Welcome, and thank you for joining the fourth quarter and full year 2025 earnings conference call for Herbalife Ltd. [Operator Instructions] As a reminder, today's conference call is being recorded. I would now like to turn the call over to Erin Banyas, Vice President and Head of Investor Relations, to begin today's call.

Thank you, and welcome to everyone joining us. With us today are Stephan Gratziani, our Chief Executive Officer; and John DeSimone, our Chief Financial Officer. Before we begin today's call, I would like to direct you to the cautionary statement regarding forward-looking statements on Page 2 of our presentation and in our earnings release issued earlier today, which are both available under the Investor Relations section of our website. The presentation and earnings release include a discussion of some of the more important factors that could cause results to differ from those expressed in any forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. As is customary, the content of today's call and presentation will be governed by this language. In addition, during today's call, we will be discussing certain non-GAAP financial measures. These non-GAAP financial measures exclude certain unusual or nonrecurring items that management believes impact the comparability of the periods referenced. Please refer to our earnings release and presentation materials for additional information regarding these non-GAAP financial measures and the reconciliations to the most directly comparable GAAP measure. And with that, I will now turn the call over to our CEO, Stephan Gratziani.

Thank you, Erin, and thank you all for joining us today. As we look back on 2025, I want to take a moment to reflect on what we have accomplished and more importantly, discuss where Herbalife is headed and how we are positioning the company for long-term growth. Our vision is clear: to be the world's premier health and wellness company, community and platform. And in 2025, we took deliberate steps to ensure our vision is supported by a strong and resilient financial foundation. We executed with discipline, reducing our total leverage ratio to 2.8x. This meaningful step down from 3.9x at the end of 2023 underscores the strength of our business and our strong sustainable cash generation. We also sharpened how we operate, how we engage and how we create value for our community, the company and our shareholders, and we are advancing innovation, modernizing our digital ecosystem and deepening engagement across our distributor network. With the momentum generated in 2025, we enter 2026 in a position of strength, advancing our strategy to build a more innovative and digitally enabled Herbalife. Let's turn briefly to our fourth quarter and full year financial performance. Q4 marked our second consecutive quarter of year-over-year net sales growth with net sales of $1.3 billion, up 6.3%. India delivered its highest quarterly net sales in Q4. And even without India's outperformance, our Q4 net sales would have still come in above the midpoint of our guidance range. Adjusted EBITDA for the quarter was $156 million. For the full year, net sales were up nearly 1% to just over $5 billion; and excluding FX, net sales were up 2.5% compared to 2024. Full year adjusted EBITDA was $658 million, with margin at 13.1%, marking our second consecutive year of adjusted EBITDA and margin expansion, and…

Thank you, Stephan. Turning to our fourth quarter financial highlights on Slide 8. Our remarks today focus on the quarter with a summary of full year results in the appendix. As Stephan just described, we delivered a strong finish to 2025. Net sales for the fourth quarter were $1.3 billion, with 6.3% growth versus Q4 of 2024 and exceeding the high end of our guidance of 1.5% to 5.5% year-over-year growth. Q4 marked our second consecutive quarter of growth and our strongest year-over-year increase since the second quarter of 2021. On a constant currency basis, net sales increased 5.5% year-over-year, also exceeding guidance. We have now delivered year-over-year constant currency growth in 7 of the last 9 quarters. While FX rates moved slightly against us versus our Q4 guidance assumptions, we still realized an 80 basis point tailwind. Our Q4 net sales outperformance was driven by a record quarter in India with net sales of $250 million, up nearly 15% year-over-year and exceeding our expectations. We believe this was fueled by stronger demand following the reduction of the goods and services tax rate on the majority of our products in late September 2025. Importantly, while India outperformed our expectations, even without this upside, Q4 net sales growth would have been above midpoint of our guidance range. Adjusted EBITDA was $156 million, exceeding the high end of our guidance range of $144 million to $154 million. Adjusted EBITDA margin was 12.2%, down 20 basis points year-over-year, driven primarily by FX headwinds of 100 basis points and an approximately 90 basis point headwind from employee bonus accruals, which we previously communicated as a meaningful and expected headwind given the 2024 annual employee bonus was fully accrued by the end of Q3 of 2024, and therefore, we had no bonus expense in last…

[Operator Instructions]. Our first question comes from the line of Chasen Bender from Citi.

