Charlotte’s Web, a U.S. CBD firm, reported another drop in sales for the second quarter. The company cut costs and restructured its business after a major investment from British American Tobacco.
The restructuring comes as the fight over intoxicating hemp – and a looming ban – has become central to the future of the U.S. CBD business, pushing Charlotte’s Web toward a more healthcare-oriented strategy.
CW’s revenues fell by 15%, from $12.8 to $10.9 millions in the second quarter of 2016. The company reported a $4.1 million net loss, compared to a $6.3 million loss in the second half of 2025.
Europe squeezed too
Bill Morachnick, CEO at CBD Inc., spelled out the stakes in March. “If we limit the CBD market to 0.4 mg THC/container it will basically destroy the CBD business as we currently know it.” The federal restrictions should be in place before the end year.
The company stated that it supports rules “that clearly distinguish non-intoxicating full spectrum hemp wellness products from intoxicating drinks and recreational products.”
The United States could be squeezed after European regulators have effectively eliminated much of the CBD ingestible market, including by setting the safe intake limit of only 2mg per day.
Sales slide
Charlotte’s Web stated that the decline in quarterly revenue was primarily due to a restructuring which began in September 2025 and reduced distribution via traditional retail channels. The company is placing more emphasis on direct sales online, healthcare professionals and other botanical wellness product.
The company’s latest results are part of a trend that has been in place for a while. It was once the leading brand on the CBD market in the United States. CW posted a loss of $29.7million and a revenue of $49.9million in 2025.
BAT deal
Charlotte’s Web’s debt was significantly reduced during the third quarter, after BAT traded the debt owed to it for shares of the company. They also invested an extra $10 million.
Charlotte’s Web’s financial position was significantly strengthened by the BAT transactions. The company’s total liabilities dropped to just $20.3 million by the end June, down from $77.3 million in 2025. Cash increased from $8 to $14 million, giving it more breathing space.
Revenue for the first six-months of 2026 fell 12%, to $22 Million from $25.1 Million a year ago. The net loss grew to $17.2 from $12.5. The first-half loss increased primarily due to a noncash accounting charge relating to BAT debt prior its conversion.
Healthcare push
Charlotte’s Web is continuing to follow a strategy that is increasingly tied to regulated health applications for CBD.
DeFloria is a joint venture between AJNA BioSciences, a BAT subsidiary and AJNA BioSciences that is working on a full spectrum botanical drug candidate. Charlotte’s Web holds the commercial manufacturing rights for the drug, if it is approved by the U.S. Food and Drug Administration.
The company is also positioning its full spectrum CBD products to be used in federal healthcare initiatives, while lobbying in the U.S. for rules that differentiate conventional non-intoxicating CBD from synthetic and intoxicating cannabinoids derived from hemp.
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