Cannabis retailer SNDL Q3 revenue falls on product mix shift
SNDL•SNDL's third-quarter revenue fell 2.5% year over year to C$238 million, as a product mix shift weighed on Cannabis Operations. Adjusted operating income turned positive, and the company expects cost-reduction actions to benefit results starting in Q4 2026.
1. Revenue and operations
SNDL's third-quarter revenue fell 2.5% year over year to C$238 million. Gross profit and gross margin declined due to weak Cannabis Operations performance, while adjusted operating income turned positive from a loss a year earlier.
2. Business changes
The company said Cannabis Operations revenue declined mainly because it exited the unprofitable dried flower category and focused more on higher-value products. It also reduced manufacturing costs and operating expenses, including through workforce cuts at its Kelowna facility.
3. Outlook and review
SNDL expects cost-reduction actions to benefit results starting in Q4 2026 and is conducting a strategic review of Cannabis Operations to improve financial performance. It expects its Value Buds franchise network to resume growth in Ontario after a regulatory resolution.
