Leef Brands (LEEF) Q2 2026 earnings summary

Executive summary

• Completed an oversubscribed CAD 9.3 million financing and raised a total of CAD 14.2 million in 2026 to expand Salisbury Canyon Ranch, strengthen the balance sheet, and fund inventory.

• Acquired Himalaya Vapor Company and Standard Holdings, Inc., adding a leading California concentrate brand and a new CPG segment, with Himalaya contributing $1.0M in revenue post-acquisition.

• Filed multiple DEA registration applications, began and completed the largest harvest in company history, and expanded cultivation footprint to 80 acres with plans for 180 acres by 2027.

• Entered a supply agreement for an additional 21 acres, securing biomass supply through 2027.

• Net revenue for the six months ended June 30, 2026 was $16.7M, down 7.9% year-over-year, reflecting a strategic focus on wholesale concentrate manufacturing and ongoing pricing pressure in California’s cannabis market.

Financial highlights

• Q2 2026 revenue was $7.3M, down 16% year-over-year due to reliance on third-party biomass and a temporary biomass gap.

• Gross profit rose 62% year-over-year to $2.4M in Q2, with gross margin nearly doubling to 33% from 17%; for the six months, gross profit was $7.0M (42% margin).

• Adjusted EBITDA for Q2 was CAD -631,000; for the first half, adjusted EBITDA was +CAD 1.7M, a $3.8M improvement year-over-year.

• Operating loss narrowed to $0.7M from $4.3M year-over-year, with net loss and comprehensive loss at $1.8M, improved from $2.7M in the prior year.

• Cash at June 30, 2026 was $5.0M, up from $2.2M at December 31, 2025; working capital surplus was $8.7M.

Outlook and guidance

• Management expects gross margins to rebound to around 50% in the second half of 2026 and into 2027 as own biomass is processed.

• Anticipate strong growth from Himalaya in 2027 and meaningful cash flow contribution.

• Expansion to 122 acres by fall 2026 and full 180-acre cultivation and expanded processing capacity expected to support higher production and lower costs.

• Preparing for interstate commerce and international exports, with DEA registration applications filed and GMP/GACP compliance underway.

• Ongoing efforts to secure additional equity financing and reduce operational expenses to support liquidity.