Aurora Cannabis Announces Fiscal 2026 Second Quarter Results
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Expands YoY Global Medical Cannabis Net Revenue
1 by 15% to Record
$70.5 million -
Increases International Medical Cannabis Net Revenue
1 by 22% to Record
$42.7 million , with leadership positions across key markets -
Delivers Adjusted EBITDA1 growth of 52%, reaching
$15.4 million -
Maintains Strong Balance Sheet with
$141.9 million of Cash and Debt-Free Cannabis Business2
NASDAQ | TSX: ACB
"Aurora's quarterly performance highlights our continued focus on profitable growth. We achieved record net revenue1 for global medical cannabis representing a 15% year-over-year increase, while adjusted EBITDA1 rose 52%. These strong results affirm our strategic prioritization of medical cannabis as the industry's most compelling growth area," said Executive Chairman and Chief Executive Officer,
"Our number one position in
"Looking ahead, we intend to deliver continued strong results for our shareholders supported by a sizable cash balance and debt-free2 cannabis business," concluded
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__________________________________ |
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1 |
This press release includes certain non-GAAP financial measures, which are intended to supplement, not substitute for, comparable GAAP financial measures. See "Non-GAAP Measures" below for reconciliations of non-GAAP financial measures to GAAP financial measures. |
|
2 |
Aurora's only remaining debt is non-recourse debt of |
Second Quarter 2026 Highlights
(Unless otherwise stated, comparisons are made between fiscal Q2 2026 and Q2 2025 results and are in Canadian dollars)
Consolidated Revenue and Adjusted Gross Profit:
Total net revenue1 was
Consolidated adjusted gross margin before fair value adjustments1 was 61% in Q2 2026 and 54% in the prior year period. Adjusted gross profit before FV adjustments1 was
Medical Cannabis:
Medical cannabis net revenue1 was
The increase in medical cannabis net revenue1 of
Adjusted gross margin before fair value adjustments1 on medical cannabis net revenue reached 69% for the three months ended
Consumer Cannabis:
Aurora's consumer cannabis net revenue1 was
Adjusted gross margin before fair value adjustments1 on consumer cannabis net revenue1 was 27%, an increase from 15% compared to the prior year period. The increase from the prior year period is primarily due to cost improvements resulting from spend efficiencies.
Plant Propagation:
Plant propagation net revenue1 was wholly comprised of the Bevo business, and contributed
Adjusted gross margin before fair value adjustments1 on plant propagation revenue was 10% for Q2 2026 and 19% for the prior year period. The decrease is from costs incurred related to inventory write-offs caused by a non- recurring quality issue, as well as some surplus crops that were not sold, during the first quarter of fiscal 2026.
Adjusted Selling, General and Administrative ("Adjusted SG&A"):
Adjusted SG&A1 was
Net Income (Loss):
Net loss from continuing operations for the three months ended
Adjusted Net Income:
Adjusted net income1 was
Adjusted EBITDA:
Adjusted EBITDA1 increased 52% to
Fiscal Q3 2026 Expectations:
For Q3 2026, we expect to see consolidated net revenue1 increase year over year, driven primarily by 8% to 12% growth in our Global Medical Cannabis segment.
Plant propagation revenue1 is expected perform in line with traditional seasonal trends, as 25% to 35% of revenues are normally earned in the second half of a calendar year.
Consolidated adjusted gross margins1 are expected consolidated adjusted gross margins are expected to remain strong, driven primarily by industry leading margins in our cannabis business, with plant propagation adjusted gross margins expected to mostly perform in line with historical trends. Continued strength in our adjusted gross margins and higher global medical cannabis revenue, should lead to year over year annual adjusted EBITDA1 growth.
Free cash flow1 is expected to be positive in Q3 2026, due to continued strong performance and improved operating cash use.
