Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Jan. 31, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Document Transition Report | false | ||
Entity File Number | 001-12421 | ||
Entity Registrant Name | NU SKIN ENTERPRISES, INC. | ||
Entity Central Index Key | 0001021561 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 87-0565309 | ||
Entity Address, Address Line One | 75 West Center Street | ||
Entity Address, City or Town | Provo | ||
Entity Address, State or Province | UT | ||
Entity Address, Postal Zip Code | 84601 | ||
City Area Code | 801 | ||
Local Phone Number | 345-1000 | ||
Title of 12(b) Security | Class A Common Stock, $.001 par value | ||
Trading Symbol | NUS | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 2,170 | ||
Entity Common Stock, Shares Outstanding | 49,460,121 | ||
Auditor Firm ID | 238 | ||
Auditor Name | PricewaterhouseCoopers LLP | ||
Auditor Location | Salt Lake City, Utah |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 264,725 | $ 339,593 |
Current investments | 13,784 | 15,221 |
Accounts receivable, net | 47,360 | 41,299 |
Inventories, net | 346,183 | 399,931 |
Prepaid expenses and other | 87,816 | 76,906 |
Total current assets | 759,868 | 872,950 |
Property and equipment, net | 444,806 | 453,674 |
Operating lease right-of-use assets | 98,734 | 120,973 |
Goodwill | 206,432 | 206,432 |
Other intangible assets, net | 66,701 | 76,991 |
Other assets | 244,429 | 175,460 |
Total assets | 1,820,970 | 1,906,480 |
Current liabilities | ||
Accounts payable | 53,963 | 49,993 |
Accrued expenses | 280,280 | 372,201 |
Current portion of long-term debt | 25,000 | 107,500 |
Total current liabilities | 359,243 | 529,694 |
Operating lease liabilities | 76,540 | 88,759 |
Long-term debt | 377,466 | 268,781 |
Other liabilities | 110,425 | 106,474 |
Total liabilities | 923,674 | 993,708 |
Commitments and contingencies (Notes 7 and 16) | ||
Stockholders' equity | ||
Class A common stock - 500 million shares authorized, $0.001 par value, 90.6 million shares issued | 91 | 91 |
Additional paid-in capital | 613,278 | 601,703 |
Treasury stock, at cost - 41.1 million and 40.7 million shares | (1,569,061) | (1,526,860) |
Accumulated other comprehensive loss | (86,509) | (73,896) |
Retained earnings | 1,939,497 | 1,911,734 |
Total stockholders' equity | 897,296 | 912,772 |
Total liabilities and stockholders' equity | $ 1,820,970 | $ 1,906,480 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Stockholders' equity: | ||
Common stock, shares authorized (in shares) | 500 | 500 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares issued (in shares) | 90.6 | 90.6 |
Treasury stock (in shares) | 41.1 | 40.7 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Consolidated Statements of Income [Abstract] | |||
Revenue | $ 2,225,659 | $ 2,695,669 | $ 2,581,934 |
Cost of sales | 630,915 | 675,223 | 658,028 |
Gross profit | 1,594,744 | 2,020,446 | 1,923,906 |
Operating expenses: | |||
Selling expenses | 879,634 | 1,080,153 | 1,029,869 |
General and administrative expenses | 555,769 | 654,431 | 636,473 |
Restructuring and impairment expenses | 48,494 | 51,870 | 0 |
Total operating expenses | 1,483,897 | 1,786,454 | 1,666,342 |
Operating income | 110,847 | 233,992 | 257,564 |
Other income (expense), net (Note 17) | (21,877) | (1,533) | (1,332) |
Income before provision for income taxes | 88,970 | 232,459 | 256,232 |
Provision (benefit) for income taxes | (15,808) | 85,193 | 64,877 |
Net income | $ 104,778 | $ 147,266 | $ 191,355 |
Net income per share: | |||
Basic (in dollars per share) | $ 2.1 | $ 2.93 | $ 3.66 |
Diluted (in dollars per share) | $ 2.07 | $ 2.86 | $ 3.63 |
Weighted-average common shares outstanding: | |||
Basic (in shares) | 50,002 | 50,193 | 52,296 |
Diluted (in shares) | 50,525 | 51,427 | 52,765 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Consolidated Statements of Comprehensive Income [Abstract] | |||
Net income | $ 104,778 | $ 147,266 | $ 191,355 |
Other comprehensive income (loss): | |||
Foreign currency translation adjustment, net of taxes of $536, $429, and $(299), respectively | (22,918) | (13,476) | 19,708 |
Net unrealized gains/(losses) on cash flow hedges, net of taxes of $(3,519), $(1,166) and $(220), respectively | 12,748 | 4,225 | 797 |
Less: Reclassification adjustment for realized losses/(gains) in current earnings on cash flow hedges, net of taxes of $674, $(34), and $(5), respectively | (2,443) | 123 | 19 |
Other comprehensive (loss) income, net of tax | (12,613) | (9,128) | 20,524 |
Comprehensive income | $ 92,165 | $ 138,138 | $ 211,879 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other comprehensive income (loss): | |||
Foreign currency translation adjustment, tax | $ 536 | $ 429 | $ (299) |
Net unrealized gains/(losses) on foreign currency cash flow hedges, tax | (3,519) | (1,166) | (220) |
Reclassification adjustment for realized losses/(gains) in current earnings on cash flow hedges, tax | $ 674 | $ (34) | $ (5) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Common Stock [Member] Class A [Member] | Additional Paid-in Capital [Member] | Treasury Stock, at Cost [Member] | Accumulated Other Comprehensive Loss [Member] | Retained Earnings [Member] | Total |
Balance at beginning of period at Dec. 31, 2019 | $ 91 | $ 557,544 | $ (1,324,826) | $ (85,292) | $ 1,727,772 | $ 875,289 |
Stockholders' Equity [Roll Forward] | ||||||
Net income | 0 | 0 | 0 | 0 | 191,355 | 191,355 |
Other comprehensive income (loss), net of tax | 0 | 0 | 0 | 20,524 | 0 | 20,524 |
Repurchase of Class A common stock (Note 8) | 0 | 0 | (144,334) | 0 | 0 | (144,334) |
Exercise of employee stock options/vesting of stock awards | 0 | (1,803) | 7,567 | 0 | 0 | 5,764 |
Stock-based compensation | 0 | 24,060 | 0 | 0 | 0 | 24,060 |
Cash dividends | 0 | 0 | 0 | 0 | (78,387) | (78,387) |
Balance at end of period at Dec. 31, 2020 | 91 | 579,801 | (1,461,593) | (64,768) | 1,840,740 | 894,271 |
Stockholders' Equity [Roll Forward] | ||||||
Net income | 0 | 0 | 0 | 0 | 147,266 | 147,266 |
Other comprehensive income (loss), net of tax | 0 | 0 | 0 | (9,128) | 0 | (9,128) |
Repurchase of Class A common stock (Note 8) | 0 | 0 | (80,420) | 0 | 0 | (80,420) |
Exercise of employee stock options/vesting of stock awards | 0 | (1,292) | 15,153 | 0 | 0 | 13,861 |
Stock-based compensation | 0 | 23,194 | 0 | 0 | 0 | 23,194 |
Cash dividends | 0 | 0 | 0 | 0 | (76,272) | (76,272) |
Balance at end of period at Dec. 31, 2021 | 91 | 601,703 | (1,526,860) | (73,896) | 1,911,734 | 912,772 |
Stockholders' Equity [Roll Forward] | ||||||
Net income | 0 | 0 | 0 | 0 | 104,778 | 104,778 |
Other comprehensive income (loss), net of tax | 0 | 0 | 0 | (12,613) | 0 | (12,613) |
Repurchase of Class A common stock (Note 8) | 0 | 0 | (70,045) | 0 | 0 | (70,045) |
Exercise of employee stock options/vesting of stock awards | 0 | (792) | 27,844 | 0 | 0 | 27,052 |
Stock-based compensation | 0 | 12,367 | 0 | 0 | 0 | 12,367 |
Cash dividends | 0 | 0 | 0 | 0 | (77,015) | (77,015) |
Balance at end of period at Dec. 31, 2022 | $ 91 | $ 613,278 | $ (1,569,061) | $ (86,509) | $ 1,939,497 | $ 897,296 |
Consolidated Statements of St_2
Consolidated Statements of Stockholder's Equity (Parenthetical) - shares shares in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Stockholders' Equity [Roll Forward] | |||
Exercise of employee stock options (in shares) | 1.2 | 0.7 | 0.4 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Net income | $ 104,778 | $ 147,266 | $ 191,355 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 72,506 | 76,320 | 73,991 |
Non-cash lease expense | 44,518 | 48,704 | 46,163 |
Stock-based compensation | 12,367 | 23,194 | 24,060 |
Foreign currency (gains)/losses | 8,245 | 7,056 | (287) |
Loss on disposal of assets | 33 | 13,026 | 3,209 |
Impairment of fixed assets and other intangibles | 9,916 | 31,892 | 0 |
Unrealized (gain)/losses on equity investments | 0 | (18,077) | 0 |
Deferred taxes | (51,626) | 5,821 | (11,914) |
Changes in operating assets and liabilities: | |||
Accounts receivable, net | (11,449) | 20,219 | (11,207) |
Inventories, net | 40,314 | (95,320) | (31,137) |
Prepaid expenses and other | 2,758 | 15,132 | (153) |
Other assets | 3,099 | (19,792) | (31,616) |
Accounts payable | 9,263 | (13,279) | 24,836 |
Accrued expenses | (120,833) | (104,992) | 87,452 |
Other liabilities | (15,827) | 4,412 | 14,389 |
Net cash provided by operating activities | 108,062 | 141,582 | 379,141 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (59,056) | (68,615) | (63,823) |
Proceeds on investment sales | 5,932 | 15,094 | 14,037 |
Purchases of investments | (13,955) | (16,242) | (14,693) |
Acquisitions (net of cash acquired) | 0 | (18,963) | (14,949) |
Net cash used in investing activities | (67,079) | (88,726) | (79,428) |
Cash flows from financing activities: | |||
Exercise of employee stock options and taxes paid related to the net shares settlement of stock awards | 27,052 | 13,861 | 5,764 |
Payment of cash dividends | (77,015) | (76,272) | (78,387) |
Repurchase of shares of common stock | (70,045) | (80,420) | (144,334) |
Finance lease principal payments | (1,919) | (1,871) | (709) |
Payment of debt issuance cost | (5,077) | 0 | 0 |
Payments on debt | (432,500) | (115,000) | (142,500) |
Proceeds from debt | 460,000 | 155,000 | 115,000 |
Net cash used in financing activities | (99,504) | (104,702) | (245,166) |
Effect of exchange rate changes on cash | (16,347) | (11,244) | 12,506 |
Net increase (decrease) in cash and cash equivalents | (74,868) | (63,090) | 67,053 |
Cash and cash equivalents, beginning of period | 339,593 | 402,683 | 335,630 |
Cash and cash equivalents, end of period | $ 264,725 | $ 339,593 | $ 402,683 |
The Company
The Company | 12 Months Ended |
Dec. 31, 2022 | |
The Company [Abstract] | |
The Company | 1. The Company Nu Skin Enterprises, Inc. (the “Company”) is a holding company, with Nu Skin being the primary operating unit. Nu Skin develops and distributes premium-quality, innovative beauty and wellness products that are sold worldwide under the Nu Skin, Pharmanex and ageLOC brands and a small number of other products and services. The Company reports revenue from nine segments, consisting of its geographic Nu Skin segments—Americas, which includes Canada, Latin America and the United States; Mainland China; Southeast Asia/Pacific, which includes Indonesia, Malaysia, the Philippines, Singapore, Thailand, Vietnam, Australia, New Zealand, and other markets; South Korea; Japan; Europe, Middle East and Africa (“EMEA”), which includes markets in Europe as well as Israel and South Africa; and Hong Kong/Taiwan, which also includes Macau—and . |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Consolidation The consolidated financial statements include the accounts of the Company and the Subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation. Use of estimates The preparation of these financial statements, in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), required management to make estimates and assumptions that affected the reported Reclassifications Certain prior period amounts have been reclassified to conform to the current presentation. The Company reclassified $12.0 million and $10.4 million of events and other miscellaneous selling costs from the general and administration expenses line to the selling expenses Cash and cash equivalents Cash equivalents are short-term, highly liquid instruments with original maturities of 90 days or less. Accounts receivable Accounts receivable represents amounts owed to us through our operating activities and are presented net of allowance for doubtful accounts. Accounts receivable for core Nu Skin consists primarily of credit card receivables, while accounts receivable for our Rhyz investments consists primarily of trade receivables from customer sales. For the Company’s trade receivables from its Rhyz investment customers, the Company performs ongoing credit evaluations of its customers and maintains an allowance for expected credit losses. The allowance for expected credit losses represents the Company’s best estimate based on current and historical information, and reasonable and supportable forecasts of future events and circumstances. Inventories Inventories consist primarily of merchandise purchased for resale and are stated at the lower of standard cost or net realizable value, using a standard cost method which approximates the first-in, first-out method. The Company had reserves of its inventory carrying value totaling $37.3 million and $18.6 million as of December 31, 2022 and 2021, respectively. Inventories consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Raw materials $ 163,797 $ 179,891 Finished goods 182,386 220,040 Total inventory, net $ 346,183 $ 399,931 Reserves of inventories consist of the following (U.S. dollars in thousands): 2022 2021 2020 Beginning balance $ 18,643 $ 14,249 $ 12,295 Additions 43,286 31,300 15,952 Write-offs (24,662 ) (26,906 ) (13,998 ) Ending balance $ 37,267 $ 18,643 $ 14,249 Prepaid expense and other Prepaid expenses and other consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Deferred charges $ 11,748 $ 14,266 Prepaid income tax 9,333 2,784 Prepaid inventory and import costs 3,540 6,087 Prepaid rent, insurance and other occupancy costs 5,830 3,690 Prepaid promotion and event cost 2,395 4,382 Prepaid other taxes 8,768 9,333 Derivative financial instruments 9,156 557 Prepaid software license 17,463 17,041 Deposits 1,153 1,158 Other 18,430 17,608 Total prepaid expense and other $ 87,816 $ 76,906 Property and equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is recorded using the straight-line method over the following estimated useful lives: Buildings 39 years Furniture and fixtures 5 - 7 years Computers and equipment 3 - 5 years Leasehold improvements Shorter of estimated useful life or lease term Scanners 3 years Vehicles 3 - 5 years Expenditures for maintenance and repairs are charged to expense as incurred. When an asset is sold or otherwise disposed of, the cost and associated accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized in the statement of income. Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. An impairment loss is recognized if the carrying amount of the asset exceeds its fair value. Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, accrued expenses and operating lease liabilities on the consolidated balance sheets. Finance leases are included in other assets, accrued expenses and other liabilities on the consolidated balance sheets. Operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU assets also include any lease payments made and exclude lease incentives and initial direct costs incurred. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Leases with a term of 12 months or less are not recorded on the balance sheet. The Company’s lease agreements do not contain any residual value guarantees. The Company has lease agreements with lease and non-lease components. The Company accounts for the lease and non-lease components as a single lease component. Goodwill and other intangible assets Goodwill is recorded when the cost of acquired businesses exceeds the fair value of the identifiable net assets acquired. Goodwill and intangible assets with indefinite useful lives are not amortized, but are assessed for impairment annually on October 1. In addition, impairment testing is conducted when events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Goodwill and intangible assets with indefinite useful lives would be written down to fair value if considered impaired. Guidance under Accounting Standards Codification (“ASC”) 350, Intangibles - Goodwill and Other (“ASC 350 The Company has historically evaluated its goodwill for impairment annually as of June 30 or more frequently if impairment indicators arose in accordance with ASC 350, “Intangibles - Goodwill and Other.” In the fourth quarter of 2021, the Company changed the date of its annual assessment of goodwill to October 1 for all reporting units. The change in testing date for goodwill is a change in accounting principle, which management believes is preferable as the new date of the assessment better aligns with the Company’s budgeting process and will create a more efficient and timely process surrounding the impairment tests. The change in the assessment date does not delay, accelerate or avoid a potential impairment charge. The Company has determined that it is impracticable to objectively determine projected cash flows and related valuation estimates that would have been used as of each October 1 of prior reporting periods without the use of hindsight. As such, the Company prospectively applied the change in annual goodwill impairment testing date from October 1, 2021. No impairment was recognized during the years ended December 31, 2022 and 2020. As discussed further in Note 20 of the Notes to Consolidated Financial Statements, during the fourth quarter of fiscal year 2021, the Company recognized an $18.2 million goodwill and intangibles impairment charge related to the Grow Tech segment, which was included in Restructuring and impairment expenses The Company completed the annual goodwill and indefinite-lived intangible asset impairment testing as of October 1, 2022, and concluded that the fair value of the reporting units were determined to be in excess of its carrying amounts and no goodwill impairment charge was required. As of the October 1, 2022 testing date, the fair value of the Manufacturing reporting unit was estimated to be approximately 8% in excess of its carrying amount, and therefore the reporting unit is considered to be at risk of future impairment. The Manufacturing reporting unit’s fair value remains sensitive to significant unfavorable changes in revenue, gross margin and discount rates that could negatively impact future analyses. Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and factors. As a result, there can be no assurance that the estimates and assumptions made for purposes of the goodwill impairment tests will prove to be an accurate prediction of the future. Although the Manufacturing reporting unit showed strong revenue growth in fiscal year 2020 and 2021, the fair value of the reporting unit in the current year was negatively impacted by an increase in the discount rate due to the current interest rate environment, and Equity investments The Company holds strategic investments in other companies. These investments are accounted for under the measurement alternative described in ASC 321, Investments - Equity Securities Other assets Other assets consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Deferred taxes $ 89,770 $ 26,483 Deposits for noncancelable operating leases 13,872 17,121 Cash surrender value for life insurance policies 40,055 49,851 Right-of-use assets, Financing, net 14,259 6,477 Derivative financial instruments 10,582 6,033 Long-term investments 39,493 35,868 Other 36,398 33,627 Total other assets $ 244,429 $ 175,460 Accrued expenses Accrued expenses consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Accrued sales force commissions and other payments $ 95,686 $ 139,793 Accrued other taxes 21,822 31,135 Accrued payroll and other employee expenses 37,650 53,641 Accrued payable to vendors 29,569 45,347 Short-term operating lease liability 29,376 33,427 Accrued royalties 845 1,095 Sales return reserve 3,359 3,513 Deferred revenue 27,053 33,139 Other 34,920 31,111 Total accrued expenses $ 280,280 $ 372,201 Other liabilities Other liabilities consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Deferred tax liabilities $ 439 $ 2,385 Reserve for other tax liabilities 35,532 21,774 Liability for deferred compensation plan 44,427 54,213 Contingent consideration 6,364 10,341 Finance lease liabilities 12,140 5,318 Asset retirement obligation 5,978 5,408 Other 5,545 7,035 Total other liabilities $ 110,425 $ 106,474 Revenue recognition Net sales include products and shipping and handling charges, net of estimates for product returns and any related sales incentives. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products. All revenue is recognized when we satisfy our performance obligations under the contract. The Company recognizes revenue by transferring the promised products to the customer, with revenue recognized at shipping point, the point in time the customer obtains control of the products. The Company recognizes revenue for shipping and handling charges at the time the products are delivered to or picked up by the customer. A reserve for product returns is accrued based on historical experience totaling $3.4 million and $3.5 million as of December 31, 2022 and 2021, respectively. During the years ended December 31, 2022, 2021 and 2020, the Company recorded sales returns of $31.6 million, $52.1 million and $49.5 million, respectively. The majority of the Company’s contracts have a single performance obligation and are short term in nature. Sales taxes and value added taxes in foreign jurisdictions that are collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. Contract Liabilities – Customer Loyalty Programs Contract liabilities, recorded as deferred revenue within the accrued expenses line in the consolidated balance sheets, include loyalty point program deferrals with certain customers which are accounted for as a reduction in the transaction price and are generally recognized as points are redeemed for additional products. The balance of deferred revenue related to contract liabilities was $18.7 million and $22.0 million as of December 31, 2022, and 2021, respectively. The contract liabilities impact to revenue for the years ended December 31, 2022, 2021 and 2020 was an increase of $3.3 million, decrease of $3.8 million and a decrease of $5.7 million, respectively. Disaggregation of Revenue Please refer to Note 15 - Segment Information for revenue by segment and product line. Arrangements with Multiple Performance Obligations The Company’s contracts with customers may include multiple performance obligations. For such arrangements, the Company allocates revenues to each performance obligation based on its relative standalone selling price. The Company generally determines standalone selling prices based on the prices charged to customers for individual products sales to customers. Shipping and handling costs Shipping and handling costs are recorded as cost of sales and are expensed as incurred. Advertising expenses Advertising costs are expensed as incurred and are included in general and administrative expenses in the accompanying consolidated statements of income. Advertising expense incurred for the years ended December 31, 2022, 2021 and 2020 totaled $14.5 million, $15.5 million and $14.7 million, respectively. Selling expenses Selling expenses are the Company’s most significant expense and are classified as operating expenses. Selling expenses include commissions the Company pays to its Brand Affiliates, as well as salaries, service fees, benefits, bonuses and other labor and unemployment expenses the Company pays to its sales force in Mainland China. The term “Brand Affiliates” refers to members of the Company’s independent sales force in all of the Company’s markets besides Mainland China. In each of the Company’s markets, except Mainland China, Sales Leaders can earn “multi-level” compensation under the Company’s global sales compensation plan, including commissions for product sales to their consumer groups as well as the product sales made through the sales network they have developed and trained. The Company does not pay commissions on sales materials. Outside of Mainland China, the Company’s Brand Affiliates may make profits by purchasing the products from the Company at a discount and selling them to consumers with a mark-up. The Company does not account for nor pay additional commissions on these mark-ups received by Brand Affiliates. In many markets, the Company also allows individuals who are not members of its sales force, referred to as “preferred customers,” to buy products directly from the Company at a discount. The Company pays commissions on preferred customer purchases to the referring member of its sales force. Research and development Research and development costs are expensed as incurred and are included in general and administrative expenses in the accompanying consolidated statements of income and totaled $23.3 million, $27.2 million and $23.3 million in 2022, 2021 and 2020, respectively. Deferred tax assets and liabilities The Company accounts for income taxes in accordance with the Income Taxes Topic of the Financial Accounting Standards Codification. These standards establish financial accounting and reporting standards for the effects of income taxes that result from an enterprise’s activities during the current and preceding years. The Company takes an asset and liability approach for financial accounting and reporting of income taxes. The Company pays income taxes in many foreign jurisdictions based on the profits realized in those jurisdictions, which can be significantly impacted by terms of intercompany transactions between the Company and its foreign affiliates. Deferred tax assets and liabilities are created in this process. The Company has netted these deferred tax assets and deferred tax liabilities by jurisdiction. These deferred tax assets assume sufficient future earnings will exist for their realization, and are calculated using anticipated tax rates. