Unidentified Analyst: Okay. Thank you.
Operator: Thank you. [Operator Instructions]. That will come from the line of Doug Lane with Water Tower Research. Your line is open.
Doug Lane: Yes, hi. Thank you. Good afternoon, everybody. I just want to go back to China a little bit. I know it’s only 7% of sales now it used to be 5 years ago, 20% or more of sales. So it’s an important market, and I just want to get a better sense on two things. One, do you think we’re nearing inflection point here? I noticed sequentially your sales have improved first quarter, second quarter, third quarter this year, And then secondly, Michael, you’ve been talking about China for forever and I’ve always been very bullish on it. And I just wondered if your longer term perspective on China has changed given the difficulties there in the last five years.
Michael O. Johnson: Hi, Doug. It’s Michael. Long time no see no talk. China. China is one of those great enigmas, but it’s a great opportunity for us. And if any market got hurt really badly during the pandemic, it was China where we were highly, highly leveraged in the business of Nutrition Clubs. And they’ve got different names and they’ve got different styles in that marketplace. But regardless, when China shut down, it wasn’t like any kind of shutdown that any of us the western world experienced, couldn’t leave your apartment, let alone operator business in brick and mortar. So that is coming back slowly differently. Stephan has been with the regional management team as well as with the distributors there who he knows very well.
We brought in a few other distributors to sit down and map out a progress and a plan for the future in China that’s going to change some of the way we go to market. We’re going to look at different channels of distribution, different styles in which our distributors will be rewarded. The opportunity there, I believe, is still immense. There is a huge under, what should I say, under employment in 26 year old and unders in that marketplace, it’s staggering the opportunity for us to bring a business opportunity and a health opportunity in that market. I believe still alive. It’s going to take a little time for us to get back on track there. But believe me, and I’ve seen the action in the activity and we’re looking at a strategic plan there. But I believe we’ll get us back to maybe not to the numbers we enjoyed in 2017 to 2018 anytime soon, but it will get there.
And I’m pretty confident that that marketplace will turn and become a vital part of our future in Herbalife. Stephan, you want to add anything to that?
Stephan Gratziani: Yes. Just to support what Michael is saying, I think that the pandemic and the tail there was just extremely long. I can tell you the timing also was very impactful. Opening up thousands of Nutrition Clubs just before and then having a period of two years, two and a half years where they couldn’t operate. So I will say that the distributors there are focused. They’re excited. The market opportunity is huge. And it’s really just a question of figuring out post pandemic again. And I hate to say it, but it’s just a reality. Of where we need to go and how we need to move there. And so I would say that the distributors, they see the opportunity, the management team sees the opportunity, It’s just a question of giving it the time and attention that it needs. And that’s what we’re focused on. So Alex, I don’t know if you want to add something.
Alex Amezquita: Yes. And so, Doug, I think you were looking for an inflection point. I believe we have seen an inflection point. We had a second quarter larger than a first quarter, which have some seasonal impacts, typically second quarters are larger than first quarters, but you also had a third quarter larger than second quarter on the top line. So, it feels to us like we are — we’ve seen that the bottom and we’re continuing to grow from this base. For fourth quarter, don’t expect necessarily the fourth quarter to be larger. There is seasonality still in China, but again, from a trend basis, I think if you look at our third quarter results and you look at some of the supplemental data, you’ll be encouraged by what’s happening in that market.
Doug Lane: Thanks. That’s very helpful. And just a quick follow-up, given that your business definitely feels like it’s stabilizing. Is there any thought to resuming giving guidance here?
Alex Amezquita: We’ll come back to you next quarter on that. Obviously, we’re still in a — we’re still in a world where the sort of the volatility from different shocks around the world is difficult to forecast at this point, but we’ll come back to you in a quarter to see if there’s an update to that.
Doug Lane: Okay. Thanks, Alex.
Operator: Thank you. I’m showing no further questions in the queue at this time. I would like to turn the call back over to Michael Johnson for any closing remarks.
Michael O. Johnson: So thanks everyone for being on the call, joining us and asking the questions. Our vision in this company is pretty straightforward, we are going to be the premier health and wellness company and community. And this continues to evolve. The style in which we go to marketplace, this is a 43 years young company, what started in 1980 the business practices then, the fundamental ones of use wear talk, getting people face to face, building a community around the practice. Those are all still the same. The opportunities for us in the future are to expand ourselves across multiple channels, about making sure that we build a model that is relative to the consumer, to our business partners, to our distributors, to make sure that they can profit and build an incredible business in their lives.
We’ve seen so much success in 43 years, and we see the opportunity for us only getting better. I want to welcome to our team, Susan and Claire and Stephan. We have brought new ideas into this company already. We are already building for a future. We visit next week with our distributors in Japan, our leadership. We’ll sit down with them and share with them what we shared with our board of directors in a strategic plan last week that shows us getting back to growth. Shows us building this company stronger, building on that promise that we made you that the fourth quarter will be a net sales gain for us in the marketplace. We still believe in that. We still see that coming. The indications are very good. We always are going to have challenges in the 95 market business.
The thing that just came up in Mexico with the potential suspension of our product into the marketplace got alleviated today. On that, we still will have to refill some of that pipeline. But this is business in the world today. This is the way we operate. This is the challenges that we face. But we’re going to continue how we can discuss to build and drive our communities better to ensure that we bring this company to the next level. We’re on a great journey here. This is really something that’s exciting. And I’m excited about it. I know that all the senior team and all of our distributors share in fact that we know we’ve got work to do to continue our growth trajectory, but we also know that that’s possible and its potential is great and its right in front of us.
So we’re engaged, committed, we’re on the right track, and we got momentum. So we’re going to stay the course. We’re going to change the course when we need to and remain committed to help people live their best lives. So I want to thank you all for your continued support and it wouldn’t be me if I didn’t say let’s go Herbalife at the end. Thank you all very much.
Operator: This concludes today’s program. Thank you all for participating. You may now disconnect.
