Cresco Labs delivers strong quarter, maintains market leadership and unlocks new growth opportunities
CHICAGO – (BUSINESS WIRE) – Cresco Labs Inc. (CSE: CL) (OTCQX: CRLBF) (FSE: 6CQ) (“Cresco Labs” or the “Company”), an industry leader in branded cannabis products with a portfolio of some of America’s most popular brands and operator of Sunnyside dispensaries, today announced its financial and operating results for the third quarter ended September 30 of this year. GAAP and in U.S. dollars unless otherwise noted and is available on the Company’s investor website here.
Highlights of the third quarter of 2025
Third quarter revenue: $165 million. Third quarter operating cash flow: $6 million.
Gross profit: $79 million. Adjusted gross profit¹ $80 million; and adjusted gross margin¹ of 48.8%.
SG&A $52 million or 31.3% of revenue.
The net loss of $22 million includes a $16 million loss related to debt repayments related to the refinancing of the Company’s senior secured term loan and a $2 million non-cash impairment charge related to the California assets held for sale.
Third quarter adjusted EBITDA¹ of $40 million and adjusted EBITDA margin¹ of 24.1%.
Maintained #1 stock position in multi-billion dollar markets
Management Commentary
“In Q3, we refinanced our debt and strengthened our balance sheet, delivering solid results and maintaining leadership in key markets through disciplined execution. Our proven retail and wholesale capabilities continue to drive profitability, while new dispensaries in Ohio, expansion into Kentucky, and our upcoming product launch in Germany open the way for growth. Labs to Outperform the Market and Create Sustainable Shareholder Value”.
“The cannabis industry is entering a new phase of growth and consolidation, and Cresco Labs is poised to lead the way. Operators with scale, efficiency and discipline will define the next chapter. Leveraging our core assets and operational excellence, we are building a new growth platform designed to create long-term value, both within and beyond the regulated U.S. regulatory framework.”
Balance sheet, liquidity and other financial information
On August 13, 2025, the Company closed a refinancing of its senior secured term loan to reduce total debt and extend the maturity of the debt to 2030. The $325 million senior secured term loan bears interest at 12.5% per annum and matures on August 13, 2030. repay the Company’s previous $360 million loan.
As of September 30, 2025, current assets were $243 million, including cash, cash equivalents and restricted cash of $79 million. An additional $3 million of restricted cash was classified as a non-current asset. The Company had $309 million of senior secured term loan debt, net of discount and issuance costs, and $18 million of mortgage debt, net of discount and issuance costs.
Total shares outstanding on a fully converted basis were 490,889,023 subordinate voting shares as of September 30, 2025.
¹See “Non-GAAP Financial Measures” at the end of this press release for additional information on the Company’s use of non-GAAP financial measures.
²According to Hoodie Analytics.
Conference call and webcast
The Company will hold a conference call and webcast to discuss its financial results on Wednesday, November 5, 2025 at 8:30 a.m. Eastern Time (7:30 a.m. Central Time). The conference call can be accessed via webcast or by dialing 1-833-470-1428 (US toll-free) or 1-646-844-6383 (US local) and providing access code 307245. Archived access to the webcast will be available for one year on Cresco Labs’ investor website here.
Consolidated Financial Statements
The financial information presented in this press release is based on unaudited management prepared financial statements for the quarter ended September 30, 2025. These financial statements have been prepared in accordance with US GAAP. The Company expects to file its unaudited condensed interim consolidated financial statements for the quarter ended September 30, 2025 on SEDAR+ and EDGAR on or about November 7, 2025. Accordingly, such financial information may be subject to change. All financial information contained in this press release is qualified in its entirety by reference to such financial statements. Although the Company does not expect any material changes to occur between this press release and the consolidated financial statements it files on SEDAR+ and EDGAR, to the extent the financial information contained in this press release is inconsistent with information contained in the Company’s financial statements, the financial information contained in this press release is deemed to be amended or superseded by the financial statements. The preparation of an amended or superseded statement shall not be deemed an admission, for any purpose, that the amended or superseded statement, when made, is misleading for purposes of applicable securities laws. Further, the reader should refer to the additional disclosures in the Company’s audited financial statements for the year ended December 31, 2024, which are filed on SEDAR+ and EDGAR.