Key Quarterly Financial Results
|
($ thousands) |
Three months ended |
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|
September |
|
$ Change |
% |
September |
$ Change |
% |
|
|
Financial Results |
|
|
|
|
|
|
|
|
Net revenue (1a) |
90,366 |
98,023 |
(7,657) |
(8 %) |
81,122 |
9,244 |
11 % |
|
Medical cannabis net revenue (1a) |
70,530 |
64,768 |
5,762 |
9 % |
61,316 |
9,214 |
15 % |
|
Consumer cannabis net revenue (1a) |
6,868 |
7,875 |
(1,007) |
(13 %) |
10,422 |
(3,554) |
(34 %) |
|
Plant propagation revenue |
11,557 |
23,947 |
(12,390) |
(52 %) |
8,634 |
2,923 |
34 % |
|
Adjusted gross margin before FV adjustments on total net revenue (1b) |
61 % |
52 % |
N/A |
9 % |
54 % |
N/A |
7 % |
|
Adjusted gross margin before FV adjustments on total cannabis net revenue (1b) |
65 % |
64 % |
N/A |
1 % |
57 % |
N/A |
8 % |
|
Adjusted gross margin before FV adjustments on medical cannabis net revenue (1b) |
69 % |
69 % |
N/A |
0 % |
68 % |
N/A |
1 % |
|
Adjusted gross margin before FV adjustments on consumer cannabis net revenue (1b) |
27 % |
33 % |
N/A |
(6 %) |
15 % |
N/A |
12 % |
|
Adjusted gross margin before FV adjustments on plant propagation net revenue (1b) |
10 % |
6 % |
N/A |
4 % |
19 % |
N/A |
(9 %) |
|
Adjusted SG&A expense(1d) |
35,547 |
37,353 |
(1,806) |
(5 %) |
31,722 |
3,825 |
12 % |
|
Adjusted EBITDA (1c) |
15,372 |
10,827 |
4,545 |
42 % |
10,136 |
5,236 |
52 % |
|
Adjusted net income (1g) |
7,109 |
3,689 |
3,420 |
93 % |
3,021 |
4,088 |
135 % |
|
Free cash flow (1e) |
(42,274) |
9,228 |
(51,502) |
(558 %) |
(26,433) |
(15,841) |
(60 %) |
|
|
|
|
|
|
|
|
|
|
Balance Sheet |
|
|
|
|
|
|
|
|
Working capital (1f) |
299,729 |
308,416 |
(8,687) |
(3 %) |
306,976 |
(7,247) |
(2 %) |
|
Cannabis inventory and biological assets (2) |
186,905 |
195,620 |
(8,715) |
(4 %) |
176,395 |
10,510 |
6 % |
|
Total assets |
756,863 |
837,839 |
(80,976) |
(10 %) |
807,391 |
(50,528) |
(6 %) |
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|
|
|
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(1) |
These terms are defined in the "Cautionary Statement Regarding Certain Non-GAAP Performance Measures" section of our management's discussion and analysis in the second quarter 2026 period ending |
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|
|
a. |
Refer to the "Revenue" and "Cost of Sales and Gross Margin" section for a reconciliation of cannabis net revenue to the IFRS equivalent. |
|
|
|
b. |
Refer to the "Adjusted Gross Margin" section for reconciliation to the IFRS equivalent. |
|
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c. |
Refer to the "Adjusted EBITDA" section for reconciliation to the IFRS equivalent. |
|
|
|
d. |
Refer to the "Operating Expenses" section for reconciliation to the IFRS equivalent. |
|
|
|
e. |
Refer to the "Liquidity and Capital Resources" section for a reconciliation to the IFRS equivalent. |
|
|
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f. |
"Working capital" is defined as Current Assets less Current Liabilities as reported on the Company's Consolidated Statements of Financial Position. |
|
|
|
g. |
Refer to "Adjusted Net Income" section for reconciliation to the IFRS equivalent. |
|
(2) |
Represents total biological assets and inventory, exclusive of merchandise, accessories, supplies, consumables and plant propagation biological assets. |
||
|
(3) |
In connection with the audit of the Annual Financial Statements, the Company noted that inventory and lease obligation were misstated, impacting the interim condensed consolidated financial statements filed during the 2025 fiscal year. Certain balances in the interim condensed consolidated financial statements as at and for the three months ended |
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Conference Call
Aurora will host a conference call today,
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DATE: |
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TIME: |
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WEBCAST: |
About Aurora Cannabis
Aurora is opening the world to cannabis, serving both the medical and consumer markets across
Aurora's common shares trade on the NASDAQ and TSX under the symbol "ACB".
