Tilray Brands (TLRY) Q1 2026 earnings summary

Executive summary

• Achieved record Q1 net revenue of $210 million, up 5% year-over-year, with net income of $1.5 million and EPS of zero, marking a return to profitability from a prior year net loss of $34.7 million.

• Adjusted EBITDA rose 9% year-over-year to $10.2 million, supported by organic growth, cost-saving initiatives, and Project 420, which delivered $25.1 million in cumulative savings.

• Revenue growth was driven by strong performance in Canadian adult-use and international cannabis, as well as distribution and wellness, while beverage revenue remained flat due to SKU optimization.

• Strengthened balance sheet by reducing outstanding debt by $7.7 million, ending the quarter with $265 million in cash and a net debt-to-EBITDA ratio of 0.07x.

• Maintained leadership in Canadian cannabis, expanded international presence, and continued innovation in beverage and wellness segments.

Financial highlights

• Net revenue reached $210 million, a 5% increase year-over-year.

• Cannabis revenue grew 5% to $64.5 million, with 12% growth in adult-use and 10% in international cannabis.

• Distribution revenue increased 9% to $74 million, while wellness revenue rose 3% to $15.2 million.

• Gross profit was $57.5 million (gross margin 27%), down from $59.7 million (30%) last year, due to lower margins in beverage and cannabis.

• Adjusted EBITDA improved to $10.2 million from $9.3 million last year.

Outlook and guidance

• Reaffirmed fiscal 2026 guidance for adjusted EBITDA between $62 and $72 million.

• Expects continued growth in international cannabis as permit backlogs clear and regulatory reforms progress.

• Anticipates further margin improvements and operational efficiencies in beverage and cannabis segments.

• Management remains confident in long-term growth, citing opportunities in U.S. cannabis rescheduling and European market evolution.

• Further realization of Project 420 synergies and ongoing investments in marketing and infrastructure for acquired brands expected.