TerrAscend (TER) Q1 2025 earnings summary

Executive summary

• Q1 2025 net revenue was $71 million, down 4.5% sequentially due to seasonality, but gross margin expanded to 51.8% and adjusted EBITDA reached $15.3 million.

• Achieved 11th consecutive quarter of positive operating cash flow and 7th consecutive quarter of positive free cash flow.

• Ongoing cost reductions led to a $1.6 million decrease in G&A expenses in Q1, with $10 million in annualized savings targeted for 2025.

• Aggressive M&A strategy continues, with acquisitions in Ohio (Ratio Cannabis) and a signed agreement for a fourth dispensary in New Jersey.

• Launched a $10 million share repurchase program, with initial purchases made during open trading windows.

Financial highlights

• Net revenue for Q1 2025 was $71 million, down from $74.4 million in Q4 2024.

• Gross profit margin was 51.8%, up from 50.2% in Q4 2024 and 48% in Q1 2024.

• Adjusted EBITDA was $15.3 million (21.6% margin), up from $15.1 million (20.3%) in Q4 2024.

• GAAP net loss for Q1 2025 was $12.3 million, improved from a $30.2 million loss in Q4 2024.

• Cash and equivalents stood at $29.4 million as of March 31, 2025.

Outlook and guidance

• Q2 2025 revenue expected to be flat to up low single digits sequentially, with gross margin anticipated to remain around 50%.

• Further G&A expense reductions expected, targeting $10 million in annual savings for 2025.

• Facility expansions in Maryland and New Jersey expected to drive operational efficiencies and growth.

• Preparations underway for potential Pennsylvania adult-use market entry.

• No significant debt maturities until late 2028, supporting strategic acquisitions and growth.