Canopy Growth 2026 Q2 Earnings 99.3% Net Loss Per Share Improvement

Canopy Growth (CGC) delivered a significant earnings beat in Q2 2026, resolving long-standing "going concern" concerns. The company reported a net loss of $0.01 per share, a 99.3% improvement from the prior year, while revenue rose 5.9% to $66.68 million. Guidance highlighted sequential margin gains and international stabilization, aligning with management’s focus on cost discipline and operational execution.

Revenue

Cannabis sales drove the majority of revenue growth, with Canadian adult-use cannabis surging 30% year-over-year to $23.9 million. The segment total reached $50.85 million, bolstered by innovations like Claybourne pre-rolls and Tweed vapes. Storz & Bickel contributed $15.83 million, though this marked a 10% decline year-over-year. International cannabis revenue, however, declined 39% due to European supply constraints.

Earnings/Net Income

Canopy narrowed its net loss to $1.64 million in Q2 2026, a 98.7% reduction from the $128.29 million loss in the prior year. Earnings per share improved to -$0.01, up from -$1.48, reflecting disciplined cost management and SG&A savings exceeding $21 million. This demonstrates the company’s progress toward profitability despite ongoing international challenges.

Price Action

Post-earnings, CGC shares fell 23.53% month-to-date, with volatility persisting despite a 19% pre-market surge following the "going concern" resolution.

Post-Earnings Price Action Review

The strategy of buying Canopy Growth shares on the date of its revenue raise announcement and holding for 30 days has shown poor performance over the past three years, with a cumulative return of -46.5%. This underperformance highlights the stock’s volatility and the lack of profitability from such a strategy, given the erratic price movements and negative overall returns.

CEO Commentary

CEO Luc Mongeau emphasized momentum in Canada’s adult-use and medical cannabis markets, with the latter growing 17% year-over-year. Challenges in Europe and international supply constraints were acknowledged, but he expressed confidence in Storz & Bickel’s VZ Vaporizer success and operational improvements.

Guidance

Canopy expects cannabis gross margin improvements in H2 2026 through production efficiencies and cost savings. International revenue is projected to stabilize as European operations improve. The company prioritizes debt reduction, operational execution, and positive adjusted EBITDA, with no near-term capital expenditures planned.

Additional News

Storz & Bickel’s Q2 revenue reached $16 million, up 5% sequentially but down 10% year-over-year, driven by the VZ Vaporizer launch. The company achieved $21 million in SG&A savings, surpassing its $20 million target. Canopy’s cash balance of $298 million exceeded debt by $70 million, resolving "going concern" concerns.

Key Operational Updates

• Canadian Growth: Adult-use cannabis revenue surged 30% YoY, with medical cannabis up 17%.

• Cost Discipline: SG&A expenses dropped 13% YoY, contributing to a 63% reduction in operating losses.

• International Challenges: European supply chain issues reduced international cannabis revenue by 39%.

• Balance Sheet Strength: $298 million in cash and $70 million net cash position, with $50 million prepaid on its term loan.

Strategic Priorities

• Product Innovation: Focus on Claybourne pre-rolls and Tweed vapes to drive Canadian sales.

• Debt Management: Prepaid $50 million on senior secured debt, capturing $6.5 million in annualized interest savings.

• International Stabilization: Targeting improved European operations and margin expansion in H2 2026.

Market Reaction

Investors initially responded positively, with shares surging 19% pre-market, but volatility persisted. Analysts noted the revenue miss versus consensus but highlighted improved liquidity and operational progress.