Tilray’s Focus on Beverages Leads to Growth
Tilray’s interest in beverages is driving growth for the company, with a 26% net revenue increase in the last year. According to Tilray’s earnings report, cannabis revenue saw a 24% increase, and net sales for this year are projected to be between $950 million to $1 billion.
CEO Irwin Simon mentioned in the recent earnings call that the company’s focus on beverages is transforming Tilray into a broader business with a wider reach into new categories.
Over the past 5 years, Tilray has built a lifestyle brand focused on cannabis, which is starting to disrupt the alcohol industry, Simon explained.
Expanding Beverage Portfolio and Market Reach
Last August, Tilray acquired 8 beer brands from Anheuser-Busch, making it the fifth-largest craft brewer in the U.S. with a 4.5% market share. Additionally, the company recently launched a nonalcoholic beer brand called Runner’s High, positioning it as a healthier alternative.
Tilray is concentrating on growing its craft beer and nonalcoholic brands portfolio, aiming to capitalize on the cannabis beverage market when regulations allow. In the meantime, the company is exploring revenue opportunities in other sectors.
Simon mentioned plans to introduce hemp delta 9-derived beverages, which do not come from the cannabis plant but still contain THC. These drinks are ready for sale pending market selection, with Texas and New Jersey being potential launch locations.
Industry Outlook and Regulatory Changes
In an interview with Yahoo! Finance, Simon highlighted the increasing acceptance of cannabis, especially among Gen Z and millennials who consume it more than alcohol. However, he remains cautious about the federal rescheduling of the drug, noting the uncertainty surrounding the timeline for such changes.
Xochitl Hinojosa, from the Department of Justice, mentioned the department’s interest in reclassifying marijuana from a Schedule I to a Schedule III controlled substance, similar to Tylenol. While no specific timeline was provided, this shift could have significant implications for the cannabis industry.