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be ultimately realized. Uncertain tax positions The Company files income tax returns in the U.S. federal jurisdiction, and in various state and foreign jurisdictions. In 2009, we entered into a voluntary program with the IRS called Compliance Assurance Process (“CAP”). Under the CAP program, the IRS audits the tax position of the Company to identify and resolve any tax issues that may arise throughout the tax year. As of December 31, 2022, tax years through 2020 have been audited and are effectively closed to further examination. For tax years 2021 and 2022, the Company is in the Bridge phase of the CAP program, pursuant to which the IRS will not accept disclosures, will not conduct reviews and will not provide letters of assurance for the year. There are limited circumstances that tax years in the Bridge phase will be opened for examination. The company has applied for the CAP program for tax year 2023 and is currently waiting on approval from the IRS. With a few exceptions, we are no longer subject to state and local income tax examination by tax authorities for the years before 2019. Foreign jurisdictions have varying lengths of statutes of limitations for income tax examinations. Some statutes are as short as three years and in certain markets may be as long as ten years. The Company is currently under examination in certain foreign jurisdictions; however, the outcomes of those reviews are not yet determinable. A reconciliation of the beginning and ending amount of unrecognized tax benefits included in other liabilities is as follows (U.S. dollars in thousands): 2022 2021 2020 Gross balance at January 1 $ 15,090 $ 17,620 $ 13,507 Increases related to prior year tax positions 6,768 4,146 2,958 Increases related to current year tax positions 5,485 1,794 3,302 Settlements (2,590 ) (5,494 ) (1,091 ) Decreases due to lapse of statutes of limitations (95 ) (2,409 ) (1,377 ) Currency adjustments (1,559 ) (567 ) 321 Gross balance at December 31 $ 23,099 $ 15,090 $ 17,620 At December 31, 2022, the Company had $23.1 million in unrecognized tax benefits of which $23.1 million, if recognized, would affect the effective tax rate. In comparison, at December 31, 2021, the Company had $15.1 million in unrecognized tax benefits of which $15.1 million, if recognized, would affect the effective tax rate. The Company’s unrecognized tax benefits relate to multiple foreign and domestic jurisdictions. Due to potential changes in unrecognized tax benefits from the multiple jurisdictions in which the Company operates, as well as the expiration of various statutes of limitation, it is reasonably possible that the Company’s gross unrecognized tax benefits, net of foreign currency adjustments, may increase within the next 12 months by a range of approximately $2.0 to $3.0 million. During the years ended December 31, 2022, 2021 and 2020 the Company recognized $5.7 million, $1.6 million and $1.5 million, respectively in interest and penalties expenses related to uncertain tax positions. The Company had $12.4 million, $6.7 million and $5.1 million of accrued interest and penalties related to uncertain tax positions at December 31, 2022, 2021 and 2020, respectively. Interest and penalties related to uncertain tax positions are recognized as a component of income tax expense. Net income per share Net income per share is computed based on the weighted-average number of common shares outstanding during the periods presented. Additionally, diluted earnings per share data gives effect to all potentially dilutive common shares that were outstanding during the periods presented (Note 8). Foreign currency translation A significant portion of the Company’s business operations occurs outside of the United States. The local currency of each of the Company’s Subsidiaries is considered its functional currency, except for the Company’s subsidiaries in Singapore and countries deemed highly inflationary where the U.S. dollar is used. All assets and liabilities are translated into U.S. dollars at exchange rates existing at the balance sheet dates, revenue and expenses are translated at weighted-average exchange rates and stockholders’ equity is recorded at historical exchange rates. The resulting foreign currency translation adjustments are recorded as a separate component of stockholders’ equity in the consolidated balance sheets and transaction gains and losses are included in other income (expense) in the consolidated statements of income. Net of tax, the accumulated other comprehensive loss related to the foreign currency translation adjustments are $102.0 million (net of tax of $8.1 million), $79.1 million (net of tax of $7.5 million), and $65.6 million (net of tax of $7.1 million), at December 31, 2022, 2021 and 2020, respectively. Classification of a highly inflationary economy A market is considered to have a highly inflationary economy if it has a cumulative inflation rate of approximately 100% or more over a three-year period as well as other qualitative factors including historic inflation rate trends (increasing and decreasing), the capital intensiveness of the operation and other pertinent economic factors. The functional currency in highly inflationary economies is required to be the functional currency of the entity’s parent company, and transactions denominated in the local currency are remeasured to the functional currency. The remeasurement of local currency into U.S. dollars creates foreign currency transaction gains or losses, which the Company includes in its consolidated statements of income. In the second quarter of 2018, published inflation indices indicated that the three-year cumulative inflation in Argentina exceeded 100 percent, and as of July 1, 2018, we elected to adopt highly inflationary accounting for our subsidiary in Argentina. Under highly inflationary accounting, Argentina’s functional currency became the U.S. dollar, and its income statement and balance sheet have been measured in U.S. dollars using both current and historical rates of exchange. The effect of changes in exchange rates on peso-denominated monetary assets and liabilities has been reflected in earnings in Other income (expense), net and was not material. As of December 31, 2022, and 2021, Argentina had a small net peso monetary position. Net sales of Argentina were less than of our consolidated net sales for the years ended December 31, 2022, 2021 and 2020. Fair value of financial instruments The carrying value of financial instruments including cash and cash equivalents, accounts receivable and accounts payable approximate fair values due to the short-term nature of these instruments. The Company’s current investments as of December 31, 2022 include certificates of deposits and pre-refunded municipal bonds that are classified by management as held-to-maturity as the Company had the positive intent and ability to hold to maturity. The carrying value of these current investments approximate fair values due to the short-term nature of these instruments. As of December 31, 2022 and 2021, the fair value of debt was $405.0 million and $377.5 million, respectively. The estimated fair value of the Company’s debt is based on interest rates available for debt with similar terms and remaining maturities. The FASB Codification defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. On a quarterly basis, the Company measures at fair value certain financial assets, including cash equivalents. Accounting standards specify a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs have created the following fair-value hierarchy: ● Level 1 – quoted prices in active markets for identical assets or liabilities; ● Level 2 – inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; ● Level 3 – unobservable inputs based on the Company’s own assumptions. Accounting standards permit companies, at their option, to measure many financial instruments and certain other items at fair value. The Company has elected not to apply the fair value option to existing eligible items. Stock-based compensation All share-based payments, including grants of stock options and restricted stock units, are required to be recognized in the Company’s financial statements based upon their respective grant date fair values. The Black-Scholes option-pricing model is used to estimate the fair value of stock options. The determination of the fair value of stock options is affected by the Company’s stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends. The Company uses historical volatility as the expected volatility assumption required in the Black-Scholes model. The expected life of the stock options is based on historical data trended into the future. The risk-free interest rate assumption is based on observed interest rates appropriate for the expected terms of the Company’s stock options. The fair value of the Company’s restricted stock units is based on the closing market price of its stock on the date of grant less the Company’s expected dividend yield. The Company recognizes stock-based compensation net of actual forfeitures over the requisite service period of the award. The total compensation expense related to equity compensation plans was $12.4 million, $23.2 million and $24.1 million for the years ended December 31, 2022, 2021 and 2020, respectively. In 2022, 2021 and 2020, these amounts reflect the reversal of $1.3, none, and none, respectively, for certain performance-based awards that were no longer expected to vest. For the years ended December 31, 2022, 2021 and 2020, all stock-based compensation expense was recorded within general and administrative expenses. Reporting comprehensive income Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources, and it includes all changes in equity during a period except those resulting from investments by owners and distributions to owners. Derivative instruments and hedging activities FASB ASC 815, Derivatives and Hedging As required by ASC 815, the Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain of its risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. In accordance with the FASB’s fair value measurement guidance in ASU 2011-04, the Company made an accounting policy election to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. Recent accounting pronouncements In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which provides optional guidance for a limited time to ease the potential burden in accounting for the effects of reference rate reform on financial reporting. The guidance provides optional expedients and exceptions for applying US GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. ASU 2020-04 applies only to contracts and hedging relationships that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued due to reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2024. The amendments in ASU 2020-04 are elective and are effective upon issuance for all entities. The Company had previously elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. In the second quarter of 2022, the Company elected the hedge accounting expedient that allows an update to the hedged risk in active hedging relationships without de-designation as the Company’s debt transitioned to SOFR. In the fourth quarter of 2022, the Company elected the hedge accounting expedient that allows an amendment to existing hedges without de-designation as the Company’s hedges transitioned to SOFR. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property and Equipment [Abstract] | |
Property and Equipment | 3. Property and Equipment Property and equipment are comprised of the following (U.S. dollars in thousands): December 31, 2022 2021 Land $ 42,931 $ 45,027 Buildings 274,049 281,192 Construction in progress (1) 64,566 44,021 Furniture and fixtures 136,835 147,786 Computers and equipment 145,934 162,746 Leasehold improvements 114,633 129,675 Scanners 6,438 6,746 Vehicles 1,606 2,021 786,992 819,214 Less: accumulated depreciation (342,186 ) (365,540 ) $ 444,806 $ 453,674 (1) Construction in progress includes $20.5 million and $11.0 million as of December 31, 2022 and 2021, respectively, of eligible capitalized internal-use software development costs which will be reclassified to computers and equipment when placed into service. Depreciation of property and equipment totaled $61.0 million, $62.9 million and $62.5 million for the years ended December 31, 2022, 2021 and 2020, respectively. The Company recorded impairments of $8.2 million and $13.7 million for the years ended December 31, 2022 and 2021, respectively, in connection with our fiscal year 2022 and 2021 restructuring plans, see Note 20 – Restructuring and Severance Charges. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill [Abstract] | |
Goodwill | 4. Goodwill The following table presents goodwill allocated to the Company’s reportable segments for the periods ended December 31, 2022 and 2021 (U.S. dollars in thousands): December 31, 2022 2021 Nu Skin Americas $ 9,449 $ 9,449 Mainland China 32,179 32,179 Southeast Asia/Pacific 18,537 18,537 South Korea 29,261 29,261 Japan 16,019 16,019 EMEA 2,875 2,875 Hong Kong/Taiwan 6,634 6,634 Rhyz Investments Manufacturing 78,875 78,875 Rhyz Other 12,603 12,603 Total $ 206,432 $ 206,432 All of the Company’s goodwill is recorded in U.S. dollar functional currency and allocated to the respective segments. Goodwill is not amortized; rather, it is subject to annual impairment tests. In connection with the Company’s decision to exit the Grow Tech segment, a $9.2 million impairment charge was recorded in the year ended December 31, 2021, see Note 20 for further discussion regarding the restructuring and impairment of the Grow Tech segment. |
Other Intangible Assets
Other Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Other Intangible Assets [Abstract] | |
Other Intangible Assets | 5. Other Intangible Assets Other intangible assets consist of the following (U.S. dollars in thousands): Carrying Amount at December 31, 2022 2021 Indefinite life intangible assets: Trademarks and trade names $ 24,599 $ 24,599 December 31, 2022 December 31, 2021 Finite life intangible assets: Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Weighted- average Amortization Period Scanner technology $ 40,716 $ 40,716 $ 40,716 $ 40,716 18 years Developed technology 43,841 27,365 43,841 24,697 14 years Sales force network 11,598 11,598 11,598 11,598 15 years Trademarks 7,860 4,200 8,989 3,827 9 years Other 48,285 26,319 51,176 23,090 8 years $ 152,300 $ 110,198 $ 156,320 $ 103,928 13 years Amortization of finite-life intangible assets totaled $9.7 million, $11.7 million and $9.8 million for the years ended December 31, 2022, 2021 and 2020, respectively. The estimated annual amortization expense for each of the five succeeding fiscal years are as follows (U.S. dollars in thousands): Year Ending December 31, 2023 $ 9,595 2024 9,108 2025 7,826 2026 6,222 2027 4,373 Indefinite Finite life intangibles are amortized over their useful lives unless circumstances occur that cause the Company to revise such lives or review such assets for impairment. and a $5.2 million impairment charge related to other finite lived intangibles |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2022 | |
Long-Term Debt [Abstract] | |
Long-Term Debt | 6. Long-Term Debt 2018 Credit Agreement On April 18, 2018, the Company entered into a Credit Agreement (the “2018 Credit Agreement”) , . Credit Agreement On June 14, 2022, the Company entered into an Amended and Restated Credit Agreement (the “Credit Agreement”) with several financial institutions as lenders and Bank of America, N.A., as administrative agent, which amended and restated the 2018 Credit Agreement. The Credit Agreement provides for a $400 million term loan facility and a $500 million revolving credit facility, each with a term of five years. Both facilities bear interest at the SOFR, plus a margin based on the Company’s consolidated leverage ratio. Commitment fees payable under the Credit Agreement are also based on the consolidated leverage ratio as defined in the Credit Agreement and range from 0.175% to 0.30% on the unused portion of the total lender commitments then in effect. The term loan facility amortizes in quarterly installments in amounts resulting in an annual amortization of 2.5% during the first year and 5.0% during the second, third, fourth and fifth years after the closing date of the Credit Agreement, with the remainder payable at final maturity. The Credit Agreement is guaranteed by certain of the Company’s domestic subsidiaries and collateralized by assets of such subsidiaries, including a pledge of 65% of the capital stock of certain foreign subsidiaries. The Credit Agreement requires the Company to maintain a consolidated leverage ratio not exceeding 2.75 to 1.00 and a consolidated interest coverage ratio of no less than 3.00 to 1.00. As of December 31, 2022, the Company was in compliance with all covenants under the Credit Agreement. The following table summarizes the Company’s debt facilities as of December 31, 2022 and 2021: Facility or Arrangement Original Principal Amount Balance as of December 31, 2022 (1)(2 ) Balance as of December 31, 2021 (1)(2) Interest Rate Repayment Terms 2018 Credit Agreement term loan facility $400.0 million — $307.5 million Principal amount was paid in full during June 2022. 2018 Credit Agreement revolving credit facility — $70.0 million Principal amount was paid in full during June 2022 and credit line was closed. Credit Agreement term loan facility $400.0 million $395.0 million — Variable 21% of the principal amount is payable Credit Agreement revolving credit facility $10.0 million — Variable Revolving line of credit expires June 14, 2027. (1) As of December 31, 2022 and 2021, the current portion of the Company’s debt (i.e. becoming due in the next 12 months) included $15.0 million and $37.5 million, respectively, of the balance of its term loan under the Credit Agreement and 2018 Credit Agreement. (2) The carrying value of the debt reflects the amounts stated in the above table, less debt issuance costs of $2.5 million and $1.2 million as of December 31, 2022 and 2021, respectively, related to the Credit Agreement and 2018 Credit Agreement, which are not reflected in this table. Maturities of all long-term debt at December 31, 2022, are as follows (U.S. dollars in thousands): Year Ending December 31, 2023 $ 15,000 2024 20,000 2025 20,000 2026 20,000 2027 320,000 Thereafter — Total (1) $ 395,000 (1) The carrying value of the debt reflects the amounts stated in the above table less debt issuance costs of $2.5 million, which is not reflected in this table. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | 7. Leases The Company has operating and finance leases for regional offices, manufacturing facilities, retail centers, distribution centers and certain equipment. The Company’s leases have remaining lease terms of year to years, some of which include options to extend the leases for up to years, and some of which include options to terminate the leases within year. As of December 31, 2022, the weighted average remaining lease term was 8.8 and 4.6 years for operating and finance leases, respectively. As of December 31, 2022, the weighted average discount rate was 3.3% and 3.5% for operating and finance leases, respectively. The components of lease expense were as follows (U.S. dollars in thousands): Year Ended December 31, 2022 2021 2020 Operating lease expense Operating lease cost $ 39,682 $ 48,447 $ 51,828 Variable lease cost 6,061 5,734 4,366 Short-term lease cost 210 592 1,056 Sublease income — (5,663 ) (5,052 ) Finance lease expense Amortization of right-of-use assets 2,371 2,398 1,023 Interest on lease liabilities 268 319 154 Total lease expense $ 48,592 $ 51,827 $ 53,375 Supplemental cash flow information related to leases was as follows (U.S. dollars in thousands): Year Ended December 31, 2022 2021 2020 Operating cash outflow from operating leases $ 37,174 $ 51,570 $ 56,395 Operating cash outflow from finance leases $ 243 $ 322 $ 138 Financing cash outflow from finance leases $ 1,919 $ 1,871 $ 709 Right-of-use assets obtained in exchange for operating lease obligations $ 34,026 $ 25,427 $ 82,662 Right-of-use assets obtained in exchange for finance lease obligations $ 9,797 $ 74 $ 9,206 Maturities of lease liabilities were as follows (U.S. dollars in thousands): Year Ending December 31, Operating Leases Finance Leases 2023 $ 26,086 $ 3,836 2024 18,808 3,428 2025 13,338 3,371 2026 8,692 3,277 2027 7,690 2,933 Thereafter 42,385 — Total 116,999 16,845 Less: Finance charges 15,542 1,362 Total principal liability $ 101,457 $ 15,483 The Company has additional lease liabilities of $5.5 million which have not yet commenced as of December 31, 2022, and as such, have not been recognized on the consolidated balance sheets. |
Capital Stock
Capital Stock | 12 Months Ended |
Dec. 31, 2022 | |
Capital Stock [Abstract] | |
