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Sep 30
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SNDL Q3 2025 Earnings Report
SNDL's financial and operational results for the third quarter ended September 30, 2025 were reported.
Key Takeaways
SNDL reported strong third-quarter results, achieving record free cash flow and significant growth in its Cannabis business, despite a decline in the Liquor retail segment. The company maintained a strong balance sheet with no debt and substantial unrestricted cash.
Net revenue increased by 3.1% year-over-year, reaching $244.2 million, primarily driven by a 13.5% growth in the combined Cannabis business.
The company achieved a record free cash flow of $16.7 million for the quarter, driven by a reduction in working capital.
Operating loss was $(11.1) million, impacted by non-cash share-based compensation, inventory adjustments, and fixed asset write-offs.
SNDL maintains a strong financial position with $240.6 million in unrestricted cash and no debt, enabling strategic organic and inorganic growth opportunities.
SNDL
SNDL
SNDL Revenue by Segment
Revenue by Segment
Cannabis Retail Revenue
CapyFin.comCannabis Operations Revenue
CapyFin.comTotal Cannabis Revenue
CapyFin.comLiquor Retail Revenue
CapyFin.com Forward Guidance
SNDL plans to continue its growth trajectory through strategic acquisitions, organic investments in new store openings, and facility ramp-ups, while leveraging its strong balance sheet to avoid issuing equity or incurring high-interest debt.
Positive Outlook
- Acquisition of 32 cannabis retail stores from 1CM Inc. for $32.2 million, pending regulatory review.
- Targeted CAPEX and working capital investments for five new Cannabis store openings and two new Wine & Beyond stores in Q4.
- Completion of capacity ramp-up at Atholville cultivation facility, contributing to international sales.
- Partial sale of equity position in High Tide Inc., realizing a gain of $5.3 million in Q3.
- Expected resolution of SunStream restructuring process to provide exposure to dynamic medical cannabis markets.
Challenges Ahead
- Continued softness in market demand affecting Liquor Retail net revenue.
- Industry-wide volume declines impacting convenience banners (Ace Liquor and Liquor Depot).
- Operating loss impacted by non-cash items such as share-based compensation and inventory adjustments.
- Restructuring charges of $1.5 million incurred during the quarter.
- Fixed asset write-off related to the idle Stellarton facility.
Revenue & Expenses
Visualization of income flow from segment revenue to net income