CV Sciences (CVSI) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue was $3.9 million, down 5% year-over-year, mainly due to a 9% decline in B2B sales impacted by state CBD regulations, but gross margin improved to 46.0% from 45.1% due to cost efficiencies.

• Operating loss for Q3 2024 was $0.3 million, improved from $0.4 million loss in Q3 2023, and adjusted EBITDA loss was $75,000, near break-even.

• Launched Plus Health/+PlusHLTH™, a cannabinoid-free supplement line, and introduced new pet products.

• Acquisitions of Cultured Foods (Dec 2023) and Elevated Softgels (May 2024) expanded product offerings and geographic reach.

• Preparing for U.S. launch of plant-based protein products in Q1 2025.

Financial highlights

• Q3 2024 revenue: $3.9 million (down from $4.1 million in Q3 2023 and $4.0 million in Q2 2024); gross margin: 46.0% (up from 45.1% in Q3 2023, down from 47.0% in Q2 2024); gross profit: $1.8 million.

• Operating loss for Q3 2024 was $0.3 million; net loss was $0.5 million, similar to Q3 2023.

• Adjusted EBITDA loss was $75,000 in Q3 2024, improved from $0.4 million loss in Q3 2023.

• Cash at September 30, 2024: $1.0 million; working capital: $0.6 million.

• Inventory at end of Q3 2024 was $5.0 million, down from $5.7 million at end of 2023.

Outlook and guidance

• Management anticipates further gross margin improvements and revenue growth in 2025, supported by recent acquisitions and product innovations.

• Several new product launches planned for the first half of 2025, including cannabinoid-free supplements and plant-based protein products.

• Expecting to realize synergies from recent acquisitions and generate positive cash flow in 2025.

• Anticipate modest cash usage in the near term until acquisition synergies are realized.

• Management anticipates continued dependence on additional investment capital to fund operations and growth initiatives.