Herbalife HLF CN — Other Operating Income

To encourage local investment and operations, governments in various China provinces conduct grant programs. The Company applied for and received several such grants in China. Government grants are recorded into income when a legal right to the grant exists, there is a reasonable assurance that the grant proceeds will be received, and the substantive conditions under which the grants were provided have been met. Generally, these substantive conditions are the Company maintaining operations and paying certain taxes in the relevant province and obtaining government approval by completing an annual application process. The Company believes the continuing obligation with respect to the funds is a general requirement that they are used only for its business in China. The Company recognized government grant income related to its regional headquarters and distribution centers within China of zero and approximately $4.8 million during the three months ended June 30, 2026 and 2025, respectively, in other operating income within its condensed consolidated statements of income (loss). The Company recognized government grant income related to its regional headquarters and distribution centers within China of approximately $5.5 million and $4.8 million during the six months ended June 30, 2026 and 2025, respectively, in other operating income within its condensed consolidated statements of income (loss). The Company intends to continue applying for government grants in China when programs are available; however, there is no assurance that the Company will receive grants in future periods.