Canopy Growth Corporation (TSX: WEED) (Nasdaq: CGC) announced its financial results for the second quarter ended September 30, 2022 today. All financial information below is reported in Canadian dollars, unless otherwise indicated, and compared to the previous quarter.

Q2 Financial Highlights

• Total Revenue: +7.1% to $117.9M
  • Canadian: -0.2% to $52.3M 
    • • Recreational: -2.3% to $38.1M
      • Medical: +6.0% to 14.2M
        • Total Adj. Gross Margin: (15%)
  • International: -23.2% to $10.6M
    • • • Adj. Gross Margin: 23% 
  • Total Cannabis: -5% to $62.9M
    • • Share of Total Revenue: 54%
  • Other Consumer Products: +25.3% to $55.0M
    • • BioSteel (beverages): +67.0% to $29.9M
        • Adj. Gross Margin: 26%
    • Storz & Bickel (vaporizers): -13.5% to $13.5M
      • • Adj. Gross Margin: 44%
    • The Works: +25.5% to $6.9M
      • • Adj. Gross Margin: 49%
    • Other: -4.1% to $4.7M
  • Consumer Products Share of Total Revenue: 46%
• Net Income (Loss): Loss declined from $(2,083.1)M to $(231.9)M
• Adj. EBITDA: Loss increased by 4.4% to $(78.1)M
• Long Term Debt: -18.4% to $1,032,134

Management Commentary

David Klein, Chief Executive Officer, said:

• “Our second quarter marks a key inflection point for Canopy, demonstrating momentum across our key businesses and accelerating
  our entry into the U.S. cannabis market through the creation of Canopy USA. Canopy is ideally positioned to capitalize on this once-in-a-generation opportunity and accelerate our path to North American cannabis market leadership.”

Judy Hong, Chief Financial Officer, said:

• "We delivered solid sequential quarterly net revenue growth and improved margins, led by another record quarter for BioSteel, the
  stabilization of our Canadian cannabis business, and continued actions to reduce overall costs. We are pressing forward on our path to
  profitability in Canada and expect Canopy USA will meaningfully enhance our growth and profitability over time once it closes the
  announced acquisitions of Acreage, Jetty, and Wana.”

Q2 Operational Highlights

• Announced comprehensive plan to fast-track entry into the U.S. cannabis market through the creation of a new U.S. domiciled holding company, Canopy USA, LLC which is expected to accelerate growth and market expansion.
• Announced divestiture of Canadian retail operations, ensuring cost reduction program remains on track to deliver $70-$100 million
  in Selling, General & Administrative ("SG&A") savings. In addition, the Company continues to assess opportunities to focus the
  Company's Canadian cannabis operations.

Stock Performance

• The stock price:
  • declined 4.2% during the 3-month period of Q2 (July, August, September),
  • declined another 21.2% in October,.
  •  jumped 62.9% between October 24th and October 31st as a result of the announcement of a plan to create a new U.S., domiciled holding company, Canopy USA, LLC
  • retraced by 14% between the end of October and yesterday and
  • has shown marginal weakness today as a result of the release of the Q2 financial report.

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