Canopy Growth’s Mixed Quarter: Losses Narrow but Earnings Miss

Shares of Canopy Growth Corporation showed muted movement at the start of the week, following the release of the Canadian cannabis producer's quarterly results last Friday. While the company made significant progress in cutting its overall losses, its earnings per share fell short of analyst projections.

A key development for Canopy Growth's financial stability was completed in January 2026: a comprehensive recapitalization. This move extended the maturity of all the company's outstanding debt obligations to 2031, providing crucial liquidity relief and eliminating near-term refinancing pressure.

Furthermore, the company confirmed its planned acquisition of MTL Cannabis remains on schedule for completion within the current quarter. Valued at approximately $125 million, the transaction is anticipated to be immediately accretive to earnings. MTL Cannabis reported annual revenue of $84 million last year.

A Closer Look at the Financials

For its third fiscal quarter of 2026, which ended December 31, 2025, Canopy Growth posted net revenue of 74.5 million CAD. This figure was largely unchanged year-over-year but exceeded market estimates of roughly 70.5 million CAD.

Should investors sell immediately? Or is it worth buying Canopy Growth?

A breakdown of the key metrics reveals a mixed picture:

• Cannabis Revenue: 52 million CAD (a 4% year-over-year increase)
• Adjusted EBITDA Loss: 2.9 million CAD (representing a 17% improvement)
• Net Loss: Reduced by 49% compared to the prior year
• Loss Per Share: 0.18 CAD – this was notably higher than the consensus estimate of 0.08 CAD
• Cash Position: 371 million CAD

Chief Executive Officer Luc Mongeau highlighted the company's "improved fundamentals" and its integrated operating model as stabilizing factors, particularly within the Canadian recreational and medical cannabis sectors.

The Persistent US Regulatory Hurdle

These financial results are set against a backdrop of shifting regulations in the United States. While the reclassification of marijuana to a Schedule III substance provides tax relief for U.S. operators (via the 280E rule), it does not grant Canadian companies like Canopy Growth direct access to the U.S. THC market. A pathway would only materialize following full federal legalization.

Investor attention is now likely to focus on the successful integration of MTL Cannabis and management's stated goal of returning to a positive adjusted EBITDA by fiscal year 2027.