Green Thumb Lifts Revenue 5% as Schedule III Tax Relief Kicks In

Green Thumb Industries reported its second-quarter 2026 results on August 4, 2026: revenue of $306.7 million, up 4.6% over the same period last year, and GAAP net income of $4.9 million, or $0.02 per basic and diluted share, against a $0.6 million loss in the prior-year quarter.

The Chicago-based multistate operator, which owns the RISE Dispensaries retail chain, posted normalized EBITDA of $84.3 million, or 27.5% of revenue, and cash flow from operations of $29.0 million. Cash at quarter end totaled $283.6 million against total debt of $283.0 million.

During the quarter, the company repurchased the equivalent of roughly 7.9 million subordinate voting shares for $48.3 million, at an average price of $6.11 per share.

“There is real momentum in the business, and we are building on it with a disciplined approach and a solid balance sheet,” said founder, chairman and CEO Ben Kovler. “Material developments are underway in Virginia and Texas, two states that together account for roughly 12% of the U.S. population. Virginia is one of the largest states yet to open recreational retail, with adult-use sales launching July 1, 2027, while our conditional license under Texas’ Compassionate Use Program positions us to serve patients as access expands.”

Green Thumb’s second quarter by the numbers

• Revenue: $306.7 million, up 4.6% year over year
• Gross profit: $137.9 million, or 45.0% of revenue, down from 49.9% a year earlier
• GAAP net income: $4.9 million, versus a $0.6 million loss in the second quarter of 2025
• Normalized EBITDA: $84.3 million, or 27.5% of revenue
• Income tax expense: $12.5 million, down from $21.6 million
• Cash and equivalents: $283.6 million; total debt: $283.0 million
• Share repurchases in the quarter: $48.3 million for the equivalent of about 7.9 million shares

How the RYTHM licensing deal reshaped Green Thumb’s margins

The most striking line in the release is what happened to gross margin. The 45.0% figure is down from 49.9% in the prior-year quarter, and the company attributes the decline to two forces: price compression across key markets, and licensing fees on the RYTHM (RYM ) brand now running through cost of goods sold. Those fees totaled $15.8 million in the quarter, against zero a year earlier, because Green Thumb previously owned the intellectual property it now licenses.

The structure is a consequence of last year’s deal, in which the company sold its incredibles intellectual property and hemp business to RYTHM, Inc. and became a brand licensee. The company’s preferred profitability metric, normalized EBITDA, adds those license fees back to adjusted EBITDA, which is why the normalized figure ($84.3 million) sits well above the $68.6 million adjusted EBITDA and the $53.1 million unadjusted EBITDA in the company’s reconciliation table. Read one way, the core business held roughly flat year over year; read another, $15.8 million a quarter now leaves the building as brand rent.

The second margin pressure is deliberate, per management. Selling, general and administrative expenses rose to $117.9 million, or 38.4% of revenue, from $106.8 million, or 36.4%, a year earlier, driven by higher compensation and benefits costs tied to planned changes in the company’s pay structure. President Anthony Georgiadis said the investment in the team “weighed on EBITDA margins in the near term” and described it as a retention decision.

Working the other direction: income tax expense fell to $12.5 million from $21.6 million, which the company attributes to the Department of Justice’s final order moving state-legal medical cannabis to Schedule III under the Controlled Substances Act, effective April 28, 2026. That change ended the federal cannabis tax penalty for portions of the business, freeing the taxed income line for the first time. On the revenue side, growth came primarily from Minnesota retail following the state’s adult-use launch on September 17, 2025, plus Connecticut, Florida and Ohio, partially offset by price compression and competition. Comparable sales across the 103 stores open at least 12 months declined 1.1%.

The story so far for Green Thumb

The quarter lands on top of a busy twelve months for the company. Last year it divested the incredibles IP and hemp business into RYTHM, Inc.; separately, the company was named alongside Cresco and Verano in a federal racketeering lawsuit over adult-use marketing claims. In December 2025, President Trump signed the order rescheduling cannabis to Schedule III, setting up the tax relief that showed up in this quarter’s income statement.

In Virginia, Governor Abigail Spanberger and state lawmakers announced a compromise on June 16, 2026 creating a legal retail market with sales beginning July 1, 2027, and state regulators have already opened the rulemaking process for that launch. Green Thumb has operated in Virginia since 2021 and holds one of the state’s five vertically integrated medical licenses, six RISE dispensaries and a grower-processor facility. The compromise lets existing medical licensees convert to adult use for a one-time $10 million fee.

Closer to its retail base, the company launched adult-use sales at RISE Paramus in New Jersey on July 13, 2026, the same week the NLRB certified that roughly 269 workers across four of its New Jersey facilities had voted to decertify UFCW Local 360, and opened RISE Hanover in Pennsylvania on July 31, 2026. Georgiadis said the company held the number-one brand share position in Illinois, Pennsylvania, Ohio, Maryland and Minnesota during the quarter, per the company’s own figures.

What happens next for Green Thumb

Management was scheduled to discuss the quarter on an earnings call at 5:00 p.m. Eastern on August 4, 2026, with a replay archived on the company’s investor relations site.

The buyback clock is the nearer deadline: the company has $62.3 million of repurchase authority remaining, available through September 22, 2026. It has so far repurchased the equivalent of about 29.5 million shares for $203.4 million at an average price of $6.90, against the $6.11 average it paid this quarter.

Virginia’s adult-use market opens July 1, 2027, giving Green Thumb eleven months from the August report to decide on and execute its conversion from medical-only operator in a state where it already grows, processes and sells at six stores.