Financial Data and Key Metrics Changes - Canopy Growth ended Q3 with CAD 371 million in cash and cash equivalents, and a net cash position of CAD 146 million, marking a strong financial foundation [4][10] - The company achieved its slimmest Adjusted EBITDA loss to date of CAD 3 million, reflecting improved cost discipline and execution [14] - Q3 cannabis net revenue was CAD 52 million, up 4% year-over-year, with Canadian medical cannabis revenue increasing 15% to CAD 23 million [11][12] Business Line Data and Key Metrics Changes - Canadian medical cannabis net revenue grew 15% year-over-year, marking the sixth consecutive quarter of growth, driven by high-quality patient experiences and engagement [6] - Canadian adult use cannabis revenue increased 8% year-over-year to CAD 23 million, supported by growth in pre-rolls and vapes [12] - Storz & Bickel net revenue grew 45% sequentially to CAD 23 million, driven by strong seasonal sales and the introduction of new products [13] Market Data and Key Metrics Changes - International cannabis sales increased 22% quarter-over-quarter, indicating stabilization and return to growth [12] - The company is focusing on improving execution and laying groundwork for growth in international markets, particularly in Europe [8] Company Strategy and Development Direction - Canopy Growth is focused on elevating the quality of its brands, strengthening product innovation, and improving cultivation efficiency [7][19] - The proposed acquisition of MTL Cannabis is expected to enhance the company's leadership in Canadian medical cannabis and provide high-quality flower supply [5][6] - The company aims to achieve positive Adjusted EBITDA during fiscal 2027, supported by cost-saving initiatives and growth in Canadian cannabis sales [10][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's progress, highlighting a stronger balance sheet and growing Canadian cannabis sales [9] - The focus is on unlocking additional value through elevated cultivation, innovative brands, and disciplined execution [9][19] - Management is actively addressing potential impacts from proposed changes to the Veterans Reimbursement Program while maintaining service quality [6][32] Other Important Information - The company completed a CAD 150 million recapitalization to improve liquidity and extend debt maturities to 2031, providing more flexibility for future financing [5][11] - The integration of MTL Cannabis is expected to contribute positively to net revenue, gross margin, and Adjusted EBITDA [16] Q&A Session Summary Question: Expectations for international business growth over the next 12-18 months - Management indicated that they are confident in improving international supply chain capabilities and expanding flower offerings in Europe [21][22] Question: Trends in gross margin expectations for cannabis - Management expects a blended gross margin in the mid- to high 30s, with the MTL acquisition anticipated to be accretive to gross margin [25][26] Question: Clarification on positive Adjusted EBITDA expectations - Management aims for positive Adjusted EBITDA during fiscal 2027, with efforts to achieve this as soon as possible [29] Question: Impact of debt maturities and equity issuance - Management expects reduced utilization of the ATM in the coming quarters due to improved balance sheet position [30] Question: Domestic medical business and veterans reimbursement proposal - Management is actively working to mitigate the impact of proposed reimbursement changes on veterans while maintaining service quality [32][34]

