Canopy Growth Revenue Rises 22% as International Sales Jump 141%

Canopy Growth (CGC ) reported on November 6, 2026 that net revenue rose 22% year over year to C$81.4 million in its fiscal 2027 second quarter, covering the three months ended September 30, 2026. International cannabis revenue jumped 141%, while the quarter also produced a wider net loss and a lower consolidated gross margin. All amounts are in Canadian dollars.

Cannabis segment net revenue increased 30% to C$66.2 million. International markets contributed C$12.3 million, up from C$5.1 million a year earlier, primarily because of strong sales in Germany and Poland. In Canada, medical cannabis revenue rose 18% to C$25.8 million and adult-use revenue increased 17% to C$28.1 million.

MTL Cannabis contributed to both Canadian categories. Medical growth reflected an increase in insured customers as well as the acquisition, partly offset by the Canadian government’s reduction in the Veterans Affairs Canada reimbursement rate. Adult-use growth came primarily from higher MTL-related flower sales, partly offset by lower opportunistic bulk sales. Storz & Bickel moved in the opposite direction: revenue declined 4% to C$15.1 million, a decrease Canopy attributed primarily to lower customer spending in certain geographic regions.

Acquisition Growth Comes With Margin Pressure

Revenue growth did not carry through to reported gross margin. Consolidated gross margin fell to 29% from 33%, while adjusted gross margin declined to 31% from 33%. The adjusted measure strips out specified acquisition-related inventory charges, including C$2.1 million of MTL inventory step-up costs this quarter. Cannabis gross margin fell to 26% from 31%, and adjusted Cannabis gross margin slipped to 29% from 31%, primarily because of the reduced reimbursement rate.

Storz & Bickel’s gross margin improved to 39% from 38% despite lower revenue, which Canopy linked to cost efficiencies and product mix. Selling, general and administrative expenses rose 9% as MTL operations were added, though headcount reductions and other cost initiatives offset part of that increase.

Fair-Value Charges Widen Net Loss

Net loss widened to C$40.7 million from C$5.0 million, with basic and diluted loss per share increasing to C$0.10 from C$0.02. Canopy attributed the deterioration to C$35.8 million of fair-value charges on Canopy USA-related assets. Those charges help explain why stronger revenue did not produce a smaller bottom-line loss.

Adjusted EBITDA loss, a non-GAAP measure that excludes other income and expense among other adjustments, narrowed 6% to C$2.9 million from C$3.0 million. Canopy linked the improvement to Cannabis revenue growth and cost savings, partly offset by the lower reimbursement rate. Chief Financial Officer Tom Stewart said the results placed Canopy “within reach of reporting positive adjusted EBITDA during fiscal 2027,” a target rather than a reported result.

Free cash outflow also narrowed, to C$15.5 million from C$19.2 million. Canopy defines free cash flow as cash from operating activities less purchases of and deposits on property, plant and equipment. Lower operating cash use drove the improvement, partly offset by capital expenditures at production facilities intended to improve cultivation consistency and output.

International Operations Expand

Canopy paired the revenue growth with an expanded international operating footprint. Its Smiths Falls facility received European Union Good Manufacturing Practice certification, while Kincardine’s certification was renewed. The company also entered the United Kingdom through distribution partner GROW Group U.K. Ltd. with four Canadian-grown Spectrum Therapeutics flower strains, appointed a country manager for Germany, and broadened its Australian portfolio with two new product formats, additional oil and softgel formulations, and two new flower SKUs.

The quarter combines faster cannabis revenue growth with continued margin and bottom-line pressure. International and Canadian cannabis revenue grew, adjusted EBITDA loss and free cash outflow narrowed, but the lower medical reimbursement rate compressed Cannabis margins while the Canopy USA charges drove the much larger net loss. The open question for the rest of fiscal 2027 is whether Canopy’s expanded supply chain and cultivation spending can sustain revenue growth while eliminating the remaining adjusted EBITDA loss.