Vireo Growth (VREO) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue rose 1.9% year-over-year to $24.5 million, with growth in Maryland, stable Minnesota, and expected or realized declines in New York medical sales, partially offset by adult-use sales commencement.

• Adjusted EBITDA increased 8.5% to $6.6 million, with margins above 25% and improvement to 26.8%.

• Operating income declined 58.5% year-over-year to $2.0 million, with margin dropping to 8.1%.

• Net loss for the quarter was $6.5 million, compared to a $6.7 million loss in Q1 2024.

• Pending merger transactions are expected to begin closing in Q2 2025, anticipated to enhance profitability and leadership capabilities.

Financial highlights

• Q1 revenue: $24.5 million, up 1.9% year-over-year; GAAP gross profit was $12.4 million, up 1.4%.

• Gross margin was 50.6%, down 20 bps year-over-year; adjusted gross margin would have been 51.8% excluding one-time fees.

• SG&A expenses: $7.5 million (30.5% of sales), up 6% year-over-year; excluding $400,000 severance, flat year-over-year at 29% of sales.

• Adjusted EBITDA was $6.6 million, margin 26.8%.

• Cash on hand at quarter end: $86.3 million.

Outlook and guidance

• Merger transactions expected to close in Q2 2025, with updates on the combined platform and outlook to follow.

• Continued focus on growth in Maryland, stable performance in Minnesota, and expansion of adult-use sales in New York.

• No anticipated integration issues; focus remains on building a portfolio of leading cannabis brands.