So I know you guys don't traditionally give guidance by region, but I was hoping you could do a little bit of around the world and give some more color on how you're thinking about sales for the different geographic segments in 2026. I know you called out you're expecting growth in the U.S. But if you could kind of flesh out the comments for your other geographies, especially given the really strong India results and how the GST impact should kind of flow through until we lap those changes, that would be great.

Yes. So we don't guide by region. I do want to give maybe a little bit of commentary. It'll be a very high level. I will say that we're expecting net sales growth in every region with the exception of China. China is expected more of a 2027 event. And that's about, I think, all I really feel comfortable giving out.

Okay. Okay. Got it. And then as it relates to Pro2col, obviously, there's a lot of excitement building around the organization on that. I was hoping you could kind of frame your expectations in terms of the sales contribution you're expecting from that program and kind of what you've assumed in 2026 guidance. And then I guess to kind of stay in the realm of guidance, just on the EBITDA side, too. You've exceeded your quarterly guidance in each of the last 8 quarters, and if my math is right, you're only guiding to 20 to 30 bps of margin expansion in '26. It seems like you've built in a lot of flexibility there. So I'm just curious to understand kind of what your assumptions are and what's driving that degree of expansion.

So Chasen, that's a lot of questions. So let me see if I can hit them all. So...

I'm sorry.

No, that's okay. It's great. On the Pro2col side, there's very little from a top line built in at this point. There's a lot more upside from vertical than risk. We're in beta phase right now. We launched commercially in the U.S. in July, and there will be a build from there, of course. So we haven't built a ton in. We have a few other beta tests we'll launch this year in some other markets, but again, the beta doesn't drive the kind of volume. It's more of an acclimation process and a build. So again, more upside than downside risk there. On SG&A, there's one complexity, which is the -- it's GST in India. So one of the drivers of sales in India is the government lowered its GST rate, which is a goods and services tax, so think of it as a sales tax, from 18% to 5% of a lot of our products. That's a big price decrease for consumers, and it's been very beneficial. However, on services, which is what our distributors provide to us and what we pay to them and on our intercompany services, that rate did not get lower. It's still 18%. We used to be able to offset those, the input and the output credits, and now we don't. So one of the things that's happening next year in -- with GST is there's a net of about $16 million incremental cost between G&A and member comp. The net-net is $16 million on -- negative impact on the bottom line. So our margins ex GST would be about 30 basis points higher than what you're seeing in guidance. So I know guidance -- by the way, we're getting margin enhancement and improvement next year anyway, and I think that's an important point. But there's also a slight drag on the percentage from the GST in India. However, the GST in India is great for our business because it's driving a lot more volume.

[Operator Instructions]. Our next question comes from the line of Nicholas Sherwood from Maxim Group.

Kind of looking at the product categories, energy, sports and fitness was the fastest grower in 2025. Can you kind of talk about where that momentum came from? And how do you expect to continue that in 2026?

Well, if you look historically over the last few years -- not that -- I don't even know how many years, but it goes back quite a ways. We've been seeing that category outpace our overall performance as a company. So you see a slight decrease in the percent of our sales coming from weight management and a slight increase coming from targeted nutrition and from sports. And it comes from a various number of regions. But I also think we launched sports in India, had some growth this year in the sports products. I don't have a breakdown by market for each one of those categories. So that's just the general picture of what's happening in the business.

There was also a little bit of an uplift with Nutrition Clubs with Liftoff, which is a very popular product that specifically was designed in the H24 product brand. So that's helped a little bit of the growth here as well.

Okay. And kind of talking about Nutrition Clubs, I noticed in the 10-K, there was wording about doing training in Europe, Middle East and Africa of -- on Nutrition Clubs for the distributors there. Can you kind of go into any more detail on sort of expanding that Nutrition Club infrastructure in that market or other markets?

