CGC Earnings: Canopy Growth Stock Sinks 20% after Weak Results

Shares of Canopy Growth (CGC) (TSE:WEED) are down over 20% at the time of writing after the cannabis company reported weak fourth-quarter results for Fiscal Year 2025. The company brought in C$65 million in net revenue, which missed analyst expectations by C$5.5 million, even though revenue grew by 11% year-over-year. The main problem was poor performance in Canopy’s international operations and its Storz & Bickel division, while its Canadian business helped offset some of the losses.

Sales in Canada rose by around 4% from the year before to C$40 million, which was helped by a 13% growth in medical cannabis. However, revenue from international cannabis sales fell by 35% to C$8 million. At the same time, Storz & Bickel brought in C$17 million, down 23% from last year. In addition, Canopy’s adjusted gross margin dropped by 2% to 19%. As a result, the company reported an adjusted EBITDA loss of C$9 million and a GAAP loss per share of -C$1.43, both of which were worse than expected, even though they showed some year-over-year improvement.

Moreover, free cash outflow for the quarter got worse after rising about 60% to -C$36 million. Nevertheless, for the full year, free cash outflow improved by 24% to -C$177 million, mainly because of lower interest costs after the company reduced its total debt to C$304 million from C$597 million a year ago. Interestingly, though, CEO Luc Mongeau said that the company is working toward positive adjusted EBITDA and free cash flow. Indeed, Canopy plans to cut costs by at least C$20 million over the next 12–18 months by focusing on sales, general, and administrative expenses, as well as cost of sales.

Is CGC Stock a Good Buy?

Turning to Wall Street, analysts have a Hold consensus rating on CGC stock based on one Buy, one Hold, and one Sell assigned in the past three months, as indicated by the graphic below. Furthermore, the average CGC price target of $3.91 per share implies 187.5% upside potential. However, it’s worth noting that estimates will likely change following today’s earnings report.

See more CGC analyst ratings