Tilray Brands (TSX:TLRY)(NASDAQ:TLRY) reported its second-quarter results last week, and its net revenue hit a new record. Its top line got a big boost from surging international medical cannabis sales, which helped lead to an improvement in its bottom-line as well.
The consumer packaged goods company reported net revenue of $217.5 million for its second fiscal quarter, a 3% increase over the prior year. This growth was underpinned by a 36% jump in international cannabis revenue and a 6% rise in Canadian adult-use cannabis sales, which helped offset a reduction in wholesale cannabis activity.
The company's diversification strategy was evident in its divisional performance. While beverage net revenue declined to $50.1 million from $63.1 million in the previous year, the distribution segment, which includes Tilray Pharma, achieved its highest revenue quarter ever at $85.3 million.
Profitability metrics also showed positive momentum, with cannabis gross margins expanding to 39% from 35% a year ago. Most notably, the company nearly halved its net loss, which improved to $43.5 million compared to $85.3 million in the same period last year. Adjusted EBITDA was reported at $8.4 million, keeping the company on track to meet its fiscal 2026 guidance range of $62 million to $72 million.
Management remains focused on the potential for federal cannabis rescheduling in the United States. Chairman and CEO Irwin Simon highlighted that such regulatory changes would unlock opportunities for research and patient access.
Tilray, however, remains a risky investment as it has lost more than 90% of its value in five years, and it's still nowhere near breaking even, and its growth has been choppy at best. Investors should tread carefully with this stock.
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