[PRESS RELEASE] - NEW YORK, Aug. 7, 2025 - Ascend Wellness Holdings Inc. (AWH), a multistate, vertically integrated cannabis operator, reported its financial results for the quarter ended June 30, 2025. Financial results are reported in accordance with U.S. generally accepted accounting principles (GAAP), and all currency is in U.S. dollars.
"With the first half of the year behind us, we have taken pivotal steps to fortify our capital structure and position the company for sustained success," AWH CEO Sam Brill said. "The retirement of our prior term loan strengthens our balance sheet and extends our financial runway, allowing us to execute on our strategic priorities with greater focus and stability. We remain committed to the initiatives identified in recent quarters that are fueling our transformation and driving improved profitability, such as expanding our vertical margin through retail densification and supporting our store footprint with differentiated products and elevated customer experiences. These foundational efforts support our long-term growth strategy as we enter the second half of the year with strong momentum and a clear roadmap ahead."
Frank Perullo, co-founder and president of AWH, said, "Q2 delivered strong progress, including the addition of three new stores in key markets and the debut of our new infused brand, High Wired. We also ramped up commercialization of higher-margin, top-selling SKUs, launching 225 in the first half of 2025. Our products continue to gain strong consumer traction, maintaining the number two brand house position by both sales and units across Illinois, Massachusetts and New Jersey combined for another consecutive quarter. To complement this achievement, we completed the full-scale launch of our new e-commerce ecosystem across our entire footprint. The platform features a completely reimagined tiered loyalty program and mobile app, designed to revolutionize the shopping experience and reward our valued customers with unmatched perks and benefits."
Roman Nemchenko, chief financial officer of AWH, said, "We continue to build a strong, scalable platform to support disciplined expansion as we work to grow our topline. In addition to paying down debt, we reached a significant milestone by achieving positive operating cash flow for ten consecutive quarters and have driven improvements through strong cost controls. While there is still progress to be made, we are confident that the strategic actions implemented in the first half of the year will continue to yield meaningful results in the near-term and we remain steadily focused on delivering value for our shareholders."
Q2 2025 Financial Overview
Net revenue was flat at $127.3 million, with a slight decrease of 0.5% sequentially, of which 2.1% resulted from declines in third-party wholesale revenue that was offset by 1.6% attributable to growth in retail revenue.
Retail revenue totaled $86.5 million, representing a 2.5% increase compared to the prior quarter, primarily driven by the addition of five stores in H1 2025, along with sustained strong performance in Ohio's adult-use market. This growth was partially offset by ongoing pricing pressure across several markets.
Third-party wholesale revenue totaled $40.8 million, a 6.4% decrease from the prior quarter. This reduction was primarily driven by softer sales in Illinois and continued price compression in various markets, offset by an increase in sales in New Jersey.
Q2 2025 gross profit was $41.4 million, or 32.5% of revenue, as compared to $39.6 million, or 30.9% of revenue, in Q1 2025. Adjusted gross profitwas $55.3 million, or 43.4% of revenue, for Q2 2025, as compared to $52.2 million, or 40.8% of revenue, for the prior quarter. This increase was primarily attributable to stronger unit growth and a 260-basis-point lift, partially offset by competitive pricing pressures across both retail and wholesale channels.
Total general and administrative (G&A) expenses for Q2 2025 were $42.4 million, or 33.3% of revenue, compared to $37.1 million, or 29% of revenue, for Q1 2025. The increase was primarily associated with the expansion of operations, partially offset by a benefit from cost-savings initiatives previously implemented.
Net loss attributable to AWH for Q2 2025 was $24.4 million, compared to $19.3 million in Q1 2025, primarily driven by higher G&A expenses, partially offset by a contribution from improved margins and continued cost-saving and operational efficiency initiatives.
Adjusted EBITDA was $28.6 million in Q2 2025 compared to $27 million for Q1 2025, with an adjusted EBITDA margin of 22.4%, a 130-basis-point increase over Q1 2025. This improvement was driven by an increase in adjusted gross profit of 260 basis points and the benefits of continued cost-savings initiatives, and was partially offset by continued pricing pressure and slightly higher G&A expenses.
Cash and cash equivalents at the end of Q2 2025 were $95.3 million, and net debt was $254.3 million. Cash from operations was $17.8 million in Q2 2025, representing the 10th consecutive quarter of positive operating cash flow, and free cash flow was $12.1 million.