Cresco, Canopy Flag Challenging Market Conditions
June 3, 2025The cannabis industry continues to face headwinds, with both U.S.-based Cresco Labs and Canada’s Canopy Growth reporting challenging conditions in their fiscal first and fourth quarters respectively. Widespread issues with price compression and customer reach have been common refrains for key players across the U.S. and Canada markets lately.
Cresco reported net revenue of $166 million in the first quarter, down by $10 million sequentially and by just under $20 million year-over-year. Adjusted EBITDA, at $36 million, was down $5 million from the previous quarter and $17 million from a year earlier.
“We entered 2025 with the flexibility and financial strength needed to navigate market volatility, complete our debt refinancing, and remain both strategic and patient as we invest thoughtfully for long-term growth,” said Cresco CEO and co-founder Charlie Bachtell. “By staying disciplined and thoughtful in how we deploy capital, we’re positioning Cresco Labs to drive margin expansion, gain market share, and invest in sustainable growth when the right opportunities arise.”
Canopy, meanwhile, saw quarterly net revenue fall 11% year-over-year and net revenue for FY 2025 slip 9% to C$269 million ($196m). The quarterly challenges, according to the company, were due to softness in its international markets and specifically the Storz & Bickel brand, with losses partially offset by a strengthening Canadian business.
Adjusted EBITDA for Canopy was down quarterly and for the full fiscal year, showing a loss of C$9 million ($6.6m) for the quarter and C$24 million ($17.5) for the fiscal year, with the company noting that both figures are improvements compared with the previous year.
In Canada, Canopy’s cannabis revenues rose by 4% to C$40 million ($29m) for Q4, with the company noting that growth was focused in the medical business. Adult-use sales, however, declined by 3%, attributed to declines in flower and lower-priced pre-rolls. “With renewed focus and our resources dedicated to the most promising opportunities, I’m confident that our leading brands and product innovation pipeline can deliver meaningful growth and long-term value for both consumers and shareholders,” said Canopy CEO Luc Mongeau.—Shane English
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