LifeVantage Corporation Stock

Thank you. Good day, ladies and gentlemen. Thank you for standing by. Welcome to DataAge's conference call to discuss LifeVantage's fourth quarter and fiscal year 2026 results. At this time, all participants are in a listen-only mode. Following the formal remarks, we'll conduct a question and answer session. will be provided at that time for you to queue up. Hosting today's conference will be Reed Anderson with ICR. As a reminder, today's conference is being recorded and I.

I would now like to turn the conference over to Mr. Anderson. Please go ahead, sir. Thank you and good afternoon, everyone, and welcome to LifeVantage Corporation's conference call to discuss results for the fourth quarter and full fiscal year 2026. the call today from LifeVantage are Terrence Moorhead, President and Chief Executive Officer, and Carl Alray, Chief Financial Officer. By now, everyone should have access to the earnings release, which went out this afternoon at approximately 4.05 p.m. Eastern Time. If you have not received the release, it is available on the investor relations portion of LifeVantage site at www.lifevantage.com. This call is being webcast and a replay will be available on the company's website as well. Before we begin, we'd like to remind everyone that our prepared remarks contain forward-looking statements, and management may make additional forward-looking statements in response to your questions. These statements do not guarantee future performance, and therefore undue reliance should not be placed upon them.

Thank you. statements are based on current expectations of the company's management, involve inherent risks and uncertainties, including those identified in the risk factor section of life advantages most recently filed, forms 10-K and 10-Q. Please note that during today's call, we will discuss non-GAAP financial measures, including results on an adjusted basis. Management believes these financial measures can facilitate a more complete analysis and greater transparency to LifeVantage's ongoing results of operations, particularly when comparing underlying operating results from period to period. We've included a reconciliation of these non-GAAP measures with today's release. This call also contains time-sensitive information. that is accurate only as of the date of this live broadcast, August 27th, 2026. LifeVantage assumes no obligation to update any forward-looking projections that may be made in today's release or call. Now I will turn the call over to Terrence Moorhead, President and Chief Executive Officer of LifeVantage.

Thank you, Reid, and good afternoon, everyone. Before we begin, I want to take a moment to thank Michael Beindorf for his stewardship of the business and recognize our leadership team for their support during this transition. Michael stepped in to take on the leadership role, and on behalf of the board of directors, I want to thank him for his leadership. With that, I'd like to say that it's truly a privilege to join you today as Chief Executive Officer of LifeVantage. Since joining the company, I've been immersed in the business, meeting employees, talking with our sales organization and customers, reviewing processes, evaluating capabilities, and assessing our position in the market. It's only been a few weeks, but my conviction about this company is stronger today than when I accepted the role. What attracted me to LifeVantage was the company's differentiated science, solid balance sheet and economics, and significant untapped potential.

Specifically, I believe the company's differentiated science is a critical linchpin to our future success. LifeVantage occupies a unique position in the health and wellness industry, focused on delivering a scientifically grounded platform that helps activate the body's natural biological processes. There are a lot of supplement companies on the market, but there aren't a lot of companies like LifeVantage whose products actually help our bodies do what they're naturally built to do instead of just supplementing our diets. That's a meaningful and powerful distinction, and I believe it gives LifeVantage a real competitive advantage that we intend to leverage. As I look at LifeVantage through a more consumer-focused lens, I see an opportunity for us to build a larger, stronger, more relevant brand. We have compelling science, differentiated products, strong margins, and are targeting a passionate group of consumers that are looking for new ways to improve their health every single day. Those are important building blocks that can create substantial value when paired with focused brand building, disciplined execution, and and a consumer-centric growth strategy.

My initial impression is that the opportunity in front of us is about unlocking the company's potential by reimagining key aspects of the business. We have an opportunity to revitalize our positioning, reframe how consumers think about our brand, strengthen product storylines, and create a greater understanding of the value of our products. Coming out of the blocks, our early focus will be centered around three priorities. First, strengthening the LifeVantage brand. We have valuable science and differentiated products, but I believe we can do a much better job of communicating our story in a more clear, compelling, and consumer-friendly way. Consumers gravitate towards brands they trust and understand. Building that connection consistently and at scale will be a major focus. Our second priority focuses on building a more relevant consumer proposition.

Here, our goal is to arm our sales force with more powerful tools, dramatically improve the consumer experience, and create a larger base of loyal consumers who incorporate LifeVantage in their lives on a daily basis. Our third and final priority will focus on improving operational excellence and profitability. One of the things that immediately stood out to me about LifeVantage were the economics of the business, particularly the gross margins that have historically approached 80% and could create strong opportunities. The challenge will be to effectively translate those economics into sustainable growth and improved shareholder value. Now, I want to be thoughtful about expectations. It's still early in my tenure, so we're not going to be providing any formal guidance at this time. Over the next several months, we'll continue to assess the business and work closely with our leadership team to develop a comprehensive growth strategy supported by clear priorities, measurable objectives, and accountability throughout the organization.

What I can tell you today is that I accepted this role because I believe this company has far greater potential than its current scale reflects. I believe in the potential of our brand. I believe in the quality of our products. And I believe in the people behind this business. We have meaningful work ahead of us, but I'm confident that we have what it takes to create long-term value for our sales force, our employees, and our shareholders. I look forward to sharing more about our plans as the work progresses. And with that, I'd like to turn the call over to our Chief Financial Officer, Carl Oury, so he can walk you through our financial results in more detail.

Carl?.

Thank you, Terrence, and good afternoon, everyone. Let me walk you through our fourth quarter financial results. Please note that I will be discussing our non-GAAP adjusted results where applicable. You can refer to the GAAP to non-GAAP reconciliations in today's press release for additional details. FOR THE FOURTH QUARTER OF FISCAL 2026, WE DELIVERED NET REVENUE OF 42.4 MILLION, WHICH WAS DOWN 23.1% COMPARED TO 55.1 MILLION IN THE FOURTH QUARTER OF FISCAL 2025. The decrease was primarily driven by downward pressure in the number of orders from our active account base and lower average order size, reflecting impacts from the broader macroeconomic environment, as well as lower sales of our mind-body GLP-1 system cycling the higher comparable fourth quarter of fiscal 2025 and partially offset by sales of Love Biome, which we acquired in October of 2025. Fourth quarter revenue was down 3.1% sequentially from the third quarter of fiscal 2026.

Revenue in the Americas region decreased 24.8% to $32.7 million, and revenue in the Asia-Pacific and Europe region decreased 16.9% to $9.7 million. Subscription-based revenue remains strong, representing more than 75% of our total revenue in the fourth quarter of fiscal 2026, and our customer retention metrics improved year over year. We will continue to look for opportunities to improve our retention metrics for our most loyal customers. As Terrence mentioned earlier, we will also look to strengthen the LifeVantage brand and refine our consumer proposition to expand appeal to new consumers. This will be an area of focus for us as we move forward into fiscal 2027. Our gross profit percentage for the fourth quarter was 78% compared to 79.9% in the prior year period, reflecting a shift in product mix, higher inventory obsolescence expenses, and increases in shipping and related warehouse expenses. Commission's incentive expense was 41.3% of revenue compared to 42.1% a year ago, reflecting the timing and magnitude of our promotional incentive programs and changes to the sales mix between customers and independent consultants.

Selling general and administrative expenses were 32.7% of revenue compared to 33.9% in the prior year period. adjusted non-GAAP SG&A was 32.3% of revenue compared to 33.3% in the prior year period, reflecting decreases in variable employee compensation expenses and lower event-related expense. Gap operating income was $1.7 million compared to $2.1 million in the prior year period. Adjusted non-gap operating income was $1.8 million compared to $2.5 million a year ago. Gap net income was 1.3 million or 10 cents per diluted share compared to 2 million or 15 cents per diluted share in the fourth quarter of fiscal 2025. Adjusted non-gap net income was 1.4 million or 11 cents per diluted share compared to 2.3 million and 17 cents in the prior year period. We recorded income tax expense of just over $400,000 in the fourth quarter of fiscal 2026. Our overall effective tax rate for fiscal 2026 was approximately 16.4%.

Adjusted EBITDA in the fourth quarter was $2.7 million, or 6.5% of revenue, compared to $4.8 million, or 8.7% of revenue in the same period a year ago. Our financial position remains strong, with $14.9 million of cash and no debt at the end of fiscal 2026, compared to $20.2 million of cash a year ago. We generated 10.2 million of cash from operations during fiscal 2026 compared to 11.9 million in the prior year period. We also maintain access to a $5 million revolving line of credit. Capital expenditures total $3.6 million in fiscal 2026 compared to $1.4 million in 2025, reflecting our continued investment in technology infrastructure, including the Shopify integration. We also utilized $3.7 million in cash during fiscal 2026 for the Love Biome transaction. Turning to capital allocation, we repurchased 85,700 shares in the fourth quarter for an aggregate purchase price of approximately 459,000.

During fiscal 2026, we repurchased approximately 336,000 shares for an aggregate purchase price of $2 million. As of June 30th, there was $58.5 million remaining under the new $60 million share repurchase authorization approved by our board of directors in January. We also recently announced a quarterly cash dividend of $0.05 per share of common stock that will be paid on September 15, 2026 to shareholders of record as of September 1, 2026. We remain committed to our balanced capital allocation strategy in order to maximize shareholder value. Given the recent transition in our Chief Executive Officer role, we are not issuing formal guidance for fiscal 2027 on today's call. And with that, let me turn the call back over to Terrence.

Before we open the call for questions, I'd like to leave you with some final thoughts. First, despite the challenges reflected in our recent results, I'm very optimistic about the future of LifeVantage. The more I learn about the company, the more convinced I am that we have a unique opportunity and significant white space ahead. Second, because we have a strong financial foundation driven by our debt-free balance sheet, a healthy cash position, and a disciplined approach to capital allocation, we have the flexibility to invest in growth while continuing to return capital to shareholders. Third and finally, we're going to move forward with a sense of urgency. Over the coming months, we'll be working as a team to develop a clear strategic roadmap, establish measurable goals, and align our organization around execution. In closing, I'm very excited about the future and the potential that lies ahead.

Now, our focus is on building the brand, accelerating consumer relevance, and executing with discipline so we can fully realize that potential.

With that, let's open the line for questions. Thank you. We'll now be conducting a question and answer session. If you'd like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up the handstand before pressing the star keys. One moment please while we poll for questions.

Thank you. Our first question is from Ryan Myers with Lake Street Capital.

Hey guys, thanks for taking my questions. Terrence, congrats on the new role. We're just thinking about the revenue side of the business. You know, we saw another sequential decline here in the fourth quarter. Can you maybe just talk about the monthly trends throughout the quarter and maybe what you've seen so far in July and August and understand that you're not giving back? But have we seen sort of a stabilization? Have trends improved a little bit? Just any commentary there would be helpful.

I'm going to let Carl handle that one. Yes, happy to take that, Ryan. Yes, as you mentioned, sequentially we were down just about $1.5 million or so from Q3 into Q4. You know, some of that we've mentioned, we've talked about some of the challenges we face just with declining orders, number of orders that are out there, as well as just we're seeing a little bit of a decline in just the average order size between Q3 and Q4. we look forward, we're not giving guidance obviously for fiscal 2027, but as you know, looking back at the comparables, we still have a couple of difficult comparables in Q1 and Q2 of our fiscal year next year, and so those will certainly be challenging, but I think as we start to work through the strategies that Terrence and the team are working on here. When we get to our fiscal Q3 into Q4, that's really where we anticipate that we hopefully can turn the trend line and really start to see a little bit of momentum associated with those strategies that we're working on and look to be putting in place at the first part of the year.

Okay, got it. And then thinking about the fewer orders and the lower average order size that you had mentioned, did these come specifically from MindBody? Did they come from the broader portfolio, just as we sort of attribute some of these software KPIs? Was it portfolio?.

I can tell you as a whole, there's certain areas that are down. Yes, no, I can talk to some of that. I mean, MindBody definitely has an impact since MindBody was a higher priced product. So there is certainly some impact from shift away from mind-body on the average order size. But we also are seeing just some decline in the overall average order size in some of the other categories, not significantly so. know, and I think also what we're seeing is we're still, you know, our base of loyal customers. We're seeing that base continue to purchase, but, you know, possibly we're seeing, you know, possibly they're pausing a subscription for a month and then picking it up the next month. And so some of that or all of those things are impacting those metrics at the end of the day.

I think there's a fair amount of price pressure that.

our consumers under right now, just given what's happening in the economy. And so a couple of our strategies going forward will be looking at how we can strengthen our value proposition, not necessarily by dropping prices, but adding credence to the voice that we have when we're talking about about our products in order to attract new customers into the business. Okay. Got it. Well, thank you for taking my question.

Yes, thank you. Thanks, Ryan. Thanks, Ryan. Thank you. Our next question is from Linda Wiser with Water Tower Research.

Hello. Hi, Terrence. Nice to be speaking with you again. Yes, hey, Linda. Good to hear you. So, my advantage in terms of the percentage of revenue that's outside of the Americas, it's really small, you know, relative to other direct selling companies. It seems to me that there could be an opportunity to expand the business a lot more outside the Americas. Is that kind of one of your first impressions? And if so, like, how would you prioritize that versus just kind of the things you want to do to the core business as it is now? Thanks. Okay.