Capital Stock | 8. Capital Stock The Company’s authorized capital stock consists of 25 million shares of preferred stock, par value $0.001 per share, 500 million shares of Class A common stock, par value $0.001 per share, and million shares of Class B common stock, par value $ per share Each share of Class A common stock entitles the holder to vote on matters submitted to a vote of the Company’s stockholders. Stock dividends of Class A common stock may be paid only to holders of Class A common stock. Class A common stock has no conversion rights. Weighted-average common shares outstanding The following is a reconciliation of the weighted-average common shares outstanding for purposes of computing basic and diluted net income per share (in thousands): Year Ended December 31, 2022 2021 2020 Basic weighted-average common shares outstanding 50,002 50,193 52,296 Effect of dilutive securities: Stock awards and options 523 1,234 469 Diluted weighted-average common shares outstanding 50,525 51,427 52,765 For the years ended December 31, 2022, 2021 and 2020, other stock options totaling 0.1 million, 0.1 million and 0.4 million, respectively, were excluded from the calculation of diluted earnings per share because they were anti-dilutive. Dividends Quarterly cash dividends for the years ended December 31, 2022 and 2021 totaled $77.0 million and $76.3 million or $0.385 per share in all quarters of 2022 and $0.38 for all quarters of 2021. The board of directors has declared a quarterly cash dividend of $0.39 per share of Class A common stock to be paid on March 8, 2023 to stockholders of record on February 27, 2023. Repurchases of common stock In July 2018, the Company’s board of directors approved a stock repurchase plan with an authorization amount of $500 million. The repurchases are used primarily for strategic initiatives and to offset dilution from the Company’s equity incentive plans. During the years ended December 31, 2022, 2021 and 2020, the Company purchased 1.7 million, 1.6 million and 5.1 million shares under the 2018 plan for $70.0 million, $80.4 million and $144.3 million, respectively. At December 31, 2022, $175.4 million was available for repurchases under the 2018 stock repurchase plan. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | 9. Stock–Based Compensation At December 31, 2022, the Company had the following stock-based employee compensation plans: Equity Incentive Plans In April 2010, the Company’s board of directors approved the Nu Skin Enterprises, Inc. 2010 Omnibus Incentive Plan (the “2010 Omnibus Incentive Plan”). This plan was approved by the Company’s stockholders at the Company’s 2010 Annual Meeting of Stockholders held in May 2010. The 2010 Omnibus Incentive Plan provides for granting of a variety of equity-based awards including stock options, stock appreciation rights, restricted stock, restricted stock units, other share-based awards, performance cash, performance shares and performance units to executives, other employees, independent consultants and directors of the Company and its subsidiaries. Options granted under the 2010 Omnibus Incentive Plan are generally non-qualified stock options, but the 2010 Omnibus Incentive Plan permits some stock options granted to qualify as “incentive stock options” under the U.S. Internal Revenue Code. The exercise price of a stock option generally is equal to the fair market value of the Company’s common stock on the stock option grant date. The contractual term of a stock option granted under the 2010 Omnibus Incentive Plan is seven years. Currently, all shares issued upon the exercise of stock options are from the Company’s treasury shares. Subject to certain adjustments, 7.0 million shares were authorized for issuance under the 2010 Omnibus Incentive Plan. On June 3, 2013, the Company’s stockholders approved an Amended and Restated 2010 Omnibus Incentive Plan, which among other things increased the number of shares available for awards by 3.2 million shares. On May 24, 2016, the Company’s stockholders approved a Second Amended and Restated 2010 Omnibus Incentive Plan, which among other things increased the number of shares available for awards by 3.8 million shares. On June the stockholders approved a Amended and Restated Omnibus Incentive Plan, which among other things increased the number of shares available for awards by shares. The fair value of stock option awards was estimated using the Black-Scholes option-pricing model with the following assumptions and weighted-average fair values as follows: December 31, Stock Options: 2021 2020 Weighted-average grant date fair value of grants $ 16.10 $ 8.59 Risk-free interest rate (1) 0.5 % 1.4 % Dividend yield (2) 2.9 % 2.9 % Expected volatility (3) 49.5 % 40.7 % Expected life in months (4) 56 months 59 months (1) The risk-free interest rate is based upon the rate on a zero-coupon U.S. Treasury bill, for periods within the contractual life of the option, in effect at the time of the grant. (2) The dividend yield is based on the average of historical stock prices and actual dividends paid. (3) Expected volatility is based on the historical volatility of the Company’s stock price, over a period similar to the expected life of the option. (4) The expected term of the option is based on the historical employee exercise behavior, the vesting terms of the respective option, and a contractual life of either seven or . Options under the plans as of December 31, 2022 and changes during the year ended December 31, 2022 were as follows: Shares (in thousands) Weighted- average Exercise Price Weighted- average Remaining Contractual Term Aggregate Intrinsic Value (in thousands) Options activity – service based Outstanding at December 31, 2021 538.2 $ 35.89 Granted — — Exercised (340.0 ) 33.15 Forfeited/cancelled/expired (34.3 ) 54.45 Outstanding at December 31, 2022 163.9 37.69 0.35 $ 834 Exercisable at December 31, 2022 163.9 37.69 0.35 834 Options activity – performance based Outstanding at December 31, 2021 2,220.1 $ 40.87 Granted — — Exercised (340.5 ) 31.14 Forfeited/cancelled/expired (418.0 ) 50.66 Outstanding at December 31, 2022 1,461.6 40.30 3.89 $ 9,515 Exercisable at December 31, 2022 958.6 39.46 3.41 7,193 Options activity – all options Outstanding at December 31, 2021 2,758.3 $ 39.90 Granted — — Exercised (680.5 ) 31.65 Forfeited/cancelled/expired (452.3 ) 50.95 Outstanding at December 31, 2022 1,625.5 40.04 3.53 $ 10,349 Exercisable at December 31, 2022 1,122.5 39.20 2.96 8,027 The aggregate intrinsic value in the table above represents the total pretax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the respective years and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on December 31, 2022. This amount varies based on the fair market value of the Company’s stock. Cash proceeds, tax benefits and intrinsic value related to total stock options exercised during 2022, 2021 and 2020, were as follows (U.S. dollars in thousands): December 31, 2022 2021 2020 Cash proceeds from stock options exercised $ 31,600 $ 14,435 $ 7,419 Tax benefit / (expense) realized for stock options exercised 229 807 (459 ) Intrinsic value of stock options exercised 15,505 8,402 5,232 Nonvested restricted stock awards as of December 31, 2022 and changes during the year ended December 31, 2022 were as follows: Number of Shares (in thousands) Weighted- average Grant Date Fair Value Nonvested at December 31, 2021 884.9 $ 44.11 Granted 587.1 46.04 Vested (326.6 ) 47.03 Forfeited (192.4 ) 44.01 Nonvested at December 31, 2022 953.0 $ 44.28 Nonvested performance share units as of December 31, 2022 and changes during the year ended December 31, 2022 were as follows: Number of Shares (in thousands) Weighted- average Grant Date Fair Value Nonvested at December 31, 2021 — $ — Granted 192.7 44.39 Vested — — Forfeited (12.5 ) 44.39 Nonvested at December 31, 2022 180.2 $ 44.39 Stock-based compensation expense is recognized on a straight-line basis, except for performance-based awards for which expense is recognized using a graded-attribution method if the results are materially different than the straight-line method. The Company recognized none, none and $0.3 million of expense related to service condition stock options in 2022, 2021 and 2020, respectively; and recognized $14.3 million, $15.4 million and $13.9 million of expense related to service condition restricted stock units in 2022, 2021 and 2020, respectively. For performance stock options and performance stock units, an expense is recorded each period for the estimated expense associated with the projected achievement of the performance-based targets. The Company recognized $2.0 million of income, $7.8 million of expense and $9.9 million of expense related to performance stock options in 2022, 2021 and 2020, respectively; and no expense related to performance stock units in 2022, 2021 and 2020. The amount in 2022 reflects the reversal of stock compensation for awards no longer expected to vest. As of December 31, 2022, there was $0.1 million of unrecognized stock-based compensation expense related to nonvested stock option awards. That cost is expected to be recognized over a weighted-average period of 0.1 years. As of December 31, 2022, there was $29.6 million of unrecognized stock-based compensation expense related to nonvested restricted stock awards. That cost is expected to be recognized over a weighted-average period of 2.6 years. |
Fair Value and Equity Investmen
Fair Value and Equity Investments | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value and Equity Investments [Abstract] | |
Fair Value and Equity Investments | 10. Fair Value and Equity Investments Fair Value The carrying value of financial instruments including cash and cash equivalents, accounts receivable and accounts payable approximate fair values due to the short-term nature of these instruments. Fair value estimates are made at a specific point in time, based on relevant market information. The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (U.S. dollars in thousands): Fair Value at December 31, 2022 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 55,356 $ — $ — $ 55,356 Derivative financial instruments asset — 19,738 — 19,738 Life insurance contracts — — 40,055 40,055 Contingent consideration — — (6,364 ) (6,364 ) Total $ 55,356 $ 19,738 33,691 $ 108,785 Fair Value at December 31, 2021 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 66,477 $ — $ — $ 66,477 Derivative financial instruments asset — 6,590 — 6,590 Life insurance contracts — — 49,851 49,851 Contingent consideration — — (10,341 ) (10,341 ) Total $ 66,477 $ 6,590 $ 39,510 $ 112,577 The following methods and assumptions were used to determine the fair value of each class of assets and liabilities recorded at fair value in the consolidated balance sheets: Cash equivalents and current investments: Life insurance contracts: provisions of U.S. Derivative financial instruments asset and liability: Derivative financial instruments are measured at fair value based on observable market information and appropriate valuation methods. See Note , “Derivative Financial Instruments” for more information on derivative financial instruments. Contingent consideration: The following table provides a summary of changes in fair value of the Company’s Level 3 life insurance contracts (U.S. dollars in thousands): 2022 2021 Beginning balance at January 1 $ 49,851 $ 45,453 Actual return on plan assets (9,180 ) 5,153 Purchases and issuances — 6,261 Sales and settlements (616 ) (7,016 ) Ending balance at December 31 $ 40,055 $ 49,851 The following table provides a summary of changes in fair value of the Company’s Level 3 contingent consideration (U.S. dollars in thousands): 2022 2021 Beginning balance at January 1 $ (10,341 ) $ (3,125 ) Additions from acquisitions — (8,702 ) Changes in fair value of contingent consideration 3,977 1,486 Ending balance at December 31 $ (6,364 ) $ (10,341 ) Equity Investments The Company maintains equity investments in companies which are accounted for under the measurement alternative described in ASC 321-10-35-2 for equity securities that lack readily determinable fair values. The carrying amount of equity securities held by the Company without readily determinable fair values was $28.1 million as of December 31, 2022 and 2021. During the year ended December 31, 2021, the Company made an additional investment of $5.0 million. During the year ended December 31, 2021, the Company recognized $18.1 million of upward fair value adjustments, based on the third quarter of 2021 valuation of additional equity issued by the investee which was deemed to be an observable transaction of a similar investment under ASC 321. The gain was recorded within Other income (expense), net on the consolidated statement of income. The upward fair value adjustment represents a nonrecurring fair value measurement based on observable price changes and is classified as a level 2 fair value measurement. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes [Abstract] | |
Income Taxes | 11. Income Taxes Consolidated income before provision for income taxes consists of the following for the years ended December 31, 2022, 2021 and 2020 (U.S. dollars in thousands): 2022 2021 2020 U.S. $ 24,411 $ 45,371 $ 71,138 Foreign 64,559 187,088 185,094 Total $ 88,970 $ 232,459 $ 256,232 The provision for current and deferred taxes for the years ended December 31, 2022, 2021 and 2020 consists of the following (U.S. dollars in thousands): 2022 2021 2020 Current Federal $ — $ — $ — State 1,515 1,458 1,629 Foreign 34,117 77,393 77,079 35,632 78,851 78,708 Deferred Federal (65,733 ) 3,705 (14,430 ) State (1,239 ) (38 ) (563 ) Foreign 15,532 2,675 1,162 (51,440 ) 6,342 (13,831 ) Provision for income taxes $ (15,808 ) $ 85,193 $ 64,877 The principal components of deferred taxes are as follows (U.S. dollars in thousands): Year Ended December 31, 2022 2021 Deferred tax assets: Inventory differences $ 41,127 $ 5,859 Foreign tax credit and other foreign benefits 51,273 69,401 Stock-based compensation 5,981 9,392 Accrued expenses not deductible until paid 37,181 36,401 Foreign currency exchange — 605 Net operating losses 12,773 9,479 Capitalized research and development 26,406 22,962 R&D credit carryforward 1,795 1,451 Other 242 34 Gross deferred tax assets 176,778 155,584 Deferred tax liabilities: Foreign currency exchange 3,225 — Foreign withholding taxes 15,375 15,412 Intangibles step-up 4,446 4,446 Overhead allocation to inventory 3,504 3,373 Amortization of intangibles 21,211 21,936 Other 6,129 6,133 Gross deferred tax liabilities 53,890 51,300 Valuation allowance (33,557 ) (80,186 ) Deferred taxes, net $ 89,331 $ 24,098 At December 31, 2022, the Company had foreign operating loss carryforwards of $35.4 million for tax purposes, which will be available to offset future taxable income. If not used, $18.6 million of carryforwards will expire between 2023 2042 2028 2031 2036 2041 The Company uses the tax law ordering approach when determining when excess tax benefits have been realized. Valuation allowances have been recognized for a portion of the foreign tax credit, the foreign net operating loss carryforwards, and the R&D credit carryforward. During 2022, the Company made an election to change its capitalization policy for tax purposes related to certain direct and indirect costs for inventory and self-constructed assets under Internal Revenue Code (“IRC”) Section 263A. This method change allows the Company to utilize a portion of its tax attributes related to foreign tax credits in the United States that were previously fully reserved. The impact of the method change is approximately $51.3 million from the utilization of foreign tax credits and the release of valuation allowances. This change only impacts a portion of the Company’s foreign tax credit carryforwards and the Company will maintain a valuation allowance against the remaining balance of foreign tax credit carryforwards The deferred tax asset valuation adjustments for the years ended December 31, 2022, 2021 and 2020 are as follows (U.S. dollars in thousands): Year Ended December 31, 2022 2021 2020 Balance at the beginning of period $ 80,186 $ 67,340 $ 77,042 Additions charged to cost and expenses 3,231 (1) 12,674 (4) 2,154 (6) Decreases (50,315 ) (2) — (5) (12,100 ) (7) Adjustments 455 (3) 172 (3) 244 (3) Balance at the end of the period $ 33,557 $ 80,186 $ 67,340 (1) Increase in valuation is due primarily to net operating losses in foreign markets. (2) The decrease was due to utilization of $18.1 million of foreign tax credits and the valuation allowance release of $32.2 million foreign tax credits. (3) Represents the net currency effects of translating valuation allowances at current rates of exchange. (4) Increase in valuation is primarily due to $11.9 million that was recorded on the foreign tax credit carryforward due to the disposal of the Company’s Grow Tech segment. The additional amount is due to net operating losses in foreign markets. (5) No decreases in 2021. (6) Increase in valuation is due primarily to net operating losses in foreign markets. (7) The decrease was due primarily to the utilization of foreign tax credits that had previously had a valuation allowance recorded against the asset. The components of deferred taxes, net on a jurisdiction basis are as follows (U.S. dollars in thousands): Year Ended December 31, 2022 2021 Net noncurrent deferred tax assets $ 89,770 $ 26,483 Net noncurrent deferred tax liabilities 439 2,385 Deferred taxes, net $ 89,331 $ 24,098 The Company is subject to regular audits by federal, state and foreign tax authorities. These audits may result in proposed assessments that may result in additional tax liabilities. The actual tax rate for the years ended December 31, 2022, 2021 and 2020 compared to the statutory U.S. Federal tax rate is as follows: Year Ended December 31, 2022 2021 2020 Income taxes at statutory rate 21.00 % 21.00 % 21.00 % Excess tax benefit from equity award (0.12 )% (0.19 )% 0.70 % Deferred compensation 2.18 % (0.46 )% (0.30 )% Executive salary limitation 2.06 % 0.47 % 0.04 % Non-U.S. income taxed at different rates 4.78 % 6.06 % 3.37 % Foreign withholding taxes (0.73 )% 4.71 % 5.21 % Change in reserve for uncertain tax positions 17.69 % (0.06 )% 1.98 % Valuation allowance recognized foreign tax credit & others (56.17 )% 5.12 % (4.59 )% Foreign-Derived Intangible Income (FDII) (8.14 )% (0.87 )% (2.78 )% Other (0.32 )% 0.87 % 0.69 % (17.77 )% 36.65 % 25.32 % The decrease in effective tax rate for the 2022 was primarily due to the Company making an election to change its capitalization policy for tax purposes related to certain direct and indirect costs for inventory and self-constructed assets under Internal Revenue Code (“IRC”) Section 263A. This method change allows the Company to utilize a portion of its tax attributes related to foreign tax credits in the United States that were previously fully reserved. The cumulative amount of undistributed earnings of the Company’s non-U.S. Subsidiaries held for indefinite reinvestment is approximately $60.0 million, at December 31, 2022. If this amount were repatriated to the United States, the amount of incremental taxes would be approximately $6.0 million. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2022 | |
Employee Benefit Plan [Abstract] | |
Employee Benefit Plan | 12. Employee Benefit Plan The Company has a 401(k) defined-contribution plan which permits participating employees to defer up to a maximum of 100% of their compensation, subject to limitations established by the IRS. Employees age 18 and older are eligible to contribute to the plan starting the first day of employment. After completing at least one day of service, employees are eligible to receive matching contributions from the Company. In 2022, 2021, and 2020 the Company provided matching contributions of up to 4% of employees’ compensation each year. The Company’s matching contributions cliff vest after two years of service. The Company recorded compensation expense of $3.8 million, $4.8 million and $4.4 million for the years ended December 31, 2022, 2021 and 2020, respectively, related to its contributions to the plan. The Company may make additional discretionary contributions to the plan of up to 10% of employees’ base pay. The Company’s discretionary contributions vest 20% per year for an employee’s first five years of service. For the years ended December 31, 2022, 2021 and 2020, the Company did not make any additional discretionary contributions. |
Deferred Compensation Plan
Deferred Compensation Plan | 12 Months Ended |
Dec. 31, 2022 | |
Deferred Compensation Plan [Abstract] | |
Deferred Compensation Plan | 13. Deferred Compensation Plan The Company has a deferred compensation plan for select management personnel, highly compensated employees, and members of the Company’s board of directors. Under this plan, the Company may make discretionary contributions to participants’ deferred compensation accounts; prior to 2021, contributed for participants above a specified job level. on or prior to December 31, 2020 will Effective January 1, 2021, the Company amended its deferred compensation plan. Under the revision, the Company shall make matching contributions up to 5% of base salary for participants above a specified job level. The revision continues to authorize the Company to make discretionary contributions to participants’ accounts , though the Company is not obligated to make these contributions The Company recorded compensation expense of $2.3 million, $4.0 million and $2.3 million for the years ended December 31, 2022, 2021 and 2020, respectively, related to its contributions to the plan. The total long-term deferred compensation liability under the deferred compensation plan was $44.4 million and $54.2 million for the years ended December 31, 2022 and 2021, respectively, related to its contributions to the plan and is included in other long-term liabilities. All benefits under the deferred compensation plan are unsecured obligations of the Company. The Company has contributed assets to a “rabbi trust” for the payment of benefits under the deferred compensation plan. As the assets of the trust are available to satisfy the claims of general creditors if the Company becomes insolvent, the amounts held in the trust are accounted for as an investment on the Company’s consolidated balance sheets of $40.1 million and $49.9 million for the years ended December 31, 2022 and 2021, respectively. |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Financial Instruments [Abstract] | |
Derivative Financial Instruments | 14. Derivative Financial Instruments Risk Management Objective of Using Derivatives The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s borrowings. Cash Flow Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. During 2022, such derivatives were used to hedge the variable cash flows associated with existing variable-rate debt. For derivatives designated and that qualify as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in Accumulated Other Comprehensive Income and subsequently reclassified into interest expense/income in the same period(s) during which the hedged transaction affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense/income as interest payments are made/received on the Company’s variable-rate debt. During the next twelve months, the Company estimates that an additional $9.2 million will be reclassified as a reduction to interest expense. As of December 31, 2022, the Company had four outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk with a total notional amount of $200 million. Fair Values of Derivative Instruments on the Balance Sheet The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Balance Sheet: Fair Values of Derivative Instruments December 31, Derivatives in Cash Flow Hedging Relationships: Balance Sheet Location 2022 2021 Interest Rate Swap - Asset Prepaid expenses and other $ 9,156 $ 557 Interest Rate Swap - Asset Other assets $ 10,582 $ 6,033 Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income The tables below present the effect of cash flow hedge accounting on Accumulated Other Comprehensive Income. Amount of Gain (Loss) Recognized in OCI on Derivatives Year Ended December 31, Derivatives in Cash Flow Hedging Relationships: 2022 2021 2020 Interest Rate Swaps $ 16,267 $ 5,391 $ 1,017 Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income Year Ended December 31, Derivatives in Cash Flow Hedging Relationships: Income Statement 2022 2021 2020 Interest Rate Swaps Other income (expense), net $ 3,117 $ (157 ) $ (24 ) |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2022 | |
