Leafly Achieves Strong Q1 2023 Results: Revenue $11.2M, Net Loss Improves, Retail Accounts Grow By 5.2%

Leafly Holdings, Inc. LFLY, a leading online cannabis discovery marketplace, announced its financial results on Thursday for its first quarter ended March 31, 2023.

“Our first quarter results reflect a continued focus on our strategy and our commitment to building a path to profitability. Macro challenges have put overall pressure on the cannabis industry, particularly in our brand advertising business," said Yoko Miyashita, CEO of Leafly.

First Quarter Financial Results

• Revenue was $11.2 million, down 1.5% from Q1 2022.
• Gross margin was 88%, improved from 87% in Q1 2022.
• Total operating expense was $14.9 million, down 14.7% from $17.4 million in Q1 2022, reflecting the impact of recently announced cost-cutting measures.
• Net loss for Q1 2023 was $5.4 million. This compares to a net loss of $19.4 million in Q1 2022.
• Adjusted EBITDA loss was $3.3 million, compared to adjusted EBITDA loss of $5.4 million in Q1 2022, per an official announcement.
• The financial outlook for Q2 2023 predicts approximately $10.5 million in revenue and an adjusted EBITDA loss of around $2.1 million.

Business Highlights: Leafly implemented cost-saving measures, including a 21% reduction in staff in March. It shifted to a new business model, focusing on high-value clients while expanding its reach in the retail market.

Additionally, the company gained 5% more retail accounts in Q1 compared to the previous year, although the average revenue per account decreased slightly.

Leafly partnered with Uber Eats to offer cannabis delivery in British Columbia after a successful pilot program in Ontario. It also introduced new deal types and improved search capabilities for consumers.

“We are starting to see the increased efficiency from recent restructurings and expect to see further improvements to adjusted EBITDA going forward," said Suresh Krishnaswamy, CFO of Leafly. "We remain committed to prudently managing our cash and aligning resources to the areas with the highest opportunity for returns in this challenging environment.”

Photo: Courtesy Of Markus Spiske On Unsplash