Core Insights - Cronos Group Inc. achieved record net revenue in Q4 2025 and FY 2025, with Q4 revenue increasing by 47% year-over-year to $44.5 million and FY revenue increasing by 25% year-over-year to $146.6 million [1][2][16] - The company reported strong performance driven by consumer demand, expansion at Cronos GrowCo, and contributions from international markets [2][3] - The company maintains a robust balance sheet with $832 million in cash and cash equivalents and short-term investments [1] Financial Performance - Q4 2025 net revenue of $44.5 million increased by $14.2 million from Q4 2024, primarily due to higher cannabis flower sales in Israel and other countries [10] - Gross profit for Q4 2025 was $16.2 million, an increase of $5.4 million from Q4 2024, driven by higher average sales prices and sales volumes [10] - For FY 2025, gross profit reached $62.8 million, up $37.6 million from FY 2024, attributed to lower inventory step-up costs and higher sales prices [16] Brand and Market Position - The Spinach brand maintained a strong position in Canada, ranking 2 overall and 4 in the flower category with a market share of 5.1% [11] - SOURZ by Spinach led the edibles category with a market share of 21.7% in Q4 2025, continuing to innovate with new product launches [12] - PEACE NATURALS consistently ranked as the top cannabis brand in Israel, achieving record sales volume and revenue throughout 2025 [15] International Expansion - The PEACE NATURALS brand expanded into new international markets, including Australia, Malta, and Switzerland, significantly increasing its global footprint [17] - International revenue outside Israel grew by 68% year-over-year in Q4 2025, reflecting strong demand and normalized shipment timing [17] Strategic Acquisition - Cronos Group entered into an agreement to acquire CanAdelaar B.V. for approximately $67 million, which will enhance its strategic footprint in Europe and leverage its borderless product strategy [22][24] - CanAdelaar operates a significant greenhouse facility and has rapidly grown its market share in the Dutch cannabis market, achieving net revenue of $47.3 million in the twelve months ended September 30, 2025 [23] Operational Updates - The company reported a net loss of $0.5 million in Q4 2025, a significant decrease from net income of $43.9 million in Q4 2024, primarily due to foreign currency transaction losses [10] - Adjusted EBITDA for FY 2025 improved by $45.1 million to $10.1 million, driven by higher adjusted gross profit and lower operating expenses [16]

Core Business Performance - The core Canadian retail business demonstrated strength with same-store sales growth of 5.5%, contributing to a 15% year-over-year growth in the brick-and-mortar segment [1] - High Tide added 27 stores in 2025, reaching a total of 218 locations, and plans to add another 20-30 stores in 2026, targeting over 350 locations long-term [7][8] Financial Highlights - Fourth-quarter revenue rose 19% year-over-year and 10% sequentially, primarily driven by the brick-and-mortar segment, with consolidated gross margin at 26% [3] - Record performance was reported with revenue of CAD 164 million and Adjusted EBITDA of CAD 12.4 million, implying an annualized revenue run rate exceeding CAD 650 million [4][8] - Adjusted EBITDA increased by 51% year-over-year and 17% sequentially, with a record Adjusted EBITDA margin of 9.4% in the brick-and-mortar segment [2] Operational Efficiency - Salaries and wages fell to 11.5% of revenue, the lowest level in nine quarters, while general and administrative expenses were 4.3% of revenue [2] - Annualized revenue per square foot was CAD 1,775 in the quarter, with market share across five provinces increasing to 12% from 11% a year earlier [10] Loyalty and Membership Growth - Cabana Club membership reached 2.5 million, up 45% year-over-year, with a long-term target raised to 3 million members [9] - The Canadian ELITE member count reached 151,000, up 107% year-over-year, indicating increased shopping frequency and larger basket sizes among these members [9] Acquisition Impact - The Remaxion acquisition contributed nearly CAD 10 million in revenue but pressured margins due to inventory and expiry issues, with improvements expected by late Q2/Q3 [6][11] - High Tide is diversifying supply routes beyond Portugal, citing new sourcing strategies that could reduce costs by 30%-40% [14] Cash Flow and Balance Sheet - Free cash flow for Q4 was CAD 1.3 million, with a total of CAD 12.12 million for the full fiscal year, supporting internal funding for store expansion [16] - Total debt stood at CAD 65.5 million, with cash and cash equivalents at CAD 47.9 million and no upcoming maturities for over two years [17] Market Opportunities - The company is exploring partnerships with U.S. operators following an executive order on cannabis rescheduling, while also considering potential CBD-related policy changes that could benefit its U.S. CBD brands [17][18]