Canopy Growth (WEED) Q3 2026 earnings summary

Executive summary

• Q3 FY2026 saw flat consolidated revenue, significant progress in Canadian cannabis, and a narrowed net loss of $62.6M, a 49% improvement year-over-year, with a strong cash position of $371M and net cash of $146M as of December 31, 2025.

• Adjusted EBITDA loss improved to $2.9M in Q3 FY2026 from $3.5M in Q3 FY2025, reflecting cost savings and operational improvements.

• Completed a $150M recapitalization in January 2026, extending all debt maturities to 2031 and enhancing liquidity.

• Announced the proposed acquisition of MTL Cannabis, expected to be accretive and strengthen leadership in Canadian medical and Quebec adult-use markets, with closing anticipated in the current quarter.

Financial highlights

• Q3 FY2026 consolidated net revenue was $75M, flat year-over-year; cannabis net revenue rose 4% to $52M, led by 15% growth in Canada medical cannabis to $23M and 8% growth in Canadian adult-use to $23M.

• International cannabis net revenue fell 31% year-over-year but rose 22% sequentially, reflecting stabilization and improved supply chain execution.

• Storz & Bickel net revenue was $23M, up 45% sequentially but down 9% year-over-year, with strong Black Friday sales and the launch of the VEAZY device.

• Gross margin for Q3 was 29% (down from 32% year-over-year); cannabis segment margin at 25%, Storz & Bickel at 37%.

• Free cash outflow improved to $19M in Q3 FY2026 from $28M year-over-year.

Outlook and guidance

• Management targets positive Adjusted EBITDA in fiscal 2027, supported by cost savings, revenue growth, and the MTL Cannabis acquisition.

• Expecting continued strength in Canadian adult-use and medical cannabis, with innovation and expanded distribution as key drivers.

• Anticipating sequential improvements in international cannabis, especially in Europe, and improved cannabis gross margins in Q4 and fiscal 2027.

• Storz & Bickel expected to face sequential top-line challenges in Q4 due to seasonality.

• The company is monitoring the impact of proposed changes to Canadian medical cannabis reimbursement rates, which could affect future revenues and margins.