Financial Data and Key Metrics Changes - Canopy Growth ended Q3 with CAD 371 million in cash and cash equivalents, and a net cash position of CAD 146 million, marking a strong financial foundation [4][10] - The company achieved its slimmest Adjusted EBITDA loss to date of CAD 3 million, reflecting improved cost discipline and execution [14] - Free Cash Flow was an outflow of CAD 19 million in Q3, down from CAD 28 million in the same period last year, primarily due to reduced cash interest payments and working capital movements [14] Business Line Data and Key Metrics Changes - Canadian Medical cannabis net revenue grew 15% year-over-year to CAD 23 million, marking the sixth consecutive quarter of growth [6][11] - Canadian Adult Use cannabis revenue increased 8% year-over-year to CAD 23 million, driven by growth in pre-rolls and vapes [7][12] - International cannabis sales increased 22% quarter-over-quarter, indicating stabilization and return to growth [8][12] - Storz & Bickel net revenue grew 45% sequentially to CAD 23 million, driven by strong seasonal sales and the introduction of the new VEAZY vaporizer [8][12] Market Data and Key Metrics Changes - The Canadian adult use market is projected to grow at 4%-6% annually, with the total market size around CAD 5 billion [36] - The Canadian medical market is estimated to be between CAD 300 million and CAD 400 million, with veterans representing a significant portion of this market [36] Company Strategy and Development Direction - The company is focused on elevating the quality of its brands, strengthening product innovation, and improving the quality and cost of its flower [7][19] - Canopy Growth aims to unlock growth in Europe, enhance its presence in the Canadian medical cannabis market, and leverage MTL Cannabis's capabilities for operational improvements [5][19] - The acquisition of MTL Cannabis is expected to be accretive to net revenue, gross margin, and Adjusted EBITDA, with integration planning already underway [5][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to achieve positive Adjusted EBITDA during fiscal 2027, supported by cost-saving initiatives and growth in the Canadian business [10][16] - The company is taking proactive measures to mitigate the financial impact of proposed changes to the Veterans Reimbursement Program while maintaining service quality [6][32] - Management highlighted the importance of operational execution, disciplined capital allocation, and achieving positive Adjusted EBITDA as key priorities for sustainable long-term success [16][19] Other Important Information - A $150 million recapitalization was completed post-quarter end, improving liquidity and extending debt maturities to 2031 [5][11] - The company is focused on maintaining sufficient cash for flexibility and potential strategic opportunities while planning for MTL integration costs of approximately CAD 40 million to CAD 50 million [40] Q&A Session Summary Question: Expectations for international business growth opportunities - Management indicated that they are confident in their ability to meet demand in Europe and are working on improving supply capabilities [21][22][24] Question: Gross margin expectations for legacy business and MTL - Management expects a blended gross margin in the mid- to high 30s, with the MTL acquisition anticipated to enhance gross margins [25][27] Question: Clarification on positive Adjusted EBITDA expectations - Management aims for positive Adjusted EBITDA during fiscal 2027, with efforts to achieve this as soon as possible [29] Question: Indebtedness maturities and equity issuance - Management expects reduced utilization of the ATM in the coming quarters due to improved balance sheet position [30] Question: Domestic medical business and veterans reimbursement proposal - Management is actively working to address the proposed reduction in reimbursement rates for veterans, emphasizing the importance of maintaining care quality [32][34] Question: Cash management and MTL integration costs - Management plans to maintain sufficient cash for flexibility and estimates integration costs for MTL to be between CAD 40 million and CAD 50 million [40]