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, EMEA, and Hong Kong/Taiwan—and two Rhyz Investments 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 strategic investment 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. Prior year segment information has been recast to reflect the fourth quarter of 2021 exit of the Grow Tech segment, which has been recast to Corporate and other expense. Prior year segment information has been recast to reflect the move of the Pacific components from the “America/Pacific” operating segments to the “Southeast Asia/Pacific” operating segment to comply with current segment presentation. Prior year segment information has been recast for a first quarter of 2021 change in the Company’s transfer pricing policies in the Americas segment, the 2020 Americas and Corporate and other segment contribution has been recast to conform with the new policy. Consolidated financial information is not affected. 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) 2022 2021 2020 Nu Skin Americas $ 508,537 $ 547,755 $ 453,022 Mainland China 360,389 568,774 625,538 Southeast Asia/Pacific 344,411 336,651 361,627 South Korea 268,707 354,252 326,478 Japan 224,896 266,216 273,681 EMEA 204,275 283,200 230,246 Hong Kong/Taiwan 157,197 162,611 161,117 Nu Skin Other 3,959 3,653 886 Total Nu Skin 2,072,371 2,523,112 2,432,595 Rhyz Investments Manufacturing (1) 149,458 172,120 149,339 Rhyz Other 3,830 437 — Total Rhyz Investments 153,288 172,557 149,339 Total $ 2,225,659 $ 2,695,669 $ 2,581,934 (1) The Manufacturing segment had $69.2 million, $84.5 million and $39.4 million of intersegment revenue for the years ended December 31, 2022, 2021 and 2020, 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) 2022 2021 2020 Nu Skin Americas $ 110,522 $ 116,265 $ 86,386 Mainland China 72,362 151,645 181,024 Southeast Asia/Pacific 85,827 81,779 87,753 South Korea 81,804 114,034 100,933 Japan 54,976 67,511 68,027 EMEA 21,446 41,988 24,078 Hong Kong/Taiwan 35,253 37,330 33,466 Nu Skin contribution 462,190 610,552 581,667 Rhyz Investments Manufacturing 3,570 18,346 21,168 Rhyz Other (6,180 ) (1,813 ) — Rhyz Investments contribution (2,610 ) 16,533 21,168 Total segment contribution 459,580 627,085 602,835 Corporate and other (348,733 ) (393,093 ) (345,271 ) Operating income 110,847 233,992 257,564 Other income (expense) (21,877 ) (1,533 ) (1,332 ) Income before provision for income taxes $ 88,970 $ 232,459 $ 256,232 Depreciation and Amortization Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 Nu Skin Americas $ 591 $ 871 $ 984 Mainland China 12,177 13,345 11,056 Southeast Asia/Pacific 1,500 1,450 1,670 South Korea 1,616 3,279 3,620 Japan 1,011 906 1,876 EMEA 854 1,106 1,017 Hong Kong/Taiwan 3,743 3,637 2,912 Total Nu Skin 21,492 24,594 23,135 Rhyz Investments Manufacturing 13,838 11,765 8,081 Rhyz Other 2,368 1,579 — Total Rhyz Investments 16,206 13,344 8,081 Corporate and other 34,808 38,382 42,775 Total $ 72,506 $ 76,320 $ 73,991 Capital Expenditures Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 Nu Skin Americas $ 204 $ 714 $ 1,061 Mainland China 10,692 24,382 19,363 Southeast Asia/Pacific 263 1,330 2,197 South Korea 727 854 1,420 Japan 225 194 3,128 EMEA 1,612 1,242 1,875 Hong Kong/Taiwan 3,338 736 708 Total Nu Skin 17,061 29,452 29,752 Rhyz Investments Manufacturing 7,301 14,022 14,366 Rhyz Other — — — Total Rhyz Investments 7,301 14,022 14,366 Corporate and other 34,694 25,141 19,705 Total $ 59,056 $ 68,615 $ 63,823 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%. Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 United States $ 537,081 $ 540,253 $ 425,155 Mainland China 360,389 568,774 625,538 South Korea 268,707 354,252 326,478 Japan 224,896 266,216 273,681 All others 834,586 966,174 931,082 Total $ 2,225,659 $ 2,695,669 $ 2,581,934 Revenue by Product Line Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 Beauty $ 1,069,714 $ 1,442,659 $ 1,491,803 Wellness 992,338 1,062,549 922,553 Other 163,607 190,461 167,578 Total $ 2,225,659 $ 2,695,669 $ 2,581,934 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, 2022, 2021 and 2020: Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 United States $ 343,482 $ 335,020 $ 348,028 Mainland China 132,148 149,124 152,312 South Korea 30,867 25,364 39,104 Japan 18,011 23,929 31,085 All others 33,291 47,687 62,141 Total $ 557,799 $ 581,124 $ 632,670 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 16. Commitments and Contingencies The Company is subject to government regulations pertaining to product formulation, labeling and packaging, product claims and advertising, and the Company’s direct selling system. The Company is also subject to the jurisdiction of numerous foreign tax and customs authorities. Any assertions or determination that either the Company or the Company’s sales force is not in compliance with existing statutes, laws, rules or regulations could have a material adverse effect on the Company’s operations. In addition, in any country or jurisdiction, the adoption of new statutes, laws, rules or regulations or changes in the interpretation of existing statutes, laws, rules or regulations could have a material adverse effect on the Company and its operations. No assurance can be given that the Company’s compliance with applicable statutes, laws, rules and regulations will not be challenged by foreign authorities or that such challenges will not have a material adverse effect on the Company’s financial position, results of operations or cash flows. The Company and its Subsidiaries are defendants in litigation, investigations and other proceedings involving various matters. The Company is subject to loss contingencies, including various legal and regulatory proceedings, asserted and potential claims that arise in the ordinary course of business. An estimated loss from such contingencies is recognized as a charge to income if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. The Company is subject to regular audits by federal, state and foreign tax authorities. These audits may result in additional tax liabilities. The Company believes it has appropriately provided for income taxes for all years. Several factors drive the calculation of its tax reserves. Some of these factors include: (i) the expiration of various statutes of limitations; (ii) changes in tax law and regulations; (iii) issuance of tax rulings; and (iv) settlements with tax authorities. Changes in any of these factors may result in adjustments to the Company’s reserves, which would impact its reported financial results. |
Other Income (Expense), Net
Other Income (Expense), Net | 12 Months Ended |
Dec. 31, 2022 | |
Other Income (Expense), Net [Abstract] | |
Other Income (Expense), Net | 17. Other Income (Expense), Net Other income (expense), net of expense in 2022, 2021 and 2020, respectively. Other income (expense), net includes 2022, 2021 and 2020 |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Dec. 31, 2022 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Cash Flow Information | 18. Supplemental Cash Flow Information Cash paid for interest totaled $14.5 million, $8.6 million and $11.2 million for the years ended December 31, 2022, 2021 and 2020 2022, 2021 and 2020 |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2022 | |
Acquisitions [Abstract] | |
Acquisitions | 19. Acquisitions In April 2021, the Company acquired 100% ownership in MyFavoriteThings, Inc. (“Mavely”) making Mavely a wholly owned subsidiary of the Company. The acquisition enables the Company to continue to expand its digital tools. The purchase price for Mavely was $16.8 million, net of cash acquired of $0.4 million and $0.9 million to be paid within six months, all payable in cash. In addition, there is potential for an incremental $24.0 million in contingent consideration, which becomes payable if certain revenue and profitability targets are reached in 2021, 2022 and 2023. The fair value of the contingent consideration recorded on the acquisition date was $8.7 million. The Company allocated the gross purchase price of $29.4 million to the assets acquired and liabilities assumed at estimated fair values. The estimated fair value of assets acquired included $16.4 million of intangible assets, $0.4 million of cash, $0.1 million of accounts receivable, and also resulted in a deferred tax liability of $3.5 million. The excess purchase price over the aggregate fair value of assets acquired less liabilities assumed of $12.6 million was recorded as goodwill. The goodwill recognized is attributable primarily to expected synergies. None of the goodwill is expected to be deductible for income tax purposes. The intangible assets acquired were comprised of $2.0 million for customer relationships, $11.3 million for technology, $2.8 million for trademarks and $0.3 million for other intangibles. The intangibles were assigned useful lives of 8 years for the technology and trademarks, approximately 4 years for the customer relationships and 3 years for the other intangibles. All the goodwill was assigned to our Rhyz other segment. The allocation of the fair value of assets acquired and liabilities assumed for the acquisition was finalized during the three months ended September 30, 2021. |
Restructuring and Severance Cha
Restructuring and Severance Charges | 12 Months Ended |
Dec. 31, 2022 | |
Restructuring and Severance Charges [Abstract] | |
Restructuring and Severance Charges | 20. Restructuring and Severance Charges In 2021, the Company determined to exit the Grow Tech segment, to better align its resources on key strategic initiatives to achieve the future growth objectives and priorities of the core Nu Skin business. The Grow Tech segment was pursuing the commercialization of controlled-environment agriculture for use in the agriculture feed industry. This segment has been operating as part of the Company’s Rhyz strategic investment arm. As a result of the restructuring program, the Company recorded a non-cash charge of $38.5 million in 2021 , including $9.2 million $9.0 million for impairment of , $13.7 million of asset impairments and $6.6 million for inventory write-off In the quarter of the Company adopted a strategic plan to focus resources on the Company’s strategic priorities and optimize future growth and profitability. The global program includes workforce reductions and footprint optimization. The Company estimates total charges under the program will approximate – , with – in cash charges of severance and lease termination cost and of non-cash charges of impairment of fixed assets, acceleration of depreciation and impairment of other intangibles related to the footprint optimization. The Company expects to substantially complete the program during the half of During the Company incurred charges to be settled in cash of in severance charges, in lease termination cost, and in other associated cost, and non-cash charges of in fixed asset impairments, in accelerated depreciation and in impairment of other intangibles. During the Company made cash payments of related to this global program, leaving an ending restructuring accrual of . Restructuring expense by segment (U.S. dollars in s) Year Ended December 31, 2022 Nu Skin Americas $ 1,687 Mainland China 13,181 Southeast Asia/Pacific 1,809 South Korea 1,533 Japan 699 EMEA 2,143 Hong Kong/Taiwan 2,464 Total Nu Skin 23,516 Rhyz Investments Manufacturing 401 Rhyz other — Total Rhyz Investments 401 Corporate and other 19,577 Total $ 43,494 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies [Abstract] | |
Consolidation | Consolidation The consolidated financial statements include the accounts of the Company and the Subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation. |
Use of Estimates | Use of estimates The preparation of these financial statements, in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), required management to make estimates and assumptions that affected the reported |
Reclassifications | Reclassifications Certain prior period amounts have been reclassified to conform to the current presentation. The Company reclassified $12.0 million and $10.4 million of events and other miscellaneous selling costs from the general and administration expenses line to the selling expenses |
Cash and Cash Equivalents | Cash and cash equivalents Cash equivalents are short-term, highly liquid instruments with original maturities of 90 days or less. |
Accounts Receivable | Accounts receivable Accounts receivable represents amounts owed to us through our operating activities and are presented net of allowance for doubtful accounts. Accounts receivable for core Nu Skin consists primarily of credit card receivables, while accounts receivable for our Rhyz investments consists primarily of trade receivables from customer sales. For the Company’s trade receivables from its Rhyz investment customers, the Company performs ongoing credit evaluations of its customers and maintains an allowance for expected credit losses. The allowance for expected credit losses represents the Company’s best estimate based on current and historical information, and reasonable and supportable forecasts of future events and circumstances. |
Inventories | Inventories Inventories consist primarily of merchandise purchased for resale and are stated at the lower of standard cost or net realizable value, using a standard cost method which approximates the first-in, first-out method. The Company had reserves of its inventory carrying value totaling $37.3 million and $18.6 million as of December 31, 2022 and 2021, respectively. Inventories consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Raw materials $ 163,797 $ 179,891 Finished goods 182,386 220,040 Total inventory, net $ 346,183 $ 399,931 Reserves of inventories consist of the following (U.S. dollars in thousands): 2022 2021 2020 Beginning balance $ 18,643 $ 14,249 $ 12,295 Additions 43,286 31,300 15,952 Write-offs (24,662 ) (26,906 ) (13,998 ) Ending balance $ 37,267 $ 18,643 $ 14,249 |
Property and Equipment | Property and equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is recorded using the straight-line method over the following estimated useful lives: Buildings 39 years Furniture and fixtures 5 - 7 years Computers and equipment 3 - 5 years Leasehold improvements Shorter of estimated useful life or lease term Scanners 3 years Vehicles 3 - 5 years Expenditures for maintenance and repairs are charged to expense as incurred. When an asset is sold or otherwise disposed of, the cost and associated accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized in the statement of income. Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. An impairment loss is recognized if the carrying amount of the asset exceeds its fair value. |
Leases | Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, accrued expenses and operating lease liabilities on the consolidated balance sheets. Finance leases are included in other assets, accrued expenses and other liabilities on the consolidated balance sheets. Operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU assets also include any lease payments made and exclude lease incentives and initial direct costs incurred. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Leases with a term of 12 months or less are not recorded on the balance sheet. The Company’s lease agreements do not contain any residual value guarantees. The Company has lease agreements with lease and non-lease components. The Company accounts for the lease and non-lease components as a single lease component. |
Goodwill and Other Intangible Assets | Goodwill and other intangible assets Goodwill is recorded when the cost of acquired businesses exceeds the fair value of the identifiable net assets acquired. Goodwill and intangible assets with indefinite useful lives are not amortized, but are assessed for impairment annually on October 1. In addition, impairment testing is conducted when events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Goodwill and intangible assets with indefinite useful lives would be written down to fair value if considered impaired. Guidance under Accounting Standards Codification (“ASC”) 350, Intangibles - Goodwill and Other (“ASC 350 The Company has historically evaluated its goodwill for impairment annually as of June 30 or more frequently if impairment indicators arose in accordance with ASC 350, “Intangibles - Goodwill and Other.” In the fourth quarter of 2021, the Company changed the date of its annual assessment of goodwill to October 1 for all reporting units. The change in testing date for goodwill is a change in accounting principle, which management believes is preferable as the new date of the assessment better aligns with the Company’s budgeting process and will create a more efficient and timely process surrounding the impairment tests. The change in the assessment date does not delay, accelerate or avoid a potential impairment charge. The Company has determined that it is impracticable to objectively determine projected cash flows and related valuation estimates that would have been used as of each October 1 of prior reporting periods without the use of hindsight. As such, the Company prospectively applied the change in annual goodwill impairment testing date from October 1, 2021. No impairment was recognized during the years ended December 31, 2022 and 2020. As discussed further in Note 20 of the Notes to Consolidated Financial Statements, during the fourth quarter of fiscal year 2021, the Company recognized an $18.2 million goodwill and intangibles impairment charge related to the Grow Tech segment, which was included in Restructuring and impairment expenses The Company completed the annual goodwill and indefinite-lived intangible asset impairment testing as of October 1, 2022, and concluded that the fair value of the reporting units were determined to be in excess of its carrying amounts and no goodwill impairment charge was required. As of the October 1, 2022 testing date, the fair value of the Manufacturing reporting unit was estimated to be approximately 8% in excess of its carrying amount, and therefore the reporting unit is considered to be at risk of future impairment. The Manufacturing reporting unit’s fair value remains sensitive to significant unfavorable changes in revenue, gross margin and discount rates that could negatively impact future analyses. Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and factors. As a result, there can be no assurance that the estimates and assumptions made for purposes of the goodwill impairment tests will prove to be an accurate prediction of the future. Although the Manufacturing reporting unit showed strong revenue growth in fiscal year 2020 and 2021, the fair value of the reporting unit in the current year was negatively impacted by an increase in the discount rate due to the current interest rate environment, and |
Equity Investments | Equity investments The Company holds strategic investments in other companies. These investments are accounted for under the measurement alternative described in ASC 321, Investments - Equity Securities |
Revenue Recognition | Revenue recognition Net sales include products and shipping and handling charges, net of estimates for product returns and any related sales incentives. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products. All revenue is recognized when we satisfy our performance obligations under the contract. The Company recognizes revenue by transferring the promised products to the customer, with revenue recognized at shipping point, the point in time the customer obtains control of the products. The Company recognizes revenue for shipping and handling charges at the time the products are delivered to or picked up by the customer. A reserve for product returns is accrued based on historical experience totaling $3.4 million and $3.5 million as of December 31, 2022 and 2021, respectively. During the years ended December 31, 2022, 2021 and 2020, the Company recorded sales returns of $31.6 million, $52.1 million and $49.5 million, respectively. The majority of the Company’s contracts have a single performance obligation and are short term in nature. Sales taxes and value added taxes in foreign jurisdictions that are collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. Contract Liabilities – Customer Loyalty Programs Contract liabilities, recorded as deferred revenue within the accrued expenses line in the consolidated balance sheets, include loyalty point program deferrals with certain customers which are accounted for as a reduction in the transaction price and are generally recognized as points are redeemed for additional products. The balance of deferred revenue related to contract liabilities was $18.7 million and $22.0 million as of December 31, 2022, and 2021, respectively. The contract liabilities impact to revenue for the years ended December 31, 2022, 2021 and 2020 was an increase of $3.3 million, decrease of $3.8 million and a decrease of $5.7 million, respectively. Disaggregation of Revenue Please refer to Note 15 - Segment Information for revenue by segment and product line. Arrangements with Multiple Performance Obligations The Company’s contracts with customers may include multiple performance obligations. For such arrangements, the Company allocates revenues to each performance obligation based on its relative standalone selling price. The Company generally determines standalone selling prices based on the prices charged to customers for individual products sales to customers. |
Shipping and Handling Costs | Shipping and handling costs Shipping and handling costs are recorded as cost of sales and are expensed as incurred. |
Advertising Expenses | Advertising expenses Advertising costs are expensed as incurred and are included in general and administrative expenses in the accompanying consolidated statements of income. Advertising expense incurred for the years ended December 31, 2022, 2021 and 2020 totaled $14.5 million, $15.5 million and $14.7 million, respectively. |
Selling Expenses | Selling expenses Selling expenses are the Company’s most significant expense and are classified as operating expenses. Selling expenses include commissions the Company pays to its Brand Affiliates, as well as salaries, service fees, benefits, bonuses and other labor and unemployment expenses the Company pays to its sales force in Mainland China. The term “Brand Affiliates” refers to members of the Company’s independent sales force in all of the Company’s markets besides Mainland China. In each of the Company’s markets, except Mainland China, Sales Leaders can earn “multi-level” compensation under the Company’s global sales compensation plan, including commissions for product sales to their consumer groups as well as the product sales made through the sales network they have developed and trained. The Company does not pay commissions on sales materials. Outside of Mainland China, the Company’s Brand Affiliates may make profits by purchasing the products from the Company at a discount and selling them to consumers with a mark-up. The Company does not account for nor pay additional commissions on these mark-ups received by Brand Affiliates. In many markets, the Company also allows individuals who are not members of its sales force, referred to as “preferred customers,” to buy products directly from the Company at a discount. The Company pays commissions on preferred customer purchases to the referring member of its sales force. |
Research and Development | Research and development Research and development costs are expensed as incurred and are included in general and administrative expenses in the accompanying consolidated statements of income and totaled $23.3 million, $27.2 million and $23.3 million in 2022, 2021 and 2020, respectively. |
Deferred Tax Assets and Liabilities | Deferred tax assets and liabilities The Company accounts for income taxes in accordance with the Income Taxes Topic of the Financial Accounting Standards Codification. These standards establish financial accounting and reporting standards for the effects of income taxes that result from an enterprise’s activities during the current and preceding years. The Company takes an asset and liability approach for financial accounting and reporting of income taxes. The Company pays income taxes in many foreign jurisdictions based on the profits realized in those jurisdictions, which can be significantly impacted by terms of intercompany transactions between the Company and its foreign affiliates. Deferred tax assets and liabilities are created in this process. The Company has netted these deferred tax assets and deferred tax liabilities by jurisdiction. These deferred tax assets assume sufficient future earnings will exist for their realization, and are calculated using anticipated tax rates. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be ultimately realized. |
Uncertain Tax Positions | Uncertain tax positions The Company files income tax returns in the U.S. federal jurisdiction, and in various state and foreign jurisdictions. In 2009, we entered into a voluntary program with the IRS called Compliance Assurance Process (“CAP”). Under the CAP program, the IRS audits the tax position of the Company to identify and resolve any tax issues that may arise throughout the tax year. As of December 31, 2022, tax years through 2020 have been audited and are effectively closed to further examination. For tax years 2021 and 2022, the Company is in the Bridge phase of the CAP program, pursuant to which the IRS will not accept disclosures, will not conduct reviews and will not provide letters of assurance for the year. There are limited circumstances that tax years in the Bridge phase will be opened for examination. The company has applied for the CAP program for tax year 2023 and is currently waiting on approval from the IRS. With a few exceptions, we are no longer subject to state and local income tax examination by tax authorities for the years before 2019. Foreign jurisdictions have varying lengths of statutes of limitations for income tax examinations. Some statutes are as short as three years and in certain markets may be as long as ten years. The Company is currently under examination in certain foreign jurisdictions; however, the outcomes of those reviews are not yet determinable. A reconciliation of the beginning and ending amount of unrecognized tax benefits included in other liabilities is as follows (U.S. dollars in thousands): 2022 2021 2020 Gross balance at January 1 $ 15,090 $ 17,620 $ 13,507 Increases related to prior year tax positions 6,768 4,146 2,958 Increases related to current year tax positions 5,485 1,794 3,302 Settlements (2,590 ) (5,494 ) (1,091 ) Decreases due to lapse of statutes of limitations (95 ) (2,409 ) (1,377 ) Currency adjustments (1,559 ) (567 ) 321 Gross balance at December 31 $ 23,099 $ 15,090 $ 17,620 At December 31, 2022, the Company had $23.1 million in unrecognized tax benefits of which $23.1 million, if recognized, would affect the effective tax rate. In comparison, at December 31, 2021, the Company had $15.1 million in unrecognized tax benefits of which $15.1 million, if recognized, would affect the effective tax rate. The Company’s unrecognized tax benefits relate to multiple foreign and domestic jurisdictions. Due to potential changes in unrecognized tax benefits from the multiple jurisdictions in which the Company operates, as well as the expiration of various statutes of limitation, it is reasonably possible that the Company’s gross unrecognized tax benefits, net of foreign currency adjustments, may increase within the next 12 months by a range of approximately $2.0 to $3.0 million. During the years ended December 31, 2022, 2021 and 2020 the Company recognized $5.7 million, $1.6 million and $1.5 million, respectively in interest and penalties expenses related to uncertain tax positions. The Company had $12.4 million, $6.7 million and $5.1 million of accrued interest and penalties related to uncertain tax positions at December 31, 2022, 2021 and 2020, respectively. Interest and penalties related to uncertain tax positions are recognized as a component of income tax expense. |