Forward Looking Statements
This news release includes statements containing certain "forward-looking information" within the meaning of applicable securities law ("forward-looking statements"). Forward-looking statements are frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements made in this news release include, but are not limited to, statements regarding the Company's Q2 fiscal 2026 results; statements under the heading "Fiscal Q3 2026 Expectations", including, but not limited to, those related to consolidated net revenue, plant propagation revenue, consolidated adjusted gross margins, adjusted EBITDA, and expectations for free cash flow to be positive in Q3; statements regarding the Company's continued focus on profitable growth; the strategic prioritization of medical cannabis as the industry's most compelling growth area; the Company's ongoing competitive advantages in world-class manufacturing and people, cutting-edge breeding and genetics, and regulatory expertise; the Company's continued capacity and consistency of supply to effectively compete in the medical cannabis market; the Company plans to deliver continued strong results, supported by a sizable cash balance and debt-free cannabis business; and statements regarding the Company's conference call to discuss results.
These forward-looking statements are only predictions. Forward looking information or statements contained in this news release have been developed based on assumptions management considers to be reasonable. Material factors or assumptions involved in developing forward-looking statements include, without limitation, publicly available information from governmental sources as well as from market research and industry analysis and on assumptions based on data and knowledge of this industry which the Company believes to be reasonable. Forward-looking statements are subject to a variety of risks, uncertainties and other factors that management believes to be relevant and reasonable in the circumstances could cause actual events, results, level of activity, performance, prospects, opportunities or achievements to differ materially from those projected in the forward-looking statements. These risks include, but are not limited to, the magnitude and duration of potential new or increased tariffs imposed on goods imported from
Non-GAAP Measures
This news release contains reference to certain financial performance measures that are not recognized or defined under IFRS (termed "Non-GAAP Measures"). As a result, this data may not be comparable to data presented by other licensed producers of cannabis and cannabis companies. Non-GAAP Measures should be considered together with other data prepared in accordance with IFRS to enable investors to evaluate the Company's operating results, underlying performance and prospects in a manner similar to Aurora's management. Accordingly, these non-GAAP Measures are intended to provide additional information and to assist management and investors in assessing financial performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The information included under the heading "Cautionary Statement Regarding Certain Non-GAAP Performance Measures" in the FY26 Q2 MD&A is incorporated by reference into this news release. The MD&A is available on the Company's issuer profiles on SEDAR+ at www.sedarplus.com and on the U.S. Securities and Exchange Commission's (the "SEC") EDGAR website at www.sec.gov.
Net Revenue, Adjusted Gross Profit and Margin
Net revenue, adjusted gross profit before FV adjustments, and adjusted gross margin before FV adjustments are Non-GAAP Measures and can be reconciled with revenue, gross profit and gross margin, the most directly comparable GAAP financial measures, respectively, as follows:
|
($ thousands) |
Three months ended |
Six months ended |
|||
|
|
|
|
|
September |
|
|
Medical cannabis net revenue(1) |
|
|
|
|
|
|
Canadian medical cannabis net revenue |
27,879 |
27,674 |
26,269 |
55,553 |
53,386 |
|
International medical cannabis net revenue |
42,651 |
37,094 |
35,047 |
79,745 |
55,131 |
|
Total medical cannabis net revenue(1) |
70,530 |
64,768 |
