Tilray (NASDAQ: TLRY) reported a loss of 32 cents per share in the second quarter, more than double what it reported last year, as rising operating expenses continue to weigh on its bottom-line. This was wider than analysts’ projection of a loss of 25 cents per share.
Revenue came in at $45.9 million, up 371% year-over-year and above analysts’ prediction of $41.1 million, driven by the Manitoba Harvest acquisition, the legalization of the Canadian adult-use market, and growth in Europe.
Total kilogram equivalents sold tripled to 5,588 kilograms from 1,514 kilograms in the prior-year period. However, the average net selling price per gram decreased to $4.61 from $6.38 a year ago.
TLRY shares were down 5.9% immediately following the announcement. The stock has tumbled 80% since its IPO last year. However, it has stabilized from April, trading mostly between $40 and $50.
Gross margin increased sequentially to 27% from 23% in the prior quarter.
Though Tilray has put in a considerable amount of investments into beverage and retail partnerships, there is rising criticism that even these initiatives are overvalued in the markets. It’s hard to be sure though, given we are at the early stages of the cannabis industry.
As Tilray trailed behind its rivals in the medical marijuana segment, it shifted its focus to the abundant opportunities in the CBD-infused food products industry. The acquisition of Manitoba Harvest and more recently, UK-based alcohol gummy maker Smith & Sinclair, were aimed at producing food products based on cannabinoid.
READ: Canopy Growth earnings preview: Q1 crucial in the recent turn of events
In Q2, revenue from Food Products segment grew to $19.9 million, representing almost 43% of total revenues.
However, the Federal Drug Administration recently questioned the authenticity and safety aspects of such products, besides initiating the first hearing on it two weeks ago.
Rival Aurora Cannabis (NYSE: ACB) will report earnings results on August 20, while Canopy Growth (NYSE: CGC) will report on August 14.
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