Vireo Earnings + Call Notes
Stealth consolidator on track to become the biggest canna co. in world.
$209.3M Revs*; est. $166M
$41.5M AEBITDA; est. $45.4M
$95.3M GP; est. $79.7M
45.5% GM; est. 48%
($6.3M) OpIncome; est. $19.8M
($20M) NI; est. $15.2M
($0.01) EPS; est. $0.30
*$254.9m pro forma revenue
Q2 GAAP revenue of $209.3 million +335% year-over-year.
^ driven by recently closed M&A transactions.
Q2 proforma revenue of $254.9 million, gives effect to the acquisitions of Hawthorne, Bridgewell, and PharmaCann as if they were completed on April 1, 2026.
Assuming completion of acquisitions, Vireo will become the largest U.S. cannabis operator by dispensary count with approximately 270 dispensaries, and among the largest U.S. cannabis companies by revenue.
Closed the Hawthorne, Eaze and Bridgewell transactions during the second quarter.
Announced the FLUENT and C21 acquisitions during Q2, which will expand our retail footprint in Florida and further strengthen our platform in Nevada.
Subsequent to quarter end, closed the PharmaCann acquisition, deepening our position in Colorado, and entered PA through the acquisition of PhytoNatural dispensary licenses.
Subsequent to quarter end, announced an asset purchase agreement, to acquire select Cannabist assets, which will expand our key Colorado platform and mark our entry into Massachusetts, New Jersey, and Illinois.
Subsequent to quarter end, announced a merger agreement with Planet 13 which will deepen our positions in Nevada and Florida while expanding our Illinois platform.
Subsequent to quarter end, announced a four-deal transaction through securities purchase agreements to establish a fully-built vertical operation in Ohio, our 15th state.
Announced a new asset-based revolving credit facility with a $65M initial commitment, expandable to $85M with an additional $20M accordion (up to $105M total), priced at Term SOFR + 1.75%–2.00%.
Company closed Q2 with $122.7 million in cash; expects to remain acquisitive.
Management Commentary
“We believe the cannabis industry is entering a period where scale alone is no longer enough. Companies that create lasting value will be those that combine disciplined capital allocation, operational excellence, and the ability to integrate businesses efficiently.
Every acquisition we announced during the quarter reflects that philosophy. Rather than pursuing growth for its own sake, we are building a diversified cannabis and agribusiness platform where each investment strengthens the value of the broader organization.
With our pending transactions, Vireo has assembled one of the industry’s largest operating footprints while remaining focused on improving profitability, expanding free cash flow, and building $100 million-plus businesses across our core markets over time.
As we strategically diversify our platform, the Hawthorne and Bridgewell acquisitions establish the foundation of our national agribusiness supply platform, extending our reach beyond cannabis and forming the basis of our non-cannabis reporting segment.
We believe the investments we are making today will position the Company to demonstrate the full earnings power of our platform as integration activities continue into 2027.”
John Mazarakis, Chief Executive Officer of Vireo Growth
Call Notes
One of the most differentiated growth strategies in the cannabis industry.
Closed several important transactions, including Eaze, Hawthorne.
Several transformative transactions in Q2.
6 including Fluent (expanding in FL)
^ C21 (expanding NV) ⭐
^ Planet 13 (expanding NV + FL)
2 significant strategic transactions in July.
^ Asset purchase agreement to acquire certain assets of the Cannabist
^ 4-deal transaction to enter OH (15th state added to VREO)
Fluent has substantial scale and operating leverage in FL.
Cannabist solidifies market leadership in CO.
^ provides entry into MA NJ IL, 3 new states.
Bringing Cannabist assets under MSA while await acquisition approvals.
Over 100 stores.
^ 2nd largest footprint in FL.
OH transaction provides 8 dispensaries and fully vertically integrated platform.
4th largest cannabis company last quarter.
$1b pro forma revenue today.
^ doesn’t include revenues of Fluent, Cannabis, Planet 13, and OH acquisition 👀
10 states today.
Expect to operate 270 dispensaries across 15 states.
^ would become the largest operating platform in the US
Competitive advantage via experience integrating and operating complex businesses.
Decentralized operating model. 👀
Building a diversified cannabis and agribusiness platform.
Thoughtful capital allocation.
Don’t pursue acquisitions to become larger.
All acquisitions must strength existing markets.
^ provide FCF, supply chain opportunities, or strengthen/broaden platform.
Decentralized leadership.
^ believe local operating teams make better decisions on their markets.
Want to build $100m revenue across all core states.
Will not be slowing down.
Expect 2027 brings a clearer financial picture of financial vision.
$209.3m total revenue, up 335% YoY.
$175.8m cannabis revenue, up 265% YoY.
$33.5m agribusiness revenue.
$254.9m pro-forma revenue.
^ doesn’t include Fluent, C21, Cannabist, Planet 13, Ohio.
7% pro forma YoY retail revenue growth.
^ strong performance in markets where acquisition integrations are complete.
Excl non-cash inventory adjustments (FV step up on transactions).
47% GM, 430bps decline QoQ.
^ driven by non-cannabis segment (lower margin)
Cannabis adj GM of 53%.
^ +120bps YoY
Non-canna GM of 18%.
($0.1m) net loss vs. ($14.9m) in YoY period.
$41.5m adj EBITDA.
^ $22m improvement YoY.
790bps decline in adj EBITDA margin YoY.
^ driven by non-cannabis business segment and lower margin cannabis assets
22.4% cannabis adj EBITDA margin.
6.3% non-cannabis adj EBITDA margin.
Positioned to continue acting on organic and non-organic strategic opportunities.
Entered new asset-based lending facility w/ BMO for $65m initial commitment.
^ expandable to $85m and $105m.
^ industry leading rate of SOFR + 1.75-2%
One of the most under-levered companies in cannabis.
Buying at the right multiples.
Running a very decentralized model.
^ allows to run fast, integrate quickly, maintain local control.
Objective is to get to a sustainable long term market share with meaningful tailwinds, that is at least $100m/market
Will never say no to deals that are priced right.
Continue to evaluate every company out there.
Looking at existing and new states, at the right price.
MSOS really the only institutional pathway to meaningful liquidity.
Federal change will come slowly.
Regardless, prepared to mitigate risk that comes via that change, whether interstate commerce, or otherwise.
^ have a plan if and when this happens, but don’t think it is any time soon.
Unsure if its fair to assume 7% SSS growth going forward due to such a large retail platform, but believe will at least deliver low single digits.
View CO CF as non-volatile, CO margin around 20% being a long-term equilibrium for the industry.
Overall margin impacted by agri-business.
^ high single digit margin, moving to low double digit.
/end
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CB1 has a position and nothing herein should be considered advice.