61,316 |
135,298 |
108,517 |
|
|
|
|
|
|
|
|
Consumer cannabis net revenue(1) |
6,868 |
7,875 |
10,422 |
14,743 |
21,955 |
|
|
|
|
|
|
|
|
Wholesale bulk cannabis net revenue(1) |
1,411 |
1,433 |
750 |
2,844 |
2,370 |
|
|
|
|
|
|
|
|
Total cannabis net revenue(1) |
78,809 |
74,076 |
72,488 |
152,885 |
132,842 |
|
|
|
|
|
|
|
|
Plant propagation revenue |
11,557 |
23,947 |
8,634 |
35,504 |
31,715 |
|
|
|
|
|
|
|
|
Total net revenue(1) |
90,366 |
98,023 |
81,122 |
188,389 |
164,557 |
|
(1) |
Net revenue is a Non-GAAP Measure and is defined in the "Cautionary Statement Regarding Certain Non-GAAP Performance Measures" section of the FY26 Q2 MD&A. Refer to the "Cost of Sales and Gross Margin" section of the FY26 Q2 MD&A for a reconciliation to IFRS equivalent. |
Adjusted EBITDA
The following is the Company's adjusted EBITDA:
|
($ thousands) |
Three months ended |
Six months ended |
|||
|
|
|
|
|
|
|
|
Net income (loss) from continuing operations |
(53,165) |
(19,381) |
1,435 |
(72,546) |
4,885 |
|
Income tax expense (recovery) |
6,190 |
(3) |
(1,065) |
6,187 |
1,303 |
|
Other income (expense) |
28,381 |
(838) |
(2,966) |
27,543 |
(9,765) |
|
Share-based compensation |
4,969 |
2,186 |
4,468 |
7,155 |
7,487 |
|
Depreciation and amortization |
6,833 |
5,566 |
6,380 |
12,399 |
13,118 |
|
Business development costs |
321 |
361 |
991 |
682 |
1,992 |
|
Inventory and biological assets fair value and impairment adjustments |
15,134 |
13,929 |
529 |
29,063 |
(11,819) |
|
Business transformation costs (1) |
5,869 |
6,141 |
3,623 |
12,010 |
8,233 |
|
Non-recurring costs (2) |
840 |
2,866 |
(3,259) |
3,706 |
(1,796) |
|
Adjusted EBITDA (3) |
15,372 |
10,827 |
10,136 |
26,199 |
13,638 |
|
(1) |
Business transformation costs include certain IT project costs, costs associated with the repurposing of Sky and Sun, severance and retention costs in connection with the business transformation plan, sublease income and costs associated with the retention of certain medical aggregators. |
|
(2) |
Non-recurring costs includes inventory count adjustments resulting from inter-site transfers and litigation costs. |
|
(3) |
Adjusted EBITDA is a Non-GAAP Measure and is not a recognized, defined, or standardized measure under IFRS. Refer to "Cautionary Statement Regarding Certain Non-GAAP Performance Measures" section of the MD&A. Prior period comparatives were adjusted to include the adjustments for markets under development, business transformation costs and non-recurring charges related to non-core bulk cannabis wholesale to be comparable to the current period presentation. |
|
(4) |
In connection with the audit of the Annual Financial Statements, the Company noted that inventory and lease obligation were misstated, impacting the interim condensed consolidated financial statements filed during the 2025 fiscal year. Certain balances in the interim condensed consolidated financial statements as at and for the three months ended |
Adjusted Net Income
The following is the Company's adjusted net income (loss):
|
($ thousands) |
Three months ended |
Six months ended |
|||
|
|
|
|
|
|
|
|
Net income (loss) from continuing operations |
(53,165) |
(19,381) |
1,435 |
(72,546) |
4,885 |
|
Inventory and biological assets fair value and impairment adjustments |
15,134 |
13,929 |
529 |
29,063 |
(11,819) |
|
Business development costs |
321 |
361 |
991 |
682 |
1,992 |
|
Impairment of property, plant and equipment |
525 |
— |
— |
525 |
129 |
|
Impairment of intangible assets and goodwill |
31,901 |
— |
— |
31,901 |
— |
|
Deferred tax expense - impairment of intangible assets and goodwill |
5,856 |
— |
— |
5,856 |
— |
|
Business transformation costs (1) |
5,697 |
5,914 |
3,325 |
11,611 |
7,687 |
|
Non-recurring costs (2) |
840 |
2,866 |
(3,259) |
3,706 |
(1,796) |
|
Adjusted net income (3) |
7,109 |
3,689 |
3,021 |
10,798 |
1,078 |
|
(1) |
Business transformation costs include certain IT project costs, costs associated with the repurposing of Sky and Sun, severance and retention costs in connection with the business transformation plan, and costs associated with the retention of certain medical aggregators. |
|
(2) |
