Tilray Brands (NASDAQ:TLRY)
After the market closed on Monday, shares of Tilray Brands (NASDAQ:TLRY) dropped by less than four percent after the company reported revenue for the third quarter of its fiscal year 2023 that was lower than analysts anticipated. This occurred even though the company had just announced an acquisition agreement with a competing Canadian cannabis business, Hexo Corp. (NASDAQ:HEXO).
After Tilray stock agreed to execute the acquisition in June 2023 after a $56 million all-stock agreement, the share price of Hexo dropped by around 24 percent, leading to a slide in other Canadian cannabis equities. After the market has closed, shares of OrganiGram Holdings, Aurora Cannabis, and Cronos Group are selling at lower prices.
Tilray stock exceeded analysts’ predictions for its quarterly profitability. At the same time, the company fell short of sales projections for its most important business units. While distribution revenue increased approximately 5% year over year to reach $65.4M, net cannabis revenue decreased approximately 14% yearly to $47.5M. Net revenue for the quarter increased about 1% year over year to $145.6M.
Regarding market channel, revenue from Canadian cannabis products for adult use increased by approximately 4% year over year to reach $45.3 million. Still, revenue from Canadian cannabis products for medical use and overseas cannabis goods decreased by approximately 14% and 39%, respectively, to reach $6.0 million and $9.7 million, respectively.
Meanwhile, TLRY swung to a gross loss of $11.7M during the quarter compared to a gross profit of $40.0M in the previous year’s quarter. Its cash and equivalents fell short of projections to reach $165.0M, showing a 60% decline from FY22. In the prior year’s quarter, TLRY posted a gross profit of $40.0M.
In terms of adjusted EBITDA, the company’s quarterly result of $14.0 million and the full-year prediction of $60 million to $66 million came in below what the market expected.
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