Cresco Labs refers to certain non-GAAP financial measures throughout this press release that may not be comparable to similar measures presented by other issuers. Please see the Non-GAAP Financial Measures section below for more detailed information.
Non-GAAP financial measures
This release presents its financial results in accordance with US GAAP and includes certain non-GAAP financial measures that do not have standardized definitions in accordance with US GAAP. Non-GAAP measures include: Adjusted EBITDA; Adjusted EBITDA margin; Adjusted gross profit; Adjusted gross profit margin; Adjusted selling, general and administrative expenses (“Adjusted SG&A”), Adjusted SG&A margin; and Free Cash Flow are non-GAAP financial measures and do not have standardized definitions under US GAAP. The Company defines these non-GAAP financial measures as follows: Adjusted EBITDA as EBITDA less other (expense) income, net, fair value measurement for acquired inventory, adjustments for acquisition and non-core costs, impairment and stock-based compensation; Adjusted EBITDA margin as Adjusted EBITDA divided by revenues, net; Adjusted gross profit as gross profit less fair value valuation of inventory acquired and adjustments to acquisition and non-core costs; Adjusted gross profit margin as adjusted gross profit divided by revenues, net; Adjusted SG&A as SG&A less adjustments for acquisition and non-core costs; Adjusted SG&A margin as adjusted SG&A divided by revenues, net; and Free cash flow as net cash provided by operating activities, less purchases of property and equipment and income from tenant improvement benefits. The Company has provided non-GAAP financial measures that are not calculated or presented in accordance with US GAAP as additional information and in addition to financial measures calculated and presented in accordance with US GAAP, which may not be comparable to similar measures presented by other issuers. These additional non-GAAP financial measures are presented because management has evaluated the financial results, both including and excluding adjusted items, and believes that the additional non-GAAP financial measures presented provide additional perspective and insight in analyzing the underlying operating performance of the business. These additional non-GAAP financial measures should not be used in excess of, as a substitute for, or as an alternative to, and should be considered only in conjunction with, the US GAAP financial measures presented herein. Accordingly, the Company has included below reconciliations of additional non-GAAP financial measures with the most directly comparable financial measures calculated and presented in accordance with US GAAP.
About Cresco Labs Inc
Cresco Labs’ mission is to normalize and professionalize the cannabis industry through a CPG approach, creating national brands and a customer-focused retail experience while acting as the industry’s steward on legislative and regulatory initiatives. As a leader in growing, manufacturing and distribution of branded products, the Company uses its scale and agility to grow its portfolio of brands nationally, which include Cresco, High Supply, FloraCal, Good News, Wonder Wellness Co., Mindy’s and Remedi. The company also operates nationally high-performing dispensaries under the Sunnyside brand, which are focused on building patient and consumer trust and providing continuing education and convenience in a great traditional retail experience. Through year-round policy, community outreach and SEED initiative efforts, Cresco Labs is committed to supporting communities through authentic engagement, economic opportunity, investment, workforce development and legislative initiatives designed to create the most responsible, respectful and robust cannabis industry possible. Learn more about the Cresco Labs journey by visiting www.crescolabs.com or by following the company on Facebook, X or LinkedIn.
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You are reading this week’s edition of New Cannabis Ventures, a weekly magazine we have published since October 2015. The newsletter includes unique insight to help our readers stay ahead of the curve, as well as links to the most important news of the week. We no longer email them like we used to, but post this and all newsletters on our website here.
friends,
With the first month of the year almost half over, the Global Hemp Stock Index rose 0.3% to 6.61. While that’s better than cash, it lags the S&P 500, which gained 1.2%, and notably the Russell 2000, which gained 6.9%.
The global hemp stock index has been in decline over the past five years, falling 4.2% in 2025, its best annual performance since a recent surge in 2020. The hemp industry is so down and should be rallying, but most bets on that outcome have lost money.
The index was recalculated at year-end, with three stocks exiting and two entering, leaving the index with 27 stocks. So far in 2026, 17 are up, with double-digit percentage gains, and 10 are down, including three that are down more than 20%. Here is a table that includes all the companies and some additional information:
The average market cap is $1.1 billion. MSOS is up 4.7% year-to-date, and the index contains 7 MSOs, all of which have gained. The last column shows that five of these seven have negative tangible book value, suggesting potential downside risk for those with significant debt.
