Smoke

Canopy Growth sales soar 22% on "beyond the leaf" initiatives

Tuesday, August 11, 2020 by Snacks
_When the CBD-infused treats hit all at once_

When the CBD-infused treats hit all at once

Q2 hits right... Canopy Growth, Earth's most valuable cannabis company, just hit investors with stronger-than-expected earnings. Somehow Canopy's sales were 22% higher than the same quarter last year despite recreational weed sales in Canada falling overall. Canopy stock popped 8% on the news. To smoke the wider market, the Canadian cannabis giant focused beyond the leaf:

  • Beverages: Canopy expanded distribution of CBD-infused sparkling water and sports drinks. It more than 2X'd its beverage production in July, and is now the #1 producer of weed-related drinks in Canada.
  • E-CBD: Canopy launched a US online shop for CBD products like softgels, oils, and wrinkle creams.
  • Martha Stewart: Launching soon, Martha is partnering on a line of CBD-based animal health products (for when your dog needs to chill).

To put it bluntly... Canopy slashed spending. It sadly cut over 18% of its employees since December and shut some of its cannabis-growing greenhouses. That left it more $$$ to invest in the above mentioned growth initiatives. Canopy was also able to significantly narrow its quarterly loss from $194M to $128M.

THE TAKEAWAY

"Beyond the leaf" is key... The late 2018 "weed bubble" has popped. Consumer demand for legalized weed in Canada didn't meet hyped expectations, and cannabis companies found they'd over-produced. Now...

  • Canopy stock is down 65% from its 2018 high, Aurora is down 92%, and Tilray — which reported a buzz killing massive loss yesterday — is down 95%.
  • Going "beyond the leaf" with consumer products like CBD drinks and creams is more important than ever. That majorly helped Canopy's growth last quarter.
Subscribe to Snacks