns liability reserve are evaluated on a quarterly basis. As of June 30, 2023 and 2022, the Company’s return liability reserve, net was $0.1 million and $0.1 million, respectively.

Reserves for sales returns consist of the following (in thousands):

	Years ended June 30,
	2023		2022
Beginning balance	$	131	$	197
Additions	1,978		1,616
Returns	(1,980)		(1,682)
Ending balance	$	129	$	131

Geographic Information

The Company reports revenue in two geographic regions: the Americas region and the Asia/Pacific & Europe region. The following table presents the Company's revenue disaggregated by these two geographic regions (in thousands):

	Years ended June 30,
	2023		2022
Americas	$	155,361	$	138,323
Asia/Pacific & Europe	58,037		68,037
Total revenue	$	213,398	$	206,360

Additional information as to the Company’s revenue from operations in the most significant geographical areas is set forth below (in thousands):

	Years ended June 30,
	2023		2022
United States	$	148,522	$	130,932
Japan	$	32,082	$	36,810

Major Products

The Company's revenue is largely attributed to two product lines, Protandim® and TrueScience® each of which accounted for more than 10% of total revenue for each of the fiscal years ended June 30, 2023 and 2022. On a combined basis, the Protandim® and TrueScience® product lines represent approximately 79.3% and 76.8% of the Company's total revenue for the fiscal years ended June 30, 2023 and 2022, respectively. The following table shows revenue by major product line for the fiscal years ended June 30, 2023 and 2022:

	Years ended June 30,
	2023				2022
Protandim® product line	$	119,720	56.1	%	$	135,616	65.7	%
TrueScience® product line	49,494		23.2	%	22,877		11.1	%
Other	44,184		20.7	%	47,867		23.2	%
Total	$	213,398	100.0	%	$	206,360	100.0	%