Yes, I think you're right, Linda. I think clearly international is an opportunity. One of the things that attracted me to LifeVantage is that we're under-penetrated in all of our markets, not just internationally. So I think we have tremendous growth potential here in North America, but also internationally. So we will be moving forward to drive penetration in our kind of existing international markets. I don't know if we're going to expand our footprint further. you know, kind of immediately. I think we're best suited to drive penetration in a couple of anchor markets and then kind of branch out from there, almost in a kind of a hub and spoke type of approach.

But again, just given the scale of our business in North America, we want to take advantage of that. We want to leverage that, focus on on building out that team because we're still, like, we still have a lot of opportunity. And that would be kind of across categories and across, you know, kind of regions within the U.S.

Okay. And then, Terrance, I know when you were at your previous company, you really leaned into driving e-commerce sales and and you really developed that business in the US in particular. Is that something that you see as an opportunity here too? And what are your thoughts?.

along those lines, thanks. I think that the opportunities at LifeVantage really focus on, certainly focus on, upgrading capabilities, building out digital capabilities, specifically building out our digital network. We'll see kind of where we take that, but first and foremost, I think we're going to kind of upgrade and update the consumer kind of access points. And so we have a fairly major kind of program to upgrade our website, upgrade our consumer experience. But then we're also going to kind of pair with that, upgrading the tools that we give to our sales force so that they can more effectively go to market in a much more effective and powerful manner with some digital tools in their hands and digital assets in their hands as well. So I definitely believe that digital is going to be a key strategy for us. We'll see how that unfolds. I think a big piece of the strategy also has to focus on being a much more consumer-centric company, being much more relevant to consumers so that we can be more effective on all fronts to improve and increase demand. That's how I'm looking at it right now.

Again, I'm still early days, so we need to see what our capabilities are and how we can move forward and how we can make sure that we have this kind of a very much integrated approach to our go-to-market strategy. So I hope that answers your question.

Yes, thank you. Thank you. That's very helpful. And then my last question just has to do with, you know, The conversation so far has mentioned upgrades of IT, etc. So I'm just curious about any kind of very rough outlook about capital spending. It's a small percentage of revenue for the company, but it looks like it picked up a little bit in FY26. a year of increased spending in dollar terms, or just what do you think is going to be kind of the needed capital in that area? Thanks.

You want to take that one? Yes, certainly. Yes, I can take that, Linda. And yes, you're right. Over the year over year increase over in the CapEx area, that was really all Shopify related and upgrading our e-commerce platform. We've made a lot of progress on that Shopify project to date. We're not done yet. We still have, you know, a little ways to go, but I would anticipate the total capex spend for FY27 to be slightly less than that number. And I think in total, we were around 3.7 million or so in fiscal 2026. I would anticipate it's more in the $3 to $3.5 million range as we close out the final stages of Shopify.

And once we're through that, then we're back down to normal capex spend, you know, back to the historical levels of the $2 to $2.5 million. Thank you, that's very helpful. Thanks very much.

Thanks. Thank you. This concludes our question and answer session. I'll now turn it back to Mr. Moorhead for any closing remarks.

Okay, well, thank you, everybody, for joining us today and for your continuous support. I look forward to talking to you again next quarter.

then take care. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

This live transcript is auto-generated without human intervention or review.

[Call has ended.]

Good day, ladies and gentlemen. Thank you for standing by. Welcome to today's conference call to discuss LifeVantage's third quarter of fiscal 2026 results.

[Operator Instructions] Hosting today's conference will be Reed Anderson with ICR. As a reminder, today's conference is being recorded.

Now I would like to turn the conference over to Mr. Anderson. Please go ahead, sir.

Thank you. Good afternoon, and welcome to LifeVantage Corporation's conference call to discuss results for the third quarter of fiscal 2026.

On the call today from LifeVantage are Michael Beindorff, Interim Chief Executive Officer; Carl Aure, Chief Financial Officer; and Kristen Cunningham, Chief Sales Officer. By now, everyone should have access to the earnings release, which went out this afternoon at approximately 4:05 p.m. Eastern Time. If you have not received the release, it is available on the Investor Relations portion of LifeVantage's website at www.lifevantage.com. This call is being webcast, and a replay will be available on the company's website as well.

Before we begin, we would like to remind everyone that our prepared remarks contain forward-looking statements, and management may make additional forward-looking statements in response to your questions. These statements do not guarantee future performance, and therefore, undue reliance should not be placed upon them. These statements are based on current expectations of the company's management and involve inherent risks and uncertainties, including those identified in the Risk Factors section of LifeVantage's most recently filed Forms 10-K and 10-Q. Please note that during today's call, we will discuss non-GAAP financial measures, including results on an adjusted basis. Management believes these financial measures can facilitate a more complete analysis and greater transparency into LifeVantage's ongoing results of operations, particularly when comparing underlying operating results from period to period. We've included a reconciliation of these non-GAAP measures with today's release. This call also contains time-sensitive information that is accurate only as of the date of the live broadcast, May 6, 2026. LifeVantage assumes no obligation to update any forward-looking projections that may be made in today's release or call.

Now I will turn the call over to Michael Beindorff, Interim CEO of LifeVantage.

Thank you, Reed. Good afternoon, and thank you all for joining us today. For those of you I haven't had the opportunity to meet, let me briefly introduce myself. I've had the privilege of serving on the LifeVantage Board of Directors since 2012, which gives me over 14 years of insight into this company's evolution, challenges and the tremendous opportunities that we have in front of us. I've spent my career building consumer brands across a variety of business environments, including the Coca-Cola Company, Visa, and PlanetRx, among some others.

Before we dive into our quarterly results today, I want to take just a moment to recognize Steve Fife, who retired as our President and CEO on April 30. Steve's tenure at LifeVantage has been absolutely transformational. His strategic vision and his relentless focus on operational excellence have been instrumental in modernizing our business model, strengthening our financial position and laying the foundation for the future. So on behalf of the entire Board and the organization, I want to thank him for his leadership, and I want to wish him the very best in his retirement.

Now you might ask why a long-serving Board member would step into an interim operating role. And the answer to that is pretty simple. I believe deeply in LifeVantage's products, its people and its potential. My 14 years of Board service, I think, give me a pretty unique perspective on what makes this company special. I'm excited about our product portfolio from our flagship Protandim family to innovations like TrueScience Liquid Collagen, the MindBody GLP-1 system and our comprehensive gut activator, P84. These products represent genuine innovation in cellular health activation and are all backed by rigorous scientific validation. But what truly gets me excited is our passionate consultant community.

Having spent almost my entire career building consumer brands, I deeply appreciate the power of authentic advocacy. Our consultants understand the uniqueness of our products and the deep scientific validation behind them. And they deliver this information and these products to people every day. They share their personal health journeys, and they create genuine entrepreneurial opportunities. That's a combination that is both powerful and sustainable.

Our most recent Momentum Academy in Las Vegas was a great example of this. It perfectly captured the energy and the potential of our consultant community. It was centered around the theme of breakthrough, and this 3-day immersive experience brought together our independent consultants from across the country for powerful leadership training, business building strategies and meaningful connection with each other. Among other things, during the conference, the company announced the VIP bonus, our first ever 12-month volume growth incentive program for consultants. This program will handsomely reward consultants who meet their growth goals, and we believe the program can be a game changer, not only as a catalyst for growth, but also in terms of leadership development.

In addition to incentivizing growth, the program is designed to identify and elevate consultants who demonstrate the leadership behaviors associated with long-term success. We think that by rewarding these behaviors, we'll build a stronger leadership pipeline and align our field organization around what is required to improve the company's long-term growth trajectory. The passion, the clarity and the commitment that I witnessed in Las Vegas reinforce my confidence in our community strength and our company's future.

Now before Carl details our Q3 results, I want to provide a brief high-level perspective on where we stand today and where this enterprise is headed in the future. The direct selling business continues to evolve, and LifeVantage has been proactive in adapting our business model to meet the changing consumer preferences and market dynamics. We've invested in digital capabilities, upgraded our consultant compensation plan. We've enhanced our consultant tools and support systems, and we've continued to innovate our product offerings to address emerging health and wellness trends. And these investments in our future are continuing.

As we told you in February, we're making a significant investment in upgrading our e-commerce platform. The launch of Shopify, along with a totally revamped and upgraded back-office system will dramatically improve both our customers and our consultants' e-commerce experience with LifeVantage from end to end. We plan to start launching Shopify later this year, and we're excited about the prospects as we roll the Shopify launch through our markets. In addition, our business fundamentals are solid. We have a clean balance sheet, no debt and cash reserves that give us flexibility.

Looking ahead, we see significant opportunities. The health and wellness market continues to expand, and our unique positioning in Nutrigenomics gives us credibility and we think differentiates us in a crowded marketplace. We remain committed to operational excellence, strategic execution and delivering value for all stakeholders.

With that, let me turn it over to Carl, to take you through our financial results.

Thank you, Michael, and good afternoon, everyone. Let me walk you through our third quarter financial results. Please note that I will be discussing our non-GAAP adjusted results where applicable. You can refer to the GAAP to non-GAAP reconciliations in today's press release for additional details.

For the third quarter of fiscal 2026, we delivered net revenue of $43.7 million, which was down 25.2% compared to $58.4 million in the third quarter of fiscal 2025. The decrease was primarily driven by a decline in sales of our MindBody GLP-1 System, partially offset by sales of LoveBiome, which we acquired in October of 2025.

Revenue in the Americas region decreased 28.9% to $34.3 million, reflecting decreased sales of our MindBody GLP-1 System and a decrease in total active accounts. Revenue in the Asia Pacific and Europe region decreased 7.7% to $9.4 million, primarily driven by a decrease in total active accounts. Foreign currency had a negligible impact on Asia Pacific and Europe during the quarter, positively impacting results by $100,000.

Our gross profit percentage for the third quarter was 79%, down from 81% in the prior year period, reflecting increases in shipping and warehouse expenses, along with higher inventory obsolescence-related expenses. Excluding a $183,000 allowance related to MindBody inventory, our non-GAAP adjusted gross profit percentage was 79.4%.

Commissions and incentive expense as a percentage of revenue was 43.5% in the third quarter compared to 44.8% in the prior year period. The decrease as a percentage of revenue was primarily due to the timing and magnitude of our promotional incentive programs and changes to the mix of customers and independent consultants. We anticipate the full year fiscal 2026 commissions and incentive expense to be approximately 42.5% of revenue.

Selling, general and administrative expenses were $13.9 million or 31.7% of revenue compared to $17.1 million or 29.2% of revenue in the prior year period. The increase as a percentage of revenue was primarily due to the overall decrease in sales volume.

GAAP operating income was $1.7 million compared to $4.1 million in the prior year period. Adjusted non-GAAP operating income was $1.8 million compared to $4.1 million in the prior year period. GAAP net income was $1.4 million or $0.11 per diluted share compared to $3.5 million or $0.26 per diluted share in the prior year period. Adjusted non-GAAP net income was $1.5 million or $0.12 per diluted share compared to $3.5 million or $0.26 per diluted share in the prior year period.

We recorded income tax expense of $300,000 in the third quarter compared to $700,000 in the prior year period. We expect our full year effective tax rate for fiscal 2026 to be approximately 18% to 20%. Adjusted EBITDA for the third quarter was $3.2 million or 7.3% of revenues compared to $6.4 million and 11% in the same period a year ago.

Our financial position remains solid with $12.5 million of cash and no debt at the end of the third quarter. We generated $5.5 million of cash from operations during the first 9 months of fiscal 2026 compared to $10.8 million in the same period in fiscal 2025, primarily due to the payment of accrued employee-related incentive compensation and consultant incentive trip expenses. Capital expenditures totaled $2.5 million for the first 9 months of fiscal 2026 compared to $1.2 million in the prior year period, reflecting our continued investment in technology infrastructure, including the Shopify integration. We also utilized $3.7 million in cash during the first 9 months of fiscal 2026 relating to the closing of the LoveBiome transaction.

Turning to capital allocation. We repurchased 206,000 shares for an aggregate purchase price of $1 million during the quarter. During the first 9 months of fiscal 2026, we have repurchased approximately 250,000 shares for an aggregate purchase price of $1.6 million. As of March 31, there was $59 million remaining under the new $60 million share repurchase authorization approved by our Board of Directors in January. Today, we also announced a quarterly cash dividend of $0.05 per share of common stock, which represents an 11% increase to the previous dividend amount. This dividend will be paid on June 15, 2026, to shareholders of record as of June 1, 2026. We remain committed to our balanced capital allocation strategy in order to maximize shareholder value.

Turning to our outlook for fiscal 2026. We now expect to end fiscal 2026 with revenue, adjusted EBITDA and adjusted earnings per share close to the lower end of our previously issued guidance range. This updated guidance reflects the current trends in the business, including the competitive dynamics in the GLP-1 market and our commitment to managing costs while investing in strategic growth initiatives. We remain focused on improving our profitability metrics and driving long-term value for our stockholders.

With that, let me turn the call back over to Michael.

Thanks, Carl. Before we get into the Q&A, I have just a couple more comments. We recently made a couple of very important announcements. First, we've been granted a U.S. patent for our Healthy Glow Essentials Stack, which features Protandim Nrf2 Synergizer and TrueScience Liquid Collagen, further validation of our leadership in scientific innovation.

Second, and perhaps more importantly, on April 16, the Board of Directors announced the appointment of Terrence Moorehead as our next Chief Executive Officer. Terrence will join us in August, bringing over 30 years of leadership experience, revitalizing brands and accelerating growth, particularly in direct selling.

