GrowGeneration 2025 Q2 Earnings Narrowed Losses and Optimistic Outlook

GrowGeneration (GRWG) reported its fiscal 2025 Q2 earnings on Aug 11th, 2025. The company delivered a narrower-than-expected loss, reflecting operational improvements and cost discipline, although revenue declined year-over-year. The management provided a positive outlook for Q3 revenue while refraining from full-year guidance due to external uncertainties.

Revenue

GrowGeneration’s total revenue for the second quarter of fiscal 2025 declined by 23.5% year-over-year to $40.96 million, primarily driven by softer demand across key segments. The Cultivation and Gardening segment contributed the largest share at $32.86 million, followed by the Storage Solutions segment with $8.10 million. The Corporate segment reported $0, reflecting a streamlined focus on core revenue-generating areas.

Earnings/Net Income

The company reported a narrowed net loss of $-4.81 million in Q2 2025, a 18.4% reduction compared to the $-5.90 million loss in the same period of the prior year. On a per-share basis, the loss narrowed to $0.08 from $0.10, representing an 18.4% improvement. Despite the loss, the company showed positive momentum in reducing operating expenses and improving gross margins, indicating progress toward profitability.

Price Action

GrowGeneration’s stock price saw a strong post-earnings rally, with the shares rising 10.53% during the latest trading day. The stock continued its upward trend with a 24.75% surge during the most recent full trading week and an 18.87% increase month-to-date.

Post-Earnings Price Action Review

A review of historical price performance revealed that buying GrowGeneration shares on the earnings date and holding for 30 days yielded a positive return. Over three years, the cumulative return was 11.50%, with an average quarterly return of 3.83%, outperforming the market, which recorded a 5.01% return during the same period.

CEO Commentary

Darren Lampert, CEO & Co-Founder, highlighted the company’s improved financial performance in Q2 2025, including higher proprietary brand sales, gross margin expansion, and reduced operating expenses. The strategic transformation into a leaner, product-driven business focused on B2B customers is yielding results. Lampert emphasized the 32% increase in proprietary brand sales compared to 21.5% in the prior year, along with a gross margin of 28.3%. Operational efficiencies from store closures and digital initiatives like the GrowGen Pro Portal also contributed to the results. Despite external uncertainties like tariffs, Lampert expressed cautious optimism about the company’s long-term growth potential, including opportunities from the Viagrow acquisition, international partnerships, and potential cannabis policy changes.

Guidance

Lampert guided for Q3 2025 revenue in excess of $41 million, emphasizing continued gross margin expansion and a focus on achieving EBITDA profitability. However, the company has decided not to provide full-year 2025 guidance due to uncertainty surrounding cannabis reform and potential tariff impacts.

Additional News

In the three weeks following GrowGeneration’s Q2 2025 earnings report, several key developments emerged. First, the company took a step toward expansion with the announced acquisition of Viagrow, a move expected to bolster its B2B offerings and geographic reach. On the leadership front, Darren Lampert reaffirmed the company’s strategic direction and expressed confidence in the management team’s ability to execute its transformational plan. Lastly, in response to investor concerns, GrowGeneration outlined plans to enhance shareholder value through operational efficiency and improved profitability, though no dividend or share buyback initiatives were announced at this time.