Licensed cannabis products manufacturing and distribution
Strategic Profile
The company's world-class production and manufacturing operations combined with a culture of financial discipline continue to yield industry leading profitability, with Gross Margin on Cannabis Inventory Sold of 55% and an Adjusted EBITDA margin of 31%. In Q1 2026, Auxly generated $11.3 million of cash flow from operations, up 102% year-over-year, and finished the quarter with a cash balance of over $42 million.
Cyborg Score Rationale
Auxly demonstrates strong operational metrics with industry-leading margins and improving cash generation. However, profitability declined significantly in Q1 2026 despite revenue growth, with net income down 71% year-over-year. The stock trades near multi-year lows at $0.175 CAD, reflecting market skepticism about growth prospects relative to historical valuations.
Top Insights
Q1 2026 revenue grew 22% to CA$39.8M, but net income declined 71% to CA$3.47M and profit margin compressed to 8.7% from 37% in Q1 2025, signaling margin pressure despite top-line growth.
Gross margins on cannabis inventory sold remain industry-leading at 55%, indicating strong production efficiency and brand pricing power.
Revenue is forecast to grow 5.5% per annum on average over the next 2 years, tracking below the 7.7% growth forecast for the Canadian Pharmaceuticals industry.
Auxly initiated a normal course issuer bid (NCIB) in April 2026 and will hold its Annual General Meeting on June 30, 2026.
Named Competitors
Organigram Global — Licensed cannabis producer and distributor
Decibel Cannabis — Cannabis products and wholesale operator
Recent Developments
(May 2026) Q1 2026 results released showing 22% revenue growth to CA$39.8M but 71% net income decline
(May 2026) Announced participation in Lytham Partners Spring 2026 Investor Conference
(April 2026) Filed notice of intention for normal course issuer bid (NCIB) with Toronto Stock Exchange
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