Tilray no longer expects positive free cash flow in 2024 after Q3 earnings

Tilray Brands Inc (NASDAQ: TLRY) is trading down in premarket on Tuesday after reporting lower than expected revenue for its fiscal third quarter.

Tilray stock down on future guidance

The cannabis company is in the red this morning also because its management issued downbeat future guidance for the full year.

$TLRY now forecasts adjusted EBITDA to fall between $60 million and $63 million but said it no longer expects positive free cash flow (adjusted) in fiscal 2024. Still, Irwin D. Simon – the chief executive of Tilray Inc said in a press release today:

Our playbook of expanding cannabis business to complementary markets such as beverages and hemp-based consumer products has positioned us well to navigate the current environment and to benefit from future growth opportunities.

The Nasdaq-listed firm noted 165% growth in its alcoholic beverages segment to $54.7 million in the third quarter. Tilray stock is still up roughly 50% versus its year-to-date low.

Notable figures in Tilray Q3 earnings

• Lost $104.98 million versus the year-ago $1.19 billion
• Per-share loss also narrowed from $1.90 to 12 cents
• Adjusted EBITDA declined to $10.2 million as per the earnings report
• Revenue climbed 30% year-over-year to $188.3 million
• Consensus was 5 cents loss on $198.4 million in revenue
• Adjusted gross margin stood at 27% in fiscal Q3

Tilray reported an annualised increase of 33% in its cannabis revenue in Q3 on the back of HEXO and Truss acquisitions. CEO Simon also said on Tuesday:

We made several notable achievements during the third quarter, including reducing our convertible debt balance, completing our Canadian and international cannabis cost reduction plans, and strengthening our balance sheet.