During our extensive search, we talked to nearly every CEO, President and General Manager in the direct selling space. And interestingly enough, almost every one of those candidates that we spoke with wanted the job. I think they all saw the potential and the opportunity that LifeVantage presents. But when we met Terrence, we recognized instantly that he was different. He is a deeply experienced transformative leader with an outstanding track record that speaks for itself. I'm excited about the expertise and the vision that he will bring to LifeVantage. During the transition period, I'm working closely with our executive team, including Kristen Cunningham, our Chief Sales Officer; and Carl, our Chief Financial Officer. This team knows the business inside and out, and I have complete confidence in their ability to execute.

Looking forward, our dedication to optimizing health remains absolutely unwavering as does our commitment to equipping our independent consultants with the resources and the products necessary to build thriving businesses so they can deliver exceptional value to our customers. I want to express my gratitude to our employees, our independent consultants, our shareholders and most of all, our loyal customers.

Finally, to be very clear, we recognize that our performance over the last few quarters has not been up to our standards. On my desk, I keep a plaque that simply reads the world belongs to the discontented. Well, let me assure you that we are not content, and I pledge to work tirelessly with this team on behalf of all of our stakeholders to improve the results. There is much to do, but I'm certain that the solid groundwork we've laid and the talented team we have will pay dividends in the quarters and the years ahead. Thank you for your confidence and your support of our mission.

With that, operator, we'll open it up for questions.

[Operator Instructions] The first question is from Doug Lane from Water Tower Research.

Carl, looking at the cash flow, you mentioned $5.5 million cash from operations generated this year, but the $5 million came in the March quarter despite the shortfall versus what we were looking for. So I don't know, you don't really talk to this in your guidance, but there's nothing going on in the fourth quarter that wouldn't think you could be positive in cash from operations. Is there?

Yes. No, that's right, Doug. So yes, in the recent quarter, we generated about $5 million of cash from operations, and we'll anticipate to do a similar amount in Q4 as well. We anticipate to continue to build cash. I think we talked at the last call, we had some unusual timing differences in the first quarter that really led to some of those declines or unusual quarter comparisons we saw earlier in the year. So going forward, we anticipate to continue to generate cash based off of the current model.

Then again, looking at your CapEx, about $1 million in the March quarter. I know you talked about investments, Shopify, what have you. But is that $1 million a quarter run rate kind of a steady state here? Or is there something coming down the pipe that might divert that up or down?

Yes. No, I think that will be consistent, I would say, for the next quarter or two. We're getting closer on the implementation of Shopify. We should be -- we're targeting to get things in place later, probably not by the end of Q4, but into rolling into Q1, and there'll be a staggered approach as we roll it out internationally. So we'll continue to see some of those development costs, particularly in Q4 and probably start to reduce once we get into Q1 of next fiscal year. And after that, they should really start to eliminate.

With the December quarter release, you announced a $60 million share buyback. And I just wanted to see if you could update us on what your thought is there. It looks like you didn't buy back much in the March quarter, but what should we look for, for share buybacks for the next few quarters?

Yes. No, I think we're still very committed to the share buyback. Just I mean, I think that was evidenced by the Board's approval of the new $60 million authorization. During the quarter, we repurchased about $1 million worth of a little over 200,000 shares that we repurchased in the quarter. And I still think that where current valuations are at, we're still committed to this, and we'll still be looking to opportunistically buy over the next few quarters as market conditions permit.

Getting back to the lower sales, the consultant count was a little bit below what I was looking for. In the Americas, in particular, it dropped a couple of thousand sequentially from 32,000 to 30,000. So what do you think is driving the shortfall in consultants in the Americas, which is your biggest market? And what do you think -- what are you guys doing to try to get that number going the other way?

Yes. Doug, it's Kristen. Definitely not a number we're excited about, but I think what has us all really excited, myself included, is just the engagement that we're starting to see, the activity that we're starting to see. And for us, it's how do we reinforce that consultant group in really a foundational approach versus creating just a pop and drop to continue to drive sales. And we're seeing a lot of simplification around the business, which, as you know, harder to simplify almost than anything, but we're seeing consultants going back to kind of the foundation of their own business from a product standpoint. They are excited about Protandim, about Collagen, about Healthy Glow, about our recent announcement that we made about it. Those are our stickiest products. So from a retention standpoint, we're feeling good about that.

Our incentive programs -- oftentimes, when you launch an incentive program, it can be complicated, but we've really tried to create a program that is simplified, that really complements what we are doing strategically. And the message, as you really heard us talk about is about how do we get more storytellers, more consultants talking about LifeVantage and our incentives complement that. Plus when we layer that with our VIP program, which is about identifying the right leaders. I mean, you can have the right -- everything in the business, but with the wrong leadership and the wrong sentiment in the field, it's really challenging to turn that.

We are confident in our leadership right now, and we're addressing that through this VIP program where we're incentivizing growth, but we're also asking it to be like an opt-in. We didn't just say this is available to everybody in the U.S. It was they had to raise their hand and say, no, we are part of the leadership team who are committed to growth. And we're seeing so much activity kind of because of those 3 things combined. So really encouraged about what we've seen coming out of Vegas, but staying consistent with that over the past couple of weeks, and we'll continue to drive it day in and day out.

No, those are -- the VIP bonus sounds like it's very exciting.

I guess the last thing is really new products. I mean, you've had the P84 that you acquired from LoveBiome and you had the Healthy Edge Stack. But what do you have on tap for new product news maybe for the remainder of the calendar year?

Yes, I can speak to that a little bit, Doug. And we've got -- our next big event is scheduled for October. So we have our annual convention slated for October of this coming year. In some of the previous calls and some of the other investor-related discussions we've had, we've talked about a product launch at that event. As you know, our typical product cadence for launching a hero product is every 18 months to 2 years. And as you know, the last major launch we had was MindBody, which was about 2 years ago.

We did add the LoveBiome line that you had mentioned. But so we are -- we do have something in the works. We haven't talked a lot about exactly what category that falls into, but it will be in line with the typical LifeVantage science-backed product and something that we're really excited about going forward.

Most of your recent news has really been around gut health between MindBody and P84. So are we going deeper in gut health? Or is there something new on the horizon?

Well, I think this category is not necessarily in gut health itself. We still believe -- we believe in that P84 product and the LoveBiome entity or business that we acquired in October. So we -- gut health is still an important part of our product portfolio. I think looking forward, we have some other complementary products that we'll be introducing around to support P84, but P84 is still 1 of our 4 hero product lines and something that we'll continue to lean into.

This concludes the question-and-answer session. I'd like to turn the floor back over to Michael Beindorff for closing comments.

Well, I want to thank all of you again for joining us today. We know that we have a lot of work to do. That said, we're optimistic. I believe we have the people and then we have the products, and we're absolutely focused on delivering improved results for our shareholders.

So I look forward to reporting our progress on all of these initiatives in August, and I thank you for joining us today.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

Good day, ladies and gentlemen, and thank you for standing by. Welcome to today's conference call to discuss LifeVantage's Second Quarter of Fiscal 2026 results. [Operator Instructions]. Hosting today's conference call will be Reed Anderson with ICR. As a reminder, today's conference is being recorded. I would now like to turn the conference over to Mr. Anderson. Please go ahead, sir.

Thank you. Good afternoon, and welcome to LifeVantage Corporation's conference call to discuss results for the second quarter of fiscal 2026. On the call today from LifeVantage with prepared remarks are Steve Fife, President and Chief Executive Officer; and Carl Aure, Chief Financial Officer.

By now, everyone should have access to the earnings release, which went out this afternoon at approximately 4:05 p.m. Eastern Time. If you have not received the release, it is available on the Investor Relations portion of LifeVantage's website at www.lifevantage.com. This call is being webcast, and a replay will be available on the company's website as well.

Before we begin, I would like to remind everyone that our prepared remarks contain forward-looking statements, and management may make additional forward-looking statements in response to your questions. These statements do not guarantee future performance, and therefore, undue reliance should not be placed upon them. These statements are based on current expectations of the company's management and involve inherent risks and uncertainties including those identified in the Risk Factors section of LifeVantage's most recently filed Forms 10-K and 10-Q.

Please note that during today's call, we will discuss non-GAAP financial measures, including results on an adjusted basis. Management believes these financial measures can facilitate a more complete analysis and greater transparency into LifeVantage's ongoing results of operations, particularly when comparing underlying operating results from period to period. We've included a reconciliation of these non-GAAP measures with today's release.

This call also contains time-sensitive information that is accurate only as of the date of this live broadcast, February 4, 2026. The LifeVantage assumes no obligation to update any forward-looking projection that may be made in today's release or call. Now I will turn the call over to Steve Fife, the President and Chief Executive Officer of LifeVantage.

Thanks, Reed, and good afternoon, everyone. Thank you for joining us today. The second quarter presented both challenges and opportunities as we navigated a rapidly evolving competitive landscape while executing on our strategic initiatives.

While our Q2 revenue and earnings were down significantly from prior year levels, we were cycling the exclusive launch of our MindBody GLP-1 system in October of last year. Despite this headwind, we made significant progress on several key fronts and remain well positioned for long-term growth in the broader health and wellness ecosystem. As a management team, we acknowledge that our performance during the quarter did not meet your expectation or ours and we are redoubling our efforts to stabilize our GLP-1 business and make the other changes necessary to return to revenue growth.

Let me start by addressing the primary driver for our revenue decline. The competitive dynamics we've experienced in the natural GLP-1 market since launching our MindBody GLP-1 system last year. Our product is scientifically validated and proven effective, and we have a loyal customer base. However, the overall market has become significantly more competitive with pharmaceutical GLP-1 drugs becoming more accessible and affordable, along with new formulations and formats, including pills.

When we launched MindBody, pharmaceutical options were in short supply and cost several hundred dollars per month to consumers. At that time, MindBody was a compelling value proposition, plus had the added benefit of not requiring any injections and being a proven all-natural solution.

Today, pharmaceutical options have come down significantly in price and are increasingly covered by insurance which has led to much broader use by consumers. In addition, the drug is now available in more convenient formats, including pills. This rapidly shifting competitive dynamic has dramatically impacted the sale of our GLP-1 offering.

As a result, to be conservative, we are recognizing a reserve against a portion of our GLP-1 inventory and evaluating all options to respond to the changing competitive landscape. We are also taking a hard look at cost reduction opportunities to ensure we continue to maintain strong levels of profitability.

We remain committed to our MindBody GLP-1 system. It is a great product that works and we continue to believe strongly in the positioning of natural weight management solutions. The science supporting our approach is robust, and we see this as a temporary market adjustment. What excites us most about this quarter is the continued momentum from our LoveBiome acquisition. From an operational perspective, we successfully integrated the LoveBiome team and systems and we're realizing the operational synergies.

The combined expertise of our teams is already evident in our product development pipeline and go-to-market strategies. Two new products from the LoveBiome portfolio launched earlier this week. That should drive engagement, consultant growth and continue to diversify our product portfolio. First is AXIO X, a new addition to our AXIO line that focuses on pre-workout consumers looking for long-lasting energy, enhancing oxygen uptake and stamina. Second is PhytoPower B, where the B stands for blocker, an innovative approach that helps to slow sugar absorption and support a healthy metabolism.

These launches represent the power of our combined innovation capabilities and demonstrate how the LoveBiome acquisition is already paying dividends in terms of product diversification and market growth. Over the next couple of months, we will be launching additional LoveBiome products, further leveraging and expanding the LoveBiome portfolio.

Our now patent-pending P84 product continues to be a hero product with strong positioning in the rapidly growing microbiome market. The in vitro testing results we announced in October at our Momentum Academy event further validate the science behind this comprehensive gut health activator, and we're seeing strong adoption among both our combined consultant and consumer base.

The Healthy Edge stack, which combines our proven Protandim Nrf2 Synergizer with P84 has become a lead enrollment story for our consultants. In January, we released the results of our third-party cell study that shows this combination delivers foundational health support throughout the entire body, and the synergistic benefits are resonating strongly with health-conscious consumers.

I'm also pleased to report continued progress on our Shopify partnership. This strategic initiative represents a significant modernization in our technology infrastructure and will deliver enhanced e-commerce capabilities that benefit both LifeVantage and our consultants. We're on track for our pilot program and expect this platform to drive improved conversion rates and customer experience.

Looking at our international expansion efforts, we continue to see opportunities for growth in key markets. The infrastructure we've built through the LoveBiome integration position us well to scale our operations globally and serve the evolving needs of health-conscious consumers worldwide.

Now as we look ahead, I'm optimistic about our positioning. We have a comprehensive wellness ecosystem that addresses multiple aspects of human health from cellular health with Protandim to metabolic wellness with MindBody to get help with P84 to beauty and longevity with TrueScience Liquid Collagen. Combined with our industry-leading evolved compensation plan and vibrant consulting community, we're uniquely positioned to serve the evolving needs of both consumers and entrepreneurs.

The direct sales industry continues to evolve and companies that can combine innovative products, compelling compensation, modern technology and authentic communities will be the winners. We believe LifeVantage enhanced by our LoveBiome partnership and strengthened by our commitment to science validation is perfectly positioned to lead in this new era.

We also continue to have a strong balance sheet and proven track record of returning excess capital to shareholders. Since the beginning of fiscal 2024, we've returned over $20 million to shareholders through dividends and share repurchases. And today, we announced a new $60 million share repurchase authorization, underscoring our commitment to the future and commitment to driving long-term value.

