Another Quarter of Weak Revenue Growth for Cannabis Companies

The Public Cannabis Company Revenue & Income Tracker, managed by New Cannabis Ventures, ranks the top revenue producing cannabis companies. This update is our first since  late October, when we previewed the upcoming Q3 reports.

Tracker Rules

This data-driven, fact-based tracker will continually update based on new financial filings so that readers can stay up to date. Companies must file with the SEC or SEDAR and be current to be considered for inclusion. When we launched this resource in May 2019, companies with quarterly revenue in excess of US$2.5 million qualified. As the industry has scaled and as more companies have gone public, we have raised the minimum several times subsequently, including a move to US$5 million in October 2019, to US$7.5 million in June 2020, to US$10 million in November 2020, US$12.5 million in August 2021 and US$25 million in  September 2021. Due to the rapid growth in the cannabis industry, we raised the minimum again in May 2024. The senior list has a minimum of US$50 million (C$70.2 million), and the junior list now has a minimum of US$25 million (C$35.1 million).

A Note About Adjusted Operating Income

In May 2019, we added an additional metric, “Adjusted Operating Income” that we detailed in our newsletter. The calculation takes the reported operating income and adjusts it for any changes in the fair value of biological assets required under IFRS accounting. We believe that this adjustment improves comparability for the companies across IFRS and GAAP accounting. We note that often operating income can include one-time items like stock compensation, inventory write-downs or public listing expenses, and we recommend that readers understand how these non-cash items can impact quarterly financials. Many companies have moved from IFRS to U.S. GAAP accounting, which has reduced our need to make adjustments. Please note that our rankings include only actual reported revenue and not pro forma revenue. We also note that companies with non-cannabis operations must provide segment-level financial reports that detail not only revenue but also operating profit to be have their operating profit included in the tracker. Currently, Aurora Cannabis (NASDAQ: ACB) (TSX: ACB), Jazz Pharma (NASDAQ: JAZZ) and Tilray (TSX: TLRY) (NASDAQ: TLRY) aren’t providing this information.

Tracker Inclusion Updates

At the time of our last update on October 30th, 19 companies qualified for inclusion on the senior lists, including 17 filing in U.S. dollars and 2 in the Canadian currency, and the junior list had 17 companies. Now, 16 companies that file in U.S. dollars and 3 that file in Canadian dollars are qualifying for the senior lists, a total still of 19. The junior list includes 15 companies reporting in U.S. dollars and 2 in Canadian dollars. On a combined basis, the Public Cannabis Company Revenue & Income Tracker now includes 36 companies. Hydrofarm (NASDAQ: HYFM) moved from the Senior List to the Junior List. Nova Cannabis, which was acquired by SNDL (NASDAQ: SNDL), was removed from the Junior List in Canada, while Aurora Cannabis migrated to the Senior List.

Included Companies That Reported in November

Since our last update, many companies that generate substantial revenue have reported. It will be slow until February and will get very busy again in March.

Senior and Junior – American Dollar Reporting

The five largest MSOs saw revenue decline as much as 10% from a year ago to expand by just 4%. The average for these five, each with quarterly revenue in excess of $179 million, was -2%. The four Tier 2 MSOs experienced an average decline of 7%, with two unchanged and two falling. The two ancillary companies that are on the Senior List fell sharply.

Looking ahead, all of the Senior List companies have reported, and there are a few companies on the Junior List that have not yet filed.

Senior and Junior – Canadian Dollar Reporting

Since the last update we provided, two Canadian companies have reported growth.

High Tide (NASDAQ: HITI) (TSXV: HITI) will be reporting its fiscal Q4 ending 10/31 by late January. Organigram (NASDAQ: OGI) (TSX: OGI) hasn’t yet set a date to report its fiscal Q4 that ended in September, but it is due before year-end.

Based in Houston, Alan leverages his experience as founder of online community 420 Investor, the first and still largest due diligence platform focused on the publicly-traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. At New Cannabis Ventures, he is responsible for content development and strategic alliances. Before shifting his focus to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst following over two decades in research and portfolio management. A prolific writer, with over 650 articles published since 2007 at Seeking Alpha, where he has 70,000 followers, Alan is a frequent speaker at industry conferences and a frequent source to the media, including the NY Times, the Wall Street Journal, Fox Business, and Bloomberg TV. Contact Alan: Twitter | Facebook | LinkedIn | Email