Good day, ladies and gentlemen. Thank you for standing by. Welcome to today's conference call to discuss LifeVantage's First Quarter of Fiscal 2025 Results. At this time, all participants are in a listen-only mode. Following the formal remarks, we will conduct a question-and-answer session. Instructions 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. Now, I'd like to turn the call 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 first quarter of fiscal 2025. 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 be discussing 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, October 29, 2024. 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 Steve Fife, the President and Chief Executive Officer of LifeVantage.

Thanks, Reed and good afternoon, everyone. Thank you for joining us today. It's an incredible time at LifeVantage as we just launched the MindBody GLP-1 System, an amazing innovation targeting consumers searching for an effective, sustainable weight management solution. This product significantly expands our total addressable market and the initial response from our consultants and customers has been overwhelming. But before I go deeper into talking about MindBody, let me first give you a quick recap of our latest results which are generally in line with our expectations. In the first quarter, we again delivered solid profitability metrics despite lower revenues which continued to be impacted by macro headwinds, particularly in our international markets. Our adjusted EBITDA increased 11% versus last year and our adjusted EBITDA margin was 9.4%, a 160 basis point improvement compared to last year's first quarter. Total revenue was down 8%, as lower consultant and customer numbers were partially offset by an increase in revenue per consultant. While the overall consumer environment remains challenging, we are highly encouraged by the strong response from consultants and customers to our new product. September was a very strong month for us as consultants built excitement in advance of the product launch and October will be the highest bookings month in the company's history. And overall enrollments in October are approximately 4x our recent monthly averages. We believe this momentum will continue to build as fiscal 2025 unfolds. There's good reason to be excited about the MindBody GLP-1 System. GLP-1 is short for glucagon-like peptide-1, a hormone that works along the gut-brain axis to control digestion and balance blood sugar. GLP-1 also supports the health of several organs, including the heart, liver and kidneys. Like many things in our body, production of the GLP-1 hormone declines due to age, poor…

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. First quarter revenue was $47.2 million, down 8.1% on a year-over-year basis and foreign currency negatively impacted revenue by approximately $200,000. Excluding the negative impact of foreign currency fluctuations, first quarter revenue was down approximately 7.7% compared to the prior year period. Revenue in the Americas region decreased 4.2% to $36.9 million in the quarter, due to a 6.1% decrease in total active accounts partially offset by higher average revenue per account, resulting from changes in product mix and increased shipping charges. Revenue in our Asia/Pacific & Europe region decreased 19.7% to $10.3 million in the quarter, primarily driven by a 20.5% decrease in total active accounts and the negative impact from foreign currency exchange rate fluctuations. Excluding the negative impact from foreign currency fluctuations which are primarily attributable to Japan, first quarter revenue in our Asia/Pacific & Europe region was down 18.7% as compared to the prior year period. Gross margin was 79.9% for the first quarter, just slightly below the 80.2% we reported in the prior year period. We are encouraged that we were able to maintain gross margin percentages despite the decrease in revenue. We continue to focus on identifying cost savings opportunities across our supply chain to improve our gross margins back above our 80% target. Commissions and incentive expense in the first quarter decreased $2.2 million year-over-year. As a percentage of revenue, commission and incentive expense was 43%, down 80 basis points versus year ago levels. The decrease was due to changes in sales mix, along with the timing and magnitude…

[Operator Instructions] Our first question comes from the line of Doug Lane with Water Tower Research.

Carl, you just went over your guidance which remains unchanged from the last quarter. And obviously, you had a very successful launch here with MindBody having sold out of inventory already. So what was the thought process in not adjusting your guidance despite the very strong reception to MindBody?