Net Income per Share | Net income per share Net income per share is computed based on the weighted-average number of common shares outstanding during the periods presented. Additionally, diluted earnings per share data gives effect to all potentially dilutive common shares that were outstanding during the periods presented (Note 8). |
Foreign Currency Translation and Classification of a Highly Inflationary Economy | Foreign currency translation A significant portion of the Company’s business operations occurs outside of the United States. The local currency of each of the Company’s Subsidiaries is considered its functional currency, except for the Company’s subsidiaries in Singapore and countries deemed highly inflationary where the U.S. dollar is used. All assets and liabilities are translated into U.S. dollars at exchange rates existing at the balance sheet dates, revenue and expenses are translated at weighted-average exchange rates and stockholders’ equity is recorded at historical exchange rates. The resulting foreign currency translation adjustments are recorded as a separate component of stockholders’ equity in the consolidated balance sheets and transaction gains and losses are included in other income (expense) in the consolidated statements of income. Net of tax, the accumulated other comprehensive loss related to the foreign currency translation adjustments are $102.0 million (net of tax of $8.1 million), $79.1 million (net of tax of $7.5 million), and $65.6 million (net of tax of $7.1 million), at December 31, 2022, 2021 and 2020, respectively. Classification of a highly inflationary economy A market is considered to have a highly inflationary economy if it has a cumulative inflation rate of approximately 100% or more over a three-year period as well as other qualitative factors including historic inflation rate trends (increasing and decreasing), the capital intensiveness of the operation and other pertinent economic factors. The functional currency in highly inflationary economies is required to be the functional currency of the entity’s parent company, and transactions denominated in the local currency are remeasured to the functional currency. The remeasurement of local currency into U.S. dollars creates foreign currency transaction gains or losses, which the Company includes in its consolidated statements of income. In the second quarter of 2018, published inflation indices indicated that the three-year cumulative inflation in Argentina exceeded 100 percent, and as of July 1, 2018, we elected to adopt highly inflationary accounting for our subsidiary in Argentina. Under highly inflationary accounting, Argentina’s functional currency became the U.S. dollar, and its income statement and balance sheet have been measured in U.S. dollars using both current and historical rates of exchange. The effect of changes in exchange rates on peso-denominated monetary assets and liabilities has been reflected in earnings in Other income (expense), net and was not material. As of December 31, 2022, and 2021, Argentina had a small net peso monetary position. Net sales of Argentina were less than of our consolidated net sales for the years ended December 31, 2022, 2021 and 2020. |
Fair Value of Financial Instruments | Fair value of financial instruments The carrying value of financial instruments including cash and cash equivalents, accounts receivable and accounts payable approximate fair values due to the short-term nature of these instruments. The Company’s current investments as of December 31, 2022 include certificates of deposits and pre-refunded municipal bonds that are classified by management as held-to-maturity as the Company had the positive intent and ability to hold to maturity. The carrying value of these current investments approximate fair values due to the short-term nature of these instruments. As of December 31, 2022 and 2021, the fair value of debt was $405.0 million and $377.5 million, respectively. The estimated fair value of the Company’s debt is based on interest rates available for debt with similar terms and remaining maturities. The FASB Codification defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. On a quarterly basis, the Company measures at fair value certain financial assets, including cash equivalents. Accounting standards specify a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs have created the following fair-value hierarchy: ● Level 1 – quoted prices in active markets for identical assets or liabilities; ● Level 2 – inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; ● Level 3 – unobservable inputs based on the Company’s own assumptions. Accounting standards permit companies, at their option, to measure many financial instruments and certain other items at fair value. The Company has elected not to apply the fair value option to existing eligible items. |
Stock-based Compensation | Stock-based compensation All share-based payments, including grants of stock options and restricted stock units, are required to be recognized in the Company’s financial statements based upon their respective grant date fair values. The Black-Scholes option-pricing model is used to estimate the fair value of stock options. The determination of the fair value of stock options is affected by the Company’s stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends. The Company uses historical volatility as the expected volatility assumption required in the Black-Scholes model. The expected life of the stock options is based on historical data trended into the future. The risk-free interest rate assumption is based on observed interest rates appropriate for the expected terms of the Company’s stock options. The fair value of the Company’s restricted stock units is based on the closing market price of its stock on the date of grant less the Company’s expected dividend yield. The Company recognizes stock-based compensation net of actual forfeitures over the requisite service period of the award. The total compensation expense related to equity compensation plans was $12.4 million, $23.2 million and $24.1 million for the years ended December 31, 2022, 2021 and 2020, respectively. In 2022, 2021 and 2020, these amounts reflect the reversal of $1.3, none, and none, respectively, for certain performance-based awards that were no longer expected to vest. For the years ended December 31, 2022, 2021 and 2020, all stock-based compensation expense was recorded within general and administrative expenses. |
Reporting Comprehensive Income | Reporting comprehensive income Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources, and it includes all changes in equity during a period except those resulting from investments by owners and distributions to owners. |
Derivative Instruments and Hedging Activities | Derivative instruments and hedging activities FASB ASC 815, Derivatives and Hedging As required by ASC 815, the Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain of its risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. In accordance with the FASB’s fair value measurement guidance in ASU 2011-04, the Company made an accounting policy election to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. |
Recent Accounting Pronouncements | Recent accounting pronouncements In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which provides optional guidance for a limited time to ease the potential burden in accounting for the effects of reference rate reform on financial reporting. The guidance provides optional expedients and exceptions for applying US GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. ASU 2020-04 applies only to contracts and hedging relationships that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued due to reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2024. The amendments in ASU 2020-04 are elective and are effective upon issuance for all entities. The Company had previously elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. In the second quarter of 2022, the Company elected the hedge accounting expedient that allows an update to the hedged risk in active hedging relationships without de-designation as the Company’s debt transitioned to SOFR. In the fourth quarter of 2022, the Company elected the hedge accounting expedient that allows an amendment to existing hedges without de-designation as the Company’s hedges transitioned to SOFR. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies [Abstract] | |
Inventories | Inventories consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Raw materials $ 163,797 $ 179,891 Finished goods 182,386 220,040 Total inventory, net $ 346,183 $ 399,931 |
Inventory Reserves | Reserves of inventories consist of the following (U.S. dollars in thousands): 2022 2021 2020 Beginning balance $ 18,643 $ 14,249 $ 12,295 Additions 43,286 31,300 15,952 Write-offs (24,662 ) (26,906 ) (13,998 ) Ending balance $ 37,267 $ 18,643 $ 14,249 |
Prepaid Expenses and Other | Prepaid expenses and other consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Deferred charges $ 11,748 $ 14,266 Prepaid income tax 9,333 2,784 Prepaid inventory and import costs 3,540 6,087 Prepaid rent, insurance and other occupancy costs 5,830 3,690 Prepaid promotion and event cost 2,395 4,382 Prepaid other taxes 8,768 9,333 Derivative financial instruments 9,156 557 Prepaid software license 17,463 17,041 Deposits 1,153 1,158 Other 18,430 17,608 Total prepaid expense and other $ 87,816 $ 76,906 |
Estimated Useful Lives | Property and equipment are stated at cost less accumulated depreciation. Depreciation is recorded using the straight-line method over the following estimated useful lives: Buildings 39 years Furniture and fixtures 5 - 7 years Computers and equipment 3 - 5 years Leasehold improvements Shorter of estimated useful life or lease term Scanners 3 years Vehicles 3 - 5 years |
Other Assets | Other assets consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Deferred taxes $ 89,770 $ 26,483 Deposits for noncancelable operating leases 13,872 17,121 Cash surrender value for life insurance policies 40,055 49,851 Right-of-use assets, Financing, net 14,259 6,477 Derivative financial instruments 10,582 6,033 Long-term investments 39,493 35,868 Other 36,398 33,627 Total other assets $ 244,429 $ 175,460 |
Accrued Expenses | Accrued expenses consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Accrued sales force commissions and other payments $ 95,686 $ 139,793 Accrued other taxes 21,822 31,135 Accrued payroll and other employee expenses 37,650 53,641 Accrued payable to vendors 29,569 45,347 Short-term operating lease liability 29,376 33,427 Accrued royalties 845 1,095 Sales return reserve 3,359 3,513 Deferred revenue 27,053 33,139 Other 34,920 31,111 Total accrued expenses $ 280,280 $ 372,201 |
Other Liabilities | Other liabilities consist of the following (U.S. dollars in thousands): December 31, 2022 2021 Deferred tax liabilities $ 439 $ 2,385 Reserve for other tax liabilities 35,532 21,774 Liability for deferred compensation plan 44,427 54,213 Contingent consideration 6,364 10,341 Finance lease liabilities 12,140 5,318 Asset retirement obligation 5,978 5,408 Other 5,545 7,035 Total other liabilities $ 110,425 $ 106,474 |
Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits included in other liabilities is as follows (U.S. dollars in thousands): 2022 2021 2020 Gross balance at January 1 $ 15,090 $ 17,620 $ 13,507 Increases related to prior year tax positions 6,768 4,146 2,958 Increases related to current year tax positions 5,485 1,794 3,302 Settlements (2,590 ) (5,494 ) (1,091 ) Decreases due to lapse of statutes of limitations (95 ) (2,409 ) (1,377 ) Currency adjustments (1,559 ) (567 ) 321 Gross balance at December 31 $ 23,099 $ 15,090 $ 17,620 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property and Equipment [Abstract] | |
Property and Equipment | Property and equipment are comprised of the following (U.S. dollars in thousands): December 31, 2022 2021 Land $ 42,931 $ 45,027 Buildings 274,049 281,192 Construction in progress (1) 64,566 44,021 Furniture and fixtures 136,835 147,786 Computers and equipment 145,934 162,746 Leasehold improvements 114,633 129,675 Scanners 6,438 6,746 Vehicles 1,606 2,021 786,992 819,214 Less: accumulated depreciation (342,186 ) (365,540 ) $ 444,806 $ 453,674 (1) Construction in progress includes $20.5 million and $11.0 million as of December 31, 2022 and 2021, respectively, of eligible capitalized internal-use software development costs which will be reclassified to computers and equipment when placed into service. |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill [Abstract] | |
Goodwill | The following table presents goodwill allocated to the Company’s reportable segments for the periods ended December 31, 2022 and 2021 (U.S. dollars in thousands): December 31, 2022 2021 Nu Skin Americas $ 9,449 $ 9,449 Mainland China 32,179 32,179 Southeast Asia/Pacific 18,537 18,537 South Korea 29,261 29,261 Japan 16,019 16,019 EMEA 2,875 2,875 Hong Kong/Taiwan 6,634 6,634 Rhyz Investments Manufacturing 78,875 78,875 Rhyz Other 12,603 12,603 Total $ 206,432 $ 206,432 |
Other Intangible Assets (Tables
Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Intangible Assets [Abstract] | |
Indefinite Life Intangible Assets | Other intangible assets consist of the following (U.S. dollars in thousands): Carrying Amount at December 31, 2022 2021 Indefinite life intangible assets: Trademarks and trade names $ 24,599 $ 24,599 |
Finite Life Intangible Assets | December 31, 2022 December 31, 2021 Finite life intangible assets: Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Weighted- average Amortization Period Scanner technology $ 40,716 $ 40,716 $ 40,716 $ 40,716 18 years Developed technology 43,841 27,365 43,841 24,697 14 years Sales force network 11,598 11,598 11,598 11,598 15 years Trademarks 7,860 4,200 8,989 3,827 9 years Other 48,285 26,319 51,176 23,090 8 years $ 152,300 $ 110,198 $ 156,320 $ 103,928 13 years |
Future Amortization Expense | The estimated annual amortization expense for each of the five succeeding fiscal years are as follows (U.S. dollars in thousands): Year Ending December 31, 2023 $ 9,595 2024 9,108 2025 7,826 2026 6,222 2027 4,373 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Long-Term Debt [Abstract] | |
Debt Facilities | The following table summarizes the Company’s debt facilities as of December 31, 2022 and 2021: Facility or Arrangement Original Principal Amount Balance as of December 31, 2022 (1)(2 ) Balance as of December 31, 2021 (1)(2) Interest Rate Repayment Terms 2018 Credit Agreement term loan facility $400.0 million — $307.5 million Principal amount was paid in full during June 2022. 2018 Credit Agreement revolving credit facility — $70.0 million Principal amount was paid in full during June 2022 and credit line was closed. Credit Agreement term loan facility $400.0 million $395.0 million — Variable 21% of the principal amount is payable Credit Agreement revolving credit facility $10.0 million — Variable Revolving line of credit expires June 14, 2027. (1) As of December 31, 2022 and 2021, the current portion of the Company’s debt (i.e. becoming due in the next 12 months) included $15.0 million and $37.5 million, respectively, of the balance of its term loan under the Credit Agreement and 2018 Credit Agreement. (2) The carrying value of the debt reflects the amounts stated in the above table, less debt issuance costs of $2.5 million and $1.2 million as of December 31, 2022 and 2021, respectively, related to the Credit Agreement and 2018 Credit Agreement, which are not reflected in this table. |
Maturities of Long-Term Debt | Maturities of all long-term debt at December 31, 2022, are as follows (U.S. dollars in thousands): Year Ending December 31, 2023 $ 15,000 2024 20,000 2025 20,000 2026 20,000 2027 320,000 Thereafter — Total (1) $ 395,000 (1) The carrying value of the debt reflects the amounts stated in the above table less debt issuance costs of $2.5 million, which is not reflected in this table. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Components of Lease Expense | The components of lease expense were as follows (U.S. dollars in thousands): Year Ended December 31, 2022 2021 2020 Operating lease expense Operating lease cost $ 39,682 $ 48,447 $ 51,828 Variable lease cost 6,061 5,734 4,366 Short-term lease cost 210 592 1,056 Sublease income — (5,663 ) (5,052 ) Finance lease expense Amortization of right-of-use assets 2,371 2,398 1,023 Interest on lease liabilities 268 319 154 Total lease expense $ 48,592 $ 51,827 $ 53,375 |
Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases was as follows (U.S. dollars in thousands): Year Ended December 31, 2022 2021 2020 Operating cash outflow from operating leases $ 37,174 $ 51,570 $ 56,395 Operating cash outflow from finance leases $ 243 $ 322 $ 138 Financing cash outflow from finance leases $ 1,919 $ 1,871 $ 709 Right-of-use assets obtained in exchange for operating lease obligations $ 34,026 $ 25,427 $ 82,662 Right-of-use assets obtained in exchange for finance lease obligations $ 9,797 $ 74 $ 9,206 |
Maturities of Lease Liabilities | Maturities of lease liabilities were as follows (U.S. dollars in thousands): Year Ending December 31, Operating Leases Finance Leases 2023 $ 26,086 $ 3,836 2024 18,808 3,428 2025 13,338 3,371 2026 8,692 3,277 2027 7,690 2,933 Thereafter 42,385 — Total 116,999 16,845 Less: Finance charges 15,542 1,362 Total principal liability $ 101,457 $ 15,483 |
Capital Stock (Tables)
Capital Stock (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Capital Stock [Abstract] | |
Weighted-Average Common Shares Outstanding | The following is a reconciliation of the weighted-average common shares outstanding for purposes of computing basic and diluted net income per share (in thousands): Year Ended December 31, 2022 2021 2020 Basic weighted-average common shares outstanding 50,002 50,193 52,296 Effect of dilutive securities: Stock awards and options 523 1,234 469 Diluted weighted-average common shares outstanding 50,525 51,427 52,765 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stock-Based Compensation [Abstract] | |
Stock Option Valuation Assumptions | The fair value of stock option awards was estimated using the Black-Scholes option-pricing model with the following assumptions and weighted-average fair values as follows: December 31, Stock Options: 2021 2020 Weighted-average grant date fair value of grants $ 16.10 $ 8.59 Risk-free interest rate (1) 0.5 % 1.4 % Dividend yield (2) 2.9 % 2.9 % Expected volatility (3) 49.5 % 40.7 % Expected life in months (4) 56 months 59 months (1) The risk-free interest rate is based upon the rate on a zero-coupon U.S. Treasury bill, for periods within the contractual life of the option, in effect at the time of the grant. (2) The dividend yield is based on the average of historical stock prices and actual dividends paid. (3) Expected volatility is based on the historical volatility of the Company’s stock price, over a period similar to the expected life of the option. (4) The expected term of the option is based on the historical employee exercise behavior, the vesting terms of the respective option, and a contractual life of either seven or . |
Stock Options | Options under the plans as of December 31, 2022 and changes during the year ended December 31, 2022 were as follows: Shares (in thousands) Weighted- average Exercise Price Weighted- average Remaining Contractual Term Aggregate Intrinsic Value (in thousands) Options activity – service based Outstanding at December 31, 2021 538.2 $ 35.89 Granted — — Exercised (340.0 ) 33.15 Forfeited/cancelled/expired (34.3 ) 54.45 Outstanding at December 31, 2022 163.9 37.69 0.35 $ 834 Exercisable at December 31, 2022 163.9 37.69 0.35 834 Options activity – performance based Outstanding at December 31, 2021 2,220.1 $ 40.87 Granted — — Exercised (340.5 ) 31.14 Forfeited/cancelled/expired (418.0 ) 50.66 Outstanding at December 31, 2022 1,461.6 40.30 3.89 $ 9,515 Exercisable at December 31, 2022 958.6 39.46 3.41 7,193 Options activity – all options Outstanding at December 31, 2021 2,758.3 $ 39.90 Granted — — Exercised (680.5 ) 31.65 Forfeited/cancelled/expired (452.3 ) 50.95 Outstanding at December 31, 2022 1,625.5 40.04 3.53 $ 10,349 Exercisable at December 31, 2022 1,122.5 39.20 2.96 8,027 |
Stock Options Exercised | Cash proceeds, tax benefits and intrinsic value related to total stock options exercised during 2022, 2021 and 2020, were as follows (U.S. dollars in thousands): December 31, 2022 2021 2020 Cash proceeds from stock options exercised $ 31,600 $ 14,435 $ 7,419 Tax benefit / (expense) realized for stock options exercised 229 807 (459 ) Intrinsic value of stock options exercised 15,505 8,402 5,232 |
Nonvested Restricted Stock Awards | Nonvested restricted stock awards as of December 31, 2022 and changes during the year ended December 31, 2022 were as follows: Number of Shares (in thousands) Weighted- average Grant Date Fair Value Nonvested at December 31, 2021 884.9 $ 44.11 Granted 587.1 46.04 Vested (326.6 ) 47.03 Forfeited (192.4 ) 44.01 Nonvested at December 31, 2022 953.0 $ 44.28 |
Nonvested Performance Share Units | Nonvested performance share units as of December 31, 2022 and changes during the year ended December 31, 2022 were as follows: Number of Shares (in thousands) Weighted- average Grant Date Fair Value Nonvested at December 31, 2021 — $ — Granted 192.7 44.39 Vested — — Forfeited (12.5 ) 44.39 Nonvested at December 31, 2022 180.2 $ 44.39 |
Fair Value and Equity Investm_2
Fair Value and Equity Investments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value and Equity Investments [Abstract] | |
Assets (Liabilities) Measured at Fair Value on a Recurring Basis | The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (U.S. dollars in thousands): Fair Value at December 31, 2022 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 55,356 $ — $ — $ 55,356 Derivative financial instruments asset — 19,738 — 19,738 Life insurance contracts — — 40,055 40,055 Contingent consideration — — (6,364 ) (6,364 ) Total $ 55,356 $ 19,738 33,691 $ 108,785 Fair Value at December 31, 2021 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 66,477 $ — $ — $ 66,477 Derivative financial instruments asset — 6,590 — 6,590 Life insurance contracts — — 49,851 49,851 Contingent consideration — — (10,341 ) (10,341 ) Total $ 66,477 $ 6,590 $ 39,510 $ 112,577 |
Changes in Fair Value of Level 3 Life Insurance Contracts | The following table provides a summary of changes in fair value of the Company’s Level 3 life insurance contracts (U.S. dollars in thousands): 2022 2021 Beginning balance at January 1 $ 49,851 $ 45,453 Actual return on plan assets (9,180 ) 5,153 Purchases and issuances — 6,261 Sales and settlements (616 ) (7,016 ) Ending balance at December 31 $ 40,055 $ 49,851 |
Changes in Fair Value of Level 3 Contingent Consideration | The following table provides a summary of changes in fair value of the Company’s Level 3 contingent consideration (U.S. dollars in thousands): 2022 2021 Beginning balance at January 1 $ (10,341 ) $ (3,125 ) Additions from acquisitions — (8,702 ) Changes in fair value of contingent consideration 3,977 1,486 Ending balance at December 31 $ (6,364 ) $ (10,341 ) |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes [Abstract] | |
Consolidated Income Before Provision for Income Taxes | Consolidated income before provision for income taxes consists of the following for the years ended December 31, 2022, 2021 and 2020 (U.S. dollars in thousands): 2022 2021 2020 U.S. $ 24,411 $ 45,371 $ 71,138 Foreign 64,559 187,088 185,094 Total $ 88,970 $ 232,459 $ 256,232 |
