Herbalife (HLF) Q4 2024 earnings summary

Executive summary

• Stephan Gratziani appointed CEO effective May 1, 2025, with Rob Levy as President of Worldwide Markets and Michael Johnson transitioning to Executive Chairman.

• Celebrated 45th anniversary and highlighted vision to become a leading global health and wellness platform.

• Q4 2024 net sales reached $1.2B, down 0.6% year-over-year, but up 2.7% on a constant currency basis; full-year net sales were $5.0B, down 1.4% year-over-year, up 1.2% on a constant currency basis.

• Adjusted EBITDA for Q4 was $150M, exceeding guidance; full-year adjusted EBITDA was $635M, also above guidance.

• Distributor growth continued for the third consecutive quarter, with new distributors up 22% year-over-year in Q4.

Financial highlights

• Q4 2024 net sales: $1.2B, down 0.6% YoY as reported, up 2.7% at constant currency; gross profit margin 77.8% (+150 bps YoY).

• Q4 adjusted EBITDA: $150M (+38% YoY), margin 12.4% (+340 bps YoY); full-year adjusted EBITDA: $635M (+11% YoY), margin 12.7% (+140 bps YoY).

• Q4 net income was $178M, including $147M in non-cash deferred tax benefits from corporate restructuring; adjusted net income was $37M.

• Net cash from operating activities was $285M for the year; capital expenditures totaled $122M.

• Total leverage ratio reduced to 3.2x at year-end; revolving credit facility fully undrawn.

Outlook and guidance

• 2025 net sales guidance: -3% to +3% reported, +1% to +7% at constant currency; Q1 2025 net sales expected to decline 5.5% to 1.5% YoY.

• 2025 adjusted EBITDA guidance: $600M–$640M reported, $670M–$710M at constant currency; Q1 2025 adjusted EBITDA: $140M–$150M.

• FX expected to be a significant headwind in 2025, with a $200M impact on net sales and $70M on EBITDA.

• Targeting total leverage ratio reduction to 3.0x by end of 2025 and $1B–$1.4B debt reduction by 2028.

• Capital expenditures for 2025 expected at $100M–$130M, with SaaS implementation costs of $25M–$30M.