Thanks Doug for the question. We definitely gave that some thought. And in the comment that I made on the script, I mean, we did allude to -- we do believe that we're going to be at the top end of that range in the guidance. And I think the other thing is that we're really only 2 weeks in to the launch of the MB product that we had. And we launched it on October 11 and we were out of inventory within 2 weeks. And I just think as we've looked through and just with -- there's still some uncertainty and we talked about getting the product back in stock and where we are from a stock-out situation but I think that was the preliminary thought. I still think that we're highly optimistic about the long-term success of MB. But just due to where things are at, we felt that, that was the appropriate range at this point.

That's fair enough. It is still early days. So I mean this is a good problem to have but you are dealing now with a stock out situation for a product that is obviously -- you've done a good job teasing and promoting and launching. So what do you think the impact will be of moving into a stock out situation so quickly among your consultants?

I think we have kind of a proof here of the excitement around this product, not just because of selling it out so quickly that -- if I look back in terms of our September activity, in September before the product was even available, our enrollments virtually doubled over that of the previous several months. And then -- and again, that was in advance of the product. And what drove that really was we had a group of 55 people that were kind of our trial group. They had access to the product since about the 20th of August and they were taking before and after pictures and building their stories. And in September, those stories started getting out there and drove the excitement around the product and the launch. And fast forward to October 11, we have an amazing launch, you were there, you were able to see the excitement around it. And 2 weeks later, we've sold out. And now in my mind and I think the way our consultants are really looking at it, is now there's not just 55 but there's thousands of people that have access to the product. And they will be able to build their personal stories about the product over the next several weeks until the product comes in. And there's no indication from our consultant leadership group right now that anyone is slowing down in terms of talking to people and enrolling people. And the way we've communicated access to the product when we do get it, it's going to be those people that are signed up on a subscription now are going to be the first ones to get product once it comes into inventory. So there's still excitement around the product. We have, like I said, thousands more people talking about it than we did in September. So I still remain really optimistic that it's going to continue to build the excitement. Now, do I wish we had inventory? Absolutely. But I'm really pleased with how our field has embraced this and they see the demand that -- for the product and I think it's encouraged them as well in terms of what this really can be.

No, there was a lot of excitement in the event, that's for sure. And did you mention what the price of the product is? I assume that it's going to be geared for monthly subscription.

It is. We sell the -- it's a 2-part system. We sell them only in tandem. And that's critical because the efficacy of the products and really all of our studies, our human clinical, our patent that we've filed for are based on the combination of those 2 products. And for the 2 products, at a customer retail price, it's $199. At a customer subscription, the price is $179. And for our consultants, it's $159 and that's for a 30-day supply.

Right, a month supply. Got it. And then the launch was in the U.S. at the Kansas City event. What are the plans for launching this product in the markets outside the U.S.? And can you clarify is this in Canada yet?

It is -- in Canada on Nrf2 are not for resale basis, so they can purchase it for personal consumption in Canada. We also have a program where any person throughout the world can actually purchase product. And we're seeing some of the product being -- and again, just for personal consumption, we do see people throughout the world buying it, especially in Australia and New Zealand right now. Not large quantities but they're trying to get a jump start on it. And our launch, it's going to be really kind of dependent on regulatory approval but we're targeting in the March, April time frame of next year of 2025 to have most of our countries -- launching in most of our countries. We know that there's a couple of countries where the regulatory time will be longer than that but most of our international markets will launch in the March, April time frame.

There are no further questions at this time. I'd like to pass the call back over to Steve for closing remarks.

Thank you, operator and thank you for joining us today. As we conclude, I want to extend my appreciation to our committed employees, outstanding independent consultants, stockholders and faithful customers. We are incredibly excited about the overall response for our new MindBody GLP-1 System that significantly expands our total addressable market. This is an amazing innovation targeting customers, searching for an effective sustainable weight management solution. We believe it has the potential to drive significant growth and value creation in the future as we leverage the strength of our distinctive platform, along with the competitive edge of our business model that empowers individuals to establish businesses on their own terms. Thanks, again, for joining us and we look forward to updating you with our Q2 results at the end of January. Thanks, everyone.

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