Yes. Nick, I think you're referring to the Breakfast Budget Clubs, which is a particular model that started in the U.K., which there's a lot of interest, and we do kind of biannual master classes where we'll have thousands of people actually that will come either virtually or physically to learn about this particular model that started in the United Kingdom, which now is starting to take roots in other markets as well. It's a really powerful, small club grassroots where people are literally coming to the club every single day. They're interacting with distributors. They're weighing themselves. They're talking about what kind of food they're eating. They're taking products, and it's really a community-driven one. We actually have a little bit of an uptake as well here in the United States with some of the distributors that have gone to the U.K. and understanding the model. So that's part of the strategy that we have in terms of master classes and making sure that our distributors understand what's happening in different markets, so they can see how it relates to their own and to be able to kind of import it into models in areas and geographies that make sense for them.

And then my last question is positive sales leader retention rates, especially in North America and Latin America in 2025. How much is that attributed to some of these training programs that have been going on for almost 2 years now, such as the Mastermind program? And kind of what -- where are you seeing is why so many more sales leaders were retained in 2025 compared to 2024?

Yes, I think you see an incremental improvement. We have a very strong sales leader base. And so all of these programs that are designed to support them better, better education, better support, the key account management program, which has key account managers that are working with certain levels of leadership and going through their business metrics, I think everything helps. I just revert back to my experience as a distributor leader of an organization. And the more educated people are, the more understanding, the better strategy they have towards their business. It all makes a difference. So I think it's hard to point to one thing. I think it's really the totality of the things that we've been doing over the last couple of years, but it definitely -- all the pieces make a difference.

[Operator Instructions]. Our next question comes from the line of William Reuter from Bank of America.

So my first question is around products and how much they may have contributed to expanded sales in fiscal year '25 versus previous years. Was there an increase in that percentage of what you offer that was part of the contribution?

Well, just to talk to kind of North America. We had a very successful launch of MultiBurn that was launched at Extravaganza just previous to -- prior to Extravaganza, which really helped us to have the performance that we had in Q3. Overall, I think we're doing a good job. In EMEA, we had the launch of the Skin, which really -- HL/Skin, which was, again, a successful launch. I think we have been launching successfully products probably the most that's ever happened in the history of the company. It's 2 very successful launches. So we continue -- I think there's learnings that are taking place, and as we roll out more products, we're just getting more effective at how we're rolling out product lines and products.

Got it. And then just secondarily for me, you have been increasing your number of distributor events over the last 2 years really. What is your expectation for fiscal year '26 in terms of are you going to be doing more events? Are you going to be doing fewer larger events and what the total spending on those may be on a year-over-year basis?

Yes, I'll let J.D. hit the total spend. Overall, we really go by the markets and regions. India had increased to more Extravaganzas, which are the big one based on the needs. Asia Pacific last year went to 2 Extravaganzas instead of 1. So it really depends. I think, overall, we try to stay in line with what the spending is based on the region. But I would say, in general, we try to do more events, more attendance. We've been tracking increases on an annual basis. Obviously, coming out of COVID, where we didn't have events, there's been a ramp up. But I'll let J.D. -- I'll refer to J.D. on the costs overall.

Yes. There's multiple lines we look at when we think of supporting our distributors, and events is just one of those lines. And event costs are expected to go up next year. A little more than sales is going to go up. But we're funding it both from the sales and from some other lines in the advertising promotion area. So it's not a material change overall.

[Operator Instructions] Our next question comes from the line of John Baumgartner from Mizuho Securities.

I'd like to ask -- Stephan, I'd like to ask, as you're making these investments in the personalized technology and more specialized new products, the MultiBurn, the Life I/O, it really feels like a new Herbalife that's much more geared to where the health and wellness market is going. And as you move down this path with an evolving product portfolio, how do you think about product customer fit? Is there a need to maybe also augment your legacy customer base with maybe higher income households or consumers who are more intense users of supplements? Just how do you think about complementing an evolving product offering with also evolving or expanding your consumer base to maximize the revenue opportunity?