The Board remains committed to this perspective as evidenced by the quarterly dividend and new share repurchase program just announced. With that, let me turn the call over to Carl for a detailed review of our financial results and outlook.

Thank you, Steve, and good afternoon, everyone. Let me walk you through our second quarter financial results. Please note that I will be discussing our non-GAAP adjusted results where applicable. You can refer to the GAAP to non-GAAP reconciliations in today's press release for additional details.

For the second quarter of fiscal 2026, we delivered net revenue of $48.9 million, which was down 27.8% compared to $67.8 million in the second quarter of fiscal 2025 but was up 2.9% sequentially from the first quarter. The decrease compared to the prior year period was primarily driven by declines in sales of our MindBody GLP-1 system which decreased $16.2 million compared to the prior year period. This decline was partially offset by sales of the LoveBiome product line, which contributed $4.1 million in revenue following our October acquisition.

Breaking down our regional performance. Revenue in the Americas region decreased 32.6% to $38.5 million, while revenue in the Asia Pacific and Europe region decreased 2.1% to $10.4 million. The Americas decline was primarily driven by lower sales of our MindBody GLP-1 system and a 25.2% decrease in total active accounts, mostly from decreases in our active customer base.

In Asia Pacific and Europe, the decline in revenue reflected a 6.5% decrease in total active accounts. Revenues did increase slightly in Japan on a constant currency basis. Our gross profit percentage for the second quarter was 74%, down from 80.5% in the prior year period, reflecting a onetime allowance for inventory obsolescence related to MindBody inventory along with increases in shipping and warehouse related expenses.

Excluding the $2.4 million onetime inventory reserve, our non-GAAP adjusted gross profit percentage was 78.8%. Commissions and incentive expense as a percentage of revenue was 40.7% in the second quarter compared to 48% in the prior year period. The decrease as a percentage of revenue was primarily due to elevated incentive-related expenses recorded in the prior year period and impact from changes to the mix of customers and consultants in our overall active account base.

Selling, general and administrative expenses were $15.8 million or 32.3% of revenue compared to $18.6 million or 27.5% of revenue in the prior year period. The increase as a percentage of revenue was primarily due to the overall decrease in sales volume and elevated event-related expenses in comparison to the prior year period.

GAAP operating income was $0.5 million compared to $3.4 million in the prior year period. Adjusted non-GAAP operating income was $2.6 million compared to $3.9 million in the prior year period. GAAP net income was $0.3 million or $0.02 per diluted share compared to $2.6 million or $0.19 per diluted share in the prior year period.

Adjusted non-GAAP net income was $1.9 million or $0.15 per diluted share compared to $3 million or $0.22 per diluted share in the prior year period. Adjusted EBITDA for the second quarter was $3.9 million or 7.9% of revenues compared to $6.5 million and 9.6% in the same period a year ago. Our financial position remains strong with $10.2 million of cash and no debt at the end of the second quarter. We generated $0.5 million of cash from operations during the first 6 months of fiscal 2026 compared to $8.6 million in the same period in fiscal 2025, mostly due to the timing of incentive payments, payments of other accrued liabilities and other working capital changes.

Capital expenditures totaled $1.5 million for the first 6 months of fiscal 2026 compared to $0.8 million in the prior year period, reflecting our continued investment in technology infrastructure. We also utilized $3.7 million in cash during the second quarter relating to the closing of the LoveBiome transaction.

Turning to capital allocation. We did not repurchase any shares during the second quarter. During the first 6 months of fiscal 2026, we repurchased 44,000 shares for an aggregate purchase price of $0.6 million. We are also pleased to announce the company's Board of Directors recently approved a new $60 million share repurchase program, which replaces in its entirety the prior share repurchase program, and authorizes the company to repurchase shares in both open market and private transactions through December 31, 2027. Today, we also announced a quarterly cash dividend of $0.045 per share of common stock. This dividend will be paid on March 16, 2026, to stockholders of record as of March 2, 2026.

Turning to our outlook for fiscal 2026. We now expect revenue in the range of $185 million to $200 million, adjusted EBITDA of $15 million to $19 million and adjusted earnings per share in the range of $0.60 to $0.80 per fully diluted share. This guidance reflects the current trends in our business, including the competitive dynamics in the GLP-1 market, the positive momentum from our LoveBiome integration and the expected impact of our February product launches. We remain committed to improving our profitability metrics and driving long-term value for our shareholders. And with that, let me turn the call back over to Steve.

Thanks, Carl. Immediately following our earnings release today, we also issued another press release announcing my planned retirement in April of this year. While these decisions are never easy, I'm confident now is the right time for this transition after accomplishing so much as a team over the last 9 years and laying the foundation for LifeVantage's next chapter of growth.

The Board has been working closely with me on a comprehensive succession planning process for my eventual retirement that ensures leadership continuity and positions LifeVantage for continued success. Leading LifeVantage has been one of the most rewarding experiences of my career and I am incredibly proud of what we've achieved, from evolving our business model to strengthening our market position and impacting the lives of thousands of individuals. Our entrepreneurial opportunity is unlike any other industry, and I have complete confidence in our talented team and the Board's ability to guide LifeVantage into its future. Operator, we're now ready to open up the call for questions.

[Operator Instructions]. Our first question is from Doug Lane with Water Tower Research.

Steve, best wishes on your retirement here, all the best. Let me ask about LoveBiome. You mentioned the $3.7 million cash at closing, is that transaction costs? Or is that the actual purchase price for LoveBiome?

Yes, Doug, that's the actual cash transaction price related to the LoveBiome piece. And so I think that we've also talked a little bit more if you look in the details of the 10-Q. And I think we've talked about this in some of our previous discussions but the deal was structured in 2 pieces.

You had the cash down payment component, which worked out to be that $3.7 million number and then there's also the ability for a future earn-out that's based off of future revenue targets. And so those are really the 2 components of that. So any further either cash or stock compensation there would be subject to the long-term earn-out amounts.

Got it. So that explains about almost half of the $10 million reduction in cash on your balance sheet. What the -- what are 2 other big things that impacted that reduction in cash on your balance sheet from the first quarter?

Yes. That was definitely one of the big items. The other big item is just the timing of accrued payables. If you look at where we were at the end of June, we had some pretty significant accrued payables that just the timing of those turned here during the first half of the year.

And then the other component that we had is that one of the other items we do is when we settle stock-based compensation withholding tax from employees vesting, company utilized about $3 million of cash associated with that during the first half of the year.

So I would say just between those 3 buckets, that really accounts for the $10 million decline from where we were in June. But looking forward, as I look at the back half of the year, I would anticipate that we'll start to really start to build cash here in the back half of the year from now through the end of our fiscal year.

Okay. That makes sense. And can you give us an update with MindBody so far this year as you enter the weight loss season, what are your marketing plans? How are you approaching that? And what's sort of an early read on how things are going?

Yes. We kicked off in our fiscal Q2 and in November, December, a whole kind of go-to-market strategy around MindBody. It included a 20% off sale for the product which we've carried over through January and now into February. So our product has been discounted by the 20% promotion we have -- we also had an event in December that people could qualify for, we call it our Activeate90 event, which was -- is a weekly access to professional trainers, lifestyle and business individuals that on every week on Thursday evening, they have access to these individuals that talk to them holistically about health and wealth maintenance and management.

Those calls, the people qualified to be on those calls live. We record them and now distribute them out or they're made available to everyone now after the events occur. So that's kind of this weekly a reminder for the field. We've also in January, introduced a new feature in our app. Our app has previously been really consultant-driven and to help them with their businesses.

But we also now have provided access to a tracking mechanism for customers and consultants to go through and utilize it to help track their calories, their activities, daily reminders and goal setting. We all know that having those kinds of devices and reminders help all of us kind of be more mindful of our activities regardless of what it is. And so we are pleased to be able to introduce that in January, and we see and received positive feedback from that.

We also -- I guess the last thing that I'd say is we have a very active win back campaign where we target consumers of MindBody that were part of -- that had utilized it in the past and maybe even going back to a year ago, where all of our minds tend to drift a little bit as it relates to let management in this time of year, but win back campaigns and offering them incentives to come back and get back on the product or try the product again. So it's really, I'd say, multipronged in terms of what we're doing to focus our attention on that.

Okay. Getting back to LoveBiome. I see in the Q, I got a chance to look briefly at it, that it contributed about $4 million for the quarter. That sounds about right. I did not see what -- if you even disclosed how it impacted your consultant numbers and your customer numbers?

Yes. On the product revenue, that $4 million that we disclosed, that relates to the actual -- the LoveBiome products that were sold during the quarter. So just the products that they brought over through the transaction. There would have also been other revenue of LoveBiome consultants that came over that purchased LifeVantage products.

We didn't break that out separately in the Q. But -- so that's what that $4 million refers to is just the LoveBiome product line itself. And then as far as on the consultants, we didn't disclose the number of active consultants that came over, but there were -- they've been integrated correctly, and that's something that maybe we can speak to in the future -- at a future time.

The other thing, just adding on to that, I did say in my prepared remarks, we launched 2 LoveBiome products on Monday, actually, we had a kickoff. We had just under 1,000 participants on Monday night and Tuesday night this week, where we launched 2 of LoveBiome's previous products, AXIO X, which is a fits into our Axio product line. It's targeting more a higher level of energy and people use it for pre workouts or when they would need a boost during the day and then PhytoPower B and that B stands for blocker. And so it's a product designed to be not necessarily a daily use product, but one where all in anticipation of a big meal, it helps to combat the downside of sugar and carbs as we consume them.

So these kickoff calls that we had on Monday and Tuesday night, it was really expanding the knowledge of those -- launching the products and then educating the LifeVantage consultants as the phenomenal products that they are. A lot of it was actually led by LoveBiome individuals because they had access to the products previously.

So we're thrilled to now make them available to everyone and expect them to provide some growth in the second half of the year. And then also, I mentioned there will be 2 additional products that will be launched here that, again, were previous LoveBiome products that will be launched in the next couple of months. And that will kind of then round out the portfolio of products that came to us through that acquisition.

Okay. Got it. And just looking at the sales, I get the tough comparison with MindBody that we saw coming. But I noticed in the previous 3 years in the second quarter, you were north of $50 million, pretty consistent. And then now a little bit below that and maybe even more so if you exclude LoveBiome. So I'm just wondering if there's something else, one or 2 things besides MindBody that maybe wasn't working up to your expectations in the December quarter.

Well, no, I think it has been -- we've had a decline in our -- especially in our customer base and modestly in our consultant base and really, I think the top line story there is over the last year, MindBody became the enrollment story for many of our consultants and as some of the challenges that we described in again, the prepared remarks, started to play out throughout the year.

The consultants continue to push MindBody , but we lost some momentum around the other hero products that we have, specifically Nrf2 and collagen. And it's one of the reasons why we're so excited about now having added LoveBiome to the mix and having another hero product that has really reengaged a lot of our consultants with a new story and really opening up a whole new white space for LifeVantage consultants to take a gut health activator too.

And so it's just -- that shift doesn't turn overnight. The enthusiasm, excitement about P84, and we talked -- you and I have spoken and we've spoken in the past around our Healthy Edge stack, which is the combination of P84 and Nrf2. And that combination, I think, will very shortly be our biggest and highest enrollment product because of how the synergistic benefits and where our consultant base heads are right now.

So we're repositioning MindBody is still a great product for us. It contributed just under 10% of our revenue for the quarter. And the science behind it, the benefits that people feel and are achieving are real, they're demonstrable but we're trying to now also balance now the other good great products that we have and incorporating them into that enrollment story.

Steve, that's good color. And just one more for me. The Shopify thing you've been talking about, and it looks like it's about to be underway here. Can you take a little bit deeper dive into how you're going to use Shopify. Are there other direct sellers that use Shopify? Or are you basically pioneering that for the channel? Just a little bit more color on how Shopify is going to impact your business?

Yes. Shopify is probably the best-known and leader from an e-commerce customer experience platform standpoint, the -- they started off as really a solution to the mom-and-pop small business areas, people that didn't have resources to address the technology associated with owning the business. And since those early years -- and that's really how they cut their teeth, they built their reputation and the high technology standard that they are known for today.

And over the past several years, they have expanded and are working up the food chain, if you will, to larger and larger companies and expanding their capabilities to address bigger companies and e-commerce in those platforms. And there's a lot of benefits that we are going to see from this. Some of them again, I think I mentioned this in the prepared remarks around conversion rates and just the ease of customer experience of going through checkout and having a modern approach.

And I'm sure you've been on our site and purchased product, it has not been a seamless experience for consumers. And the data that's been provided by Shopify in conversions of previous systems to Shopify is pretty staggering around the improvement in that conversion. So that's one aspect of it.

The other aspect is just ease of use from a corporate standpoint in when we do promotions, how we display our products, our internal pricing and how do we get it onto our e-commerce website. The technology that we're currently using is fairly dated and it takes a lot of internal resources to navigate that. And so we think that there will be benefits from a process improvement standpoint.

And I guess, the last one, just again at a high level, is -- this gives us the opportunity to, although not directly tied to Shopify per se that gives us the opportunity, and we're taking it to look at our whole consultant tool base. So what we refer to as the back office, what their consultants are looking at to run their business, we are taking the opportunity to also make enhancements to that so that it again ties in now with the ease of use from a Shopify standpoint.

