XML 30 R19.htm IDEA: XBRL DOCUMENT v3.21.2
Segment Information
 9 Months Ended
Sep. 30, 2021
Segment Information [Abstract]  
Segment Information
10.
Segment Information

The Company reports revenue from ten segments, consisting of its seven geographic Nu Skin segments—Mainland China, Americas, South Korea, Southeast Asia/Pacific, Japan, EMEA, and Hong Kong/Taiwan—and three Rhyz Investments segments—Manufacturing, Grow Tech and Rhyz other. The Nu Skin other category includes miscellaneous corporate revenue and related adjustments. The Rhyz other segment includes other investments by our Rhyz strategic investment arm. These segments reflect the way the chief operating decision maker evaluates the Company’s business performance and allocates resources. Reported revenue includes only the revenue generated by sales to external customers.

Profitability by segment as determined under US GAAP is driven primarily by the Company’s transfer pricing policies. Segment contribution, which is the Company’s segment profitability metric presented in the table below, excludes certain intercompany charges, specifically royalties, license fees, transfer pricing, discrete charges and other miscellaneous items. These charges have been included in Corporate and other expenses. Corporate and other expenses also include costs related to the Company’s executive and administrative offices, information technology, research and development, and marketing and supply chain functions not recorded at the segment level.

In the first quarter of 2021, as a result of a change in the Company’s transfer pricing policies in the Americas, the segment contribution calculation has been adjusted. The prior year Americas and Corporate and other has been recast to conform with the new policy.

Beginning in July 2021, the Company has changed how the chief operating decision maker manages and reports the Pacific market. The Pacific market will be now be reported with the Southeast Asia segment and no longer with the Americas segment. Segment information has been recast to reflect the move of the Pacific components from the "America/Pacific" operating segment to the "Southeast Asia/Pacific" operating segment. Consolidated financial information is not affected.

The accounting policies of the segments are the same as those described in Note 2 – Summary of Significant Accounting Policies. The Company evaluates the performance of its segments based on revenue and segment contribution. Each segment records direct expenses related to its employees and its operations.

Summarized financial information for the Company’s reportable segments is shown in the following tables. Asset information is not reviewed or included with the Company’s internal management reporting. Therefore, the Company has not disclosed asset information for each reportable segment.

Revenue by Segment


  
Three Months Ended
September 30,
    
Nine Months Ended
September 30,
  
(U.S. dollars in thousands)
  2021     2020     2021     2020  
Nu Skin
                        
Mainland China
  
$
134,291
    
$
169,068
    
$
438,066
    
$
453,096
  
      Americas
     131,482       133,618       403,755       312,436  
       South Korea     91,989       83,460       261,724       236,094  
       Southeast Asia/Pacific     79,081       101,949       246,338       262,038  
EMEA
     55,839       61,411       215,134       147,590  
       Japan     65,117       70,958       203,001       200,549  
       Hong Kong/Taiwan     39,921       42,265       114,795       115,253  
       Nu Skin other     889       (314 )     2,350       374  
Total Nu Skin
    598,609       662,415       1,885,163       1,727,430  
Rhyz Investments
                               
       Manufacturing (1)     41,635       40,910       135,760       105,975  
       Grow Tech     783       22       1,147       336  
       Rhyz other     125       —       163       —  
Total Rhyz Investments
    42,543       40,932       137,070       106,311  
Total
  
$
641,152
    
$
703,347
    
$
2,022,233
    
$
1,833,741
  

(1)
The Manufacturing segment had $27.4 million and $10.9 million of intersegment revenue for the three months ended September 30, 2021 and 2020, respectively, and $68.0 million and $24.2 million for the nine months ended September 30, 2021 and 2020, respectively. Intersegment revenue is eliminated in the consolidated financial statements, as well as the reported segment revenue in the table above.

