Tilray Brands Reports Fiscal Q1 2026 Earnings

NEW YORK – Tilray Brands Inc. swung to a profit in its fiscal first quarter, fueled by record revenue and sharper cost management, as the Cannabis company builds on a multiyear turnaround.

For the period ended August 31, 2025, Tilray reported net income of $1.5 million, erasing a $34.7 million loss from the year-ago quarter, while net revenue rose 5% to $209.5 million. The results beat analyst estimates for revenue by about $5 million and drove shares up 18% in early trading.

Adjusted EBITDA climbed 9% to $10.2 million, keeping the company on pace for its full-year target of $62 million to $72 million. Earnings per share landed at breakeven, an improvement from a 4-cent loss expected by Wall Street. Executives credited the gains to streamlined operations and a diversified portfolio that spans Cannabis, beer, and wellness products.

In the Cannabis division, net revenue increased 5% to $64.5 million, with Canadian adult-use sales up 12% year over year to maintain market leadership. International medical Cannabis revenue grew 10%, but gross margins contracted to 36% from 40%, reflecting softer prices in a supply-heavy market. Sequentially, Cannabis sales dipped 5% from the prior quarter, a reminder of uneven demand in mature regions.

Beverage alcohol revenue held flat at $55.7 million as Tilray absorbs recent U.S. craft beer acquisitions, with margins at 38%. Wellness sales rose 3% to $15.2 million on steady 32% margins, while the European distribution platform delivered a 9% revenue gain to $74 million, though at slimmer 11% margins due to logistics expenses. Overall gross margins fell to 27% from 30%, highlighting the tension between volume growth and pricing discipline.

The balance sheet tells a cleaner story. Cash swelled to $265 million from $222 million at fiscal year-end, and net debt shrank to $4 million [yielding a leverage ratio of 0.07x trailing EBITDA, well below industry norms. Operating cash use dropped to $1.3 million, a $34 million improvement, and adjusted free cash flow narrowed its deficit to $4.8 million.

Irwin D. Simon, Tilray’s Chairman and CEO, described the quarter as evidence of “disciplined execution” in a prepared statement. He pointed to the global footprint, now with 30% of revenue from outside Canada, as a hedge against domestic slowdowns, especially with U.S. rescheduling talks advancing and European medical markets opening further.

A closer look reveals the profit stems partly from nonrecurring items and integration savings, but core trends hold promise. Tilray’s revenue growth outpaces rivals like Aurora Cannabis, which saw flat sales last quarter, and its debt reduction frees capital for targeted buys rather than survival spending.

Still, the margin slide underscores risks. Oversupply caps Cannabis pricing, and beverage synergies could falter if consumer spending cools. At a forward price-to-sales multiple of about 1.5x, the stock trades at a discount to MSOs like Green Thumb Industries, betting on international upside.

Tilray* reaffirmed its annual EBITDA outlook, underscoring faith in the playbook. With ample cash and operational momentum, the company has crossed a threshold from chronic losses to quarterly wins, a development that [while incremental] reinforces its edge in a sector still chasing consistency.

*Highly Capitalized Network-HCN reports impartially on developments in the industry and its participants & does not endorse, promote, or take positions on any party, association, or company involved.