Key Takeaways
- Tilray Brands shares plummeted Tuesday after it posted weaker-than-anticipated results and cut its earnings guidance as cannabis sales slowed.
- The company’s loss was wider than forecasts, and revenue also came up short of analysts’ estimates.
- Tilray reduced its full-year adjusted EBITDA outlook and said it now doesn’t expect positive free cash flow for 2024.
Shares of Tilray Brands (TLRY) plummeted Tuesday after the marijuana products maker and craft beer brewer posted worse-than-expected quarterly results and reduced its full-year earnings guidance as cannabis sales slipped.
Tilray reported a third-quarter fiscal 2024 loss of $0.12 per share, more than double estimates. Revenue rose 29.4% to $188.3 million, but that was more than 5% below forecasts.
The company’s cannabis revenue of $63.4 million, while higher year-over-year, declined 5.5% from the second quarter. Tilray doesn’t sell cannabis in the U.S. because of federal drug laws, and noted that the “rescheduling of cannabis could open a path for Tilray to leverage its expertise in Canadian and European medical cannabis to distribute medical cannabis in the U.S.”
Beverage-alcohol unit sales soared 165% from a year earlier to $54.7 million following the Sept. 2023 acquisition of five craft breweries and three other beverage companies from Anheuser-Busch InBev (BUD). Beverage-alcohol sales accounted for 29% of Tilray’s overall revenue, a jump from 14% in the prior year.
Tilray now expects full-year adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to be in a range of $60 million to $63 million, down from its previous outlook of $68 million to $78 million. In addition, the company no longer anticipates generating positive adjusted free cash flow because of “delayed timing for collecting cash on various asset sales.”
The news sent Tilray Brands shares down 21% to $2.03 as of 11:05 a.m. ET, and into negative territory for the year.
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