And one of the things about Shopify is, again, they are the industry leader in this space. And by creating this partnership with them, we're really putting our future in a position where we're not chasing what's next. We've partnered with someone who is always going to be at the forefront of technology as it relates to e-commerce.

And so there's going to be a short-term benefit, but knowing that 10 years from now, we're going to continue to be part of a technology trend that is only going to accelerate and be bigger and be part of being able to leverage that and not be in a constant catch-up like we are today.

Our next question is from Ryan Meyers with Lake Street Capital.

Given the demand and competitive dynamics in the mine body in GLP-1 space, why do you feel like that's a category that you guys can return to growth in? And why is that a category that you feel like you guys can actually win in?

We believe that because of our solution. There are -- we still -- when you look at our clinical studies, our science and our results. And you layer on top of that a natural solution versus it doesn't matter really if it's an injectable or a pill that you're taking, it is still introducing the GLP-1 hormone into your body and not helping your body to actually produce and be more effective in the production of that natural hormone.

So there are millions of people out there that look more to prevention and natural holistic alternatives that are still going to be very -- are and will continue to be interested in our option. And that will always be the case with our products, versus synthetic drugs that might help the same kind of results, but without -- but we are able to do it in a natural way.

Got it. And then walk us through the decision to take the inventory charge and just the background information on that.

Yes. No, I can share some more insight there, Ryan. As you know, when we launched the GLP-1 product last October, 1.5 years ago, we just had an incredible response to the demand of that product. We sold out really quickly. We sold out the initial stock that we had within a 3-week period. And just based off of that demand, we really ramped up our supply chain -- and based off of that, those early months of demand, we really felt like we needed to build up inventory. And frankly, we got a little bit ahead of ourselves.

I think now that we've got the more rightsized demand that MindBody has really settled in and we have more visibility into what the seasonality looks like. We decided to take a conservative approach and put a reserve against some of the inventory that we have. The shelf life -- I mean, the shelf life of the product is 2 years but we felt that it was appropriate to put a reserve against it to be conservative. We'll still look for other ways to find a way to either sell that or find other uses for it, but that was really the background behind why we went ahead with the inventory reserve.

Got it. And then just lastly, how should we be thinking about the revenue split in the second half of the year? I mean have you guys seen a rebound at all here in the third quarter? Just any commentary on what we should be thinking about for Q3 and Q4 in terms of revenue split would be helpful.

Yes. I think when we think about the back half of the year, we do believe that the MindBody trends have stabilized a bit and this is a traditional weight loss season. But I do think that we anticipate the build -- to build third quarter and then also again into the fourth quarter.

So especially coming from as we integrate the LoveBiome acquisition and we get their leaders more engaged in the continued rollout of the LoveBiome product. I would anticipate that when you're balancing between the 2 quarters, that Q4 will likely have a higher proportion of the revenue versus Q3.

We have reached the end of our question-and-answer session. I would like to turn the conference back over to Steve for closing remarks.

Thanks, operator, and thank you, everyone, for joining us today. Clearly, the second quarter presented some challenges for us. And although that's the case, we do remain confident in our strategic direction and the strength of our diversified -- both product portfolio and our business model.

The successful integration of LoveBiome and our incredible consultants and our recent product and future product launches, our international expansion plans and our continued focus on scientific innovation position us well for sustainable growth.

As we move forward, we remain committed to our mission of activating optimal health processes at a cellular level while providing our independent consultants with the tools and opportunities they need to build successful businesses.

I want to extend my appreciation to our dedicated employees, outstanding consultants, loyal stockholders and faithful customers. And while I'm approaching my end as tenure as CEO, I'm excited about the bright future ahead of LifeVantage, and I'm confident in the strong foundation we've built together will continue to drive innovation and growth for years to come. Thank you once again for your continued support and trust and our mission.

Thank you. This will conclude today's conference. You may disconnect at this time, and thank you for your participation.

Welcome to today's fireside chat with LifeVantage Corporation. I'm your host, Doug Lane, Managing Director and Consumer Analyst at Water Tower Research. Today, I'm joined by Steve Fife, President and CEO at LifeVantage; and Carl Aure, CFO. So welcome Steve and Carl.

Thanks, Doug.

Yes. Thank you, Doug.

LifeVantage is a world leader in using nutrigenomics to activate a healthy body mind and mood with science-backed products that include unique combinations of naturally occurring compounds. The company activates financial, social and community wellness by using a direct selling business model to offer its premium quality supplements, energy and skin care products through a connected network of independent consultants around the globe.

The company's safe harbor statements can be found in the Events and Presentations section on its Investor Relations website. Also, this fireside chat may not be reproduced or written transcript distributed without the express written consent of Water Tower Research.

So let's get started. Steve, it's been an eventful year for LifeVantage here in 2025. You came into the year recovering from inventory stockouts of the MindBody GLP-1 System after a successful launch in the 2024 fourth quarter, and now you're exiting 2025 with all of the excitement generated by the recent LoveBiome acquisition. So how you look back on what 2025 has meant for LifeVantage?

Yes. Thanks, Doug. Great question. And I guess it's that time of year when people reflect on the past and probably project into the future a little bit. But when I think about 2025, I believe we're continuing to take steps in the right direction and continue on the journey that LifeVantage is committed to. This journey for me started a few years ago as we really looked at our product strategy and established ourselves as the activation company. We looked at how we compensate our consultants and really modernize that compensation plan, and we're seeing success through the changes, the enhancements that we made.

And then we also started investing in our technology realizing that in order to keep pace and to accelerate our growth, our technology needed to become modernized. And we've announced a partnership with Shopify. We're making progress in that implementation and look forward to being able to launch that in 2026 as we continue the implementation of that. But I'd say the crown jewel of the year for us was the acquisition of LoveBiome.

And that acquisition, there are a number of aspects that make this and will continue to make it a success. But it's -- I think it's important to, I guess, set the tone right now of -- this acquisition was more than just acquiring a great product. But it was really about partnering with a great team of individuals who shared a very common vision and values around this industry passionate about science and how we can collectively change people's lives through amazing science-based products and also an entrepreneurial business opportunity.

And it's that combination of the people and that shared vision that is what is driving success with LifeVantage right now in 2025 and we're going to build upon clearly in 2026.

Yes. And I know that LoveBiome is a new company, but you're familiar with some of the players there, right? They are not new members to the direct selling community?

No, that's right. The two co-founders have been in the industry for over 40 years. Actually, Carl worked with them in a previous life. And it's how we became acquainted -- I became acquainted with them was through the relationship that Carl had with Kelly Olson and Shon Whitney, the two co-founders of the company.

The key product that LoveBiome brings to LifeVantage is P84, which is a microbiome blend focusing on improving gut health. I noticed you just released your first in vitro study of P84. So what were the key findings and what's in store for the next stage of your scientific research on P84?

Yes. I mentioned this journey that we've been on and establishing ourselves as the activation company. And that's critical really to who LifeVantage is. And the way we go about establishing ourselves as that, and we distinguish from supplementation and that our products really are very focused on helping the body activate or produce naturally different things that our bodies need for good health, be it antioxidants through our Protandim Nrf2 product, collagen, hormones like GLP-1 with our MindBody product. And P84s another now activator that we have in our -- arrow in our quiver, if you will, that helps with the activation of gut health.

And we back all of our products through studies. And not just ingredient studies, but typically, we start with an in vitro test, where we will look at specific proteins or peptides to see the impact that it has on -- again, on the function of a body. In this case, we looked at 14 different peptides and proteins that are all known to regulate, repair and restore the gut, so very focused on the gut microbiome. And the results from this in vitro test were amazing. All 14 of the markers showed statistically impressive and relevant results. A couple of examples of those peptides, there's a peptide referred to as GRP, which is responsible for sending alerts to kind of fire up the digestive system in our gut, and we saw an increase of over 1,000% in our in vitro test with P84.

Another peptide, TTF3, it's responsible for managing the gut lining and repairing, and it saw over 100% increase. So each one of these 14 peptides and proteins that we tested, saw an increase. And typically, when you're doing in vitro testing, an increase of 20% or 30% is statistically meaningful. And so when you see 100%, 1,000%, it tells you that the ingredients -- and it's not just the ingredients, but it's the combination of the ingredients, acting with one another are really activating our bodies, in this case, gut system.

And so we're thrilled to be able to add this to our product portfolio, marrying it is as a hero product along with our Protandim product, our Collagen product, and our GLP-1 product really establishes another whole space for -- to attract consumers, for our consultants to bring in new consultants and to take our company down another avenue of health and wellness.

Yes. And I remember you launched a new stack right after you acquired LoveBiome. Maybe give us a quick update on how that's working out. What's the reception been there?

Yes. Another part of when we do studies, we look at the synergistic benefits of our products taken in tandem. Protandim Nrf2 has been LifeVantage's hero product, a foundational product. P84, LoveBiome's hero product. And what we did for a number of reasons, but a couple of reasons was to bring those two products together and create literatures and material around that for our consultants. Because we knew at the time there would be a synergistic benefit. When you take those two products together. We also brought it as a unifying front for the two consultant bases. We've worked hard and we refer to ourselves as Activation Nation, and we feel like we've brought in a new group of people to Activation Nation. And by marrying those two products, it gave a one singular message for our consultants to take out regardless of what your background was or where you came from.

So it has been the focus of our stacks philosophy for the next -- or for the last couple of months. It will be going forward into next year as well as we integrate the two companies and the product lines together.

Well, that's true, Steve. I mean you didn't just get products, you also got a bunch of independent consultants as well. And how has it been going so far? I guess it's been over 2 months since the acquisition closed. And so maybe an update on the migration of some of the LoveBiome consultant base over to your Evolve Compensation Plan.

Yes. Well, it's gone amazingly well. And I've been part of a number of acquisitions. And I think I've shared this before, but from the very first conversations that I had with Kelly and Shon, it was amazing how aligned. We were philosophically. I mentioned earlier the vision -- the shared vision. But when you start a journey like this with a new partner and you're so aligned from the very beginning, you figure out how to overcome the little challenges that come through integration.

And that's what -- exactly what we've done. We signed the deal on October -- or September 3. The deal officially closed on October 1. And on November 1, we were fully integrated as now one company together. And the biggest piece of that was integrating the LoveBiome consultants into LifeVantage and getting them trained and up to speed on our Evolve Compensation Plan.

And so there's been a series of trainings that have taken place around that. We have put in place some incentives to help in that transitionary period to help them really learn how to optimize the compensation plan. But -- and that's progressing well. That -- we just closed our first month where we're all on one compensation plan. And it's gone as well as I can imagine.

The other thing that is happening beyond just the compensation plan is really how the two groups are merging together as one. During November -- well, I guess it started kind of officially in Dallas, where we had an in-person event, you were able to attend that. And I'm sure you sense the excitement of both of the groups coming together as one. And since that Dallas event in October, I think we've had about 30 different meetings throughout the world, but combine group meetings where both LoveBiome and LifeVantage consultants participated in trainings and opportunities meetings, bringing in new people to the company and the outreach, across communication, across support has just been amazing as both teams have welcomed one another.

Yes, there's no question. There was a lot of energy at that convention, and I'm glad to hear it being sustained here 2 months later as everybody rolls up their sleeves and goes to work. But let's talk about what's upcoming here. We've got in January, you guys do a Global Kickoff every January, I guess, mid-January to talk about what's going to happen in calendar 2026. Can you sort of give us maybe a sneak peek of what you'll be talking at the Global Kickoff this year?

Yes. It's kind of -- having a June 30 year-end, I feel like we get two beginnings of the year and two ends of the year. And because most of us, most consumers, most of our consultants think on a calendar year basis, we do have a Kickoff each year to really to set the tone, to set the theme. And the last, I guess, in 2024, our theme was to Rise. Last year in 2025 or I guess this current year, it was to Drive.

And those are words, but during the year, we build upon that. And each of our promotions and the in-person events that we have, we focus on those words to help drive behaviors and our results. And you're right, this year, I'm not going to tease it too much. But this year, and I think it's on October 10 is our Kickoff. We will be announcing a new theme. And it will be kind of our common messaging throughout all of 2026.

And in addition, at this Kickoff, we'll announce an incentive. We'll announce a couple of destination trips that our consultants earn. And one of our big focuses this year will be on a -- focus on subscriptions, and subscriptions for both our consultants and our customers. We know the power of being on a subscription. And so a lot of our messaging, not just at this event, but through the year will be in terms of training and helping our consultants understand the power of that.

And we'll also be announcing some results of another study that we've done that looks at Protandim, P84 and MindBody. And the results are going to be amazing.

Well, we'll stay tuned for that. I'm looking forward to it. I know you've got a lot of work with getting the P84 and the LoveBiome products and their science into the portfolio. But one thing I think got maybe a little bit buried in all the LoveBiome excitement is the move into Iceland over the summer. And not that Iceland is a big market, but it's really -- it's been a while since you've really expanded into new markets. And I'm always curious as to what your plans are with regards to geographic expansion. So is there anything there we can look forward to in 2026?

Yes. Yes. No, you're right. On the -- we -- LifeVantage kind of hit the pause but on geographic expansion in the last couple of years, in part because our focus was on what I said at the very beginning on our product strategy, comp plan and technology. And I -- we have made enough progress, I don't think you ever stopped on the journey on any three of those -- any one of those three areas. But I'm comfortable with the progress that we're making there. And now shifting a little bit more to broadening up the opportunity geographically.

