Ascend Wellness Reports Q1 Revenue of $128M

[PRESS RELEASE] – NEW YORK, May 12, 2025 – Ascend Wellness Holdings Inc. (AWH), a vertically integrated multistate cannabis operator focused on bettering lives through cannabis, reported its financial results for the quarter ended March 31, 2025. Financial results are reported in accordance with U.S. generally accepted accounting principles (GAAP) and all currency is in U.S. dollars.

Business Highlights 

• AWH continues to implement its densification strategies, expected to lead to an approximately 50% increase in stores in the medium-term. In its efforts to expand, the company will continue to focus its expansion on high-density populations centers and premier locations.
  • Currently, the company is targeting 10 new stores to come online in 2025, including three in Ohio and one in Pennsylvania.
  • In Illinois, three partner stores have now opened, Markham in Q1, and North Riverside and Lynwood subsequent to the quarter end, with an additional partnership opportunity recently identified.
  • In New Jersey, the company expects to open its first partner store in Little Falls in the coming months, with three additional partner locations identified for later this year.
• Focus on cost reductions to support the company’s transformational initiatives that have had a positive impact on adjusted EBITDA¹ of $27 million and adjusted gross margin¹ 40% in the first quarter.
• The company has continued to make solid progress in improving its balance sheet and working capital, highlighted by the $100 million of cash and cash equivalents on hand and the generation of $5.9 million in cash from operations.
• Launched a share buyback program in January 2025. Pursuant to a normal course issuer bid (NCIB), the company may repurchase up to the lesser of: (i) 10,215,690 shares of the company’s class A common stock (common shares); and (ii) $2.25 million worth of common shares in the open market. As of April 30, 2025, the company has repurchased 1,571,500 common shares via the NCIB program.

Financial Highlights

• Revenue:
  • Total net revenue declined 5.9% quarter-over-quarter to $128 million.
  • Retail revenue decreased 6.6% quarter-over-quarter to $84.4 million.
  • Wholesale revenue decreased 4.4% quarter-over-quarter to $43.6 million.
• Net Loss:
  • Net loss of $19.3 million in Q1 2025 compared to net loss of $16.8 million in Q4 2024.
• Adjusted EBITDA¹:
  • Adjusted EBITDA¹ was $27 million for Q1 2025, representing a 21.1% margin¹. Adjusted EBITDA¹ EBITDA Margin has decreased 10.7%.¹ decreased 110 basis points quarter-over-quarter.
• Balance Sheet
  • As of March 31, 2025, cash and cash equivalents were $100 million, a sequential increase of $11.7 million. Net debt², which equals total debt less unamortized deferred financing costs less cash and cash equivalents, was $233 million.
• Cash Flow
  • Generated $5.9 million of cash from operations in Q1 2025, representing the ninth consecutive quarter of positive operating cash flow, and free cash flow³ of $1.2 million.

Management Commentary

“Building on the groundwork we laid in 2024, we have begun to execute the key steps needed to drive long-term value across our business,” CEO Sam Brill said. Our top priorities will remain improving profitability, increasing asset efficiency, and improving cash flow. Our strong balance sheet allows us to advance our densification strategies and roll out consumer-focused initiatives across all of our locations, such as a new e-commerce system. The actions that we took are expected to begin delivering measurable benefits by the end of the year.

Frank Perullo is the co-founder of the company and its president. He said that “we have worked hard to prepare the business to be successful and in the months to come, we expect to launch new products and open locations to help advance our strategy for densification.” This initiative reflects our commitment towards expanding access and improving consumer experiences, as well as reinforcing the position of a leader in a market that is becoming more dynamic and competitive.

Roman Nemchenko (CFO) concluded: “Overall, the quarter was a success for us. We strengthened our cash position and finished the quarter in a very strong financial situation.” We will be able to take advantage of accretive deals in an environment that is becoming more buyer-friendly, and pursue strategic opportunities for further strengthening our capital structure. Our team has been executing with discipline, so we’re well-positioned to achieve our long-term objectives.”

Q1 2025 Financial Overview

Net revenue decreased by 5.9% sequentially to $128 million, of which 4.4% of the decrease was attributable to a decline in retail revenue and 1.5% of the decrease was due to a decline in third-party wholesale revenue. Retail revenue totaled $84.4 million, representing a 6.6% decrease compared to the prior quarter, primarily due to the softening of sales in Illinois, Michigan, New Jersey and Massachusetts resulting from a combination of pricing pressure and volume, partially offset by the contribution of adult-use sales in Ohio and the ramp of new partner stores in Illinois. Third-party wholesale revenue totaled $43.6 million, representing a 4.4% decrease compared to the prior quarter, attributable to declines in New Jersey, partially offset by improvements in Illinois.

Q1 2025 gross profit was $39.6 million, or 30.9% of revenue, as compared to $46.9 million, or 34.5% of revenue, in Q4 2024. Q1 2025 adjusted gross profit¹ was $52.2 million, or 40.8% of revenue, as compared to $56.9 million, or 41.9% of revenue, for the prior quarter. Pricing declines due to competitive pressures both in the wholesale and retail sectors were a major factor for this drop.

Total general and administrative (G&A) expenses for Q1 2025 were $37.1 million, or 29% of revenue, compared to $40.8 million, or 30% of revenue, for Q4 2024, reflecting a benefit from certain cost-savings initiatives implemented in late 2024.

Net loss attributable to AWH for Q1 2025 was $19.3 million, compared to $16.8 million in Q4 2024, primarily impacted by lower margins, partially offset by a benefit from certain cost-savings initiatives.

Adjusted EBITDA¹ was $27 million in Q1 2025 and adjusted EBITDA margin¹ The Q4 2018 result was 21,1%. This is a 110 basis-point drop compared with the previous quarter. Lower margins are mainly responsible for this decline.

Cash and cash equivalents at the end of Q1 2025 were $100 million, and net debt² was $233 million. Cash from operations was $5.9 million in Q1 2025, representing the ninth consecutive quarter of positive operating cash flow, and free cash flow³ was $1.2 million.