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Canopy Growth’s Revenues Slip Amid Competitive Canadian Market Conditions

November 9, 2021

Canada-based cannabis company Canopy Growth saw sales slip 3% year-on-year to C$131 million ($105m) in the three months through September, representing the second quarter of its fiscal year. Adjusted EBITDA showed a loss of C$163 million ($131m).

Amid a highly competitive market in Canada, Canopy says it’s focused on generating “increased supply of in-demand high-THC flower products and new product launches across flower, pre-roll joints, vapes, edibles and beverages” in a bid to bolster its market share. Canopy’s latest launches include Doja Okanagan Grown Ultra Sour and Cold Creek Kush premium flower, Tweed Quickies pre-rolled joints, Tweed Iced Teas and Fizz Seltzers, and new gummies from its Ace Valley and Deep Space brands.

In the U.S., Canopy says the Martha Stewart CBD brand is now the third-largest brand among all CBD gummies in the food, drug and convenience-store channel with 12.4% market share, according to IRI. Additionally, in recent weeks, Canopy agreed to pay $298 million for the right to buy Colorado-based edibles company Wana Brands, contingent on federal legalization of THC.

While Canopy expects its revenue growth to accelerate in the months ahead, it no longer anticipates positive adjusted EBITDA before the end of the fiscal year, “due to Canada supply challenges and a delayed revenue ramp in the U.S.” Company CEO David Klein noted, “In new industries where the potential is immense, progress is rarely a straight line. With a focused strategy, a foundation for growth, and our burgeoning U.S. ecosystem, Canopy is uniquely positioned to win as the industry matures.”—Daniel Marsteller

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