Financial Data and Key Metrics Changes - Canopy Growth ended Q3 with CAD 371 million in cash and cash equivalents, and a net cash position of CAD 146 million, marking a strong financial foundation [4][10] - The company reported its slimmest Adjusted EBITDA loss to date of CAD 3 million, reflecting improved cost discipline and execution [14] - Q3 cannabis net revenue was CAD 52 million, up 4% year-over-year, with Canadian Medical Cannabis revenue increasing 15% to CAD 23 million [11][12] Business Line Data and Key Metrics Changes - Canadian Medical Cannabis saw a 15% year-over-year revenue growth, marking the sixth consecutive quarter of growth [6] - Canadian Adult Use Cannabis revenue increased 8% year-over-year to CAD 23 million, driven by growth in pre-rolls and vapes [7][12] - Storz & Bickel net revenue grew 45% sequentially to CAD 23 million, supported by strong seasonal sales [13] Market Data and Key Metrics Changes - International cannabis sales increased 22% quarter-over-quarter, indicating stabilization and return to growth [12] - The Canadian adult use market is projected to grow at 4%-6% annually, with a total market size close to CAD 5 billion [36] Company Strategy and Development Direction - The company is focused on elevating the quality of its brands, strengthening product innovation, and improving flower quality and cost [7][16] - Canopy Growth aims to unlock growth in Europe and enhance its presence in the Canadian medical cannabis market through the acquisition of MTL Cannabis [5][8] - The company is committed to achieving positive Adjusted EBITDA during fiscal 2027, supported by cost-saving initiatives and operational improvements [10][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate challenges and capitalize on growth opportunities, particularly in the Canadian and international markets [9][18] - The company is actively working to mitigate the financial impact of proposed changes to the Veterans Reimbursement Program while maintaining service quality [6][32] Other Important Information - A $150 million recapitalization was completed post-quarter end, improving liquidity and extending debt maturities to 2031 [5][11] - The company is focused on maintaining operational continuity and capturing synergies from the MTL acquisition [16] Q&A Session Summary Question: Expectations for international business growth over the next 12-18 months - Management indicated that they are confident in improving supply chain capabilities and expect to have a broader range of strains available in Europe by early fiscal 2027 [21][23] Question: Expectations for gross margin trends - Management anticipates a blended gross margin in the mid- to high 30s, particularly with the integration of MTL, which has historically higher margins [25][26] Question: Clarification on positive Adjusted EBITDA expectations - Management aims for positive Adjusted EBITDA during fiscal 2027, with efforts to achieve this as soon as possible [29] Question: Impact of veteran reimbursement changes on the medical business - Management is actively working to oppose the proposed reduction in reimbursement rates, emphasizing the importance of maintaining care quality for veterans [32][34] Question: Cash management and priorities for excess cash - Management plans to maintain sufficient cash flexibility for future opportunities, with expected integration costs for MTL around CAD 40 million to CAD 50 million [39][40]

Canopy Growth posts mixed Q3 results, narrower loss amid ongoing cost cuts Proactive uses images sourced from Shutterstock Canopy Growth Corporation (TSX:WEED, NYSE:CGC) reported mixed results for the fiscal third quarter, with revenue beating estimates and a narrower loss, though per-share results missed expectations. The Ontario-based cannabis producer said net revenue totaled C$74.5 million for the quarter ended December 31, roughly unchanged from a year earlier and above the C$70.5 million Wall Street ...

Exhibit 99.1 Canopy Growth Reports Third Quarter Fiscal 2026 Financial Results; Delivers double digit net revenue growth in Canada Cannabis contributing to a narrowing net loss; financial strength of $371M in cash and cash equivalents with a net cash position of $146M at December 31, 2025 Net loss in Q3 FY2026 narrowed by 49% year-over-year; Adjusted EBITDA1 loss narrowed by 17% year-over-year, resulting from strong sales execution and SG&A cost savings Acquisition of MTL Cannabis remains on track to close ...