Current and Deferred Taxes | The provision for current and deferred taxes for the years ended December 31, 2022, 2021 and 2020 consists of the following (U.S. dollars in thousands): 2022 2021 2020 Current Federal $ — $ — $ — State 1,515 1,458 1,629 Foreign 34,117 77,393 77,079 35,632 78,851 78,708 Deferred Federal (65,733 ) 3,705 (14,430 ) State (1,239 ) (38 ) (563 ) Foreign 15,532 2,675 1,162 (51,440 ) 6,342 (13,831 ) Provision for income taxes $ (15,808 ) $ 85,193 $ 64,877 |
Deferred Tax Assets and Liabilities | The principal components of deferred taxes are as follows (U.S. dollars in thousands): Year Ended December 31, 2022 2021 Deferred tax assets: Inventory differences $ 41,127 $ 5,859 Foreign tax credit and other foreign benefits 51,273 69,401 Stock-based compensation 5,981 9,392 Accrued expenses not deductible until paid 37,181 36,401 Foreign currency exchange — 605 Net operating losses 12,773 9,479 Capitalized research and development 26,406 22,962 R&D credit carryforward 1,795 1,451 Other 242 34 Gross deferred tax assets 176,778 155,584 Deferred tax liabilities: Foreign currency exchange 3,225 — Foreign withholding taxes 15,375 15,412 Intangibles step-up 4,446 4,446 Overhead allocation to inventory 3,504 3,373 Amortization of intangibles 21,211 21,936 Other 6,129 6,133 Gross deferred tax liabilities 53,890 51,300 Valuation allowance (33,557 ) (80,186 ) Deferred taxes, net $ 89,331 $ 24,098 |
Deferred Tax Asset Valuation Adjustments | The deferred tax asset valuation adjustments for the years ended December 31, 2022, 2021 and 2020 are as follows (U.S. dollars in thousands): Year Ended December 31, 2022 2021 2020 Balance at the beginning of period $ 80,186 $ 67,340 $ 77,042 Additions charged to cost and expenses 3,231 (1) 12,674 (4) 2,154 (6) Decreases (50,315 ) (2) — (5) (12,100 ) (7) Adjustments 455 (3) 172 (3) 244 (3) Balance at the end of the period $ 33,557 $ 80,186 $ 67,340 (1) Increase in valuation is due primarily to net operating losses in foreign markets. (2) The decrease was due to utilization of $18.1 million of foreign tax credits and the valuation allowance release of $32.2 million foreign tax credits. (3) Represents the net currency effects of translating valuation allowances at current rates of exchange. (4) Increase in valuation is primarily due to $11.9 million that was recorded on the foreign tax credit carryforward due to the disposal of the Company’s Grow Tech segment. The additional amount is due to net operating losses in foreign markets. (5) No decreases in 2021. (6) Increase in valuation is due primarily to net operating losses in foreign markets. (7) The decrease was due primarily to the utilization of foreign tax credits that had previously had a valuation allowance recorded against the asset. |
Deferred Taxes, Net on a Jurisdiction Basis | The components of deferred taxes, net on a jurisdiction basis are as follows (U.S. dollars in thousands): Year Ended December 31, 2022 2021 Net noncurrent deferred tax assets $ 89,770 $ 26,483 Net noncurrent deferred tax liabilities 439 2,385 Deferred taxes, net $ 89,331 $ 24,098 |
Reconciliation of Statutory to Effective Tax Rate | The actual tax rate for the years ended December 31, 2022, 2021 and 2020 compared to the statutory U.S. Federal tax rate is as follows: Year Ended December 31, 2022 2021 2020 Income taxes at statutory rate 21.00 % 21.00 % 21.00 % Excess tax benefit from equity award (0.12 )% (0.19 )% 0.70 % Deferred compensation 2.18 % (0.46 )% (0.30 )% Executive salary limitation 2.06 % 0.47 % 0.04 % Non-U.S. income taxed at different rates 4.78 % 6.06 % 3.37 % Foreign withholding taxes (0.73 )% 4.71 % 5.21 % Change in reserve for uncertain tax positions 17.69 % (0.06 )% 1.98 % Valuation allowance recognized foreign tax credit & others (56.17 )% 5.12 % (4.59 )% Foreign-Derived Intangible Income (FDII) (8.14 )% (0.87 )% (2.78 )% Other (0.32 )% 0.87 % 0.69 % (17.77 )% 36.65 % 25.32 % |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Financial Instruments [Abstract] | |
Fair Value of Derivative Instruments on the Balance Sheet | The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Balance Sheet: Fair Values of Derivative Instruments December 31, Derivatives in Cash Flow Hedging Relationships: Balance Sheet Location 2022 2021 Interest Rate Swap - Asset Prepaid expenses and other $ 9,156 $ 557 Interest Rate Swap - Asset Other assets $ 10,582 $ 6,033 |
Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income | The tables below present the effect of cash flow hedge accounting on Accumulated Other Comprehensive Income. Amount of Gain (Loss) Recognized in OCI on Derivatives Year Ended December 31, Derivatives in Cash Flow Hedging Relationships: 2022 2021 2020 Interest Rate Swaps $ 16,267 $ 5,391 $ 1,017 Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income Year Ended December 31, Derivatives in Cash Flow Hedging Relationships: Income Statement 2022 2021 2020 Interest Rate Swaps Other income (expense), net $ 3,117 $ (157 ) $ (24 ) |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Information [Abstract] | |
Revenue by Segment | Revenue by Segment Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 Nu Skin Americas $ 508,537 $ 547,755 $ 453,022 Mainland China 360,389 568,774 625,538 Southeast Asia/Pacific 344,411 336,651 361,627 South Korea 268,707 354,252 326,478 Japan 224,896 266,216 273,681 EMEA 204,275 283,200 230,246 Hong Kong/Taiwan 157,197 162,611 161,117 Nu Skin Other 3,959 3,653 886 Total Nu Skin 2,072,371 2,523,112 2,432,595 Rhyz Investments Manufacturing (1) 149,458 172,120 149,339 Rhyz Other 3,830 437 — Total Rhyz Investments 153,288 172,557 149,339 Total $ 2,225,659 $ 2,695,669 $ 2,581,934 (1) The Manufacturing segment had $69.2 million, $84.5 million and $39.4 million of intersegment revenue for the years ended December 31, 2022, 2021 and 2020, respectively. Intersegment revenue is eliminated in the consolidated financial statements and in the table above. |
Segment Contribution | Segment Contribution Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 Nu Skin Americas $ 110,522 $ 116,265 $ 86,386 Mainland China 72,362 151,645 181,024 Southeast Asia/Pacific 85,827 81,779 87,753 South Korea 81,804 114,034 100,933 Japan 54,976 67,511 68,027 EMEA 21,446 41,988 24,078 Hong Kong/Taiwan 35,253 37,330 33,466 Nu Skin contribution 462,190 610,552 581,667 Rhyz Investments Manufacturing 3,570 18,346 21,168 Rhyz Other (6,180 ) (1,813 ) — Rhyz Investments contribution (2,610 ) 16,533 21,168 Total segment contribution 459,580 627,085 602,835 Corporate and other (348,733 ) (393,093 ) (345,271 ) Operating income 110,847 233,992 257,564 Other income (expense) (21,877 ) (1,533 ) (1,332 ) Income before provision for income taxes $ 88,970 $ 232,459 $ 256,232 |
Depreciation and Amortization and Capital Expenditures | Depreciation and Amortization Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 Nu Skin Americas $ 591 $ 871 $ 984 Mainland China 12,177 13,345 11,056 Southeast Asia/Pacific 1,500 1,450 1,670 South Korea 1,616 3,279 3,620 Japan 1,011 906 1,876 EMEA 854 1,106 1,017 Hong Kong/Taiwan 3,743 3,637 2,912 Total Nu Skin 21,492 24,594 23,135 Rhyz Investments Manufacturing 13,838 11,765 8,081 Rhyz Other 2,368 1,579 — Total Rhyz Investments 16,206 13,344 8,081 Corporate and other 34,808 38,382 42,775 Total $ 72,506 $ 76,320 $ 73,991 Capital Expenditures Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 Nu Skin Americas $ 204 $ 714 $ 1,061 Mainland China 10,692 24,382 19,363 Southeast Asia/Pacific 263 1,330 2,197 South Korea 727 854 1,420 Japan 225 194 3,128 EMEA 1,612 1,242 1,875 Hong Kong/Taiwan 3,338 736 708 Total Nu Skin 17,061 29,452 29,752 Rhyz Investments Manufacturing 7,301 14,022 14,366 Rhyz Other — — — Total Rhyz Investments 7,301 14,022 14,366 Corporate and other 34,694 25,141 19,705 Total $ 59,056 $ 68,615 $ 63,823 |
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%. Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 United States $ 537,081 $ 540,253 $ 425,155 Mainland China 360,389 568,774 625,538 South Korea 268,707 354,252 326,478 Japan 224,896 266,216 273,681 All others 834,586 966,174 931,082 Total $ 2,225,659 $ 2,695,669 $ 2,581,934 |
Revenue by Product Line | Revenue by Product Line Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 Beauty $ 1,069,714 $ 1,442,659 $ 1,491,803 Wellness 992,338 1,062,549 922,553 Other 163,607 190,461 167,578 Total $ 2,225,659 $ 2,695,669 $ 2,581,934 |
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, 2022, 2021 and 2020: Year Ended December 31, (U.S. dollars in thousands) 2022 2021 2020 United States $ 343,482 $ 335,020 $ 348,028 Mainland China 132,148 149,124 152,312 South Korea 30,867 25,364 39,104 Japan 18,011 23,929 31,085 All others 33,291 47,687 62,141 Total $ 557,799 $ 581,124 $ 632,670 |
Restructuring and Severance C_2
Restructuring and Severance Charges (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Restructuring and Severance Charges [Abstract] | |
Restructuring Expense by Segment | Restructuring expense by segment (U.S. dollars in s) Year Ended December 31, 2022 Nu Skin Americas $ 1,687 Mainland China 13,181 Southeast Asia/Pacific 1,809 South Korea 1,533 Japan 699 EMEA 2,143 Hong Kong/Taiwan 2,464 Total Nu Skin 23,516 Rhyz Investments Manufacturing 401 Rhyz other — Total Rhyz Investments 401 Corporate and other 19,577 Total $ 43,494 |
The Company (Details)
The Company (Details) | 12 Months Ended |
Dec. 31, 2022 Segment | |
The Company [Abstract] | |
Number of reportable segments | 9 |
Number of geographic segments | 7 |
Number of Rhyz Investments segments | 2 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies, Reclassifications (Details) - Reclassification Adjustment [Member] - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
General and Administrative Expenses [Member] | ||
Reclassifications [Abstract] | ||
Events and other miscellaneous selling costs | $ (12) | $ (10.4) |
Selling Expenses [Member] | ||
Reclassifications [Abstract] | ||
Events and other miscellaneous selling costs | $ 12 | $ 10.4 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies, Inventories (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Inventories [Abstract] | |||
Raw materials | $ 163,797 | $ 179,891 | |
Finished goods | 182,386 | 220,040 | |
Total Inventory, net | 346,183 | 399,931 | |
Inventory Valuation Reserve [Member] | |||
Valuation Allowance [Roll Forward] | |||
Beginning balance | 18,643 | 14,249 | $ 12,295 |
Additions | 43,286 | 31,300 | 15,952 |
Write-offs | (24,662) | (26,906) | (13,998) |
Ending balance | $ 37,267 | $ 18,643 | $ 14,249 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies, Prepaid Expenses and Other (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Prepaid Expenses and Other [Abstract] | ||
Deferred charges | $ 11,748 | $ 14,266 |
Prepaid income tax | 9,333 | 2,784 |
Prepaid inventory and import costs | 3,540 | 6,087 |
Prepaid rent, insurance and other occupancy costs | 5,830 | 3,690 |
Prepaid promotion and event cost | 2,395 | 4,382 |
Prepaid other taxes | 8,768 | 9,333 |
Derivative financial instruments | 9,156 | 557 |
Prepaid software license | 17,463 | 17,041 |
Deposits | 1,153 | 1,158 |
Other | 18,430 | 17,608 |
Total prepaid expense and other | $ 87,816 | $ 76,906 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies, Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Buildings [Member] | |
Property and Equipment [Abstract] | |
Useful life | 39 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property and Equipment [Abstract] | |
Useful life | 5 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property and Equipment [Abstract] | |
Useful life | 7 years |
Computers and Equipment [Member] | Minimum [Member] | |
Property and Equipment [Abstract] | |
Useful life | 3 years |
Computers and Equipment [Member] | Maximum [Member] | |
Property and Equipment [Abstract] | |
Useful life | 5 years |
Leasehold Improvements [Member] | |
Property and Equipment [Abstract] | |
Useful life | Shorter of estimated useful life or lease term |
Scanners [Member] | |
Property and Equipment [Abstract] | |
Useful life | 3 years |
Vehicles [Member] | Minimum [Member] | |
Property and Equipment [Abstract] | |
Useful life | 3 years |
Vehicles [Member] | Maximum [Member] | |
Property and Equipment [Abstract] | |
Useful life | 5 years |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies, Goodwill and Other Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2022 | |
Goodwill and Other Intangible Assets [Abstract] | |||||
Impairment of goodwill | $ 0 | $ 0 | |||
Impairment of other intangible assets | $ 1.7 | ||||
Manufacturing Reporting Unit [Member] | |||||
Goodwill and Other Intangible Assets [Abstract] | |||||
Percentage of fair value in excess of carrying amount | 8% | ||||
Grow Tech Segment [Member] | |||||
Goodwill and Other Intangible Assets [Abstract] | |||||
Impairment of goodwill | $ 9.2 | ||||
Grow Tech Segment [Member] | Restructuring and Impairment Expenses [Member] | |||||
Goodwill and Other Intangible Assets [Abstract] | |||||
Impairment of goodwill and intangibles | $ 18.2 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies, Other Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Assets [Abstract] | ||
Deferred taxes | $ 89,770 | $ 26,483 |
Deposits for noncancelable operating leases | 13,872 | 17,121 |
Cash surrender value for life insurance policies | 40,055 | 49,851 |
Right-of-use assets, Financing, net | 14,259 | 6,477 |
Derivative financial instruments | 10,582 | 6,033 |
Long-term Investments | 39,493 | 35,868 |
Other | 36,398 | 33,627 |
Total other assets | $ 244,429 | $ 175,460 |
Right-of-use assets, Financing, net Statement of Financial Position [Extensible Enumeration] | Total other assets | Total other assets |
Summary of Significant Accou_10
Summary of Significant Accounting Policies, Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accrued Expenses [Abstract] | ||
Accrued sales force commissions and other payments | $ 95,686 | $ 139,793 |
Accrued other taxes | 21,822 | 31,135 |
Accrued payroll and other employee expenses | 37,650 | 53,641 |
Accrued payable to vendors | 29,569 | 45,347 |
Short-term operating lease liability | 29,376 | 33,427 |
Accrued royalties | 845 | 1,095 |
Sales return reserve | 3,359 | 3,513 |
Deferred revenue | 27,053 | 33,139 |
Other | 34,920 | 31,111 |
Total accrued expenses | $ 280,280 | $ 372,201 |
Short-term operating lease liability, Statement of Financial Position [Extensible List] | Total accrued expenses | Total accrued expenses |
Summary of Significant Accou_11
Summary of Significant Accounting Policies, Other Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Liabilities [Abstract] | ||
Deferred tax liabilities | $ 439 | $ 2,385 |
Reserve for other tax liabilities | 35,532 | 21,774 |
Liability for deferred compensation plan | 44,427 | 54,213 |
Contingent consideration | 6,364 | 10,341 |
Finance lease liabilities | 12,140 | 5,318 |
Asset retirement obligation | 5,978 | 5,408 |
Other | 5,545 | 7,035 |
Total other liabilities | $ 110,425 | $ 106,474 |
Finance lease liabilities, Statement of Financial Position [Extensible Enumeration] | Total other liabilities | Total other liabilities |
Summary of Significant Accou_12
Summary of Significant Accounting Policies, Revenue Recognition (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue Recognition [Abstract] | |||
Sales returns | $ 31.6 | $ 52.1 | $ 49.5 |
Allowance for Product Returns [Member] | |||
Revenue Recognition [Abstract] | |||
Accrued reserve | $ 3.4 | $ 3.5 |
Summary of Significant Accou_13
Summary of Significant Accounting Policies, Contract Liabilities - Customer Loyalty Programs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Contract Liabilities - Customer Loyalty Programs [Abstract] | |||
Contract liabilities for customer loyalty programs | $ 18.7 | $ 22 | |
Contract liabilities, increase (decrease) to revenue | $ 3.3 | $ (3.8) | $ (5.7) |
Summary of Significant Accou_14
Summary of Significant Accounting Policies, Advertising Expenses (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
General and Administrative Expenses [Member] | |||
Advertising Expenses [Abstract] | |||
Advertising costs incurred | $ 14.5 | $ 15.5 | $ 14.7 |
Summary of Significant Accou_15
Summary of Significant Accounting Policies, Research and Development (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Research and Development [Abstract] | |||
Research and development expense | $ 23.3 | $ 27.2 | $ 23.3 |
Summary of Significant Accou_16
Summary of Significant Accounting Policies, Uncertain Tax Positions (Details) - Multiple Foreign and Domestic Authorities [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of Unrecognized Tax Benefits [Roll Forward] | |||
Gross balance at beginning of year | $ 15,090 | $ 17,620 | $ 13,507 |
Increases related to prior year tax positions | 6,768 | 4,146 | 2,958 |
Increases related to current year tax positions | 5,485 | 1,794 | 3,302 |
Settlements | (2,590) | (5,494) | (1,091) |
Decreases due to lapse of statutes of limitations | (95) | (2,409) | (1,377) |
Currency adjustments | (1,559) | (567) | |
Currency adjustments | 321 | ||
Gross balance at end of year | 23,099 | 15,090 | 17,620 |
Uncertain Tax Positions [Abstract] | |||
Unrecognized tax benefits that would impact effective tax rate | 23,100 | 15,100 | |
Interest and penalties expenses | 5,700 | 1,600 | 1,500 |
Accrued interest and penalties | $ 12,400 | $ 6,700 | $ 5,100 |
Minimum [Member] | |||
Uncertain Tax Positions [Abstract] | |||
Statute of limitations related to income tax examinations | 3 years | ||
Uncertain Tax Positions [Abstract] | |||
Estimated increase in gross unrecognized tax benefits within next 12 months | $ 2,000 | ||
Maximum [Member] | |||
Uncertain Tax Positions [Abstract] | |||
Statute of limitations related to income tax examinations | 10 years | ||
Uncertain Tax Positions [Abstract] | |||
Estimated increase in gross unrecognized tax benefits within next 12 months | $ 3,000 |
Summary of Significant Accou_17
Summary of Significant Accounting Policies, Foreign Currency Translation (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Foreign Currency Translation [Abstract] | |||
Cumulative translation adjustment related to foreign currency adjustment | $ (102) | $ (79.1) | $ (65.6) |
Cumulative translation adjustment related to foreign currency adjustment, tax | $ 8.1 | $ 7.5 | $ 7.1 |
Summary of Significant Accou_18
Summary of Significant Accounting Policies, Classification of a Highly Inflationary Economy (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Argentina [Member] | Net Sales [Member] | Geographic Concentration Risk [Member] | Maximum [Member] | |||
Operations in Argentina [Abstract] | |||
Concentration percentage | 2% | 2% | 2% |
Summary of Significant Accou_19
Summary of Significant Accounting Policies, Fair Value of Financial Instruments (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Value of Financial Instruments [Abstract] | ||
Fair value of debt | $ 405 | $ 377.5 |
Summary of Significant Accou_20
Summary of Significant Accounting Policies, Stock-Based Compensation (Details) - General and Administrative Expenses [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Stock-Based Compensation [Abstract] | |||
Compensation expense related to equity compensation plans | $ 12.4 | $ 23.2 | $ 24.1 |
Reversal of compensation expense for certain performance based awards no longer expected to vest | $ 1.3 | $ 0 | $ 0 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||
Property and Equipment [Abstract] | ||||
Property and equipment | $ 786,992 | $ 819,214 | ||
Less: accumulated depreciation | (342,186) | (365,540) | ||
Property and equipment, net | 444,806 | 453,674 | ||
Depreciation expense | 61,000 | 62,900 | $ 62,500 | |
Impairment of fixed assets | 8,200 | 13,700 | ||
Land [Member] | ||||
Property and Equipment [Abstract] | ||||
Property and equipment | 42,931 | 45,027 | ||
Buildings [Member] | ||||
Property and Equipment [Abstract] | ||||
Property and equipment | 274,049 | 281,192 | ||
Construction in Progress [Member] | ||||
Property and Equipment [Abstract] | ||||
Property and equipment | [1] | 64,566 | 44,021 | |
Furniture and Fixtures [Member] | ||||
Property and Equipment [Abstract] | ||||
Property and equipment | 136,835 | 147,786 | ||
Computers and Equipment [Member] | ||||
Property and Equipment [Abstract] | ||||
Property and equipment | 145,934 | 162,746 | ||
Leasehold Improvements [Member] | ||||
Property and Equipment [Abstract] | ||||
Property and equipment | 114,633 | 129,675 | ||
Scanners [Member] | ||||
Property and Equipment [Abstract] | ||||
Property and equipment | 6,438 | 6,746 | ||
Vehicles [Member] | ||||
Property and Equipment [Abstract] | ||||
Property and equipment | 1,606 | 2,021 | ||
Internal-Use Software Development Costs [Member] | ||||
Property and Equipment [Abstract] | ||||
Property and equipment | $ 20,500 | $ 11,000 | ||
[1]Construction in progress includes $20.5 million and $11.0 million as of December 31, 2022 and 2021, respectively, of eligible capitalized internal-use software development costs which will be reclassified to computers and equipment when placed into service. |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill [Abstract] | |||
Goodwill | $ 206,432 | $ 206,432 | |
Impairment charges | 0 | $ 0 | |
Americas [Member] | |||
Goodwill [Abstract] | |||
Goodwill | 9,449 | 9,449 | |
Mainland China [Member] | |||
Goodwill [Abstract] | |||
Goodwill | 32,179 | 32,179 | |
Southeast Asia/Pacific [Member] | |||
Goodwill [Abstract] | |||
Goodwill | 18,537 | 18,537 | |
South Korea [Member] | |||
Goodwill [Abstract] | |||
Goodwill | 29,261 | 29,261 | |
Japan [Member] | |||
Goodwill [Abstract] | |||
Goodwill | 16,019 | 16,019 | |
EMEA [Member] | |||
Goodwill [Abstract] | |||
Goodwill | 2,875 | 2,875 | |
Hong Kong/Taiwan [Member] | |||
Goodwill [Abstract] | |||
Goodwill | 6,634 | 6,634 | |
Manufacturing [Member] | |||
Goodwill [Abstract] | |||
Goodwill | 78,875 | 78,875 | |
Rhyz Other [Member] | |||
Goodwill [Abstract] | |||
Goodwill | $ 12,603 | 12,603 | |
Grow Tech [Member] | |||
Goodwill [Abstract] | |||
Impairment charges | $ 9,200 |
Other Intangible Assets, Indefi
Other Intangible Assets, Indefinite Life Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Trademarks and Trade Names [Member] | ||
Indefinite Life Intangible Assets [Abstract] | ||
Indefinite life intangible assets | $ 24,599 | $ 24,599 |
Other Intangible Assets, Finite
Other Intangible Assets, Finite Life Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Finite Life Intangible Assets [Abstract] | |||
Gross carrying amount | $ 152,300 | $ 156,320 | |
Accumulated amortization | $ 110,198 | 103,928 | |
Weighted-average amortization period | 13 years | ||
Amortization expense | $ 9,700 | 11,700 | $ 9,800 |
Scanner Technology [Member] | |||
Finite Life Intangible Assets [Abstract] | |||
Gross carrying amount | 40,716 | 40,716 | |
Accumulated amortization | $ 40,716 | 40,716 | |
Weighted-average amortization period | 18 years | ||
Developed Technology [Member] | |||
Finite Life Intangible Assets [Abstract] | |||
Gross carrying amount | $ 43,841 | 43,841 | |
Accumulated amortization | $ 27,365 | 24,697 | |
Weighted-average amortization period | 14 years | ||
Sales Force Network [Member] | |||
Finite Life Intangible Assets [Abstract] | |||
Gross carrying amount | $ 11,598 | 11,598 | |
Accumulated amortization | $ 11,598 | 11,598 | |
Weighted-average amortization period | 15 years | ||
Trademarks [Member] | |||
Finite Life Intangible Assets [Abstract] | |||
Gross carrying amount | $ 7,860 | 8,989 | |
Accumulated amortization | $ 4,200 | 3,827 | |
Weighted-average amortization period | 9 years | ||
Other [Member] | |||
Finite Life Intangible Assets [Abstract] | |||
Gross carrying amount | $ 48,285 | 51,176 | |
Accumulated amortization | $ 26,319 | $ 23,090 | |
Weighted-average amortization period | 8 years |
Other Intangible Assets, Annual
Other Intangible Assets, Annual Estimated Future Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Annual Estimated Future Amortization Expense [Abstract] | ||
2023 | $ 9,595 | |
2024 | 9,108 | |
2025 | 7,826 | |
2026 | 6,222 | |
2027 | 4,373 | |
Impairment Charges [Abstract] | ||
Impairment of other intangible assets | 1,700 | |
Exit Grow Tech Segment [Member] | ||
Impairment Charges [Abstract] | ||
Impairment charge related to indefinite lived intangible assets | $ 3,800 | |
Impairment, Intangible Asset, Indefinite-Lived (Excluding Goodwill), Statement of Income [Extensible Enumeration] | Restructuring and impairment expenses | |
Impairment of other intangible assets | $ 5,200 | |
Impairment, Intangible Asset, Finite-Lived, Statement of Income [Extensible Enumeration] | Restructuring and impairment expenses | |
2022 Strategic Restructuring Plan [Member] | ||
Impairment Charges [Abstract] | ||
Impairment of other intangible assets | $ 1,700 | |
