Tilray dips after sales miss

Tilray dipped in premarket trading after reporting revenue that missed analyst estimates for its most recent quarter.

The Canadian cannabis company reported sales of $185.8 million, which is slightly above what it sold in the same period last year, but below the $210 million analysts were expecting. The company has been increasingly selling more booze than cannabis but has continued to struggle to grow its revenue and turn a profit.

“We expect that beverage segment sales may remain under pressure in the near term due also to extended consumer economizing and increased competitive pressures,” Bloomberg Intelligence senior analyst Kenneth Shea wrote. “Cannabis segment sales may grow modestly, assuming rising contributions from international operations more than offset challenging conditions in the Canadian adult-use market, beset by intense price competition.”

Tilray also reported a net loss of $793.5 million, compared to a $34.8 million net loss analysts polled on FactSet were expecting. About $700 million of that loss consisted of noncash impairments, primarily from changes in the value of convertible notes based on its stock price dipping, the company said.

The stock had fallen as much as 5% in premarket trading — a modest move for a stock at its price, representing less than a penny change in the value of the shares — before its recovery. With its stock trading below $1 per share, a reverse stock split likely looms to ensure the shares continue to be listed on the Nasdaq exchange.