When I look at our footprint, where LifeVantage revenue is, where our consultant base and customer base is, we are dominant in the United States and candidly, just underrepresented in the rest of the world. And that is a tremendous opportunity for us.

And recently, as you said, we launched in Iceland. Iceland is not one of those countries that people probably think about as the next -- what's going to move the company in a significant way. But it was an important strategic decision for us because we had attracted consultants to the company from other companies who had a presence there in Iceland. Some of them live there, some of them were outside of Iceland, but they had teams in Iceland. As we looked into those teams, we looked at the contribution that they could provide really to support them and their businesses, we made the decision to go there. And it's been a success. The results are exceeding our forecast. It got us kind of as a company back in the mindset of what it takes to launch in a market.

And 2026, there will be further international expansion coming from LifeVantage. And that's launching countries, it's a skill. It's something that there's probably 80% -- 90%, 95% overlap from country to country to country. But each -- and we need to become experts in that, and we will. The 5% to 10% uniqueness to each country is really what kind of determines the bandwidth and the length of time it takes us to launch because each country has its own nuances.

But I'm excited that we have this first one behind us. We've also made significant progress in the Canary Islands because of relationships coming out of Spain and Mexico into that small country. And there will be more to come, and there are new additional products that we're planning on launching into Iceland either even as we look forward into 2026. So it will be -- you'll hear more about our geographic expansion as we progress during '26.

Yes. I'm always interested in that. As you mentioned, you're underrepresented. And with 80% of direct selling outside the U.S. And I think only 30% of your business is outside the U.S., it just seems like there's a lot of white space out there. So I'll keep asking.

Yes.

Shift gears here. Carl, you just closed on the acquisition. It didn't sound like it was a big source -- or a big use of cash. But maybe you can update us on capital allocation plans for 2026.

Yes, sure. Yes. As I look forward to 2026, I still think that we're committed to those three pillars that we've talked about in the past about investing internally. One of the things that Steve had talked about is just our e-commerce platform and the investments that we want to continue to support there. That will clearly be a priority. But I think from a share repurchase standpoint, we're still very committed to share repurchases, especially where current valuation levels are at. We still have just under $17 million remaining under the existing authorization. We do have a 10b-5 plan out there that's effective through June 30 of 2025, and we'll be able to supplement that through open window purchases as market conditions permit.

So we're definitely still very committed. And I -- when I think of the priorities, especially at these valuations, I think share repurchases will be at the higher end of the list there. We also remain committed to our dividend. As you know, we put the dividend in place almost 4 years ago. So we're still obviously very committed to that dividend.

And as I look back kind of at the current quarter as our current fiscal Q2, as you mentioned, really from a capital allocation perspective, we've been really hyper-focused on LoveBiome. We did -- there was a cash upfront payment on the closing on October 1. So we used a portion of our existing cash from our balance sheet to fund the closing of LoveBiome. But we've also been investing internally as well just through the integration efforts that Steve was talking about with LoveBiome getting them onto our comp plan. There's definitely been some -- also some additional internal investment there just to make sure that, that transition goes as smooth as possible.

And then along with that, just building inventory as well, building up inventory from a working capital perspective to get sufficient supply of P84, and some of the other popular products of LoveBiome that we can -- that we anticipate to go forward. And so I would say in the current quarter, we've been hyper focused on LoveBiome. But looking forward, for sure, share repurchases would be a priority as our cash balances start to rebuild.

Well, that's a good point. This is also your first diet season, if you will, with MindBody. So I imagine there's an inventory build perhaps going...

Absolutely. Yes.

So we might see a little bit elevated inventories in the December quarter.

I think that's right.

Yes. And what about CapEx for the full year, for the fiscal -- the June fiscal year in 2026, maybe slightly elevated...

Yes. It will be slightly elevated versus historical years and mostly because of the development associated with the e-commerce platform. That's where the internal CapEx is going to be not significantly higher than prior years because it will bridge a little bit into fiscal -- to our next fiscal year as well. But yes, it will be elevated primarily due to the e-commerce platform.

Okay. That makes sense. And then let me see your last Global Convention was in the spring of 2025. So you're due one in the fall of 2026, if I had my math right. So not quite a year away, so maybe it's a little bit early. But maybe if you put on your crystal ball, Steve, what do you think you'll be talking about with LifeVantage at your Global Convention, I assume it's in October of 2026.

That's right. It will be in October. And between -- we have the Global Kickoff here that we've talked about, that's a virtual event. In November, the U.S. and each of our countries will have kind of regional events. So it will be -- that will be -- and those will be in person. So we actually, in the U.S., that event is going to be in Las Vegas in April. And then July, we have a virtual event that is a global virtual. And so that's -- and then leading up to October, we'll have our Global Convention.

And this is -- our Conventions are amazing. What's really fun is when we have international consultants come and join us and seeing how they interact with the U.S. team and vice versa, you can see Activation Nation really coming together as one. And they bring a different energy and excitement. They don't get to be here as often as we would love to. And so it's pretty special when we have these international events.

And I would look forward to a product launch at our Convention in October. And then consist a lot of recognition for what I hope to be a big year. But as we building off of the LoveBiome opportunity, the partnership with LoveBiome. I expect that we'll have a lot of recognition and training and motivations. We typically bring in third-party speaker to inspire with skills. So it's just they're great events. And really, I think our consultants really look forward to them. And I'm sure it will be fantastic.

Well, it will be your first Global Convention with the LoveBiome folks. So I'm sure there'll be a lot of enthusiasm around that. Anyway, we're about out of time here. So maybe we'll leave it there. Steve, Carl, thank you very much for joining us on today's fireside chat.

Yes. Thanks, Doug. Appreciate it.

Thank you, Doug. Thank you very much.

To learn more about LifeVantage, please visit the Investor page on their website, lifevantage.com, or access our research on WTR's website, which is watertowerresearch.com. Thank you, everybody, for joining us.

And please note that the views expressed in this fireside chat may not necessarily reflect the views of Water Tower Research, LLC and are provided for informational purposes only. This fireside chat may not be distributed or reproduced without the written consent of Water Tower Research and should not be considered research nor a recommendation. WTR as an investor engagement firm, not a license broker, broker dealer, market maker, investment bank, underwriter or investment adviser. Additional disclaimers can be found at watertowerresearch.com.

Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to today's conference call to discuss LifeVantage's First Quarter of Fiscal 2026 Results. [Operator Instructions] Hosting today's conference will be Reed Anderson with ICR. As a reminder, today's conference is being recorded.

And now I would like to turn the conference over to Mr. Anderson.

Thank you. Good afternoon, and welcome to LifeVantage Corporation's conference call to discuss results for the first quarter of fiscal 2026. On the call today from LifeVantage with prepared remarks are Steve Fife, President and Chief Executive Officer; and Carl Aure, Chief Financial Officer.

By now, everyone should have access to the earnings release, which went out this afternoon at approximately 4:05 p.m. Eastern Time. If you have not received the release, it is available on the Investor Relations portion of LifeVantage's website at www.lifevantage.com. This call is being webcast, and a replay will be available on the company's website as well. Before we begin, we would like to remind everyone that our prepared remarks contain forward-looking statements and management may make additional forward-looking statements in response to your questions. These statements do not guarantee future performance, and therefore, undue reliance should not be placed upon them. These statements are based on current expectations of the company's management and involve inherent risks and uncertainties, including those identified in the Risk Factors section of LifeVantage's most recently filed Forms 10-K and 10-Q.

Please note that during today's call, we will discuss non-GAAP financial measures, including results on an adjusted basis. Management believes these financial measures can facilitate a more complete analysis and greater transparency into LifeVantage's ongoing results of operations, particularly when comparing underlying operating results from period to period. We've included a reconciliation of these non-GAAP measures with today's release. This call also contains time-sensitive information that is accurate only as of the date of this live broadcast November 4, 2025. LifeVantage assumes no obligation to update any forward-looking projection that may be made in today's release or call.

Now I will turn the call over to Steve Fife, the President and Chief Executive Officer of LifeVantage.

Thanks, Reed, and good afternoon, everyone. Thank you for joining us today. Before we dive into our Q1 results, I want to take a moment to reflect on what has truly been transformational this quarter for LifeVantage. We successfully closed the strategic acquisition that positions us at the forefront of a rapidly growing wellness market. We've brought together 2 passionate consultant communities and we've continued to execute on our product differentiation of activating the body through nutrigenomic innovation.

Looking at our Q1 2026 results. Net revenue of $47.6 million was up fractionally from a year ago, reflecting a modest increase in the number of consultants and similar growth rates in both the Americas as well as Asia Pacific and Europe. Adjusted EBITDA of $3.9 million was down $500,000 versus last year due to lower contribution margin, partially offset by lower SG&A. Given its strategic importance, let me now turn to the LoveBiome acquisition we closed on October 1. This transaction represents far more than just additional products in our portfolio. It's about positioning LifeVantage squarely within one of the fastest-growing segments in wellness, gut microbiome health. The gut health supplement market is projected to grow from $14.4 billion in 2025 to $32.4 billion in 2035 million and LoveBiome flagship P84 product aligns perfectly with our approach to product using carefully selected blends of naturally derived ingredients that activate optimal health processes ensuring your body is making things it needs for health.

The innovative product that's right alongside our existing portfolio of scientifically validated activators including our flagship Protandim Nrf2 Synergizer customer favorite, TrueScience Collagen and our breakthrough MindBody GLP-1 system. But what makes this partnership truly special is our shared commitment to the direct selling industry and the empowerment it provides to consultants around the world. By bringing LoveBiome consultants into our industry-leading evolve compensation plan with compelling products that address a broad spectrum of health concerns, we're able to activate wellness, both financially and physically to a much broader base of consumers. The integration of LoveBiome is essentially complete with systems and website cutover happening this past weekend. We successfully onboarded personnel, including founder, Kelly Olsen, and his leadership team and we're seeing positive early indicators from the consultant community integration.

Consultant product cross-selling training has kicked off and is expected to ramp during the quarter. From a financial perspective, we're on track to achieve the operational synergies we outlined at the time of the acquisition announcement. The integration of our technology platform, supply chain operations, and consultant support system is progressing smoothly, and we expect to realize the full benefits of these synergies as we move through fiscal 2026. Looking beyond this fiscal year, we remain confident in our ability to drive improved operating leverage as we scale our combined operations and realize the full benefits of our strategic investment in technology, product development and market expansion. The timing of this acquisition couldn't have been better as it allowed us to showcase this exciting partnership at our U.S. Momentum Academy event, which was held in Dallas on October 24 and 25. This was truly a historic event. The first time our 2 active communities came together in person for training, along with incentive and product announcements.

The energy in Dallas was absolutely electric. We had nearly 2,000 registered, making it one of our largest Momentum Academy events ever. The integration of our consultant communities exceeded our expectations with LoveBiome consultants embracing our drive era quarterly incentive campaign and our comprehensive training programs. This year's event centered around the theme, Love Life and Drive which served as both a nod to the companies coming together and inspiration to consultants to take the driver's seat in their business with purpose, speed and unstoppable momentum. Nothing replaces the energy and momentum that comes from meeting in person, and our time in Dallas emphatically proved that point. Attendees are also trained on Healthy Edge, a groundbreaking combination that pairs the original proven technology of Protandim Nrf2 Synergizer with the emerging science of P84.

Individually, each product delivers powerful benefits by supporting cellular health and system communication. Together, they form a peak performance wellness system that provides foundational health throughout the entire body, helping you feel ready to take on life's daily challenges. Consultants at the event got a first look at results of a recently completed in vitro study on P84, which demonstrated the activation of 14 natural peptides found in the gut responsible for regulating, repairing and restoring this vital organ. While most other gut health products merely supplement with pro, pre and post-biotics, the testing proved the activation differentiator of this comprehensive product. We will be providing more details of these exciting results in the coming weeks during the full P84 and Healthy Edge product launch.

Next, let me update you on the Shopify partnership we announced last quarter as this is a key focus as we continue to invest in modernizing our technology infrastructure to meet the demands of today's fast-paced consumers. This quarter, the team made great progress with the design, content and development aspects of our new e-commerce platform as we work towards a pilot this fiscal year and later our full rollout. This partnership with the most reputable highest converting e-commerce platform on the market will deliver significant growth potential for both LifeVantage and our consultants. Shopify enables increased conversion and brand advocacy through seamless channel experiences, deeper personalization and data insights and greater consumer confidence through enhanced payment security, checkout reliability and order tracking.

As we look ahead to the remainder of fiscal '26, I'm optimistic about our positioning and growth trajectory. The successful integration of LoveBiome has expanded our addressable market while strengthening our consultant base with passionate, experienced entrepreneurs who share our commitment to activating optimal health. We're not just adding products or consultants or creating a comprehensive wellness ecosystem that addresses multiple aspects of human health, including physical and financial from cellular health with Protandim to metabolic wellness with MindBody to gut health with P84 to beauty and longevity with TrueScience. We're uniquely positioned to serve the evolving needs of health-conscious consumers worldwide. And with our industry-leading evolved compensation plan, comprehensive training and recognition programs and vibrant community, we're uniquely positioned to serve the unique needs of entrepreneurs worldwide as well.

The direct sales industry continues to evolve and companies that combine innovative products, compelling compensation, modern technology and authentic community will be the winners. I believe LifeVantage enhanced by our LoveBiome partnership is perfectly positioned to lead in this new era.

With that, let me turn the call over to Carl for a detailed review of our financial results and outlook. Carl?