Impairment, Intangible Asset, Finite-Lived, Statement of Income [Extensible Enumeration] | Restructuring and impairment expenses |
Long-Term Debt, 2018 Credit Agr
Long-Term Debt, 2018 Credit Agreement (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Apr. 18, 2018 | |
2018 Credit Agreement [Member] | Maximum [Member] | ||
Long-Term Debt [Abstract] | ||
Consolidated leverage ratio | 2.25 | |
2018 Credit Agreement [Member] | Minimum [Member] | ||
Long-Term Debt [Abstract] | ||
Consolidated interest coverage ratio | 3 | |
2018 Term Loan Facility [Member] | ||
Long-Term Debt [Abstract] | ||
Original principal amount | $ 400 | $ 400 |
Term of loan | 5 years | |
2018 Term Loan Facility [Member] | First Year [Member] | ||
Long-Term Debt [Abstract] | ||
Annual amortization percentage | 5% | |
2018 Term Loan Facility [Member] | Second Year [Member] | ||
Long-Term Debt [Abstract] | ||
Annual amortization percentage | 5% | |
2018 Term Loan Facility [Member] | Third Year [Member] | ||
Long-Term Debt [Abstract] | ||
Annual amortization percentage | 7.50% | |
2018 Term Loan Facility [Member] | Fourth Year [Member] | ||
Long-Term Debt [Abstract] | ||
Annual amortization percentage | 7.50% | |
2018 Term Loan Facility [Member] | Fifth Year [Member] | ||
Long-Term Debt [Abstract] | ||
Annual amortization percentage | 10% | |
2018 Revolving Credit Facility [Member] | ||
Long-Term Debt [Abstract] | ||
Borrowing capacity | $ 350 | |
Term of loan | 5 years |
Long- Term Debt, Credit Agreeme
Long- Term Debt, Credit Agreement (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Jun. 14, 2022 | |
Credit Agreement [Member] | ||
Debt [Abstract] | ||
Percentage of capital stock of certain foreign subsidiaries pledged as collateral | 65% | |
Credit Agreement [Member] | Minimum [Member] | ||
Debt [Abstract] | ||
Commitment fee percentage payable on unused portion | 0.175% | |
Consolidated interest coverage ratio | 3 | |
Credit Agreement [Member] | Maximum [Member] | ||
Debt [Abstract] | ||
Commitment fee percentage payable on unused portion | 0.30% | |
Consolidated leverage ratio | 2.75 | |
Term Loan Facility [Member] | ||
Debt [Abstract] | ||
Original principal amount | $ 400 | $ 400 |
Term of loan | 5 years | |
Term Loan Facility [Member] | First Year [Member] | ||
Debt [Abstract] | ||
Annual amortization percentage | 2.50% | |
Term Loan Facility [Member] | Second Year [Member] | ||
Debt [Abstract] | ||
Annual amortization percentage | 5% | |
Term Loan Facility [Member] | Third Year [Member] | ||
Debt [Abstract] | ||
Annual amortization percentage | 5% | |
Term Loan Facility [Member] | Fourth Year [Member] | ||
Debt [Abstract] | ||
Annual amortization percentage | 5% | |
Term Loan Facility [Member] | Fifth Year [Member] | ||
Debt [Abstract] | ||
Annual amortization percentage | 5% | |
Revolving Credit Facility [Member] | ||
Debt [Abstract] | ||
Borrowing capacity | $ 500 | |
Term of loan | 5 years |
Long-Term Debt, Debt Facilities
Long-Term Debt, Debt Facilities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2022 | Jun. 14, 2022 | Dec. 31, 2021 | Apr. 18, 2018 | ||
Long-term Debt [Abstract] | |||||
Balance | [1] | $ 395,000 | |||
Current portion of long-term debt | 25,000 | $ 107,500 | |||
Unamortized debt issuance costs | 2,500 | ||||
2018 Credit Agreement [Member] | |||||
Long-term Debt [Abstract] | |||||
Unamortized debt issuance costs | 1,200 | ||||
2018 Credit Agreement Term Loan Facility [Member] | |||||
Long-term Debt [Abstract] | |||||
Original principal amount | 400,000 | $ 400,000 | |||
Balance | [2],[3] | $ 0 | 307,500 | ||
Repayment terms | Principal amount was paid in full during June 2022. | ||||
Term of loan | 5 years | ||||
Current portion of long-term debt | 37,500 | ||||
2018 Credit Agreement Revolving Credit Facility [Member] | |||||
Long-term Debt [Abstract] | |||||
Balance | [2],[3] | $ 0 | 70,000 | ||
Repayment terms | Principal amount was paid in full during June 2022 and credit line was closed. | ||||
Term of loan | 5 years | ||||
Credit Agreement [Member] | |||||
Long-term Debt [Abstract] | |||||
Unamortized debt issuance costs | $ 2,500 | ||||
Credit Agreement Term Loan Facility [Member] | |||||
Long-term Debt [Abstract] | |||||
Original principal amount | 400,000 | $ 400,000 | |||
Balance | [2],[3] | $ 395,000 | 0 | ||
Interest rate | Variable 30 day: 6.17% | ||||
Interest rate | 6.17% | ||||
Term of variable rate | 30 days | ||||
Repayment terms | 21% of the principal amount is payable in increasing quarterly installments over a five-year period that began on September 30, 2022, with the remainder payable at the end | ||||
Percentage of principal payable in installments | 21% | ||||
Term of loan | 5 years | ||||
Current portion of long-term debt | $ 15,000 | ||||
Credit Agreement Revolving Credit Facility [Member] | |||||
Long-term Debt [Abstract] | |||||
Balance | [2],[3] | $ 10,000 | $ 0 | ||
Interest rate | Variable 30 day: 6.17% | ||||
Interest rate | 6.17% | ||||
Term of variable rate | 30 days | ||||
Repayment terms | Revolving line of credit expires June 14, 2027. | ||||
Term of loan | 5 years | ||||
[1]The carrying value of the debt reflects the amounts stated in the above table less debt issuance costs of $2.5 million, which is not reflected in this table.[2]As of December 31, 2022 and 2021, the current portion of the Company’s debt (i.e. becoming due in the next 12 months) included $15.0 million and $37.5 million, respectively, of the balance of its term loan under the Credit Agreement and 2018 Credit Agreement.[3]The carrying value of the debt reflects the amounts stated in the above table, less debt issuance costs of $2.5 million and $1.2 million as of December 31, 2022 and 2021, respectively, related to the Credit Agreement and 2018 Credit Agreement, which are not reflected in this table. |
Long-Term Debt, Maturities of L
Long-Term Debt, Maturities of Long-Term Debt (Details) $ in Thousands | Dec. 31, 2022 USD ($) | |
Maturities of Long-term Debt [Abstract] | ||
2023 | $ 15,000 | |
2024 | 20,000 | |
2025 | 20,000 | |
2026 | 20,000 | |
2027 | 320,000 | |
Thereafter | 0 | |
Total | 395,000 | [1] |
Unamortized debt issuance costs | $ 2,500 | |
[1]The carrying value of the debt reflects the amounts stated in the above table less debt issuance costs of $2.5 million, which is not reflected in this table. |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Weighted average remaining lease term for operating leases | 8 years 9 months 18 days | ||
Weighted average remaining lease term for finance lease | 4 years 7 months 6 days | ||
Weighted average discount rate for operating leases | 3.30% | ||
Weighted average discount rate for finance lease | 3.50% | ||
Operating Lease Expense [Abstract] | |||
Operating lease cost | $ 39,682 | $ 48,447 | $ 51,828 |
Variable lease cost | 6,061 | 5,734 | 4,366 |
Short-term lease cost | 210 | 592 | 1,056 |
Sublease income | 0 | (5,663) | (5,052) |
Finance Lease Expense [Abstract] | |||
Amortization of right-of-use assets | 2,371 | 2,398 | 1,023 |
Interest on lease liabilities | 268 | 319 | 154 |
Total lease expense | 48,592 | 51,827 | 53,375 |
Supplemental Cash Flow Information Related to Leases [Abstract] | |||
Operating cash outflow from operating leases | 37,174 | 51,570 | 56,395 |
Operating cash outflow from finance leases | 243 | 322 | 138 |
Financing cash outflow from finance leases | 1,919 | 1,871 | 709 |
Right-of-use assets obtained in exchange for operating lease obligations | 34,026 | 25,427 | 82,662 |
Right-of-use assets obtained in exchange for finance lease obligations | 9,797 | $ 74 | $ 9,206 |
Maturities of Operating Lease Liabilities [Abstract] | |||
2023 | 26,086 | ||
2024 | 18,808 | ||
2025 | 13,338 | ||
2026 | 8,692 | ||
2027 | 7,690 | ||
Thereafter | 42,385 | ||
Total | 116,999 | ||
Less: Finance charges | 15,542 | ||
Total principal liability | 101,457 | ||
Maturities of Finance Lease Liabilities [Abstract] | |||
2023 | 3,836 | ||
2024 | 3,428 | ||
2025 | 3,371 | ||
2026 | 3,277 | ||
2027 | 2,933 | ||
Thereafter | 0 | ||
Total | 16,845 | ||
Less: Finance charges | 1,362 | ||
Total principal liability | 15,483 | ||
Additional lease liabilities not yet commenced | $ 5,500 | ||
Minimum [Member] | |||
Leases [Abstract] | |||
Remaining lease terms | 1 year | ||
Maximum [Member] | |||
Leases [Abstract] | |||
Remaining lease terms | 22 years | ||
Extension period for leases | 20 years | ||
Termination period for leases | 1 year |
Capital Stock, Authorized Capit
Capital Stock, Authorized Capital Stock (Details) | 12 Months Ended | |
Dec. 31, 2022 Vote $ / shares shares | Dec. 31, 2021 $ / shares shares | |
Capital Stock [Abstract] | ||
Preferred stock, authorized (in shares) | 25,000,000 | |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common Class A [Member] | ||
Capital Stock [Abstract] | ||
Common stock, shares authorized (in shares) | 500,000,000 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | |
Number of votes per share | Vote | 1 | |
Common Class B [Member] | ||
Capital Stock [Abstract] | ||
Common stock, shares authorized (in shares) | 100,000,000 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | |
Common stock, shares outstanding (in shares) | 0 | 0 |
Capital Stock, Weighted Average
Capital Stock, Weighted Average Shares Outstanding (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Weighted Average Shares Outstanding [Abstract] | |||
Basic weighted-average common shares outstanding (in shares) | 50,002 | 50,193 | 52,296 |
Effect of Dilutive Securities [Abstract] | |||
Stock awards and options (in shares) | 523 | 1,234 | 469 |
Diluted weighted-average common shares outstanding (in shares) | 50,525 | 51,427 | 52,765 |
Stock Options [Member] | |||
Weighted Average Shares Outstanding [Abstract] | |||
Anti-dilutive shares excluded from calculation of diluted earnings per share (in shares) | 100 | 100 | 400 |
Capital Stock, Dividends (Detai
Capital Stock, Dividends (Details) - USD ($) $ / shares in Units, $ in Thousands | 2 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
Feb. 15, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Dividends [Abstract] | ||||||||||||
Payment of cash dividends | $ 77,015 | $ 76,272 | $ 78,387 | |||||||||
Dividend Declared 2022-Q1 [Member] | ||||||||||||
Dividends [Abstract] | ||||||||||||
Cash dividend paid (in dollars per share) | $ 0.385 | |||||||||||
Dividend Declared 2022-Q2 [Member] | ||||||||||||
Dividends [Abstract] | ||||||||||||
Cash dividend paid (in dollars per share) | $ 0.385 | |||||||||||
Dividend Declared 2022-Q3 [Member] | ||||||||||||
Dividends [Abstract] | ||||||||||||
Cash dividend paid (in dollars per share) | $ 0.385 | |||||||||||
Dividend Declared 2022-Q4 [Member] | ||||||||||||
Dividends [Abstract] | ||||||||||||
Cash dividend paid (in dollars per share) | $ 0.385 | |||||||||||
Dividend Declared 2021-Q1 [Member] | ||||||||||||
Dividends [Abstract] | ||||||||||||
Cash dividend paid (in dollars per share) | $ 0.38 | |||||||||||
Dividend Declared 2021-Q2 [Member] | ||||||||||||
Dividends [Abstract] | ||||||||||||
Cash dividend paid (in dollars per share) | $ 0.38 | |||||||||||
Dividend Declared 2021-Q3 [Member] | ||||||||||||
Dividends [Abstract] | ||||||||||||
Cash dividend paid (in dollars per share) | $ 0.38 | |||||||||||
Dividend Declared 2021-Q4 [Member] | ||||||||||||
Dividends [Abstract] | ||||||||||||
Cash dividend paid (in dollars per share) | $ 0.38 | |||||||||||
Dividend Declared 2023-Q1 [Member] | Subsequent Event [Member] | ||||||||||||
Dividends [Abstract] | ||||||||||||
Dividend payable per share (in dollars per share) | $ 0.39 | |||||||||||
Dividend payable, date to be paid | Mar. 08, 2023 | |||||||||||
Dividend payable, date of record | Feb. 27, 2023 |
Capital Stock, Repurchases of C
Capital Stock, Repurchases of Common Stock (Details) - USD ($) $ in Thousands, shares in Millions | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jul. 31, 2018 | |
Repurchases of Common Stock [Abstract] | ||||
Class A common stock repurchased | $ 70,045 | $ 80,420 | $ 144,334 | |
2018 Stock Repurchase Plan [Member] | ||||
Repurchases of Common Stock [Abstract] | ||||
Authorized amount | $ 500,000 | |||
Amount available for repurchases | 175,400 | |||
Treasury Stock [Member] | ||||
Repurchases of Common Stock [Abstract] | ||||
Class A common stock repurchased | $ 70,045 | $ 80,420 | $ 144,334 | |
Treasury Stock [Member] | 2018 Stock Repurchase Plan [Member] | ||||
Repurchases of Common Stock [Abstract] | ||||
Class A common stock repurchased (in shares) | 1.7 | 1.6 | 5.1 | |
Class A common stock repurchased | $ 70,000 | $ 80,400 | $ 144,300 |
Stock-Based Compensation, Equit
Stock-Based Compensation, Equity Incentive Plans (Details) - 2010 Omnibus Incentive Plan [Member] - shares shares in Millions | 12 Months Ended | ||||
Jun. 03, 2020 | May 24, 2016 | Jun. 03, 2013 | Dec. 31, 2022 | Apr. 30, 2010 | |
Stock-Based Compensation [Abstract] | |||||
Number of shares authorized for issuance (in shares) | 7 | ||||
Number of additional shares authorized for issuance (in shares) | 5.9 | 3.8 | 3.2 | ||
Stock Options [Member] | |||||
Stock-Based Compensation [Abstract] | |||||
Contractual term | 7 years |
Stock-Based Compensation, Stock
Stock-Based Compensation, Stock Option Valuation Assumptions (Details) - Stock Options [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | ||
Fair Value Assumptions [Abstract] | |||
Weighted-average grant date fair value of grants (in dollars per share) | $ 16.1 | $ 8.59 | |
Risk-free interest rate | [1] | 0.50% | 1.40% |
Dividend yield | [2] | 2.90% | 2.90% |
Expected volatility | [3] | 49.50% | 40.70% |
Expected life in months | [4] | 56 months | 59 months |
Minimum [Member] | |||
Fair Value Assumptions [Abstract] | |||
Contractual life | 7 years | ||
Maximum [Member] | |||
Fair Value Assumptions [Abstract] | |||
Contractual life | 10 years | ||
[1] The risk-free interest rate is based upon the rate on a zero-coupon U.S. Treasury bill, for periods within the contractual life of the option, in effect at the time of the grant. The dividend yield is based on the average of historical stock prices and actual dividends paid. Expected volatility is based on the historical volatility of the Company’s stock price, over a period similar to the expected life of the option. The expected term of the option is based on the historical employee exercise behavior, the vesting terms of the respective option, and a contractual life of either seven or . |
Stock-Based Compensation, Sto_2
Stock-Based Compensation, Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Number of Shares [Roll Forward] | |||
Exercised (in shares) | (1,200,000) | (700,000) | (400,000) |
Stock Options [Member] | |||
Number of Shares [Roll Forward] | |||
Outstanding at beginning of year (in shares) | 2,758,300 | ||
Granted (in shares) | 0 | ||
Exercised (in shares) | (680,500) | ||
Forfeited/cancelled/expired (in shares) | (452,300) | ||
Outstanding at end of year (in shares) | 1,625,500 | 2,758,300 | |
Exercisable at end of year (in shares) | 1,122,500 | ||
Weighted-Average Exercise Price [Roll Forward] | |||
Outstanding at beginning of year (in dollars per share) | $ 39.9 | ||
Granted (in dollars per share) | 0 | ||
Exercised (in dollars per share) | 31.65 | ||
Forfeited/cancelled/expired (in dollars per share) | 50.95 | ||
Outstanding at end of year (in dollars per share) | 40.04 | $ 39.9 | |
Exercisable at end of year (in dollars per share) | $ 39.2 | ||
Remaining Contractual Term and Aggregate Intrinsic Value [Abstract] | |||
Outstanding options, weighted-average remaining contractual term | 3 years 6 months 10 days | ||
Outstanding options, aggregate intrinsic value | $ 10,349 | ||
Exercisable options, weighted-average remaining contractual term | 2 years 11 months 15 days | ||
Exercisable options, aggregate intrinsic value | $ 8,027 | ||
Service-Based Options [Member] | |||
Number of Shares [Roll Forward] | |||
Outstanding at beginning of year (in shares) | 538,200 | ||
Granted (in shares) | 0 | ||
Exercised (in shares) | (340,000) | ||
Forfeited/cancelled/expired (in shares) | (34,300) | ||
Outstanding at end of year (in shares) | 163,900 | 538,200 | |
Exercisable at end of year (in shares) | 163,900 | ||
Weighted-Average Exercise Price [Roll Forward] | |||
Outstanding at beginning of year (in dollars per share) | $ 35.89 | ||
Granted (in dollars per share) | 0 | ||
Exercised (in dollars per share) | 33.15 | ||
Forfeited/cancelled/expired (in dollars per share) | 54.45 | ||
Outstanding at end of year (in dollars per share) | 37.69 | $ 35.89 | |
Exercisable at end of year (in dollars per share) | $ 37.69 | ||
Remaining Contractual Term and Aggregate Intrinsic Value [Abstract] | |||
Outstanding options, weighted-average remaining contractual term | 4 months 6 days | ||
Outstanding options, aggregate intrinsic value | $ 834 | ||
Exercisable options, weighted-average remaining contractual term | 4 months 6 days | ||
Exercisable options, aggregate intrinsic value | $ 834 | ||
Performance-Based Options [Member] | |||
Number of Shares [Roll Forward] | |||
Outstanding at beginning of year (in shares) | 2,220,100 | ||
Granted (in shares) | 0 | ||
Exercised (in shares) | (340,500) | ||
Forfeited/cancelled/expired (in shares) | (418,000) | ||
Outstanding at end of year (in shares) | 1,461,600 | 2,220,100 | |
Exercisable at end of year (in shares) | 958,600 | ||
Weighted-Average Exercise Price [Roll Forward] | |||
Outstanding at beginning of year (in dollars per share) | $ 40.87 | ||
Granted (in dollars per share) | 0 | ||
Exercised (in dollars per share) | 31.14 | ||
Forfeited/cancelled/expired (in dollars per share) | 50.66 | ||
Outstanding at end of year (in dollars per share) | 40.3 | $ 40.87 | |
Exercisable at end of year (in dollars per share) | $ 39.46 | ||
Remaining Contractual Term and Aggregate Intrinsic Value [Abstract] | |||
Outstanding options, weighted-average remaining contractual term | 3 years 10 months 20 days | ||
Outstanding options, aggregate intrinsic value | $ 9,515 | ||
Exercisable options, weighted-average remaining contractual term | 3 years 4 months 28 days | ||
Exercisable options, aggregate intrinsic value | $ 7,193 |
Stock-Based Compensation, Sto_3
Stock-Based Compensation, Stock Options Exercised (Details) - Stock Options [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Stock-Based Compensation [Abstract] | |||
Cash proceeds from stock options exercised | $ 31,600 | $ 14,435 | $ 7,419 |
Tax benefit realized for stock options exercised | 229 | 807 | |
Tax expense realized for stock options exercised | (459) | ||
Intrinsic value of stock options exercised | $ 15,505 | $ 8,402 | $ 5,232 |
Stock-Based Compensation, Nonve
Stock-Based Compensation, Nonvested Restricted and Performance Stock Awards (Details) | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Restricted Stock Awards [Member] | |
Number of Shares [Roll Forward] | |
Nonvested at beginning of year (in shares) | shares | 884,900 |
Granted (in shares) | shares | 587,100 |
Vested (in shares) | shares | (326,600) |
Forfeited (in shares) | shares | (192,400) |
Nonvested at end of year (in shares) | shares | 953,000 |
Weighted-Average Grant Date Fair Value [Abstract] | |
Nonvested, beginning balance (in dollars per share) | $ / shares | $ 44.11 |
Granted (in dollars per share) | $ / shares | 46.04 |
Vested (in dollars per share) | $ / shares | 47.03 |
Forfeited (in dollars per share) | $ / shares | 44.01 |
Nonvested, Ending Balance (in dollars per share) | $ / shares | $ 44.28 |
Performance Share Units [Member] | |
Number of Shares [Roll Forward] | |
Nonvested at beginning of year (in shares) | shares | 0 |
Granted (in shares) | shares | 192,700 |
Vested (in shares) | shares | 0 |
Forfeited (in shares) | shares | (12,500) |
Nonvested at end of year (in shares) | shares | 180,200 |
Weighted-Average Grant Date Fair Value [Abstract] | |
Nonvested, beginning balance (in dollars per share) | $ / shares | $ 0 |
Granted (in dollars per share) | $ / shares | 44.39 |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 44.39 |
Nonvested, Ending Balance (in dollars per share) | $ / shares | $ 44.39 |
Stock-Based Compensation, Sto_4
Stock-Based Compensation, Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Stock-Based Compensation Expense [Abstract] | |||
Stock-based compensation expense (income) | $ 12,367 | $ 23,194 | $ 24,060 |
Stock Options [Member] | |||
Unrecognized Stock-Based Compensation Expense [Abstract] | |||
Unrecognized stock-based compensation expense | $ 100 | ||
Unrecognized stock-based compensation expense, period for recognition | 1 month 6 days | ||
Restricted Stock Awards [Member] | |||
Unrecognized Stock-Based Compensation Expense [Abstract] | |||
Unrecognized stock-based compensation expense | $ 29,600 | ||
Unrecognized stock-based compensation expense, period for recognition | 2 years 7 months 6 days | ||
Service-Based Options [Member] | |||
Stock-Based Compensation Expense [Abstract] | |||
Stock-based compensation expense (income) | $ 0 | 0 | 300 |
Service-Based Restricted Stock Units [Member] | |||
Stock-Based Compensation Expense [Abstract] | |||
Stock-based compensation expense (income) | 14,300 | 15,400 | 13,900 |
Performance-Based Options [Member] | |||
Stock-Based Compensation Expense [Abstract] | |||
Stock-based compensation expense (income) | (2,000) | 7,800 | 9,900 |
Performance Stock Units [Member] | |||
Stock-Based Compensation Expense [Abstract] | |||
Stock-based compensation expense (income) | $ 0 | $ 0 | $ 0 |
Fair Value and Equity Investm_3
Fair Value and Equity Investments, Fair Value (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Contingent Consideration [Member] | ||
Changes in Fair Value of Level 3 Contingent Consideration [Roll Forward] | ||
Beginning balance | $ (10,341) | $ (3,125) |
Additions from acquisitions | 0 | (8,702) |
Changes in fair value of contingent consideration | 3,977 | 1,486 |
Ending balance | (6,364) | (10,341) |
Fair Value on a Recurring Basis [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 55,356 | 66,477 |
Derivative financial instruments asset | 19,738 | 6,590 |
Life insurance contracts | 40,055 | 49,851 |
Contingent consideration | (6,364) | (10,341) |
Financial assets (liabilities) | 108,785 | 112,577 |
Restricted current investments | 4,900 | 5,200 |
Fair Value on a Recurring Basis [Member] | Level 1 [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 55,356 | 66,477 |
Derivative financial instruments asset | 0 | 0 |
Life insurance contracts | 0 | 0 |
Contingent consideration | 0 | 0 |
Financial assets (liabilities) | 55,356 | 66,477 |
Fair Value on a Recurring Basis [Member] | Level 2 [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 0 | 0 |
Derivative financial instruments asset | 19,738 | 6,590 |
Life insurance contracts | 0 | 0 |
Contingent consideration | 0 | 0 |
Financial assets (liabilities) | 19,738 | 6,590 |
Fair Value on a Recurring Basis [Member] | Level 3 [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 0 | 0 |
Derivative financial instruments asset | 0 | 0 |
Life insurance contracts | 40,055 | 49,851 |
Contingent consideration | (6,364) | (10,341) |
Financial assets (liabilities) | 33,691 | 39,510 |
Life Insurance Contracts [Member] | ||
Changes in Fair Value of Level 3 Marketable Securities [Roll Forward] | ||
Beginning balance | 49,851 | 45,453 |
Actual return on plan assets | (9,180) | 5,153 |
Purchases and issuances | 0 | 6,261 |
Sales and settlements | (616) | (7,016) |
Ending balance | $ 40,055 | $ 49,851 |
Fair Value and Equity Investm_4
Fair Value and Equity Investments, Equity Investments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Equity Investments [Abstract] | |||
Upward fair value adjustments on equity securities | $ 0 | $ 18,077 | $ 0 |
Equity Securities [Member] | |||
Equity Investments [Abstract] | |||
Carrying amount of equity securities without readily determinable fair values | $ 28,100 | 28,100 | |
Additional investment made | 5,000 | ||
Equity Securities [Member] | Other Income (Expense), Net [Member] | |||
Equity Investments [Abstract] | |||
Upward fair value adjustments on equity securities | $ 18,100 |
Income Taxes, Consolidated Inco
Income Taxes, Consolidated Income Before Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Consolidated Income Before Provision for Income Taxes [Abstract] | |||
U.S. | $ 24,411 | $ 45,371 | $ 71,138 |
Foreign | 64,559 | 187,088 | 185,094 |
Income before provision for income taxes | $ 88,970 | $ 232,459 | $ 256,232 |
Income Taxes, Current and Defer
Income Taxes, Current and Deferred Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current [Abstract] | |||
Federal | $ 0 | $ 0 | $ 0 |
State | 1,515 | 1,458 | 1,629 |
Foreign | 34,117 | 77,393 | 77,079 |
