Aurora Cannabis: 3Q Revenue Jumps on Strong Medical Sales – Quarterly Update Report

Core Insights - Aurora Cannabis Inc. reported a net revenue increase of C$7 million to C$94.2 million for the quarter, driven by the global medical cannabis and plant propagation segments [2] - The company is focusing on the higher-margin medical cannabis business, with revenue from this segment rising 12% to C$76.2 million, representing 81% of total revenue [2][4] - Adjusted gross margin improved to 62%, while adjusted EBITDA decreased by 5% year over year to C$18.5 million due to higher operating expenses [3] Financial Performance - The medical cannabis segment's growth was led by a 17% increase in international markets, particularly in Germany and Poland [2] - Management confirmed full year 2026 adjusted EBITDA guidance of C$52–57 million, despite a cautious outlook for the fourth quarter [3] - ACB's balance sheet is strong, with C$154 million in cash and no debt, and the company has filed for an at-the-market offering of up to C$100 million for additional capital flexibility [4] Strategic Focus - ACB is divesting from the less-profitable plant propagation business and exiting select Canadian consumer cannabis markets to focus on international medical opportunities [4] - Management anticipates fiscal year 2026 to be a record revenue year, with continued growth and margin expansion expected through fiscal year 2028 [5] - Despite top-line growth and improved margins, ACB's valuation remains discounted compared to peers and its historical performance, indicating potential for a rerating in 2026 [5]