Yes, it's a great question, John. I think the strength of our business, when you look across the geographic regions, is you have different levels of people using the products through different models for different reasons. Number one, we believe there is a more sophisticated customer that has higher expectations in certain markets, the United States, for example. Europe is another example. There's other markets that lag a little bit just in terms of what they're seeing and what the competition is doing. Overall, as a company, we believe that the world will come to a place where everyone wants a more personalized solution. And for some, that means a bespoke personalized formulation in a product in certain markets. In others, it means just the best data that leads for the certain individual, the best product for them. And so we're expanding the breadth of what we're offering to attract more people, and I appreciate, by the way, the comment just on kind of a new Herbalife. That's the goal, that we can go out and attract customers like you've seen with MultiBurn, with Baseline. And we believe, ultimately, with a personally formulated product, which actually there is -- I don't want to say 0 competition but very small competition for, we want to own that category. And so we believe that it's going to attract customers that we never would have had. At the same time, we want to double down and be more strategic on the current business that we have because it's an existing $5 billion business across 95 markets. And so we -- our strategy is across everything actually. We want to expand. We want to attract more, but we actually want to engage more of our current customer and go deeper in the product lines…

That was great. And then my follow-up on India, the volume growth there has decelerated going back to, I think, around mid-2024, but you saw a really nice bounce back in Q4 '25. And John, you mentioned the GST benefit. And I'm curious to the extent to which you saw any sort of related one-off benefits supporting volume this quarter relative to the extent to which this reduced GST, you can ride it as a tailwind until it's lapped late in 2026.

Yes. So it is -- we expect it to be a tailwind until we lap it in late September of 2026. It may be a declining tailwind. I mean the GST is not going to change from this reduced rate. At least, that's not our expectations, right? But maybe the excitement around it will get reduced a little bit, but it will definitely -- our expectation is it will definitely be a tailwind for the next 9 months.

[Operator Instructions]. Our next question comes from the line of Carolyn Popelka from Barclays.

This is Carolyn Popelka on for Hale Holden. My question relates to the distributor to member model. we've seen pretty outsized distributor growth, especially on a 2-year stack. So I was wondering if you could expand on the relationship between distributor growth and members growth. I think intuitively, with the current market, you might think more people want to be distributors looking for extra income, but on the other side, people might have less discretionary income for health and wellness. So is there a mismatch there?

Carol, thanks for the question. I think I just want to make sure, but you're talking about preferred members, I think, which is more of the customer type that you're talking about?

Yes.

Okay. Good. Yes. Well, look, it's both, right? The opportunity that people are looking for to have a financial opportunity, I think we're all clear that, that remains and will continue to remain something that there's a large attraction and interest and need for. At the same time, you said it. Health and wellness and people taking care of themselves and reaching their goals and what's important to them is also a major factor. The one thing that you might see just in terms of the distributor recruiting numbers versus the preferred member numbers is that we did launch 2 years ago something that we called Herbalife Premier League, which put a bit of a focus on distributor recruiting. And when we did that, there was a little bit of a focus on distributors more than preferred customers. For the first year that we ran the program, it ended up having more of a focus on the distributors. We made an adjustment in 2025 to actually account for preferred customers because a lot of markets in their models and flows they really kind of led with preferred customers. So I think as you see those numbers, there might be some level of fluctuation. All in all, it really depends on the distributor models. We could have more preferred -- so for example, preferred customers in India, it drives a lot of growth for us. It's not direct distributor recruiting it drives because it's really attuned to their model and the way that they actually build the business there. So I would say both remain highly interested and attractive, and our distributors are focused on both.

[Operator Instructions] Our next question comes from the line of Doug Lane from Water Tower Research.

I just want to follow up on the Pro2col here. You made the small IP acquisitions last year, and I don't remember Herbalife making a lot of acquisitions in the past. And now you have Ronaldo with an equity partnership in one of your parts of your business, I don't remember you doing a lot of equity partnerships in the past. So is this just one-off opportunistic? Or is this part of a new strategy going forward?

