Natural Health Trends (NHTC) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue was $10.7 million, down 2% year-over-year, with Hong Kong contributing 85% of revenue, primarily from sales delivered to members in China.

• Orders increased 9% sequentially from Q4 2024, reflecting sustained product demand.

• Active member base declined to 30,180 at March 31, 2025, down 5% year-over-year and from 30,870 at December 31.

• The company continues to focus resources on Greater China and markets with strong member networks, while navigating regulatory and geopolitical risks.

• New product launches, marketing initiatives, and a nine-city roadshow in China and Hong Kong supported brand engagement.

Financial highlights

• Gross profit margin rose to 73.6% from 73.4% in Q1 2024, with gross profit at $7.9 million.

• Operating loss was $345,000, improved from $365,000 in Q1 2024.

• Net income was $122,000 (1 cent per diluted share), down from $188,000 (2 cents per diluted share) year-over-year.

• Net cash from operating activities was $484,000, compared to $549,000 in Q1 2024.

• Cash, cash equivalents, and marketable securities totaled $41.9 million at quarter-end, down from $43.9 million at December 31, 2024.

Outlook and guidance

• Management is monitoring the impact of new U.S.-China tariffs and may adjust product sourcing and pricing to mitigate effects.

• Strategic actions underway to optimize supply chain and logistics, especially in Asia, and align manufacturing closer to key markets.

• The company expects to continue paying a quarterly cash dividend of $0.20 per share for the foreseeable future, subject to Board discretion.

• Plans to invest in China-based manufacturing and infrastructure to support long-term growth and potential direct selling license application.

• Commitment to delivering high-quality products and service to members remains a priority.