Leef Brands (LEEF) Q1 2026 earnings summary

Executive summary

• Achieved record gross profit, margins, and adjusted EBITDA in Q1 2026, with three consecutive quarters of positive operating cash flow.

• Net revenue for Q1 2026 was $9.4 million, flat year-over-year, reflecting a strategic focus on wholesale concentrate manufacturing and reduced CPG retail sales.

• Margin expansion was driven by internal cultivation, integration of in-house biomass supply, and disciplined procurement.

• Expansion of Salisbury Canyon Ranch and acquisition of Himalaya support a vertically integrated model and branded retail platform.

• Closed $4.5 million in equity financing and announced the acquisition of Himalaya, a premium vape brand.

Financial highlights

• Revenue for Q1 2026 was $9.4 million, flat year-over-year.

• Gross profit rose to $4.62 million (49% margin) from $2.07 million (22% margin) in Q1 2025.

• Adjusted EBITDA was $2.4 million, up from negative $730,000 in Q1 2025.

• Operating income reached $1.3 million, a turnaround from a $1.9 million loss last year.

• Net loss attributable to shareholders was $426,000, mainly due to a non-cash $3.9 million derivative liability swing and higher tax provision.

• Ended Q1 with $5.8 million in cash and a $5.9 million working capital surplus.

Outlook and guidance

• Plans to scale Salisbury Canyon Ranch to full 180-acre capacity by year-end, with first 2026 harvest in June and a second later in the year.

• Expects increased in-house biomass production and improved margins as additional acreage comes online throughout 2026.

• Submitted DEA license applications to enable interstate and global export opportunities, actively exploring DEA licensing following federal rescheduling.

• Q2 margins expected to compress temporarily due to seasonal third-party biomass processing.

• Full activation of the 180-acre farm targeted for spring 2027, with plans to expand beyond 180 acres.