Shares of Canopy Growth (NASDAQ:CGC)(TSE:WEED) cratered today after it reported earnings for its third quarter of Fiscal Year 2023. Earnings per share came in at -C$0.54, which missed analysts’ consensus estimate of -C$0.21 per share. Sales decreased by 28.2% year-over-year, with revenue hitting $101.2 million. This was more than C$15 million below expectations.
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As a result of this poor performance, Canopy Growth announced that it will be laying off roughly 60% of its workforce in order to transition to an asset-light business model. By moving to a third-party sourcing model, the company expects to bring its total cost reduction target to a range of $240 million to $310 million per year. The layoffs will contribute $140 million to $160 million in savings.
Canopy’s struggle to reach profitability is reflected in the share price. Indeed, CGC stock has declined almost 69% in the past 12 months.