I keep a close eye on 16 of the 27 names. Canopy Growth, Cresco Labs, Cronos Group, Curaleaf, GrowGeneration, Green Thumb Industries, Innovative Industrial Properties, WM Technology, Organigram, Chicago Atlantic Real Estate Finance, Scotts Miracle-TilrayrA BTrumsndce, Villa Verano. I’ve covered most of the others and written about RYTHM and SNDL on Seeking Alpha.
The drops include two recent additions that got me thinking more about inclusion rules. These two as well as others have very low market caps. They all met the minimum price rule and minimum average daily trading value criteria, and they are in the cannabis sector. The next rebalance, which will take place in March, may include some new rules.
The overall stock market is on the rise, but hemp stocks are still not catching the attention of investors. Shares in the index, up just 0.3% year to date, are trading near their 50-day and 150-day moving averages. MSOs are helping the market so far, while several stocks are hurting it. My model portfolio in the 420 Investor, which did very well in 2025, is outperforming the index so far in 2026. I’m very underweight MSOs relative to the index, own two, slightly overweight Canadian LPs (three names) and have a large overweight in ancillaries (four names). The model portfolio had 19% cash on 1/14.
The cannabis industry suffers from slow growth, increased competition, a slowdown in adult-use states, an uncertain regulatory environment at the federal level, and many unfair taxes (280E) Hopefully things will improve in 2026.
Sincerely,
Alan:
New Cannabis Ventures publishes curated articles as well as exclusive news. Here is what we published last week.
Follow Alan for real-time updates X.com:. Share and discover industry news with like-minded people on the largest group of cannabis investors and entrepreneurs LinkedIn:.
Stay on top of the most important communications from public companies by watching what’s coming cannabis investor calendar.
Based in Houston, Alan leverages his experience as an online community founder 420 Investorthe first and still the largest due diligence platform focused on publicly traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. time New Cannabis Ventureshe is responsible for content development and strategic alliances. Before turning his attention to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst with more than two decades of research and portfolio management experience. A prolific writer, with over 650 articles published since 2007 Looking for Alphawhere he has 70,000 followers, Alan is a frequent speaker at industry conferences and frequent source Media including the NY Times, Wall Street Journal, Fox Business and Bloomberg TV. Contact Alan. Twitter: |: Facebook |: LinkedIn: |: El
Michigan hemp sales for the month of December increased from a year ago as they rose 3.8% sequentially, which was +0.5% on a daily basis. At $269.7 million, sales increased by 1.6 percent compared to last year.
The Michigan Cannabis Regulatory Agency breaks down sales by medical and adult use, with medical sales down 50.2% year-over-year to $0.4 million, up 10.8% sequentially, and adult-use sales up 1.7% year-over-year to $269.3 million, up 3.8% sequentially.
The state breaks down sales by category and provides pricing details by category for both medical and adult;
For adultsMedical
As supply continues to expand, prices for adult flowers have plummeted. The average price of $932 a pound in December fell 2.6 percent sequentially to a new record low and fell 15.9 percent from a year earlier.
Michigan hemp sales are expected to grow 82.1% to $1.79 billion in 2021, 27.9% to $2.29 billion in 2022, and 33.3% to $3.06 billion in 2023. forward as supply becomes more accessible and distribution expands.
Based in Houston, Alan leverages his experience as an online community founder 420 Investorthe first and still the largest due diligence platform focused on publicly traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. time New Cannabis Ventureshe is responsible for content development and strategic alliances. Before turning his attention to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst with more than two decades of research and portfolio management experience. A prolific writer, with over 650 articles published since 2007 Looking for Alphawhere he has 70,000 followers, Alan is a frequent speaker at industry conferences and frequent source Media including the NY Times, Wall Street Journal, Fox Business and Bloomberg TV. Contact Alan. Twitter: |: Facebook |: LinkedIn: |: El
You are reading this week’s edition of New Cannabis Ventures, a weekly magazine we have published since October 2015. The newsletter includes unique insight to help our readers stay ahead of the curve, as well as links to the most important news of the week. We no longer email them like we used to, but post this and all newsletters on our website here.
friends,
The hemp industry ended 2025 with a slight decline. The New Cannabis Ventures Global Cannabis Stock Index, which started at 100 at the end of 2012, has fallen 4.2% in 2025 to 6.59. This was the 5th consecutive annual decline.