Non-recurring costs includes inventory count adjustments resulting from inter-site transfers and litigation costs. |
|
(3) |
Adjusted Net Income is a Non-GAAP Measure and is not a recognized, defined, or standardized measure under IFRS. Refer to "Cautionary Statement Regarding Certain Non-GAAP Performance Measures" section of the MD&A. |
|
(4) |
In connection with the audit of the Annual Financial Statements, the Company noted that inventory and lease obligation were misstated, impacting the interim condensed consolidated financial statements filed during the 2025 fiscal year. Certain balances in the interim condensed consolidated financial statements as at and for the three months ended |
Adjusted SG&A
Adjusted SG&A is a Non-GAAP Measure and can be reconciled with sales and marketing and general and administrative expenses, the most directly comparable GAAP financial measure, as follows:
|
|
Three months ended |
Six months ended |
|||
|
($ thousands) |
|
|
|
|
|
|
General and administration |
27,464 |
28,628 |
22,265 |
56,092 |
45,018 |
|
Sales and marketing |
14,329 |
14,455 |
13,721 |
28,784 |
27,745 |
|
Business transformation costs (3) |
(6,089) |
(5,491) |
(4,264) |
(11,580) |
(9,361) |
|
Non-recurring costs (4) |
(157) |
(239) |
— |
(396) |
(284) |
|
Adjusted SG&A (1) |
35,547 |
37,353 |
31,722 |
72,900 |
63,118 |
|
(1) |
Adjusted SG&A is a Non-GAAP Measure and is not a recognized, defined, or standardized measure under IFRS. Refer to the "Cautionary Statement Regarding Certain Non-GAAP Performance Measures" section of the FY26 Q2 MD&A. |
|
(2) |
In connection with the audit of the Annual Financial Statements, the Company noted that inventory and lease obligation were misstated, impacting the interim condensed consolidated financial statements filed during the 2025 fiscal year. Certain balances in the interim condensed consolidated financial statements as at and for the three months ended |
|
(3) |
Business transformation costs include certain IT project costs, severance and retention costs in connection with the business transformation plan, sublease income and costs associated with the retention of certain medical aggregators. |
|
(4) |
Non-recurring costs includes litigation costs. |
Free Cash Flow
The table below outlines free cash flow for the periods ended:
|
|
Three months ended |
Six months ended |
|||
|
($ thousands) |
|
|
|
|
|
|
Cash provided by (used in) operating activities from continuing operations before |
(3,929) |
(2,410) |
5,091 |
(6,339) |
1,411 |
|
Changes in non-cash working capital |
(36,445) |
12,545 |
(29,384) |
(23,900) |
(16,844) |
|
Net cash provided by (used in) operating activities from continuing operations |
(40,374) |
10,135 |
(24,293) |
(30,239) |
(15,433) |
|
Less: maintenance capital expenditures(1) |
(1,900) |
(907) |
(2,140) |
(2,807) |
(4,510) |
|
Free cash flow(2) |
(42,274) |
9,228 |
(26,433) |
(33,046) |
(19,943) |
|
(1) |
Maintenance capital expenditures are comprised of costs to sustain facilities, machinery and equipment in working order to support operations and excludes discretionary investments for revenue growth. |
|
(2) |
Free cash flow is a Non-GAAP Measure and is not a recognized, defined, or a standardized measure under IFRS. Refer to the "Cautionary Statement Regarding Certain Non-GAAP Performance Measures" section of the FY26 Q2 MD&A. |
|
(3) |
Certain previously reported amounts have been adjusted for a reclassification of restricted cash to cash and cash equivalents as at |
Working Capital
Working capital is a Non-GAAP Measure and can be reconciled with total current assets and total current liabilities, the most directly comparable GAAP financial measure, as follows:
|
($ thousands) |
Three months ended |
||
|
|
|
|
|
|
Total current assets |
423,845 |
465,301 |
416,071 |
|
Total current liabilities |
(124,116) |
(156,885) |
(109,095) |
|
Working capital |
299,729 |
308,416 |
306,976 |
View original content to download multimedia:https://www.prnewswire.com/news-releases/aurora-cannabis-announces-fiscal-2026-second-quarter-results-302604871.html
SOURCE Aurora Cannabis Inc.
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