Tilray's Beverage Bet Pays Off, but the Bottom Line Still Won't Cooperate

Tilray posted record Q1 revenue of $257.1M, up 23%, but swung to a $40M net loss as cannabis revenue fell and adjusted EBITDA declined.

Tilray Brands delivered its strongest first-quarter top line on record, yet the company's earnings power moved in the opposite direction. The cannabis and beverage group reported net revenue of $257.1 million for the first quarter of fiscal 2027, a 23% jump from a year earlier — a figure management flagged as a quarterly record. Gross profit followed suit, climbing 35% to $77.5 million, also a company best for a first fiscal quarter.

Those headline gains, however, stopped short of the adjusted operating line. Adjusted EBITDA slipped to $9.2 million from $10.2 million in the prior-year period, and the company swung to a net loss of $40.0 million. Twelve months earlier, Tilray had posted a modest net profit of $1.5 million. The gap between expanding revenue and shrinking profitability is what shaped the market's cool reception to the Thursday release.

Cannabis Drags as Beverages Surge

The divergence inside Tilray's portfolio explains much of the disconnect. Beverage revenue nearly doubled, rising to $101.5 million from $55.7 million, while the cannabis segment contracted to $56.1 million from $64.5 million. In other words, the group's overall growth was powered by drinks even as its legacy cannabis business lost ground — a split that analysts and investors treated as a central weakness rather than a footnote.

That uneven performance matters because it undercuts any reading of the quarter as a broad-based improvement. The revenue beat was not enough to satisfy expectations, and the softer cannabis numbers were cited among the reasons for the negative share price reaction. The stock remained under pressure following the report, with a daily move of -4.8%.

Records That Don't Reach the Bottom Line

Tilray's revenue and gross-profit milestones tell only part of the story. A positive adjusted EBITDA is not the same as a net profit, and higher sales do not automatically translate into a stronger result on that measure. Both the net loss and the year-over-year decline in adjusted EBITDA have to be weighed alongside the record figures — and together they paint a less flattering picture than the top line alone suggests.

Management, for its part, left its full-year guidance untouched despite the weaker quarterly operating result. Tilray reiterated an adjusted EBITDA range of $68 million to $75 million for fiscal 2027. That outlook is a forecast for the year as a whole, not a result already banked, and it stands apart from the net loss recorded at the start of the fiscal year.

Wall Street Trims Its Target

Analysts adjusted their expectations in the wake of the numbers. Canaccord Genuity lowered its price target on Tilray to $4.00 from $4.50 on Friday, while keeping a hold rating on the shares.

The takeaway for investors is a mixed one. The beverage unit is expanding briskly, gross profit is improving, and the annual operating forecast remains in place. Against that, the net loss and the pullback in cannabis revenue weigh on how the quarter should be judged. What matters going forward is not revenue growth by itself, but whether that growth can finally be converted into a higher adjusted EBITDA.