The AdvisorShares Pure US Cannabis ETF (NYSE Arca: MSOS ) rallied last year, gaining 20.5%, but it’s down a lot since late 2020 when it was at $36.50. The 5-year yield at $4.72 was -87.1%. During that time, the Global Hemp Stock Index fell 85.2 percent, just shy of a recession.
So far in 2026, the global hemp stock index is unchanged. MSOS, which rose in December, fell 3.0% to $4.58. After last year’s big jump, investors probably aren’t too worried just yet. Perhaps they shouldn’t have, because the realignment is still in progress, and if it passes, it’s very incremental because of the elimination 280E tax. Of course, it remains to be seen whether a realignment will actually happen, and if so, when it will happen.
Investors or traders have rushed to MSOS over the past few years in hopes of a reshuffle. The lift in late December had massive volume, surpassing the volume in August when rumors of a possible realignment under Trump first surfaced. It was also heavier than when the MSOS fell after the last election in 2024. So far in 2026, volume has been fairly low, as seen in this six-month chart:
MSOS is still trading above the 12/11 price, as are most of its stocks. It’s also trading up more than 100% from near its all-time low of $2 set last year. To me, while the stock has fallen well from its recent peak, down 36.8% from its 12/18 intraday high, it looks like it could continue to decline. The recent downturn has not spurred buyers. In my 420 Investor model portfolio, I have very little exposure to MSOs compared to the Global Hemp Stock Index, just 6.6% in both MSOs compared to 25.9%.
The ETF, which is slightly leveraged, is loaded with three MSOs, as I’ve discussed before: Curaleaf (OTC: CURLF ), Green Thumb Industries (OTC: GTBIF ) and Trulieve (OTC: TCNNF ) at 67.7% MSOS. Curaleaf, which has a major debt challengeso far in 2026, it has fallen by 1.4% and moved from the second largest position to the third. Trulieve, the current largest holding, fell 5.6%, while GTI, now the second largest, rose 2.0%. MSOS has not purchased or sold shares of any of these MSOs so far in 2026.
I have watched MSOS since its day 1 which was in late 2020. Although I was and continue to be highly critical of the way it was run, I commended them for their early efforts. Unfortunately, there are no cannabis investment funds, including ETFs, that come close to MSOS in terms of assets under management. The ETF has grown its share count dramatically over the past year, despite a recent small drawdown. Investors should understand that if it hits redemptions, it could put pressure on the MSO subsector and the price of MSOS.
It is very possible that hemp will be reclassified with the end of 280E taxation. It is also possible that large MSOs will not have to pay past 280E taxes that they did not pay. If 280E goes away and the previous liabilities go away, it will be very positive for MSOs and it will likely eliminate potential MSOS repayments. Of course, if 280E holds, traders stacked in MSOS will have trouble finding new buyers. No chart will answer this question about the future of the 280E.
I continue to recommend that cannabis investors look beyond just the MSO part of the market. I have discussed several times, as well as recently, that hemp REITs make more senseand I have a lot of exposure to both of them in my modeling portfolio. There are other supporting names that should have upside if the 280E goes away for their customers, but less downside if it stays. Canadian LPs might also make sense. 280E taxation makes no sense and should go away, but it seems premature to suggest that it will.
Sincerely,
Alan:
New Cannabis Ventures publishes curated articles as well as exclusive news. Here is what we published last week.
Follow Alan for real-time updates X.com:. Share and discover industry news with like-minded people on the largest group of cannabis investors and entrepreneurs LinkedIn:.
Stay on top of the most important communications from public companies by watching what’s coming cannabis investor calendar.
Based in Houston, Alan leverages his experience as an online community founder 420 Investorthe first and still the largest due diligence platform focused on publicly traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. time New Cannabis Ventureshe is responsible for content development and strategic alliances. Before turning his attention to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst with more than two decades of research and portfolio management experience. A prolific writer, with over 650 articles published since 2007 Looking for Alphawhere he has 70,000 followers, Alan is a frequent speaker at industry conferences and frequent source Media including the NY Times, Wall Street Journal, Fox Business and Bloomberg TV. Contact Alan. Twitter: |: Facebook |: LinkedIn: |: El
