MW Tilray's stock slumps as cannabis and beer maker plans to cut its drinks lineup

By Steve Gelsi

Beer and cannabis company's revenue falls short of analyst estimates

Tilray Brands Inc.'s stock fell in premarket trading on Friday after the beer and cannabis company said it expects a $20 million impact on its full-year revenue as it embarks on a cost-cutting plan to reduce the number of alcohol beverage brands in its portfolio.

Tilray $(TLRY)$ also fell short of revenue expectations for its second fiscal quarter, while its net loss widened.

Tilray's stock was down 8.8% in premarket trading on a robust volume of nearly 2 million shares.

Tilray announced a plan to reduce its portfolio of 20 beer, spirits and non-alcoholic drinks. The move is expected to impact its full-year revenue by $20 million, but the company said it will help accelerate revenue growth by focusing on more successful brands. The company didn't provide details on which brands will be promoted or cut back.

So far, the efforts have resulted in a $8 million loss in revenue in the first half of its fiscal 2025 due to the moves, as well as discontinuing brands in some areas "due to market conditions."

Tilray said its second-quarter loss increased to $85.28 million, or 10 cents a share, from a loss of $46.18 million, or 7 cents a share, in the year-ago quarter.

The company broke even on an adjusted basis, while the FactSet consensus estimate was for a loss of 3 cents a share.

Revenue rose 9% to $210.95 million, but fell short of the analyst estimate of $217.7 million.

Alcoholic beverage net revenue rose by 36% to $63 million.

Cannabis revenue fell $1 million to $66 million, while gross margin in the business rose to 35% from 31%

Prior to Friday's moves, Tilray's stock had fallen about 28% in the past year. The stock has risen about 14% in the past month.

-Steve Gelsi

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January 10, 2025 08:29 ET (13:29 GMT)

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