Natural Health Trends (NASDAQ:NHTC) reported fourth-quarter revenue of $9.7 million, a 3% sequential increase from $9.5 million in the third quarter of 2025, but a 10% decline from $10.8 million in the year-ago period, according to management’s prepared remarks on the company’s fourth-quarter and full-year 2025 earnings call.
President Chris Sharng said the company’s full-year performance was “more balanced than it may appear,” citing signs of “stability and rebound starting in April.” Sharng pointed to improving member engagement indicators in the company’s largest market and growth in several international markets, while emphasizing operational restructuring aimed at lowering costs and reducing tariff uncertainty.
Quarterly trends and market commentary
Chief Financial Officer Scott Davidson added that revenue in Greater China, the company’s primary market, increased 2% versus the third quarter. Davidson said the sequential improvement was “supplemented by improvement in other markets, particularly Taiwan and Peru.”
On the full-year operating backdrop, Sharng said that in the company’s largest market, “reorders as a percent of total orders increased compared to 2024,” and that sales of curated product bundles rose 10% for the full year. He said these trends reflected continued member engagement and ongoing demand for the company’s core products.
Margins, expenses, and restructuring impacts
Gross profit margin was 72.9% in the fourth quarter, down from 74.2% in the fourth quarter of 2024. Davidson attributed the decline to “the write-off of components inventory related to discontinued products and products whose manufacturing has transitioned outside the United States,” adding that gross margin “would be comparable to last year without these write-offs.”
Commissions expense was 40.3% of net sales for the fourth quarter, compared with 41.9% a year earlier. Selling, general and administrative expenses were $3.8 million, compared with $3.9 million in the year-ago quarter. Davidson said SG&A would have declined by $309,000, or 8% year over year, “if not for the $208,000 of restructuring-related charges recognized in SG&A during the quarter.”
Operating loss for the quarter was $635,000, compared with an operating loss of $421,000 in the fourth quarter of last year. Excluding $283,000 of restructuring-related charges recorded in cost of sales and SG&A during the quarter, Davidson said operating loss would have been $352,000.
- Operating loss: $635,000 (or $352,000 excluding restructuring charges cited by management)
- Net loss: $588,000, or $0.05 per diluted share
- Year-ago comparison: Net income of $176,000, or $0.02 per diluted share in Q4 2024
Davidson also noted that despite a pretax loss in the quarter, the company recognized tax expense of $175,000, “due to an increase in foreign tax expense.”
Cash flow, liquidity, and dividends
Net cash used in operating activities was $959,000 during the fourth quarter, which Davidson said was driven primarily by restructuring-related activities and payments tied to the company’s new back-office system implementation.
For the full year, net cash used in operating activities totaled $6.0 million, compared with $3.4 million a year earlier. Davidson said that excluding the company’s required annual tax installment payment related to the 2017 U.S. Tax Cuts and Jobs Act, the company used $943,000 in cash from operations during 2025.
Total cash, cash equivalents, and marketable securities were $28.9 million at December 31, down from $32.0 million at September 30. Davidson attributed the decline to the company’s quarterly dividend payment and cash used in operations during the quarter.
The company paid $9.2 million in dividends during 2025. Davidson said returning capital to stockholders remains a priority and announced that on February 2 the board declared a quarterly cash dividend of $0.10 per share, payable February 27 to stockholders of record as of February 17.
Operational changes and 2026 outlook commentary
Sharng said restructuring initiatives announced in the prior quarter were “substantially complete,” including the relocation of about 40% of product sourcing from America to East Asia “in order to reduce tariff uncertainty and streamline logistics.” He also cited workforce optimization and downsizing of several offices.
Both Sharng and Davidson said the actions are expected to generate approximately $1.5 million in annualized cost savings, with a “significant portion” anticipated to be realized during 2026.
Management also framed 2026 as a milestone year marking the company’s 25th anniversary. Sharng said the company has planned programs including a major celebration event in Hong Kong with an anticipated 1,500 attendees, signature anniversary products, and incentives intended to “leverage these special moments.” Davidson said the company views the anniversary as “both a celebration of our legacy and a foundation for our future.”
About Natural Health Trends (NASDAQ:NHTC)
Natural Health Trends Corp. is a U.S.-based holding company that develops, markets and distributes a range of plant-based health supplements, nutritional products and personal care items. The company’s product portfolio spans weight management, skin care, men’s health, nutritional supplements and wellness solutions designed to support overall health and beauty. Natural Health Trends focuses on delivering scientifically formulated products through modern e-commerce channels and direct selling platforms.
Through its principal subsidiaries in the People’s Republic of China—including Shanghai NHTC Health Products Co, Ltd.
