New Mexico Cannabis Market Edges Toward $2B in Total Sales

ALBUQUERQUE – New Mexico’s Cannabis industry has recorded $1.9 billion in combined medical and adult-use sales since recreational legalization took effect in April 2022, according to the latest figures from the state’s Regulation and Licensing Department. With two months left in the year, the market stands just $68 million short of the $2 billion threshold, a mark officials expect to clear based on recent monthly averages.

September alone brought in $44.3 million, split between $10 million in medical purchases and $34.3 million in recreational, pushing the year-to-date total for 2025 to more than $428 million. That pace [roughly $47 million per month through the first nine months] positions the state to hit the milestone well before December 31, even if sales soften in the final quarter. Adult-use transactions continue to dominate, accounting for about 68% of the overall volume at $1.3 billion, while medical sales have held steady at $554 million.

The numbers reflect a market that has matured quickly in a compact geography. Albuquerque remains the undisputed leader, with $618 million in total sales over the period, including $393 million from recreational buyers. Border communities like Sunland Park and Las Cruces follow, drawing significant cross-state traffic from Texas, where recreational Cannabis remains illegal. Sunland Park, for instance, has logged $155 million, nearly all from adult-use. This out-of-state pull has boosted revenues but also strained local infrastructure, from traffic on key highways to compliance with federal border regulations.

Yet the path isn’t without obstacles. Year-to-date sales in 2025 trail 2024’s comparable period by about 5%, a dip analysts attribute to increased competition among the state’s 2,500-plus licensed retailers and a slight pullback in consumer spending. Monthly totals have stabilized in the $40 million range, down from peaks above $50 million in late 2023, signaling a shift from explosive growth to steady consolidation. Tax collections, which include a 12% excise levy on recreational sales plus local rates averaging 5.13%, have still funneled over $200 million to state coffers since launch – funds earmarked for behavioral health, public safety, and rural economic programs.

For operators, the $2 billion benchmark underscores New Mexico’s arrival as a mid-tier player in the national Cannabis arena, where states like Colorado and California have long surpassed $20 billion cumulatively. However, it also highlights risks ahead: oversupply in a market with low barriers to entry could pressure margins, especially if federal rescheduling under the DEA’s ongoing review alters interstate dynamics. Success here will depend on players, prioritizing efficiency over expansion.

Looking forward, the milestone offers a clear signal for both investors and policymakers. With sales on track to close the year strong, New Mexico’s Cannabis sector demonstrates resilience in a fragmented industry. The real test will come in 2026, as operators adapt to tighter margins and potential regulatory shifts, ensuring the state’s early momentum translates into lasting stability.