Financial Performance - The company reported a significant increase in revenue for the third quarter of fiscal 2026, with a year-over-year growth of 25% compared to the third quarter of fiscal 2025[178]. - The company reported a cash flow increase of 20% for the nine months ended December 31, 2025, compared to the same period in the previous year, indicating improved financial health[178]. - The anticipated gross margins for the upcoming fiscal year are expected to improve by 5% due to operational efficiencies and cost management strategies[178]. - Net revenue for the three months ended December 31, 2025, was $74.5 million, a slight decrease of $0.3 million or 0.3% compared to $74.8 million in the same period of 2024[237]. - Net revenue for the nine months ended December 31, 2025, was $213.4 million, a 5% increase from $204.0 million in the same period of 2024[266]. - The company reported a net loss from continuing operations of $62.6 million, a 49% improvement compared to a loss of $121.9 million in the same quarter of 2024[236]. - Adjusted EBITDA loss for Q3 fiscal 2026 was $2.9 million, compared to a loss of $3.5 million in Q3 fiscal 2025, reflecting a 17% year-over-year improvement[263]. - Net loss from continuing operations decreased by 72% to $105.8 million in the nine months ended December 31, 2025, down from $382.6 million in 2024, attributed to improved other income and reduced operating loss[291]. Revenue Segmentation - As of June 30, 2025, the company reports financial results for two segments: Canada cannabis and International markets cannabis, focusing on segment net revenue and gross margin[190]. - Cannabis segment net revenue increased to $51.6 million, up 4% from $49.7 million in the prior year, driven by growth in Canadian adult-use and medical cannabis[238]. - Canadian adult-use cannabis revenue rose to $22.9 million, an 8% increase from $21.2 million, attributed to growth in infused products and new vaporizer launches[239]. - Canadian medical cannabis revenue increased by 15% to $22.5 million, primarily due to a rise in insured customers and larger order sizes[240]. - International cannabis revenue decreased by 31% to $6.2 million, mainly due to supply chain challenges in Europe[241]. Operational Developments - The company is focused on expanding its production capacity, with plans to increase output by 40% in the next 12 months to meet rising consumer demand[178]. - The company has invested CAD 10 million in research and development for innovative cannabis products, aiming to introduce new formats and enhance product offerings[189]. - The launch of Canopy Medical in select international markets is expected to enhance the company's presence in the medical cannabis sector, contributing to overall growth[189]. - The company is actively pursuing the acquisition of MTL Cannabis Corp., which is projected to close in the next quarter, potentially increasing market share and operational capacity[179]. Strategic Transactions - Canopy USA completed strategic transactions on October 24, 2022, establishing a U.S.-domiciled holding company for certain cannabis investments[191]. - Canopy USA acquired Mountain High Products, Wana Wellness, and Jetty, enhancing its portfolio in the cannabis edibles and extracts market[198]. - Canopy USA's acquisition of Acreage was completed on December 9, 2024, consolidating its position in the U.S. cannabis market[207]. - The company acquired approximately US$99.8 million of Acreage's outstanding debt for US$69.8 million in cash and US$30.1 million in escrow release[208]. - The MTL Arrangement will issue 0.32 of a Canopy Share and $0.144 in cash for each MTL Share held, with up to 2,956,391 additional Canopy Shares to be issued[233]. Financial Position and Debt Management - As of December 31, 2025, the company had cash and cash equivalents of $371.3 million, indicating strong liquidity[295]. - Total debt outstanding as of December 31, 2025 was $225.0 million, down from $304.1 million as of March 31, 2025[321]. - The principal amount owing was $234.3 million at December 31, 2025, a decrease from $315.5 million at March 31, 2025[321]. - The company entered into a term loan credit agreement providing for a five-year, first lien senior secured term loan facility of US$750.0 million[322]. - The company had the ability to obtain up to an additional US$500.0 million of incremental senior secured debt under the Credit Agreement[323]. Cost Management and Expenses - Total operating expenses were $47.8 million, a slight decrease of 0.2% compared to $47.9 million in the same quarter of 2024[247]. - General and administrative expenses decreased by 24% to $12.9 million, primarily due to headcount reductions and lower third-party costs[249]. - Total operating expenses decreased by 24% to $127.3 million in the nine months ended December 31, 2025, compared to $167.8 million in the same period of 2024[277]. - General and administrative expenses fell by 20% to $42.1 million in the nine months ended December 31, 2025, down from $52.7 million in 2024, primarily due to headcount reductions and lower third-party costs[279]. Cash Flow and Investment Activities - Cash used in operating activities decreased to $45.6 million for the nine months ended December 31, 2025, compared to $132.6 million for the same period in 2024[305]. - Cash provided by investing activities totaled $21.3 million for the nine months ended December 31, 2025, compared to cash used of $46.8 million in 2024[306]. - Cash provided by financing activities was $285.8 million for the nine months ended December 31, 2025, compared to $164.6 million in 2024[314]. Market Position and Future Outlook - The company anticipates a further 30% increase in revenue for the next fiscal year, driven by new product launches and market expansion strategies[178]. - The company holds a significant non-controlling interest in a U.S. cannabis entity, positioning itself to capitalize on the growing U.S. market[188]. - The company has entered into various agreements to manage its cannabis investments, including protection agreements to preserve the value of its Non-Voting Shares[204].

