Tilray Brands Q4 Earnings Call Highlights

Key Points

• Record fiscal 2026 performance: Tilray’s revenue rose 11% to $915.5 million and adjusted EBITDA increased 11% to $61.1 million. Full-year net loss narrowed substantially to $105.2 million from approximately $2.2 billion.
• International cannabis and BrewDog drove growth: International cannabis revenue grew 34%, while fourth-quarter beverage revenue surged 61%, including $51.1 million from the BrewDog acquisition. Distribution revenue also increased 21%.
• Fiscal 2027 outlook is positive: Tilray expects adjusted EBITDA of $68 million to $75 million, supported by margin expansion, operational efficiencies, integration of acquired businesses and stronger cash generation.

Tilray Brands NASDAQ: TLRY reported record fiscal 2026 revenue and adjusted EBITDA, supported by growth in international cannabis, pharmaceutical distribution, wellness and the fourth-quarter acquisition of BrewDog.

For the fiscal year ended May 31, 2026, net revenue rose 11% to $915.5 million from $821.3 million a year earlier. Adjusted EBITDA increased 11% to $61.1 million. The company said adjusted EBITDA would have been $63.4 million excluding $2.3 million in unanticipated fuel surcharges.

Tilray ended the year with $234.6 million in cash, restricted cash and marketable securities, while net debt was less than $1 million, compared with approximately $14 million at the end of fiscal 2025. Chief Financial Officer Carl Merton said the company reduced debt by roughly $60 million during and after the fiscal year, including repayments and non-cash convertible-debt settlements.

Fourth-Quarter Results

Fourth-quarter net revenue increased 25% to $281.7 million, from $224.5 million in the prior-year quarter. Revenue increased across all four operating segments, with beverage revenue rising 61% to $105.6 million, including $51.1 million contributed by BrewDog.

Fourth-quarter adjusted EBITDA rose 15% to a record $31.9 million, compared with $27.6 million a year earlier. Gross profit increased 34% to $90.5 million, and gross margin improved to 32%.

The company recorded a fourth-quarter net loss of $37.9 million, or $0.43 per share, an improvement from a loss of about $1.3 billion, or $13.01 per share, in the prior-year period. Merton said the year-over-year improvement primarily reflected the absence of prior-year non-cash impairment charges.

For the full fiscal year, net loss narrowed to $105.2 million, or $1.09 per share, from approximately $2.2 billion, or $24.56 per share, in fiscal 2025. Adjusted net income rose 87% to $12.2 million, or $0.11 per share.

International Cannabis and Distribution Growth

Net cannabis revenue increased 8% to $268.3 million in fiscal 2026. International cannabis revenue climbed 34% to $84.9 million, driven by demand, broader distribution and improved supply availability, particularly in Germany. Germany and the United Kingdom each grew 25%, while Poland increased 73% and Italy increased 53%, according to Chief Executive Officer Irwin Simon.

International cannabis results faced approximately $21.1 million of price compression during the year. Despite that pressure, Merton said Tilray sold higher gram equivalents and allocated inventory toward higher-return markets.

Tilray said its Portugal facility, which supplies about 85% of its international medical cannabis business, reached roughly 80% utilization during the year. The company is harvesting at an annualized rate of more than 30 metric tons at the facility, compared with four metric tons 24 months earlier. Its Aphria RX facility in Germany is fully utilized, management said.

Canadian adult-use cannabis revenue increased 5% to $236.4 million. Simon said pre-roll, edible, vape and THC beverage categories continued to expand, while flower sales faced pressure as consumers shifted toward other formats. Canadian medical cannabis revenue declined 5% to $23.7 million, primarily due to Veterans Affairs reimbursement changes that Tilray expects will reduce fiscal 2027 revenue by about $4 million.

Distribution revenue, largely generated through German pharmaceutical distributor CC Pharma, increased 21% to $327.2 million. Distribution gross margin improved to 12% from 11%, helped by product mix and higher average selling prices. Simon said Tilray is considering additional roles for CC Pharma in cannabis storage, sales and compounding, as well as expansion into other markets.

BrewDog Adds to Beverage Platform

Beverage revenue rose 6% to $254 million for the year, including BrewDog’s contribution following its acquisition during the fourth quarter. Tilray acquired BrewDog for approximately $54 million and subsequently invested nearly $50 million in working capital to support the business.

Management said BrewDog adds more than $200 million in annual revenue on a run-rate basis across the United Kingdom, Australia and the United States. The acquisition also added a hospitality footprint that includes pubs and franchise locations.

Excluding BrewDog, Tilray’s legacy U.S. beer operations were affected by broader industry conditions and internal efforts to improve profitability. Merton said margin-focused actions reduced revenue by approximately $16.6 million during the year. Simon said the company has rationalized SKUs, brands and distributors, and intends to focus on national brands including Shock Top and Carlsberg alongside regional brands.

Tilray also announced that, beginning Jan. 1, 2027, it will brew, market and sell Carlsberg Elephant, 1664 and Kronenbourg 1664 Blanc across the U.S. under a long-term partnership with Carlsberg.

Wellness revenue increased 9% to $65.9 million, supported by product innovation and growth in Hi*Ball clean energy drinks. Total fiscal 2026 revenue consisted of 36% distribution, 29% cannabis, 28% beverage and 7% wellness, according to the company.

Cash Flow, Margins and Outlook

Gross profit increased 8% to $260.4 million, though reported gross margin declined to 28% from 29% due to international cannabis pricing pressure and a greater mix of lower-margin distribution revenue. Adjusted gross margin was unchanged at 29%.

Cash used in operations improved to $69.1 million from $94.6 million. Before working-capital investments, Tilray generated $18.2 million in operating cash flow, a $50.3 million improvement from the prior year. Working-capital use totaled $87.4 million, including about $50 million related to BrewDog and inventory investments supporting international cannabis growth.

Tilray expects adjusted EBITDA of $68 million to $75 million in fiscal 2027, representing a double-digit increase from fiscal 2026. Merton said the company expects international operations to account for about $700 million, or 60%, of consolidated revenue, while its overall annualized pro forma revenue run rate is approximately $1.2 billion.

Simon said Tilray’s fiscal 2027 priorities include margin expansion, efficiency improvements, innovation, integration of acquired businesses and stronger cash generation. He added that the company remains prepared to pursue U.S. medical cannabis opportunities if regulatory frameworks become clearer, but said Tilray would remain disciplined on acquisitions and investments.

About Tilray Brands (NASDAQ:TLRY)

Tilray Brands, Inc is a global cannabis-lifestyle and consumer packaged goods company engaged in the cultivation, production, distribution and sale of cannabis and cannabinoid-based products. The company develops and markets a diverse portfolio of branded products spanning medical cannabis, adult-use recreational products and wellness offerings. Through state-of-the-art cultivation facilities, research and development efforts, and quality control systems, Tilray Brands aims to deliver consistent, scalable products for a range of patient and consumer needs.

Tilray's product lineup includes cannabis flower, pre-rolls, oils and tinctures, vapes, edibles and topicals, as well as hemp-derived cannabidiol (CBD) products.

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