High Tide’s Earnings Call Highlights Growth Amid Challenges

High Tide, Inc. ((TSE:HITI)) has held its Q2 earnings call. Read on for the main highlights of the call.

High Tide, Inc. recently held its earnings call, revealing a generally positive sentiment with strong growth in its bricks-and-mortar segment, significant market share gains, and successful expansion of its Cabana Club loyalty program and White Label products. However, the company faces challenges in its e-commerce segment and uncertainties regarding the regulatory environment in Germany.

Expansion Milestone: 200th Canna Cabana Store

High Tide announced the opening of its 200th Canna Cabana location in Sherwood Park, Alberta, marking a significant expansion milestone. This achievement underscores the company’s commitment to expanding its footprint and solidifying its position as a leading cannabis retail brand in Canada.

Same-Store Sales Growth

The company reported a 6.2% year-over-year increase in same-store sales, the fastest rate in five quarters. This impressive growth includes a remarkable 132% increase from October 2021 to March 2025, highlighting the effectiveness of High Tide’s retail strategies.

Market Share Increase

High Tide’s market share climbed to 12% in the provinces where they operate, up from 11%, despite representing only 6% of the total store count in these areas. This indicates a strong competitive position and effective market penetration strategies.

Strong Financial Performance

High Tide reported a trailing revenue of more than $550 million, with bricks-and-mortar revenue up 16% year-over-year. This robust financial performance underscores the strength of its core retail operations.

Cabana Club Membership Growth

The Cabana Club loyalty program reached 1.9 million members across Canada, up 33% year-over-year. The ELITE tier of the program grew by an impressive 120% year-over-year, reflecting strong customer engagement and loyalty.

Queen of Bud Brand Success

Cumulative sales of the Queen of Bud brand reached $1.4 million, with a significant increase in availability and sales of White Label products. This success highlights the brand’s growing popularity and market presence.

E-Commerce Segment Struggles

High Tide’s e-commerce segment, which represents 3% of consolidated revenue, continues to be a challenge, impacting adjusted EBITDA negatively. The company is working to address these challenges to improve its online sales performance.

Challenges in Achieving EBITDA Neutrality

Despite strong performance in the bricks-and-mortar segment, High Tide faces challenges in reaching its goal of EBITDA neutrality. The company is focusing on optimizing its operations to overcome these hurdles.

Potential Regulatory Uncertainties in Germany

The German government’s review of cannabis laws and potential changes in telemedicine regulations add uncertainty to High Tide’s planned expansion into the European market. The company is closely monitoring these developments to adapt its strategy accordingly.

Forward-Looking Guidance

During the earnings call, High Tide provided forward-looking guidance, reporting a revenue of $137.8 million for Q2, marking an 11% year-over-year increase. The company plans to surpass 300 stores nationwide, with a robust pipeline of over a dozen stores under construction. Despite challenges in the e-commerce segment, High Tide achieved an adjusted EBITDA of $8.1 million, up 14% sequentially, and generated $4.9 million in free cash flow in Q2.

In summary, High Tide’s earnings call highlighted strong growth in its bricks-and-mortar segment, significant market share gains, and successful expansion of its loyalty program. However, challenges remain in the e-commerce segment, and uncertainties in the regulatory environment could impact future expansion plans. The company remains focused on optimizing its operations and expanding its retail footprint to drive future growth.