Current income tax expense (benefit) | 35,632 | 78,851 | 78,708 |
Deferred [Abstract] | |||
Federal | (65,733) | 3,705 | (14,430) |
State | (1,239) | (38) | (563) |
Foreign | 15,532 | 2,675 | 1,162 |
Deferred income tax expense (benefit) | (51,440) | 6,342 | (13,831) |
Provision for income taxes | $ (15,808) | $ 85,193 | $ 64,877 |
Income Taxes, Deferred Tax Asse
Income Taxes, Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Deferred Tax Assets [Abstract] | ||
Inventory differences | $ 41,127 | $ 5,859 |
Foreign tax credit and other foreign benefits | 51,273 | 69,401 |
Stock-based compensation | 5,981 | 9,392 |
Accrued expenses not deductible until paid | 37,181 | 36,401 |
Foreign currency exchange | 0 | 605 |
Net operating losses | 12,773 | 9,479 |
Capitalized research and development | 26,406 | 22,962 |
R&D credit carryforward | 1,795 | 1,451 |
Other | 242 | 34 |
Gross deferred tax assets | 176,778 | 155,584 |
Deferred Tax Liabilities [Abstract] | ||
Foreign currency exchange | 3,225 | 0 |
Foreign withholding taxes | 15,375 | 15,412 |
Intangibles step-up | 4,446 | 4,446 |
Overhead allocation to inventory | 3,504 | 3,373 |
Amortization of intangibles | 21,211 | 21,936 |
Other | 6,129 | 6,133 |
Gross deferred tax liabilities | 53,890 | 51,300 |
Valuation allowance | (33,557) | (80,186) |
Deferred taxes, net | 89,331 | $ 24,098 |
R&D Credit Carryforward [Member] | ||
Tax Credit Carryforwards [Abstract] | ||
Valuation allowance on tax credit carryforward | $ 1,800 | |
R&D Credit Carryforward [Member] | Minimum [Member] | ||
Tax Credit Carryforwards [Abstract] | ||
Expiration date | Dec. 31, 2036 | |
R&D Credit Carryforward [Member] | Maximum [Member] | ||
Tax Credit Carryforwards [Abstract] | ||
Expiration date | Dec. 31, 2041 | |
Foreign Tax Credit [Member] | ||
Operating Loss Carryforwards [Abstract] | ||
Operating loss carryforwards | $ 35,400 | |
Operating loss carryforwards subject to expiration | 18,600 | |
Operating loss carryforwards not subject to expiration | 16,800 | |
Operating loss carryforwards on which valuation allowance has been placed | 34,800 | |
Valuation allowance on operating loss carryforwards | 12,700 | |
Tax Credit Carryforwards [Abstract] | ||
Valuation allowance on tax credit carryforward | $ 19,100 | |
Foreign Tax Credit [Member] | Minimum [Member] | ||
Operating Loss Carryforwards [Abstract] | ||
Expiration date | Dec. 31, 2023 | |
Tax Credit Carryforwards [Abstract] | ||
Expiration date | Dec. 31, 2028 | |
Foreign Tax Credit [Member] | Maximum [Member] | ||
Operating Loss Carryforwards [Abstract] | ||
Expiration date | Dec. 31, 2042 | |
Tax Credit Carryforwards [Abstract] | ||
Expiration date | Dec. 31, 2031 |
Income Taxes, Deferred Tax As_2
Income Taxes, Deferred Tax Asset Valuation Adjustments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |||||
Valuation Allowance [Roll Forward] | |||||||
Impact of change in capitalization policy for tax purposes under IRC Section 263A | $ (51,300) | ||||||
Utilization of foreign tax credits | (18,100) | ||||||
Valuation allowance release of foreign tax credits | (32,200) | ||||||
Foreign tax credit carryforward due to disposal of Grow Tech segment | $ 11,900 | ||||||
Deferred Tax Asset Valuation Allowance [Member] | |||||||
Valuation Allowance [Roll Forward] | |||||||
Beginning balance | 80,186 | 67,340 | $ 77,042 | ||||
Additions charged to cost and expenses | 3,231 | [1] | 12,674 | [2] | 2,154 | [1] | |
Decreases | (50,315) | [3] | 0 | [4] | (12,100) | [5] | |
Adjustments | [6] | 455 | 172 | 244 | |||
Ending balance | $ 33,557 | $ 80,186 | $ 67,340 | ||||
[1]Increase in valuation is due primarily to net operating losses in foreign markets.[2]Increase in valuation is primarily due to $11.9 million that was recorded on the foreign tax credit carryforward due to the disposal of the Company’s Grow Tech segment. The additional amount is due to net operating losses in foreign markets.[3]The decrease was due to utilization of $18.1 million of foreign tax credits and the valuation allowance release of $32.2 million foreign tax credits.[4]No decreases in 2021.[5]The decrease was due primarily to the utilization of foreign tax credits that had previously had a valuation allowance recorded against the asset.[6]Represents the net currency effects of translating valuation allowances at current rates of exchange. |
Income Taxes, Deferred Taxes, N
Income Taxes, Deferred Taxes, Net of a Jurisdiction Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Income Taxes [Abstract] | ||
Net noncurrent deferred tax assets | $ 89,770 | $ 26,483 |
Net noncurrent deferred tax liabilities | 439 | 2,385 |
Deferred taxes, net | $ 89,331 | $ 24,098 |
Income Taxes, Reconciliation of
Income Taxes, Reconciliation of Statutory to Effective Tax Rate (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Effective Income Tax Rate Reconciliation [Abstract] | |||
Income taxes at statutory rate | 21% | 21% | 21% |
Excess tax benefit from equity award | (0.12%) | (0.19%) | 0.70% |
Deferred compensation | 2.18% | (0.46%) | (0.30%) |
Executive salary limitation | 2.06% | 0.47% | 0.04% |
Non-U.S. income taxed at different rates | 4.78% | 6.06% | 3.37% |
Foreign withholding taxes | (0.73%) | 4.71% | 5.21% |
Change in reserve for uncertain tax positions | 17.69% | (0.06%) | 1.98% |
Valuation allowance recognized foreign tax credit & others | (56.17%) | 5.12% | (4.59%) |
Foreign-Derived Intangible Income (FDII) | (8.14%) | (0.87%) | (2.78%) |
Other | (0.32%) | 0.87% | 0.69% |
Effective income tax rate, continuing operations | (17.77%) | 36.65% | 25.32% |
Cumulative amount of undistributed earnings of non-U.S. subsidiaries | $ 60 | ||
Incremental taxes if undistributed earnings on non-U.S. subsidiaries were repatriated | $ 6 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - 401(k) Defined Contribution Plan [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
401(k) Defined Contribution Plan [Abstract] | |||
Maximum percentage of compensation that can be deferred | 100% | ||
Minimum age to make contributions | 18 years | ||
Requisite service period | 1 day | ||
Percentage of employees' base pay matched by employer | 4% | 4% | 4% |
Vesting period for Company's matching contributions | 2 years | ||
Compensation expense | $ 3.8 | $ 4.8 | $ 4.4 |
Additional discretionary contribution by employer, maximum percentage of employees' base pay | 10% | ||
Additional discretionary contribution by employer, annual vesting percentage | 20% | ||
Vesting period for Company's additional discretionary contributions | 5 years |
Deferred Compensation Plan (Det
Deferred Compensation Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Deferred Compensation Plan [Abstract] | |||
Percentage of participant's base salary contributed | 5% | 10% | |
Percentage of Company contributions that vest after ten years of service | 50% | ||
Number of years of service to qualify for 50% vesting in Company contributions | 10 years | ||
Percentage of Company contributions that vest annually thereafter | 5% | ||
Minimum age for participant's unvested company contributions to fully vest | 60 years | ||
Percentage of Company contributions that vest after five years of service | 20% | ||
Vesting period | 5 years | ||
Participant's vesting percentage | 100% | ||
Compensation expense | $ 2,300 | $ 4,000 | $ 2,300 |
Long-term deferred compensation liability | 44,427 | 54,213 | |
Investment in Rabbi Trust | $ 40,100 | $ 49,900 | |
Maximum [Member] | |||
Deferred Compensation Plan [Abstract] | |||
Percentage of participant's salary that can be deferred | 80% | ||
Percentage of participant's bonus or director fees that can be deferred | 100% | ||
Minimum [Member] | |||
Deferred Compensation Plan [Abstract] | |||
Number of years of service required for accelerated vesting above specified compensation level | 10 years |
Derivative Financial Instrume_3
Derivative Financial Instruments, Fair Value of Derivative Instruments on the Balance Sheet (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) Derivatives | Dec. 31, 2021 USD ($) | |
Derivatives and Hedging Activities [Abstract] | ||
Loss to be reclassified to interest expense during next twelve months | $ (9,200) | |
Number of outstanding derivatives held | Derivatives | 4 | |
Notional amount | $ 200,000 | |
Interest Rate Swaps [Member] | Designated as Hedging Instrument [Member] | Prepaid Expenses and Other [Member] | ||
Derivatives and Hedging Activities [Abstract] | ||
Fair value, asset | 9,156 | $ 557 |
Interest Rate Swaps [Member] | Designated as Hedging Instrument [Member] | Other Assets [Member] | ||
Derivatives and Hedging Activities [Abstract] | ||
Fair value, asset | $ 10,582 | $ 6,033 |
Derivative Financial Instrume_4
Derivative Financial Instruments, Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income (Details) - Interest Rate Swaps [Member] - Designated as Hedging Instrument [Member] - Cash Flow Hedges [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other Income (Expense), Net [Member] | |||
Derivatives and Hedging Activities [Abstract] | |||
Gain (loss) reclassified from accumulated other comprehensive loss into income | $ 3,117 | $ (157) | $ (24) |
Other Comprehensive Income [Member] | |||
Derivatives and Hedging Activities [Abstract] | |||
Gain (loss) recognized in OCI | $ 16,267 | $ 5,391 | $ 1,017 |
Segment Information, Revenue by
Segment Information, Revenue by Segment (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 USD ($) Segment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | ||
Segment Information [Abstract] | ||||
Number of reportable segments | Segment | 9 | |||
Number of geographic segments | Segment | 7 | |||
Number of Rhyz Investments segments | Segment | 2 | |||
Revenue by Segment [Abstract] | ||||
Revenue | $ 2,225,659 | $ 2,695,669 | $ 2,581,934 | |
Other [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 3,959 | 3,653 | 886 | |
Operating Segment [Member] | Nu Skin [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 2,072,371 | 2,523,112 | 2,432,595 | |
Operating Segment [Member] | Americas [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 508,537 | 547,755 | 453,022 | |
Operating Segment [Member] | Mainland China [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 360,389 | 568,774 | 625,538 | |
Operating Segment [Member] | Southeast Asia/Pacific [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 344,411 | 336,651 | 361,627 | |
Operating Segment [Member] | South Korea [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 268,707 | 354,252 | 326,478 | |
Operating Segment [Member] | Japan [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 224,896 | 266,216 | 273,681 | |
Operating Segment [Member] | EMEA [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 204,275 | 283,200 | 230,246 | |
Operating Segment [Member] | Hong Kong/Taiwan [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 157,197 | 162,611 | 161,117 | |
Operating Segment [Member] | Rhyz Investments [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 153,288 | 172,557 | 149,339 | |
Operating Segment [Member] | Manufacturing [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | [1] | 149,458 | 172,120 | 149,339 |
Operating Segment [Member] | Rhyz Other [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | 3,830 | 437 | 0 | |
Intersegment [Member] | Manufacturing [Member] | ||||
Revenue by Segment [Abstract] | ||||
Revenue | $ 69,200 | $ 84,500 | $ 39,400 | |
[1]The Manufacturing segment had $69.2 million, $84.5 million and $39.4 million of intersegment revenue for the years ended December 31, 2022, 2021 and 2020, respectively. Intersegment revenue is eliminated in the consolidated financial statements and in the table above. |
Segment Information, Segment Co
Segment Information, Segment Contribution (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Segment Contribution [Abstract] | |||
Operating income | $ 110,847 | $ 233,992 | $ 257,564 |
Other income (expense) | (21,877) | (1,533) | (1,332) |
Income before provision for income taxes | 88,970 | 232,459 | 256,232 |
Operating Segment [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | 459,580 | 627,085 | 602,835 |
Operating Segment [Member] | Nu Skin [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | 462,190 | 610,552 | 581,667 |
Operating Segment [Member] | Americas [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | 110,522 | 116,265 | 86,386 |
Operating Segment [Member] | Mainland China [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | 72,362 | 151,645 | 181,024 |
Operating Segment [Member] | Southeast Asia/Pacific [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | 85,827 | 81,779 | 87,753 |
Operating Segment [Member] | South Korea [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | 81,804 | 114,034 | 100,933 |
Operating Segment [Member] | Japan [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | 54,976 | 67,511 | 68,027 |
Operating Segment [Member] | EMEA [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | 21,446 | 41,988 | 24,078 |
Operating Segment [Member] | Hong Kong/Taiwan [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | 35,253 | 37,330 | 33,466 |
Operating Segment [Member] | Rhyz Investments [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | (2,610) | 16,533 | 21,168 |
Operating Segment [Member] | Manufacturing [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | 3,570 | 18,346 | 21,168 |
Operating Segment [Member] | Rhyz Other [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | (6,180) | (1,813) | 0 |
Corporate and Other [Member] | |||
Segment Contribution [Abstract] | |||
Operating income | $ (348,733) | $ (393,093) | $ (345,271) |
Segment Information, Depreciati
Segment Information, Depreciation and Amortization and Capital Expenditures (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | $ 72,506 | $ 76,320 | $ 73,991 |
Capital expenditures | 59,056 | 68,615 | 63,823 |
Operating Segments [Member] | Nu Skin [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 21,492 | 24,594 | 23,135 |
Capital expenditures | 17,061 | 29,452 | 29,752 |
Operating Segments [Member] | Americas [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 591 | 871 | 984 |
Capital expenditures | 204 | 714 | 1,061 |
Operating Segments [Member] | Mainland China [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 12,177 | 13,345 | 11,056 |
Capital expenditures | 10,692 | 24,382 | 19,363 |
Operating Segments [Member] | Southeast Asia/Pacific [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 1,500 | 1,450 | 1,670 |
Capital expenditures | 263 | 1,330 | 2,197 |
Operating Segments [Member] | South Korea [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 1,616 | 3,279 | 3,620 |
Capital expenditures | 727 | 854 | 1,420 |
Operating Segments [Member] | Japan [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 1,011 | 906 | 1,876 |
Capital expenditures | 225 | 194 | 3,128 |
Operating Segments [Member] | EMEA [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 854 | 1,106 | 1,017 |
Capital expenditures | 1,612 | 1,242 | 1,875 |
Operating Segments [Member] | Hong Kong/Taiwan [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 3,743 | 3,637 | 2,912 |
Capital expenditures | 3,338 | 736 | 708 |
Operating Segments [Member] | Rhyz Investments [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 16,206 | 13,344 | 8,081 |
Capital expenditures | 7,301 | 14,022 | 14,366 |
Operating Segments [Member] | Manufacturing [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 13,838 | 11,765 | 8,081 |
Capital expenditures | 7,301 | 14,022 | 14,366 |
Operating Segments [Member] | Rhyz Other [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 2,368 | 1,579 | 0 |
Capital expenditures | 0 | 0 | 0 |
Corporate and Other [Member] | |||
Summarized Financial Information [Abstract] | |||
Depreciation and amortization | 34,808 | 38,382 | 42,775 |
Capital expenditures | $ 34,694 | $ 25,141 | $ 19,705 |
Segment Information, Revenue _2
Segment Information, Revenue by Major Market (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Market | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Segment Information [Abstract] | |||
Number of major markets | Market | 4 | ||
Number of markets | Market | 45 | ||
Segment Contribution [Abstract] | |||
Revenue | $ 2,225,659 | $ 2,695,669 | $ 2,581,934 |
Major Market [Member] | United States [Member] | |||
Segment Contribution [Abstract] | |||
Revenue | 537,081 | 540,253 | 425,155 |
Major Market [Member] | Mainland China [Member] | |||
Segment Contribution [Abstract] | |||
Revenue | 360,389 | 568,774 | 625,538 |
Major Market [Member] | South Korea [Member] | |||
Segment Contribution [Abstract] | |||
Revenue | 268,707 | 354,252 | 326,478 |
Major Market [Member] | Japan [Member] | |||
Segment Contribution [Abstract] | |||
Revenue | 224,896 | 266,216 | 273,681 |
Major Market [Member] | All Others [Member] | |||
Segment Contribution [Abstract] | |||
Revenue | $ 834,586 | $ 966,174 | $ 931,082 |
Segment Information, Revenue _3
Segment Information, Revenue by Product Line (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue by Product Line [Abstract] | |||
Revenue | $ 2,225,659 | $ 2,695,669 | $ 2,581,934 |
Beauty [Member] | |||
Revenue by Product Line [Abstract] | |||
Revenue | 1,069,714 | 1,442,659 | 1,491,803 |
Wellness [Member] | |||
Revenue by Product Line [Abstract] | |||
Revenue | 992,338 | 1,062,549 | 922,553 |
Other [Member] | |||
Revenue by Product Line [Abstract] | |||
Revenue | $ 163,607 | $ 190,461 | $ 167,578 |
Segment Information, Long-Lived
Segment Information, Long-Lived Assets by Major Market (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Long-Lived Assets by Major Market [Abstract] | |||
Long-lived assets | $ 557,799 | $ 581,124 | $ 632,670 |
Major Market [Member] | United States [Member] | |||
Long-Lived Assets by Major Market [Abstract] | |||
Long-lived assets | 343,482 | 335,020 | 348,028 |
Major Market [Member] | Mainland China [Member] | |||
Long-Lived Assets by Major Market [Abstract] | |||
Long-lived assets | 132,148 | 149,124 | 152,312 |
Major Market [Member] | South Korea [Member] | |||
Long-Lived Assets by Major Market [Abstract] | |||
Long-lived assets | 30,867 | 25,364 | 39,104 |
Major Market [Member] | Japan [Member] | |||
Long-Lived Assets by Major Market [Abstract] | |||
Long-lived assets | 18,011 | 23,929 | 31,085 |
Major Market [Member] | All Others [Member] | |||
Long-Lived Assets by Major Market [Abstract] | |||
Long-lived assets | $ 33,291 | $ 47,687 | $ 62,141 |
Other Income (Expense), Net (De
Other Income (Expense), Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other Income (Expense), Net [Abstract] | |||
Other income (expense), net | $ (21,877) | $ (1,533) | $ (1,332) |
Interest expense | $ 13,500 | $ 11,000 | $ 13,100 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Supplemental Cash Flow Information [Abstract] | |||
Cash paid for interest | $ 14.5 | $ 8.6 | $ 11.2 |
Cash paid for income taxes | $ 42.1 | $ 96 | $ 56.2 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Acquisitions [Abstract] | ||||
Purchase price, net of cash acquired | $ 0 | $ 18,963 | $ 14,949 | |
Accrued liability | 34,920 | 31,111 | ||
Fair Value of Assets Acquired [Abstract] | ||||
Goodwill | $ 206,432 | $ 206,432 | ||
Useful life | 13 years | |||
Trademarks [Member] | ||||
Fair Value of Assets Acquired [Abstract] | ||||
Useful life | 9 years | |||
Mavely [Member] | ||||
Acquisitions [Abstract] | ||||
Percentage interest acquired | 100% | |||
Purchase price, net of cash acquired | $ 16,800 | |||
Cash acquired | 400 | |||
Accrued liability | 900 | |||
Incremental contingent consideration | 24,000 | |||
Contingent consideration | 8,700 | |||
Gross purchase price | 29,400 | |||
Fair Value of Assets Acquired [Abstract] | ||||
Intangible assets | 16,400 | |||
Cash | 400 | |||
Accounts receivable | 100 | |||
Deferred tax liability | 3,500 | |||
Goodwill | 12,600 | |||
Mavely [Member] | Customer Relationships [Member] | ||||
Fair Value of Assets Acquired [Abstract] | ||||
Intangible assets | 2,000 | |||
Useful life | 4 years | |||
Mavely [Member] | Technology [Member] | ||||
Fair Value of Assets Acquired [Abstract] | ||||
Intangible assets | 11,300 | |||
Useful life | 8 years | |||
Mavely [Member] | Trademarks [Member] | ||||
Fair Value of Assets Acquired [Abstract] | ||||
Intangible assets | 2,800 | |||
Useful life | 8 years | |||
Mavely [Member] | Other Intangibles [Member] | ||||
Fair Value of Assets Acquired [Abstract] | ||||
Intangible assets | $ 300 | |||
Useful life | 3 years |
Restructuring and Severance C_3
Restructuring and Severance Charges, Exit Grow Tech Segment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Restructuring [Abstract] | |||
Non-cash impairment charges | $ 48,494 | $ 51,870 | $ 0 |
Impairment of goodwill | 0 | $ 0 | |
Impairment of fixed assets | 8,200 | 13,700 | |
Accrued Expenses [Member] | |||
Restructuring [Abstract] | |||
Liability related to cash charges | 20,000 | ||
Exit Grow Tech Segment [Member] | |||
Restructuring [Abstract] | |||
Non-cash impairment charges | 38,500 | ||
Impairment of goodwill | 9,200 | ||
Impairment of intangible assets | 9,000 | ||
Impairment of fixed assets | 13,700 | ||
Inventory write-off | 6,600 | ||
Cash charges associated with restructuring | 20,000 | ||
Employee severance | 6,500 | ||
Other related restructuring charges | 5,000 | $ 13,500 | |
Cash payments | 20,000 | ||
Ending restructuring accrual | $ 5,000 |
Restructuring and Severance C_4
Restructuring and Severance Charges, Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Restructuring [Abstract] | |||
Impairment of fixed assets | $ 8,200 | $ 13,700 | |
Impairment of other intangible assets | 1,700 | ||
Restructuring expenses | 48,494 | $ 51,870 | $ 0 |
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | |||
Restructuring [Abstract] | |||
Severance charges | 20,100 | ||
Lease termination cost | 7,400 | ||
Other associated restructuring costs | 5,200 | ||
Impairment of fixed assets | 8,200 | ||
Accelerated depreciation | 900 | ||
Impairment of other intangible assets | 1,700 | ||
Cash payments | 21,000 | ||
Ending restructuring accrual | 11,700 | ||
Restructuring expenses | 43,494 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Minimum [Member] | |||
Restructuring [Abstract] | |||
Estimated restructuring costs | 50,000 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Maximum [Member] | |||
Restructuring [Abstract] | |||
Estimated restructuring costs | 55,000 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | Nu Skin [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 23,516 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | Americas [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 1,687 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | Mainland China [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 13,181 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | Southeast Asia/Pacific [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 1,809 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | South Korea [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 1,533 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | Japan [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 699 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | EMEA [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 2,143 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | Hong Kong/Taiwan [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 2,464 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | Rhyz Investments [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 401 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | Manufacturing [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 401 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Operating Segment [Member] | Rhyz Other [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 0 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Corporate and Other [Member] | |||
Restructuring [Abstract] | |||
Restructuring expenses | 19,577 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Severance and Lease Termination [Member] | Minimum [Member] | |||
Restructuring [Abstract] | |||
Estimated restructuring costs | 40,000 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Severance and Lease Termination [Member] | Maximum [Member] | |||
Restructuring [Abstract] | |||
Estimated restructuring costs | 45,000 | ||
Focus Resources on Strategic Priorities and Optimize Future Growth and Profitability [Member] | Impairment of Fixed Assets, Acceleration of Depreciation and Other Intangibles Related to Footprint Optimization [Member] | |||
Restructuring [Abstract] | |||
Estimated restructuring costs | $ 10,000 |