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Canopy Shares Slide as Analysts Surprised by Revenue Decline

  • Results mark the second quarter of sequentially lower sales
  • Large harvest, growing inventory bright spot in a weak quarter
An employee works in the Mother Room at the Canopy Growth facility in Smith Falls, Ontario, Canada.

An employee works in the Mother Room at the Canopy Growth facility in Smith Falls, Ontario, Canada.

Photographer: Chris Roussakis/Bloomberg
Updated on

Canopy Growth Corp. shares tumbled as much as 14% to the lowest since January after the pot producer reported revenue that missed the lowest analyst estimate and appeared to lose its first-place share of the Canadian market.

Canopy also posted a decline in recreational cannabis revenue and took an C$8 million writedown to account for potential reimbursements to its wholesale customers for unsold product. Analysts agree that it was a broadly disappointing quarter, but say the one bright spot is Canopy’s large harvest and growing inventory, which could position it well to compete as new derivative products such as edibles are legalized in Canada later this year.