Christina Tan's questions to Herbalife Ltd (HLF) leadership • Q2 2025
Question
Christina Tan from Mizuho questioned why the midpoint of the full-year constant currency sales guidance was slightly reduced despite positive trends and the upcoming Protocol launch. She also asked why the EBITDA guidance raise wasn't larger, considering the Q2 beat and expected currency tailwinds.
Answer
CFO John DeSimone explained that the constant currency guidance midpoint was lowered primarily because Q2 results came in below the midpoint of the guidance for that quarter. Regarding EBITDA, he detailed the lag effect of currency on the bottom line. While currency impacts top-line sales immediately through translation, the benefit to cost of goods sold (COGS) and EBITDA takes about one inventory turn to materialize. Therefore, the full positive impact of the weaker dollar is not expected to be reflected in the bottom line until early 2026.