Difficult Environment For Cannabis Retail And Brand Customers Reflected In Leafly's Q3 Results

Cannabis e-commerce platform Leafly Holdings, Inc. LFLY announced its financial results on Thursday for the third quarter ended Sept. 30, 2023, revealing a 10% year-over-year decrease in revenue to $10.6 million.

“Cannabis markets continue to experience pain points of various types, but the industry continues to evolve,” Leafly's CEO Yoko Miyashita said. “The Leafly platform plays an important role, providing the technology retailers need to drive consumer sales and e-commerce shopping experiences. With a strategic focus on profitability, we are carefully managing expenses which we believe will set us up for growth as the cannabis market matures and recovers."

Q3 Financial Highlights

• Gross profit totaled $9.42 million, down from $10.2 million in the prior year’s period.
• Gross margin was 89%, a year-over-year improvement from the gross margin of 87% in the prior year’s period.
• Total operating expense was $10.9 million, a 33% reduction from $16.3 million in the prior year’s period.
• Net loss was $2.2 million, compared to net income of $15.5 million in the corresponding quarter of last year, which included a $22.3 million non-cash benefit from a change in fair value derivative liabilities.
• Adjusted EBITDA, a non-GAAP measure, came in negative at $0.2 million compared to an adjusted EBITDA loss of $5.2 million in the third quarter of 2022.
• Ended the quarter with $14.5 million, excluding restricted cash, essentially flat compared to the previous quarter.
• On September 29, 2023, the company received formal notice from the Nasdaq Stock Market LLC that it regained compliance with the minimum bid price rule.

“We continue to focus on operating with efficiency and managing costs," Suresh Krishnaswamy, CFO of Leafly said. "Our third quarter results are a reflection of the difficult environment our retail and brand customers are facing, driven by lack of access to banking and capital, license delays, and margin compression.”

Q4 2023 Financial Guidance

Based on current business trends and conditions, the financial outlook is expected to be around $9.5 million in revenue; adjusted EBITDA loss is expected to be around $1.3 million, the Seattle-based company reported.

LFLY Price Action

Leafly’s shares traded 1.73% lower at $6.25 per share during the pre-market session on Friday morning.

Related News

• Former Co-Founder Of Leafly Talks Cannabis And Artificial Intelligence
• Want To Increase The Value Of Your Home? Legalizing Weed Sparks A 41% Jump, Study Shows

•  47.10% with $GTBIF
•  40.23% with $TCNNF
•  21.50% with $VFF