Doug, this is John. I think most of that question is going to go to Stephan, but let me see if I can set it up financially anyway for this audience. So our superpower, our strength is our distribution reach, right? We're in 95 countries, tens of thousands of communities, great reach into the consumer base around the world. We are interested from an acquisition standpoint in companies that are relatively small that have great content that don't have that distribution. And so we can buy the content and leverage that strength of ours. And for investors, what I think is important to understand is it augments the core business. It's not instead of. Second is it's not a huge use of cash. We're still looking to do small acquisitions but still get our total debt down to $1.4 billion by the end of 2028. And that content can be technology content. It can be product content. In addition, of course, if we can partner with somebody that can help expand our business in a way that makes economic sense, we're looking to do that, too. So it all has to fit our vision. And so I'm going to pass it to Stephan. He can maybe talk more a little bit about the vision and how things fit.

Yes, Doug, thanks for the question. I think it comes down to, when you think about the 4 things that we've done historically for 45 years, it's been the what to measure right, the inputs for health and wellness. By the way, I'll just kind of -- my experience, when I came in at 1991, we were primarily weight loss. If I had a customer, the question would be how much do you want to lose. And the measurements would be how much did you weigh this morning, and then let me take a tape measure and let's measure your hips, your waste, your thighs, your arms. And let's start with those measurements. And then let's track. So we've always been measuring. It's just, today, in the world of health and wellness, what people measure has grown exponentially. And so we believe that there's a lot of value in what people are looking at that are insights into their health and their wellness. So in terms of acquisitions and partnerships and things, building on what John mentioned, in the what to measure space, there could be some interesting opportunities. That's all I'll say in that area. On the what to take space, because for 45 years, we've been telling people what to take, which is our Herbalife products, right, we believe also that in that space, if there are opportunities of products that we believe are beneficial or technologies like personally formulation of product technologies, these could be things that could be interesting because, like John said, it aligns with our platform. On the what to do space, it's the same thing, right? So telling someone -- and I used to sit down with the customer and write on a piece of paper, this is how you're going to --…

At this time, I would now like to turn the conference back over to Stephan Gratziani for closing remarks.

Well, thank you, everyone. I'm going to keep this brief, but I think we can say that we've returned to growth. We delivered growth in Q3, Q4 and for the full year of 2025. We're guiding growth in Q1 and for the full year of 2026. I think the performance is reflected in the team that's really disciplined. We're being fiscally responsible. We strengthened the foundation, expanded margins, generating strong cash flows, fortified the balance sheet, reduced total leverage down to 2.8 from 3.9, are positioning the company for sustainable and profitable growth. And we're looking at things differently. Number one, we understand that our superpower is our distributors and this base and this foundation that was built over 45 years. So now we announced today a partnership with Cristiano Ronaldo, which is going to give Herbalife Pro2col and what we can deliver to the world more visibility than ever before. We recently made some acquisitions that we believe are giving us an expansion and will give us the possibility of leading in terms of where we believe nutrition is going for the future. And we're focused. We have not -- and by the way, this is not a departure for who we are. The results that we have today is really about what we've been doing for the last 2 years. It's the culmination of so many things that we've implemented. Market optimization efforts, the Diamond Development Mastermind, key account management programs, the Premier League, bringing in Eric Worre to support our distributor leadership, product launches, master classes and DMO and so many different things. So doubling down on our existing business, doubling down on the fact that we believe that the direct sales channel and our distributors and Herbalife in the 45 years and the 60,000 Nutrition Clubs around the world puts us in a position to do something that no other company can do. And so we thank you for being with us, and it's kind of joke -- a little bit of an inside joke because I think I'm ending every quarter by saying stay tuned next quarter, and you've been doing that. So I thank you for that. And I'll just end with saying stay tuned until next quarter. Thank you, everyone.

This concludes today's conference call. Thank you for participating. You may now disconnect.