Tilray Reports Fourth Quarter and Fiscal 2025 Financial Results

LEAMINGTON, Ontario — Tilray Brands Inc. reported financial results for its fourth quarter and fiscal year ended May 31, 2025. All financial information is reported in U.S. dollars, unless otherwise indicated.

Irwin D. Simon, Chairman and Chief Executive Officer, stated, “In Fiscal Year 2025, we meaningfully advanced our platform, driving growth in all of our sectors, cannabis, beverage, and wellness. Our progress is rooted in a deep understanding of evolving consumer needs, shaping offerings that not only reflect, but anticipate how people choose to eat, drink, relax, and address their wellbeing. We increased revenue, enhanced efficiency, and boosted gross profit across all our businesses. Our continued investment in growth led to record fiscal year revenue, underscoring the resilience and durability of our strategy.”

Simon added, “Looking ahead to Fiscal Year 2026, we see key growth opportunities in cannabis, beverage and wellness. Our global infrastructure and international distribution network position us to lead as the global cannabis market expands. Our commitment to innovation across our portfolio of brands, including our AI initiatives, differentiates Tilray from the broader competitive landscape. We have the right team and the right strategy to drive growth by delivering innovative new products to our consumers and patients around the world.”

Strategic Growth Initiatives – Fiscal Year 2025

International Growth: In fiscal 2025, international cannabis revenue increased by 19%, with Q4 increasing by 71% and when excluding Australia, European cannabis revenue grew 112%. Tilray’s strategic opportunities in these markets extend beyond cannabis to include beverage and wellness products. This expansion will be overseen by our newly appointed London and Dubai-based International Managing Director, Rajnish Ohri. Looking ahead to 2026, Tilray anticipates substantial growth opportunities, particularly across Europe as well as in emerging markets within the Middle East, India, Türkiye and Asia with a focus on non-alcoholic beer, beverages and hemp-based food product sales.

Tilray Cannabis Profitability: In Fiscal Year 2025, Tilray was focused on preserving gross margin and maintaining a higher average selling price in growing categories, such as vapes and infused pre-rolls, that have experienced a high degree of price compression. As part of that effort, Tilray Canada redirected inventories to international cannabis markets to capitalize on higher margins abroad. Global cannabis gross margin expanded by 700 basis points in fiscal 2025. Looking ahead to 2026, we intend to enhance our global supply chain through Phase II of our accelerated growth plan and continue to increase our cultivation footprint to support the growing demand in both the Canadian and international markets.

Tilray Beverages: In Fiscal Year 2025, Tilray strategically acquired four craft brands from Molson Coors—Hop Valley Brewing Company, Terrapin Beer Co., Revolver Brewing, and Atwater Brewery—thereby expanding its beer presence across the U.S., including market leadership in Portland and Georgia. During the third quarter, we introduced Project 420, our strategic initiative to integrate our craft beer businesses, streamline operations, and drive renewed growth. As part of our margin enhancement and profitability initiatives, we have already realized $24 million in annualized savings toward our $33 million cost-savings target announced in January 2025. Completion of the synergy optimization plan is anticipated in the third quarter of Fiscal Year 2026.

Hemp-Derived Delta-9 (HD-D9) THC Drinks in the U.S.: HD-D9 beverages reflect our strategic commitment to growth by utilizing our platform and expertise across multiple categories to introduce innovations at the intersection of cannabis, beverages, and wellness. Through our established national craft beer distribution network, we now serve customers in 13 states where the sale of HD-D9 THC drinks is permitted, reaching 1,300 distribution points. This distribution footprint positions us among the leading participants in this developing market segment.

Debt Reduction; $256 Million in Cash and Marketable Securities: Fiscal year to date, Tilray reduced its outstanding total debt by almost $100 million, further strengthening the balance sheet. As a result, net debt to trailing twelve months adjusted EBITDA is 0.3x. Our $256 million cash balance, including marketable securities, provides Tilray with great flexibility for strategic opportunities.