Thank you, Steve, and good afternoon, everyone. Let me walk you through our first quarter financial results. Please note that I will be discussing our non-GAAP adjusted results. You can refer to the GAAP to non-GAAP reconciliations in today's press release for additional details.

For the first quarter of fiscal 2026, we delivered net revenue of $47.6 million, which was up 0.7% compared to $47.2 million in the first quarter of fiscal 2025. The slight increase in net revenue reflected increased sales of our MB GLP-1 system, offset by lower sales of Protandim and TrueScience product line as well as decrease in total active accounts. While net revenues in our primary geographic regions were both up slightly in the first quarter, we did experience higher growth in Japan, driven by the launch of the MindBody GLP-1 system beginning in March. For the quarter, revenues in Japan increased 2.6% on a constant currency basis. Our gross margin for the quarter was 79.5%, down 40 basis points compared to the prior year period, primarily due to increases in shipping and warehouse related expenses.

Commissions and incentive expense as a percentage of revenue was 43.5% in the first quarter compared to 43% in the prior year period. The increase was due to changes in sales mix, along with the timing and magnitude of our various promotional and incentive programs. Non-GAAP adjusted SG&A expense was $14.6 million in the first quarter compared with $14.7 million in the prior year period. Adjusted non-GAAP operating income was $2.5 million in the first quarter compared with $2.7 million in the prior year period. Adjusted non-GAAP net income was $2.3 million or $0.18 per fully diluted share in the first quarter compared to $1.9 million or $0.15 per share in the prior year period. We recorded income tax expense of just under $100,000 in the first quarter compared to income tax expense of approximately $800,000 in the prior year period.

Our overall effective tax rate for the quarter was approximately 4%. The decrease in our effective tax rate for the first quarter was due to the positive impact of discrete items recorded in the quarter. We anticipate our full year fiscal 2026 effective tax rate to be approximately 25%. Adjusted EBITDA for the first quarter was $3.9 million or 8.2% of revenues compared to $4.4 million and 9.4% in the same period a year ago, primarily reflecting lower gross margins and higher commission and incentive-related expenses. Please note that all of the adjustments from GAAP to non-GAAP that I discuss today are reconciled in our earnings press release issued this afternoon.

Our financial position remains strong with $13.1 million of cash and no debt at the end of the first quarter compared to $14.6 million a year ago. We also maintain access to a $5 million revolving line of credit. Capital expenditures totaled $400,000 in the first quarter compared to $300,000 in the prior year period.

Turning to capital allocation. We repurchased 44,000 shares during the first quarter at an average of $13 per share for an aggregate purchase price of $600,000. As of September 30, 2025, there is still $16.7 million remaining under our existing share repurchase authorization. Today, we also announced a quarterly cash dividend of $0.045 per share of common stock or approximately $600,000 in the aggregate. This dividend will be paid on December 15, 2025, to stockholders of record as of December 1, 2025. Since the beginning of fiscal 2024, we have returned approximately $19.8 million in total value to our stockholders through stock repurchases and dividends. We will continue to focus on our balanced capital allocation strategy in order to drive value for our stockholders.

Turning to our outlook for fiscal 2026. We continue to expect our full year revenue will be in the range of $225 million to $240 million, which includes expected revenue contribution from the LoveBiome transaction. We are also reiterating our profitability guidance and expect adjusted non-GAAP EBITDA in the range of $23 million to $26 million and adjusted non-GAAP earnings per share in the range of $1 to $1.15 per share. We continue to anticipate revenue in the second half of fiscal 2026 will be higher than the first half due to the seasonality associated with our MindBody product line and the impact of the LoveBiome acquisition. Overall, we are pleased with the continued improvement in our profitability metrics and remain committed to improving our adjusted EBITDA margins to reach our long-term target.

And with that, let me turn the call back over to the operator for questions. Operator?

[Operator Instructions] The first question we have comes from Doug Lane of Water Tower Research.

Before we get to LoveBiome, can you give us a feel -- I know you don't put out quarterly guidance, you put out annual guidance. But can you give us just a some sort of feel on how you thought the September quarter came in versus your original expectations?

Yes, Doug, this is Steve. Q1 is historically our low quarter. We have a lot of our consultant base that isn't as active during the summer months. And we saw that trend continue this quarter. We also -- when I look back to our prior year comparison, we had in September a year ago, a fairly strong ramp-up to our launch of MindBody that occurred in the middle of October and had a separate incentive 20% off a year ago and a ramp-up to that. So it was -- on a year-over-year comparison, it's probably a tough comparison to begin with. But again, kind of seasonally low in general for us over all the years. So a little softer than maybe than what we thought, but not alarming at all.

Okay. That makes sense. And this year, I guess you announced LoveBiome right in the third month, September. Was there any impact to your business? Did that have any impact on your business between September 3 and October 1.

No. There was 0 revenue contribution from LoveBiome. We didn't close the transaction until October 1. So there were 0 revenue impact from the LoveBiome group. If anything, I would say that our consultant base of the LifeVantage consultant base may have kind of taken their foot off the gas a little bit to wait and see the anticipation and to understand what all of that meant. So possibly some just kind of a pause with some of the LifeVantage consultants, but no contribution from the LoveBiome revenue group.

Okay. That's good color. So actually, the opposite of what happened last year. So LoveBiome closed on October 1. So you will benefit from a full quarter of their sales just mathematically before you even begin the integration of their sales force and the rollout of the Healthy Edge stack. So let me ask you this. And that will help offset that tough comparison from last year, but I get that really -- really, we're looking at the second half year to really get the full benefit of LoveBiome becoming part of LifeVantage.

Yes, that's exactly right. We -- the transaction closed on October 1, and for the entire month of October, we were operating separately. So their systems, their website, their comp plan was still in full effect and similar for LifeVantage. What's really exciting and really a great success for us is that over this last weekend, we took our systems down for a few days, but converted all of LoveBiome onto LifeVantage's systems, both the transactional side, the e-commerce, the websites, the back offices, so all the tools that the consultants use and the compensation plan. So effective November 1, we have really integrated all aspects of our business. And that was a huge effort for us to pull off so quickly.

And now that integration piece is behind us, and we can focus more of our attention on really optimizing now the combined consultant base and customer base of the 2 companies. So we've put in place a very robust training programs of the cross-selling opportunities. Clearly, we've got a full court press on training the former LoveBiome consultants on the evolved compensation plan and helping them understand how their businesses can benefit from that. And the reception to both sides, I guess, of this partnership has been tremendous. But everyone is kind of drinking from that proverbial fire hose right now. And so the quicker we can get everyone trained and up to speed, and that's going to take a minute for that to really happen.

But that's why we also -- and from the very beginning, it felt like our second half of the year is going to be larger than our first half weighted heavily to the second half because of that ramp up with LoveBiome but also reentering a season at our MindBody product will come to the forefront with a lot of consumers. As we enter kind of the traditional weight loss season in the January time frame. And then there's a little bit of a resurgence in the April, May time frame as people start looking closer to summer as well.

A lot of moving parts. Let's talk about the science a little bit. The P84 Nrf2 stack sort of a no-brainer right, the 2 flagship products from each company. But what I think interests me is how deep you're going on gut health. And what are the opportunities from a gut health standpoint with LoveBiome science combined with the work that you've done on MindBody?

Yes. Well, it fits in from the very first conversations that we had with LoveBiome. The question that we asked ourselves and had to answer was how does it sit into our activation philosophy from a product standpoint. And we've started to do testing on P84, and we were fortunate that right before our Dallas Momentum Academy just a few weeks ago, we announced results from an in vitro test of P84, where I mentioned that we identified 14 peptides in our body that are responsible for regulating, repairing and restoring overall gut health that were activated. So our body's ability to produce is so far superior to anything that we can supplement with it. And our -- that in vitro test showed that across these 14 peptides, it increased the production of those peptides and so we're thrilled with that and adding another activator in a market that it's projected to grow from $14 billion to $35 billion over the next 10 years.

So we see a huge massive white space for us to operate in with a product that fits into our product strategy as well as when you couple that with the power of Protandim Nrf2 and we've got studies underway right now that we'll hopefully be announcing here in a couple of months around that power of the synergistic benefits of taking Protandim and PAD together and what we've now positioned in what we call our Healthy Edge stack.

There are no additional questions in the queue. So I'll turn the call back over to Steve Fife for closing remarks. Please go ahead, sir.

Yes. Thanks, operator, and thank you, everyone, for joining us today. As we conclude, I just want to extend my appreciation to our committed employees, our outstanding independent consultants and stockholders and all of our faithful customer base. And I look forward to updating you next quarter with further clarity and outcomes of our results. Thanks a lot.

Ladies and gentlemen, that then concludes today's conference. Thank you for joining us. You may now disconnect your lines.

Good day, ladies and gentlemen. Thank you for standing by. Welcome to today's conference call to discuss LifeVantage's Fourth Quarter of Fiscal 2025 Results.

[Operator Instructions]

Hosting today's conference will be Reed Anderson with ICR. As a reminder, today's conference is being recorded. And I would now like to turn the conference over to Mr. Anderson. Please go ahead.

Thank you. Good afternoon, and welcome to LifeVantage Corporation's conference call to discuss results for the fourth quarter of fiscal 2025. On the call today from LifeVantage with prepared remarks are Steven Fife, President and Chief Executive Officer; and Carl Aure, Chief Financial Officer. By now, everyone should have access to the earnings release, which went out this afternoon at approximately 4:05 p.m. Eastern Time. If you have not received the release, it is available on the Investor Relations portion of LifeVantage's website at www.lifevantage.com. This call is being webcast, and a replay will be available on the company's website as well.

Before we begin, we would like to remind everyone that our prepared remarks contain forward-looking statements, and management may make additional forward-looking statements in response to your questions. These statements do not guarantee future performance, and therefore, undue reliance should not be placed upon them. These statements are based on current expectations of the company's management and involve inherent risks and uncertainties, including those identified in the Risk Factors section of LifeVantage's most recently filed Forms 10-K and 10-Q.

Please note that during today's call, we will discuss non-GAAP financial measures, including results on an adjusted basis. Management believes these financial measures can facilitate a more complete analysis and greater transparency into LifeVantage's ongoing results of operations, particularly when comparing underlying operating results from period to period.

We've included a reconciliation of these non-GAAP measures with today's release. This call also contains time-sensitive information that is accurate only as of the date of this live broadcast, September 4, 2025. LifeVantage assumes no obligation to update any forward-looking projection that may be made in today's release or call. Now I will turn the call over to Steven Fife, the President and Chief Executive Officer of LifeVantage.

Thanks, Reed, and good afternoon, everyone. Thank you for joining us today. We are pleased with our fourth quarter results, including continued growth and improving margins. Revenues increased approximately 13% year-over-year to $55.1 million, driven largely by our MindBody GLP-1 system.

Profitability also remained strong, and we delivered 40 basis points of gross margin expansion versus the prior year period. Adjusted EBITDA of $4.8 million was flat versus last year's fourth quarter. While revenues in the Americas region were up a solid 14%, another exciting development was our international business returning to growth for the first time in 12 quarters.

For the quarter, revenues in our Asia Pacific and Europe regions increased by 8%. The rollout of MindBody to Japan, Australia, Europe and Thailand beginning mid-March was the key driver for higher international sales and momentum continues to build. Active account metrics reflected the positive trends we are seeing across our business.

In the Americas, total active accounts were up 6% versus last year with increases in both consultants and customers. In Asia Pacific and Europe, total active accounts were down versus last year, but increased 3% on a sequential basis as the MindBody rollout led to growth in customers. Average revenue per consultant was up 4% in the Americas and 14% in Asia Pacific and Europe, further demonstrating the early success of MindBody internationally.

Acentuating the incredible year we have had is yesterday's announcement that we have entered into a definitive agreement to acquire the critical assets of LoveBiome, a pioneer direct selling company with a growing global sales presence and strong product philosophy. This strategic partnership enables both consulting groups the opportunity for accelerated growth by cross-selling products while LifeVantage realizes operational leverage.

Two things primarily attracted us to this incredible company. First, LoveBiome has established itself as a leader in the emerging microbiome health sector, focusing on the critical connection between gut health and overall wellness. The company's innovative P84 product, which launched earlier this year, takes the guesswork out of gut health by regulating, repairing and restoring the gut and microbiome through activation, recognizing that comprehensive gut health is fundamental to health across multiple body systems.

The global gut health supplement market is projected to grow from $14.4 billion in 2025 to $32.4 billion by 2035, registering a robust CAGR of 8.4%, making it an attractive category for LifeVantage. P84 also aligns perfectly with our differentiation of activating optimal health processes throughout the body. We feel strongly that LoveBiome's expertise in microbiome science complements LifeVantage's existing portfolio of scientifically validated activators, including our flagship Protandim Nrf2 Synergizer, customer favorite TrueScience Collagen and our newest innovation, the MindBody GLP-1 system.

And second, both LoveBiome and LifeVantage believe strongly in the direct sales industry and the empowerment it provides to consultants around the world. The partnership we are entering into accelerates the call to global entrepreneurs to [ Love Life ] with the very best compensation plan, products and community while also accelerating the ability for both companies to scale their growth meaningfully and sustainably.

By empowering LoveBiome and LifeVantage consultants through our industry-leading evolve compensation plan with compelling products that address a number of health concerns, we're able to activate wellness, both financially and physically to a broader base of consumers. I commend LoveBiome's Founder and CEO, Kelly Olsen, and his team for continuously championing the direct sales industry while innovating in a growing wellness category.

