Tilray’s cannabis revenues fell sharply over its first quarter, but its overall revenues were up 13% thanks to a near doubling in revenues from its alcohol business.
The Canadian cannabis giant reported its financial results for Q1 of the 2025 fiscal year this week, reporting net revenues of $200m, up 13% from the $177m in the same period a year earlier.
This growth was largely driven by a 132% surge in beverage alcohol revenue, which totaled $56m, up from $24.2m the previous year.
Meanwhile, its cannabis net revenue, including $20m in excise taxes, declined to $61.2m, down from $70.3m.
During an earnings call held yesterday, Tilray’s CFO Carl Merton said that gross cannabis revenues of $81.2m were comprised of $57.2m in Canadian adult-use revenue, $12.2m in international cannabis revenue, $6.3m in Canadian medical cannabis revenue, and $5.5m in wholesale cannabis revenue.
Medical cannabis sales grew marginally (2%) year-on-year ‘despite’ growing competition from the adult-use market.
However, Tilray’s adult-use sales dropped by 20%, which the company says was a ‘esult of our increased focus on preserving gross margin and maintaining a higher average selling price in categories that have experienced a high degree of price compression’.
“As we focus on our goal of improving cannabis gross margins, we are intentionally less focused on share and revenue in certain categories, particularly those categories facing the most price compression, including infused, pre-roll, and vape.
“Despite the decline in net revenue and share in those categories, we increased cannabis gross profit by $4.4 million and increased adjusted cannabis gross margin by over 500 basis points from the prior year period.”
Tilray’s gross profit improved by 35%, rising to $59.7m from $44.2m in the prior year, with the company’s gross margin increasing to 30%, up from 25%. This reflects Tilray’s efforts to enhance operational efficiency. The company’s net loss narrowed by 38% to $34.7m, compared to $55.9 million in the same period last year.
Notably, Tilray’s international cannabis revenue also declined by 14%, which it attributed to ‘variability on the timing in countries other than Germany of receiving import and export permits, resulting in fluctuations on a quarterly basis.’
CEO Irwin Simon expressed optimism for the future during the same earnings call, particularly regarding potential cannabis legalization in the U.S. after the upcoming presidential election.
He emphasized that the company is ready to expand in the U.S. if regulatory hurdles are cleared, stating, “I’m pretty optimistic there.”
Simon added that if the U.S. legalizes cannabis, Tilray would seek new acquisitions in the sector, leveraging its strong balance sheet. “Stay tuned,” he said, hinting at future opportunities.