Segment Contribution

  
Three Months Ended
September 30,
    
Nine Months Ended
September 30,
  
(U.S. dollars in thousands)
  
2021
    
2020
    
2021
    
2020
  
Nu Skin
                        
Mainland China
  
$
30,677
    
$
54,522
    
$
121,596
    
$
135,577
  
Americas
    
25,752
      
20,618
      
83,495
      
48,730
  
South Korea
    
28,984
      
25,232
      
84,401
      
73,421
  
Southeast Asia/Pacific
    
19,020
      
23,892
      
59,881
      
62,263
  
EMEA
     6,693       7,111       29,270       11,084  
Japan
    
16,267
      
18,245
      
50,709
      
49,292
  
Hong Kong/Taiwan
    
8,940
      
9,048
      
24,848
      
22,825
  
Nu Skin contribution
    
136,333
      
158,668
      
454,200
      
403,192
  
Rhyz Investments
                                
Manufacturing
    
3,059
      
6,749
      
15,649
      
15,000
  
Grow Tech
    
(6,798
)
    
(5,322
)
    
(19,869
)
    
(17,659
)
Rhyz other
    
(659
)
    
—
      
(1,178
)
    
—
  
Rhyz Investments contribution
    
(4,398
)
    
1,427
      
(5,398
)
    
(2,659
)
Total segment contribution
    
131,935
      
160,095
      
448,802
      
400,533
  
Corporate and other
    
(66,551
)
    
(85,867
)
    
(235,129
)
    
(231,666
)
Operating income
    
65,384
      
74,228
      
213,673
      
168,867
  
Other income (expense)
    
2,781
      
525
      
351
      
(4,068
)
Income before provision for income taxes
  
$
68,165
    
$
74,753
    
$
214,024
    
$
164,799
  

Depreciation and Amortization

  
Three Months Ended
September 30,
    
Nine Months Ended
September 30,
  
(U.S. dollars in thousands)
  
2021
    
2020
    
2021
    
2020
  
Nu Skin
                        
Mainland China
  
$
3,253
    
$
2,649
    
$
9,868
    
$
7,631
  
Americas
    
190
      
251
      
656
      
714
  
South Korea
    
805
      
756
      
2,768
      
2,731
  
Southeast Asia/Pacific
    
359
      
334
      
1,096
      
1,300
  
EMEA
     281       231       850       731  
Japan
    
220
      
296
      
699
      
1,602
  
Hong Kong/Taiwan
    
1,004
      
691
      
2,794
      
1,948
  
Total Nu Skin
    
6,112
      
5,208
      
18,731
      
16,657
  
Rhyz Investments
                                
Manufacturing
    
3,069
      
2,077
      
8,644
      
5,954
  
Grow Tech
    
1,303
      
1,302
      
4,002
      
3,775
  
Rhyz other
    
592
      
—
      
987
      
—
  
Total Rhyz Investments
    
4,964
      
3,379
      
13,633
      
9,729
  
Corporate and other
    
8,857
      
9,333
      
25,494
      
28,893
  
Total
  
$
19,933
    
$
17,920
    
$
57,858
    
$
55,279
  

Capital Expenditures

  
Three Months Ended
September 30,
    
Nine Months Ended
September 30,
  
(U.S. dollars in thousands)
  
2021
    
2020
    
2021
    
2020
  
Nu Skin
                        
Mainland China
  
$
3,237
    
$
9,000
    
$
15,170
    
$
12,577
  
Americas
    
95
      
123
      
294
      
885
  
South Korea
    
—
      
173
      
508
      
537
  
Southeast Asia/Pacific
    
92
      
1,256
      
1,015
      
1,899
  
EMEA
     391       718       821       1,378  
Japan
    
3
      
1,484
      
94
      
3,132
  
Hong Kong/Taiwan
    
110
      
7
      
222
      
23
  
Total Nu Skin
    
3,928
      
12,761
      
18,124
      
20,431
  
Rhyz Investments
                                
Manufacturing
    
2,604
      
2,113
      
11,604
      
13,221
  
Grow Tech
    
212
      
343
      
1,215
      
760
  
Rhyz other
    
—
      
—
      
—
      
—
  
Total Rhyz Investments
    
2,816
      
2,456
      
12,819
      
13,981
  
Corporate and other
    
6,791
      
4,901
      
19,441
      
14,398
  
Total
  
$
13,535
    
$
20,118
    
$
50,384
    
$
48,810