Canopy Growth jumps as Q2 results allay going concern fears

[Medical Oil Cannabis - marijuana oil, resin and flowers with Canada flag on the mirror black background.]
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Shares of Canopy Growth (CGC [https://seekingalpha.com/symbol/CGC]) added ~19% in the premarket on Friday after the Canadian cannabis player announced Q2 results for fiscal 2026, resolving investor concerns over its ability to function as a going concern. [https://seekingalpha.com/news/4518449-canopy-growth-gaap-eps-of-c001-beats-by-c017-revenue-of-c6668m-misses-by-c514m]

For the quarter ending Sept. 30, the Ontario-based Canadian LP reported C$298.1M in cash and cash equivalents, which topped its debt balances by C$70M. “As a result, conditions that previously raised substantial doubt concerning the company's ability to continue as a going concern have been resolved,” the company said.

Canopy (CGC [https://seekingalpha.com/symbol/CGC]) also posted a C$1.6M net loss for the period, beating Street forecasts by C$0.17 per share on C$66.7M of revenue, which, however, trailed the consensus by C$5.1M despite ~6% YoY growth powered by its Canadian sales.

Revenue from the company’s cannabis segment grew ~12% YoY to C$50.8M, driven by its Canadian adult-use cannabis sales, which added C$23.9M to the topline with ~30% YoY growth, offsetting a ~39% YoY contraction in international markets.

Meanwhile, CGC’s Storz & Bickel accessories segment brought in C$15.8M in net revenue, indicating a ~10% YoY decline, which the company attributed to strong sales performance in the prior-year period and consumer economic uncertainty.

While the company’s gross margin slipped 200 bps to 33% amid lower Cannabis gross margins, its SG&A expenses decreased ~13% YoY, driven by operational efficiencies, cutting the operating loss by ~63% YoY to C$16.8M.

“We’re building a stronger, more competitive company defined by continued momentum in Canada adult-use cannabis, consistent growth in Canada medical cannabis, and a disciplined approach to strengthening our balance sheet,” CEO Luc Mongeau remarked. [https://seekingalpha.com/pr/20298635-canopy-growth-reports-second-quarter-fiscal-2026-financial-results-company-continues-to#hasComeFromMpArticle=false]

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