Tilray Brands (TLRY) Q2 2025 earnings summary

Executive summary

• Q2 net revenue reached a record $211.0m, up 9% YoY and 10% in constant currency; gross profit rose 29% to $61.2m and gross margin increased to 29% from 24%.

• Net loss was $85.3m, including a $33.8m foreign-exchange loss; adjusted net loss was $2.2m and Adjusted EBITDA was $9.0m, down from $10.1m.

• H1 revenue increased 11% to $411.0m, while H1 Adjusted EBITDA declined 12% to $18.4m amid beverage integration and SKU rationalization.

• Project 420 targets $25m in beverage synergies; $17m had been achieved by Q2.

• FY2025 net revenue guidance was reaffirmed at $950m–$1bn.

Financial highlights

• Q2 adjusted gross profit, excluding PPA step-up, was $62.6m versus $52.1m; adjusted gross margin was 30% versus 27%.

• Q2 operating loss was $42.2m versus $41.8m; net loss was $85.3m, or $0.10/share, versus $46.2m, or $0.07/share.

• Cash and marketable securities totaled $252.2m at November 30, 2024; working capital was $428.8m.

• Free cash flow was negative $43.6m for Q2, reflecting higher working-capital needs.

• Adjusted EBITDA margin was 4.3%, down from 5.2% YoY; adjusted net loss per share was $0.00.

Outlook and guidance

• FY2025 net revenue guidance remains $950m–$1bn; revenue acceleration is expected in H2 from seasonality, product launches and expanded distribution.

• Beverage SKU and market rationalization is expected to reduce FY2025 net sales by ~$20m; innovation and brand extensions are expected to offset the impact over 18 months, subject to retailer-reset timing.

• Fourth-quarter FY2025 cannabis capex is expected to improve participation in compressed-price categories, including vapes; wholesale cannabis revenue is expected to remain volatile.

• Liquidity plans prioritize positive operating cash flow and free-cash-flow generation; additional debt or equity financing may support growth.