Tilray Brands’ Q1 2025 Net Revenue Surges by 13%, Reaching $200 Million

Tilray Brands, Inc. (Nasdaq: TLRY; TSX: TLRY), a prominent global lifestyle and consumer packaged goods company, recently announced its financial results for the first quarter of fiscal year 2025, ending August 31, 2024. The company reported a 13% year-over-year increase in net revenue, reaching a record $200 million compared to $177 million in the prior year quarter.

This growth was driven by a significant boost in its beverage alcohol segment, which saw a 132% increase in net revenue to $56 million. The gross margin also improved by more than 500 basis points, representing a 20% year-over-year growth. Tilray’s cannabis segment reported net revenue of $61.2 million, with a gross margin of 40%.

Meanwhile, the distribution segment contributed $68.1 million to the total revenue, with a gross margin of 12%. The wellness segment, albeit smaller, showed an 11% increase in net revenue to $14.8 million, with a gross margin of 32%. Despite the positive revenue and margin growth, the company reported a net loss of $34.7 million for the quarter, an improvement from the $55.9 million loss in the same period last year.

Tilray Beats EPS Expectations in Q1 FY 2025

When comparing Tilray’s performance against market expectations, the results were mixed. Analysts had anticipated an earnings per share (EPS) of $-0.04 and revenue of $218.88 million for the quarter. Tilray matched the expected EPS, reporting a net loss per share of $-0.04, which was an improvement from the $-0.10 per share loss reported in the previous year.

However, the company fell short of the revenue expectations, generating $200 million compared to the projected $218.88 million.

The shortfall in revenue can be attributed to a decline in the cannabis business, which saw a decrease in net revenue from $70.3 million in the previous year to $61.2 million this quarter. This decline was partially offset by the strong performance in the beverage alcohol segment.

Additionally, the adjusted EBITDA for the quarter was $9.3 million, down from $10.7 million in the previous year, indicating challenges in maintaining operational efficiency amidst the evolving market dynamics.

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Guidance and Future Outlook

Tilray’s management remains optimistic about the future, driven by strategic investments and potential regulatory developments in the cannabis industry. Irwin D. Simon, Chairman and CEO, expressed confidence in the company’s ability to disrupt the consumer packaged goods industry through innovative products.

The company is focused on increasing revenue, driving operational efficiencies, and improving margins and profitability while investing in growth. Looking forward, Tilray anticipates favorable regulatory changes in the U.S. cannabis market, especially with the upcoming presidential elections, where both candidates have shown support for further legalization.

The company is also expanding its product offerings in the U.S. market with the launch of hemp-derived Delta-9 THC products, targeting key markets. Tilray’s strategy includes leveraging its diverse portfolio of cannabis, beverage, wellness, and distribution businesses to capture emerging opportunities and drive long-term growth.

Disclaimer: The author does not hold or have a position in any securities discussed in the article.