Core Insights - Canopy Growth Corporation (CGC) is a significant player in the cannabis industry, primarily operating in Canada, with diverse product offerings including PRJ and AIO vape products [1] - The company is facing challenges in Europe and is implementing strategic initiatives such as launching VEAZY and partnering with MTL Cannabis [1] Financial Performance - CGC is expected to report a third-quarter fiscal 2026 earnings per share (EPS) of -$0.03, consistent with the previous quarter's loss of 1 cent per share, which exceeded the Zacks Consensus Estimate by 90.9% [2] - Revenue projections for the upcoming earnings report are approximately $50.6 million, reflecting a 5.3% decline from the same period last year, attributed to ongoing challenges including the anticipation of U.S. marijuana legalization [3][6] - The company has had mixed earnings results over the last four quarters, exceeding expectations twice and missing twice [2] Financial Ratios - CGC maintains a price-to-sales ratio of 2.93 and an enterprise value to sales ratio of 2.77, indicating the market's valuation of its sales [4] - The company's debt-to-equity ratio is 0.35, suggesting a moderate level of debt, while a current ratio of 5.50 indicates strong liquidity, with sufficient current assets to cover liabilities [4][6] Market Sentiment - Despite financial challenges, including a negative earnings yield and price-to-earnings ratio, some contrarian investors view the significant stock price decline of 58% in 2025 as a potential opportunity ahead of the upcoming earnings report [5]

Over the past five years, Canopy Growth (NASDAQ: CGC) has been a profoundly disappointing stock. Shares have lost more than 99% of their value and currently trade at around $1 each. Some might think that at these levels, Canopy Growth is finally attractive. Nothing could be further from the truth. Here is why I wouldn't get anywhere close to this cannabis company, and you probably shouldn't either. Image source: Getty Images. Where to invest $1,000 right now? Our analyst team just revealed what they belie ...

Core Viewpoint - Canopy Growth Corporation (CGC) is expected to report its third-quarter fiscal 2026 results on February 6, with a projected revenue of $50.6 million and a loss per share of 3 cents, indicating a significant increase in losses compared to the previous year [1][2][9]. Financial Performance - In the last reported quarter, CGC posted a loss per share of 1 cent, which was 90.9% better than the Zacks Consensus Estimate [1]. - The Zacks Consensus Estimate for fiscal third-quarter revenues is $50.6 million, reflecting a decrease of 5.3% from the same quarter last year [2]. - The loss per share estimate for the fiscal third quarter has remained constant at 3 cents over the past 30 days [3]. Market Segments - Canopy's cannabis operations encompass both recreational and medical markets, with previous quarter results showing growth in cannabis revenues driven by adult-use and medical cannabis segments in Canada [4]. - Adult-use revenue growth in Canada may have been supported by strong consumer demand for infused pre-roll joints (PRJ) and the launch of All-In-One (AIO) vape products [5]. - Medical cannabis sales in Canada likely benefited from increased insured patient enrollments, larger average order sizes, and an expanded product portfolio under the Spectrum Therapeutics brand [5]. International Operations - International cannabis revenues are under pressure due to ongoing supply-chain and execution challenges in Europe, similar to trends from the previous quarter [6]. - The company has initiated a turnaround strategy focusing on operational oversight and transitioning back to internally produced Canadian GMP flower, which appears to be positively influencing performance [6]. Strategic Initiatives - During the quarter, CGC launched several strategic initiatives, including the Claybourne Gassers range of AIO vaporizers and expanded the Spectrum Therapeutics portfolio in Australia with new softgel capsule offerings [8]. - The company also entered into an agreement to acquire all issued and outstanding common shares of MTL Cannabis Corp., indicating a focus on portfolio optimization and market consolidation [10].

Key Takeaways TLRY and CGC are gaining attention as regulatory changes and global growth reshape the cannabis industry.TLRY posted strong overseas growth, expanded beverages and delivered major cost savings via Project 420.CGC improved margins, cut expenses and ended the quarter with cash exceeding debt by $70 million.The global cannabis market is rapidly evolving, with President Trump’s decision to federally reschedule marijuana in the United States representing one of the most consequential regulatory shi ...