Verano (VRNO) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue was $202.3 million, supported by a diversified product portfolio, national distribution across 13 states, and 157 retail locations, but declined year-over-year and sequentially due to price compression and competition, partially offset by strong performance in Ohio and Florida and recent acquisitions.

• Gross profit was $113 million (56% margin), up 13% sequentially and flat year-over-year, driven by operational efficiencies and improved cultivation.

• Adjusted EBITDA was $66.2 million (33% margin), reflecting operational efficiencies and cost controls.

• Net loss was $19.2 million (-9% margin), compared to a $12 million loss in Q1, with improvement from Q2 2024 due to lower other expenses despite higher income tax provision.

• Operational highlights included new dispensary openings in Florida and Connecticut, a partnership with Grow Sciences in Illinois, and a new retail concept in Arizona.

Financial highlights

• Q2 revenue declined 4% sequentially and 9% year-over-year, mainly from lower wholesale sales and price compression.

• Gross profit margin improved to 56% from 51% in Q2 2024 and 47% sequentially.

• Adjusted EBITDA was $66.2 million, up 7% sequentially but down 6% year-over-year.

• Net loss was $19.2 million, with a net loss margin of -9%, improved from -10% in Q2 2024.

• SG&A expenses were $86 million (43% of revenue), down year-over-year and flat sequentially.

Outlook and guidance

• Management expects to maintain a 30% adjusted EBITDA margin profile for the remainder of 2025.

• Anticipates modest improvement in wholesale business in the second half of the year as accounts are gradually reactivated.

• Full-year 2025 CapEx expected between $30 million and $45 million, focused on operational efficiencies and retail expansion.

• Cash balances projected to increase in Q3 and Q4 after a low point in Q2.

• Management anticipates a stronger second half of 2025, citing new store openings, product innovation, and ongoing efficiency initiatives.