AI Strategy: Tilray Brands is dedicated to leveraging advanced technologies to align with our shareholder interests, the consumer of tomorrow, enhancing efficiency and driving growth. We are implementing AI across our global operations to enhance our expertise, optimize processes, achieve substantial improvements, and advance our business objectives. In the cultivation sector, we are utilizing advanced horticulture automation technology throughout our global greenhouse operations. By integrating this technology with AI-driven data insights, we can manage greenhouse conditions in real-time, leading to more efficient operations, increased output, superior quality, and reduced costs for resources such as labor, water, and energy.

Financial Highlights – 2025 Fiscal Fourth Quarter

• Net revenue was $224.5 million in the fourth quarter compared to $229.9 million in the prior year quarter.
• Gross profit was $67.6 million in the fourth quarter compared to $82.4 million in the prior year quarter.   Gross margin was 30% in the fourth quarter.
• Cannabis net revenue was $67.8 million in the fourth quarter compared to $71.9 million in the prior year quarter. The year over year decline in revenue was principally driven by pausing vape and infused pre-roll categories to focus on improving profitability and unexpected international medical cannabis permit delays.
• Cannabis gross profit increased to $29.6 million in the fourth quarter from $28.8 million in the prior year quarter.
• Cannabis gross margin increased to 44% in the fourth quarter compared to 40% in the prior year quarter.
• Beverage net revenue was $65.6 million in the fourth quarter as compared to $76.7 million in the prior year quarter. The decline in revenue was principally driven by Project 420 and national SKU rationalization across our recently acquired craft beverage brands, as well as industry challenges.
• Beverage gross profit was $25.0 million in the fourth quarter compared to $40.8 million in the prior year quarter.
• Beverage gross margin 38% in the fourth quarter compared to 53% in the prior year quarter.
• Distribution net revenue increased to $74.1 million in the fourth quarter compared to $65.6 million in the prior year quarter.
• Wellness net revenue increased 9% to $17.0 million in the fourth quarter from $15.7 million in the prior year quarter.
• Net income (loss) of ($1,267.9) million in the fourth quarter compared to net loss of ($15.4) million in the prior year quarter, almost all of which is a result of non-cash expenses. This change is mainly due to non-cash expenses and accounting charges primarily associated with goodwill and intangible assets recorded during the Aphria and Tilray acquisition in 2021, at which time stock prices and market values for cannabis companies reflected expectations for U.S. cannabis legalization. As a result, an accounting-related non-cash impairment charge of ($1,396.9) million was recognized. Net Income (loss) per share was ($1.30) compared to ($0.04) in the prior year quarter.
• Adjusted net income was $20.2 million in the fourth quarter and Adjusted net income per share was $0.02 compared to $0.04 in the prior year quarter.
• Adjusted EBITDA was $27.6 million in the fourth quarter compared to $29.5 million in the prior year quarter.

