Q1 2027 Canopy Growth Corp Earnings Call Transcript
Key Points
- Canopy Growth Corp (CGC) reported broad-based growth in Q1 fiscal 2027, with net revenue up 13% year-over-year to $81.2 million, including growth across all business segments.
- Adjusted gross margin improved significantly, up 600 basis points year-over-year to 31%, driven by supply chain efficiencies and cost reduction efforts.
- The Canadian medical cannabis business grew 22% year-over-year, with continued patient count increases, solidifying its position as the number 1 Canadian medical-cannabis provider.
- International cannabis revenue rose 10% year-over-year, with strong performance in Poland (top 3 supplier) and plans to begin shipments to the UK imminently, supporting future growth.
- Storz & Bickel returned to growth with a 6% revenue increase and a substantial gross margin improvement to 48% (from 29% a year ago), reflecting successful operational and cost-efficiency initiatives.
- Canopy Growth Corp (CGC) continues to face headwinds from reduced Veterans Affairs Canada reimbursement rates, impacting margins and EBITDA, despite mitigation efforts.
- The company reported an adjusted EBITDA loss of $3.2 million in Q1, though improved 59% year-over-year, indicating ongoing profitability challenges.
- Cash used in operating activities was $25 million in Q1, higher than expected run rate, with working capital increases and one-time costs expected to balance out later in the year.
- The company noted that cultivation improvements will take time to impact financials, with benefits expected only from the end of Q2 or beginning of Q3, delaying margin expansion.
- Despite progress, Canopy Growth Corp (CGC) remains focused on Canada and international markets, with no immediate plans to prioritize the US market, potentially limiting growth opportunities in a key market.
Good morning. My name is Joanna, and I will be your conference operator today. I would like to welcome you to Canopy Growth's first-quarter fiscal 2027 financial results conference call.
(Operator Instructions)
I will now turn the call over to John Vincic, Investor Relations. John, you may begin the conference call.
Thank you, operator. Good morning and thank you to everyone for joining us.
On our call today, we have Canopy Growth's Chief Executive Officer, Luc Mongeau; and Chief Financial Officer, Tom Stewart.
Prior to the opening of financial markets today, Canopy Growth issued a news release announcing the financial results for its first quarter ended June 30, 2026.
The news release and financial statements have been filed on EDGAR and SEDAR; and will be available on the website under the Investors tab.
Before we begin, I would like to remind you that our discussion during the call will include forward-looking statements that are based on management
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