The timing of this strategic acquisition is also a testament to the transformational work the entire LifeVantage team has been delivering in the past 3 years. The success of LifeVantage's LV360 initiatives, which were previously discussed, laid the foundation that now allows for investments into the core business. It's truly an industry-first partnership that scales our path to growth this fiscal year and beyond.

Under the terms of the definitive agreement, all critical operating assets essential to the success of LoveBiome members transitioning to LifeVantage consultants as well as the assets surrounding the microbiome health business will transfer to LifeVantage. The transaction structure includes the retention of key LoveBiome personnel with Founder and CEO, Kelly Olsen, and other team members joining LifeVantage to ensure continuity of operations and leverage their expertise in the direct selling channel.

We are expected to close the transaction by mid-October upon satisfactory and customary closing conditions and regulatory requirements and plan to be fully integrated by the end of fiscal Q2 2026. Following this strategic transaction, we anticipate our U.S. Momentum Academy being held in Dallas on October 23 to 25 to be a historic event. This will be the first time the 2 active communities will come together in person for training, incentive and product announcements.

We'll also be announcing the evolution of our Summer in the Fast Lane campaign. If you remember, we kicked off quarterly campaigns at our Activate virtual event in July to help consultants at every rank build their business by qualifying for new incentives and growing Activation nation. We're excited to introduce LoveBiome consultants to the drive era using this quarterly incentive push.

Nothing replaces the energy and momentum that comes from meeting in person, and we anticipate a sellout event. Similar events will be held in several countries throughout the world in October to accelerate a seamless integration of the 2 companies. Not only are we committed to growing our consultant base through the strategic acquisition and our product and compensation differentiation, but we are also committed to delivering the experience modern fast-paced consumers demand in today's market.

I'm excited to announce that we've entered into an agreement with Shopify that will further modernize our technology and marketing stack to meet the increasing demand consumers have throughout the entire customer journey. And we've partnered with the very best, most reputable, highest converting e-commerce platform on the market to do so.

Simply stated, our Shopify partnership enables significant growth potential for both LifeVantage and our consultants. Shopify delivers increased conversions and brand advocacy through seamless channel experiences, deeper personalization and data insights and greater consumer confidence with things like payment security, checkout reliability and order tracking.

For our internal team, it also means greater efficiency, faster innovation and quicker scaling of future integrations. This project is just getting underway with the team wrapping up initial discovery sessions and milestones last week, leading to a full project and rollout plan. We will continue to update you as we progress towards go-live, but are excited about completing this early stage and what this project in partnership with Shopify means for LifeVantage.

In summary, fourth quarter results were strong, and our business continues to have a lot of momentum powered by innovation. We've built a powerful dynamic ecosystem focused on holistic wellness, along with a proven model that provides multiple avenues for entrepreneurial success.

Our team is highly engaged with an ambitious vision for the future, and we are well positioned for continued growth and margin expansion. The successful global rollout of our MindBody system and this announced partnership with LoveBiome, combined with our strengthened operational foundation and improving profitability metrics gives us confidence in our ability to deliver sustainable long-term value to our stakeholders. Now, let me turn the call over to Carl to review our fourth quarter financial results in detail. Carl?

Thank you, Steve, and good afternoon, everyone. Let me walk you through our fourth quarter financial results. Please note that I will be discussing our non-GAAP adjusted results. You can refer to the GAAP to non-GAAP reconciliations in today's press release for additional details. Fourth quarter revenue was $55.1 million, up 12.6% on a year-over-year basis. Foreign currency impacted revenue by $0.5 million in the fourth quarter. Excluding the impact of foreign currency fluctuations, fourth quarter revenue was up approximately 11.6% compared to the prior year period.

Revenue in the Americas region increased 14.1% to $43.5 million in the fourth quarter, continuing to benefit from the success of our MindBody GLP-1 system. Growth was driven by a 9.7% increase in active independent consultants, along with a 4% increase in total average revenue per consultant.

Total active accounts, which includes consultants and customers, increased 6.4% in the Americas during the fourth quarter. Revenue in our Asia Pacific and Europe region increased 7.6% to $11.6 million in the quarter, reflecting the positive impact of our international MindBody rollout that began in March. The year-over-year growth in Asia Pacific and Europe reflected a 13.9% increase in total average revenue per consultant. We are excited to see a return to growth in this region with revenue up both year-over-year and sequentially from the third quarter.

Gross margin was 79.9% for the fourth quarter compared to 79.5% in the prior year period. This improvement was primarily driven by lower shipping costs, favorable product mix, including strong sales of MindBody as well as lower inventory obsolescence. Commissions and incentive expense as a percentage of revenue was 42.1% in the fourth quarter compared to 44.9% in the prior year period, reflecting lower incentive-related expenses and the positive impact from changes in sales mix.

Non-GAAP adjusted SG&A expense was $18.3 million in the fourth quarter compared with $13.7 million in the prior year period. The increase was primarily due to higher variable employee compensation-related expenses and expenses associated with our global convention and increased marketing investments.

Adjusted non-GAAP operating income was $2.5 million in the fourth quarter compared with $3.2 million in the prior year period. Adjusted non-GAAP net income was $2.3 million or $0.17 per fully diluted share in the fourth quarter compared to $1.8 million or $0.14 per share in the prior year period. We recorded income tax expense of $400,000 in the fourth quarter compared to income tax expense of $1.4 million in the prior year period.

Our overall effective income tax rate for fiscal 2025 was approximately 20%. Adjusted EBITDA for the fourth quarter was $4.8 million or 8.7% of revenues compared to $4.8 million and 9.8% in the same period a year ago. Adjusted EBITDA in the fourth quarter of fiscal 2025 was impacted by the timing of our annual global convention, which was held in April. Please note that all of the adjustments from GAAP to non-GAAP I discussed today are reconciled in our earnings press release issued this afternoon.

Our financial position remains strong with $20.2 million of cash and no debt at the end of the fiscal year compared to $16.9 million a year ago. We also maintain access to a $5 million revolving line of credit. Capital expenditures totaled $200,000 in the fourth quarter and $1.4 million for the full year.

Turning to capital allocation. We repurchased approximately 160,000 shares during the fourth quarter at an average price of $12.74 per share for an aggregate purchase price of $2 million. As of June 30, 2025, there is still $17.3 million remaining under our existing share repurchase authorization. On August 28, we also announced a quarterly cash dividend of $0.045 per share of common stock or approximately $600,000 in the aggregate.

This dividend will be paid on September 16, 2025, to stockholders of record as of September 8, 2025. Since the beginning of fiscal 2024, we have returned approximately $18.6 million in total value to our stockholders through stock repurchases and dividends. We will continue to focus on our balanced capital allocation strategy in order to drive value for our stockholders.

Turning to our outlook for fiscal 2026. We expect our full year revenue will be in the range of $225 million to $240 million. We expect adjusted non-GAAP EBITDA in the range of $23 million to $26 million and adjusted non-GAAP earnings per share in the range of $1 to $1.15 per share. We anticipate revenue in the second half of fiscal 2026 will be higher than the first half of fiscal 2026 due to the seasonality associated with our MindBody product line and the impact of the LoveBiome acquisition.

Overall, we are pleased with the continued improvement in our profitability metrics and remain committed to improving our adjusted EBITDA margins to reach our long-term target. And with that, let me turn the call back over to the operator for questions. Operator?

[Operator Instructions] Our first question is from Doug Lane with Water Tower Research.

Before we get to the acquisition, which sounds very interesting, I just wanted to go over the fourth quarter and the demand trends there, where $55 million was at the low end of the range and $3 million or so below the midpoint. So where did you -- I don't want to say softness, but where did the disconnect come from the $55 million versus the $58 million at the middle of the range?

Yes. Thanks, Doug, for the question. Yes. So I think -- yes, in Q4, you're right, things came in a little bit softer than what we anticipated. And it was really primarily, I think, in the U.S. side. I think we started to experience some softness around or the seasonality impact of MB here in the fourth quarter. As you saw in the rest of the numbers, international was still pretty strong, but I think it was just a little bit of continued softness there in the U.S. trailing at the end of Q4.

Got it. Got it. Okay. Now on the outlook, looking, I guess, again, using midpoint of the ranges here, Carl, we're looking for maybe low single-digit growth in fiscal 2026. And how much of that is going to come from LoveBiome versus organic?

Yes. We haven't completely figured that piece out yet, Doug. I mean the transaction is looking to close sometime during the second quarter with integration intended to be towards sometime by the end of the second quarter. And there's obviously uncertainties associated with that all comes together.

So I'd say when you're looking at that guidance range that we put out, there is a modest amount of revenue associated with that transaction. So I would say, overall, it's a combination of some organic growth from the current baseline or run rate where we are from Q4 with a moderate amount of anticipated LoveBiome revenue.

And LoveBiome, obviously, is a private company. It's a direct seller out in [indiscernible]. I haven't really seen any data from independent sources on LoveBiome. Can you disclose anything with regards to what its sales are or how many consultants it has and what it's really going to bring to LifeVantage here?

Yes, probably not. As far as any of the current revenue information or the consultants, I mean, I think some of that information will be available at a later point. But at this point in time, there's probably not much that we can discuss on at least with those revenue metrics and the related drivers to their business.

How old a business is it? It's still a pretty young business, right? So it can't be that big.

Yes. They started in about 2022, so about 3 years. And I can tell you, the U.S. is their biggest market, followed by Taiwan, and then they have a reasonable presence in Europe and then a smattering in other countries throughout the world. So they have a large footprint, some overlap with LifeVantage, which I think is a really good thing.

The product that they've developed, they've been very singularly focused on the gut microbiome and have several products, but most recently announced in March the launch of a product that they refer to as P84. And it has really kind of changed the trajectory of the company and has energized their consultant base, their customer base -- and as we've looked over the past, we've distinguished ourselves, I think, as a company of activation and our products, most recently with MindBody and prior to that, Collagen and then originally with Protandim Nrf2, all critical activation products for our health and well-being.

And we have -- we had identified the microbiome space as a real opportunity for LifeVantage. And in fact, 12, 18 months ago, when we were kind of dual pathing our GLP-1 product and a microbiome, a gut product. And obviously, we decided to go down the path of GLP-1, which we're thrilled with.

But based on our research and analysis of the market, we knew it was a growing market. In the press release that went out yesterday, we quoted a research analyst that talked about the current market of $14 billion growing to $32 billion by 2035. So it's a dynamic growing market. One that I think is, well, at the center of health literally in our bodies, but also one that plays into our activation story.

And as we met with Kelly Olsen, one of the co-founders and CEO of the company and started to understand their science, their product, their vision of this industry, it aligned so clearly and so quickly with LifeVantage that it almost became a no-brainer to pursue this partnership.

And it was just announced yesterday. We had a town hall meeting of LifeVantage and LoveBiome consultants on last night. We maxed out our Zoom capabilities. And so there's a lot of benefits, not just from P84 and LoveBiome's products, but our ability to cross-sell one another's products and obviously, the operational leverage that we'll get through combining the 2 entities.

We've been learning a lot about gut health through your MindBody launch over the last year.

That's exactly right.

And I believe that's your first foray into gut health. And it really is...

We do have a probiotic and a prebiotic product that our consultants, our customers love. But we also see those products continuing and working very synergistically with P84. So from that standpoint, there's not any anticipated product cannibalization.

Geographically, although we are in a number of the same company or countries, even in the U.S. where LoveBiome's dominant footprint is more on the East Coast. And so it will actually complement the LifeVantage's footprint. And it's really -- as far as Kelly and I see it, it's a synergistic opportunity for us to really grow in a very sustainable way, good for both companies as we look at this rollout.

So maybe just one last and then I'll move on. But could you give us a little -- I don't know much about LoveBiome. I haven't heard of it before the acquisition. And obviously, I don't know much about P84. Could you give us a little color on what P84, how that's marketed versus your MindBody and prebiotic and probiotics?

Yes. It is really, I'd say, a much more complete and comprehensive product focused on the microbiome. And there's a lot of ways companies and products address this. Most of them are through pre and probiotics, but it's not really getting to the microbiome itself. And so this product, we're already thinking of it as it will -- it does regulate, repair and restore the gut microbiome, not just the gut, but the microbiome layer. And the science is out there about the criticality of a healthy microbiome and its connection points with so many other organs, tissues in the body that having that healthy microbiome is critical to the support.

And like you said, there is a direct correlation between our MindBody GLP-1 product, the research that we have done about that in terms of increasing the production of GLP-1 hormone by 200% that we know that our product is more effective when the gut is more healthy. And so I think this, again, ties into that GLP-1 story really well, does not conflict at all that ties in. And I believe when we get to our future studies, we're going to see a synergistic benefit of those 2 products taking them tandem.

Well, I have been reading a lot about the microbiome recently. It's certainly become a topic of interest and seems like a very exciting acquisition.

There are no additional questions in queue. I'll now turn the call back to Steve Fife for closing remarks.

Well, thank you, everyone, for joining us today. As we conclude, I just want to extend my appreciation to our committed employees, our outstanding independent consultants, stockholders and our faithful customer base. And I also want to welcome Kelly Olsen and the entire LoveBiome team of consultants and customers that may be joining on the call for the first time. We're happy to have you and look forward to building a great success story together. Thank you, everyone.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.