Financial Highlights – 2025 Fiscal Year

• Net revenue increased 4% to $821.3 million and increased 6% to $833.7 million on a constant currency basis in fiscal 2025 compared to $788.9 million in the prior fiscal year.
• Gross profit increased 8% to $240.6 million from the prior fiscal year and Gross margin was 29% for the fiscal year.
• Cannabis net revenue was $249.0 million in fiscal 2025 compared to $272.8 million in the prior fiscal year, due to unexpected international medical cannabis permit delays, and strategic decisions to preserve margin in Canadian cannabis. For example, we deemphasized production and sales of vapes, which negatively impacted revenue by $15 million, and we deprioritized wholesale channels as they are less accretive to margins.
• Cannabis gross profit increased 10% to $99.0 million in fiscal 2025 from $90.2 million in the prior fiscal year. Adjusted gross profit increased 1% to $99.0 million compared to $97.8 million in the prior fiscal year.
• Cannabis gross margin increased to 40% in fiscal 2025 from 33% in the prior fiscal year. Adjusted cannabis gross margin increased to 40% from 36% in the prior fiscal year.
• Beverage net revenue increased 19% to $240.6 million in fiscal 2025 from $202.1 million in the prior fiscal year primarily due to our recent acquisition of craft beverage brands effective Sept 1, 2024, offset by our strategic SKU rationalization which impacted revenue by $20 million.
• Beverage gross profit increased 5% to $93.0 million in fiscal 2025 from $88.6 million in the prior fiscal year. Adjusted beverage gross profit increased 2% to $94.6 million from $93.2 million in the prior fiscal year.
• Beverage gross margin was 39% in fiscal 2025 compared to 44% in the prior fiscal year and adjusted gross beverage margin was 39% in fiscal 2025 compared to 46% in the prior fiscal year, reflecting lower margins from the acquired brands.
• Distribution net revenue increased 5% to $271.2 million compared to $258.7 million in the prior fiscal year. Distribution gross margin remained consistent at 11% in fiscal 2025 compared to the prior fiscal year.
• Wellness net revenue increased 9% to $60.5 million in fiscal 2025 from $55.3 million in the prior fiscal year.
• Wellness gross margin increased to 32% in fiscal 2025 compared to 30% in the prior fiscal year.
• Net income (loss) was ($2,181.4) million in fiscal 2025, compared to a net loss of ($222.4) million in the previous fiscal year. This change is mainly due to non-cash impairment of goodwill and intangible assets, as stated in Q4 financial highlights, of ($2,096.1) million. Net income (loss) per share was ($2.46), compared to a net income (loss) of ($0.33) per share in the prior fiscal year.
• Adjusted net income increased 45% to $9.0 million in fiscal 2025 compared to adjusted net income of $6.2 million in the prior fiscal year. Adjusted net income per share remained at $0.01 for the fiscal year.
• Adjusted EBITDA was $55.0 million in fiscal 2025 compared to $60.5 million in the prior fiscal year.
• Strong financial liquidity position of $256.4 million, consisting of $221.7 million in cash and $34.7 million in marketable securities.
• Strengthened balance sheet and reduced bank indebtedness $10.9 million, net long-term debt $12.1 million and outstanding principal of the net convertible debt by $67.8 million from the previous fiscal year with another $5.0 million occurring subsequent to the fiscal year end totaling ~$100 million of debt repayments to date.

Fiscal Year 2026 Guidance

For its fiscal year ended May 31, 2026, the Company expects to achieve adjusted EBITDA of $62 million to $72 million, representing growth of 13% to 31% as compared to fiscal year 2025.

Management’s guidance for adjusted EBITDA is provided on a non-GAAP basis and excludes stock-based compensation; change in fair value of contingent consideration; purchase price accounting step-up; impairments of intangible assets and goodwill; inventory valuation allowance; Other than temporary change in fair value of convertible notes receivable; facility start-up and closure costs; litigation costs; restructuring costs, transaction (income) costs and (Gain) loss on sale of capital assets – non-operating facility and other non-operating income (expenses) and other non-recurring items that may be incurred during the Company’s fiscal year 2026, which the Company will continue to identify as it reports its future financial results.

The Company cannot reconcile its expected adjusted EBITDA to net income “Fiscal Year 2026 Guidance” without unreasonable effort because of certain items that impact net income, and other reconciling metrics are out of the Company’s control and/or cannot be reasonably predicted at this time.

About Tilray Brands

Tilray Brands, Inc. (Nasdaq: TLRY; TSX: TLRY), is a leading global lifestyle and consumer packaged goods company with operations in Canada, the United States, Europe, Australia, and Latin America that is leading as a transformative force at the nexus of cannabis, beverage, wellness, and entertainment, elevating lives through moments of connection. Tilray’s mission is to be a leading premium lifestyle company with a house of brands and innovative products that inspire joy, wellness and create memorable experiences. Tilray’s platform supports over 40 brands in over 20 countries, including comprehensive cannabis offerings, hemp-based foods, and craft beverages.