Avant Brands (AVNT) Q2 2025 earnings summary

Executive summary

• Net revenue for the six months ended May 31, 2025, increased 5% year-over-year to $17.1 million, driven by a strategic shift toward higher-margin international export sales, which now comprise 51% of net revenues.

• Adjusted EBITDA for the six-month period was $2.9 million, down 55% from $6.5 million in the prior year, reflecting increased cost of sales and margin compression.

• Gross margin adjusted for fair value adjustments declined to 30% from 47% year-over-year, primarily due to market price compression and higher production cost allocation.

• Operating expenses decreased 7% year-over-year, mainly from reductions in overhead, but were offset by higher share-based payments.

• Net loss for the six months was $5.0 million, an improvement from a $6.5 million loss in the prior year.

Financial highlights

• Revenue rose 6% to $19.4 million; net revenue up 5% to $17.1 million for the six months ended May 31, 2025.

• Export wholesale revenue grew 24% year-over-year, while recreational revenue declined 15%.

• Gross margin adjusted for fair value adjustments was $5.2 million (30% of net revenue), down from $7.8 million (47%).

• Adjusted net loss was $0.4 million, compared to adjusted net income of $2.6 million in the prior year.

• Cash flows from operating activities before working capital changes were $3.0 million, down from $8.4 million year-over-year.

Outlook and guidance

• Focus remains on accelerating global expansion, especially in Australia and Germany, and strengthening the BLK MKT brand internationally.

• Strategic emphasis on product innovation, cultivation partnerships, and operational efficiency to drive long-term growth.

• Ongoing efforts to optimize cost structure and maintain financial discipline amid market price pressures.