Fiscal 2027 first quarter
Filed Aug 5, 2026Aurora Cannabis Announces Fiscal 2027 First Quarter Results
International medical cannabis revenue increased 17% and the loss from continuing operations narrowed, but total net revenue declined 9%, adjusted gross margin before fair value adjustments declined to 58%, adjusted EBITDA fell to 3,443 ($ thousands), and free cash flow was an outflow of 5,793 ($ thousands).
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total net revenuenon-GAAP | 67,554 ($ thousands) | – | 9% decrease |
| Gross profitother | 35,622 ($ thousands) | – | increase of $2.1 million |
| Gross profit before fair value adjustmentsother | 29,192 ($ thousands) | – | – |
| Gross marginother | 53% | – | – |
| Gross margin before fair value adjustmentsother | 43% | – | – |
| Adjusted gross margin before fair value adjustments on total net revenuenon-GAAP | 58% | – | – |
| Adjusted gross profit before fair value adjustmentsnon-GAAP | $39.5 million | – | decrease of $8.3 million |
| Operating expensesother | 44,353 ($ thousands) | – | decrease of $1.1 million |
| General and administrationother | 24,602 ($ thousands) | – | – |
| Sales and marketingother | 15,591 ($ thousands) | – | – |
| Adjusted selling, general & administration expensenon-GAAP | 35,084 ($ thousands) | – | decrease of $1.0 million |
| Other income (expenses)other | 5,101 ($ thousands) | – | increase in other income of $3.4 million |
| Net loss from continuing operationsother | (4,033) ($ thousands) | – | decrease in net loss from continuing operations of $6.2 million |
| Net income (loss) from discontinued operations, net of taxesother | - | – | – |
| Net lossother | (4,033) ($ thousands) | – | – |
| Adjusted net incomenon-GAAP | 3,811 ($ thousands) | – | decrease of $2.8 million |
| Adjusted EBITDAnon-GAAP | 3,443 ($ thousands) | – | decrease of $7.4 million |
| Net cash provided by (used in) operating activities from continuing operationsother | (4,446) ($ thousands) | – | – |
| Maintenance capital expendituresother | (1,347) ($ thousands) | – | – |
| Free cash flownon-GAAP | (5,793) ($ thousands) | – | decrease in free cash flow of $12.6 million |
| Income tax expense (recovery)other | 403 ($ thousands) | – | – |
| Working capitalnon-GAAP | 320,020 ($ thousands) | – | – |
| Total current assetsother | 393,449 ($ thousands) | – | – |
| Total current liabilitiesother | (73,429) ($ thousands) | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Canadian medical cannabisChanges in the federal reimbursement program effective April 1, 2026, which lowered reimbursement rates by approximately 30%. | 20,699 ($ thousands) | – | 25% decrease |
| International medical cannabisHigher sales in Germany driven by increased patient demand. | 43,337 ($ thousands) | – | 17% increase |
| Consumer cannabisStrategic shift to focus on Canadian and international medical cannabis and wind down the consumer cannabis business. | 2,060 ($ thousands) | – | – |
| Wholesale bulk cannabisOffset part of the decrease in total net revenue. | 1,458 ($ thousands) | – | – |
Fiscal Full Year 2027 Outlook (Unchanged) outlook
- NoteIn the fiscal second quarter, we expect revenue and adjusted EBITDA to be sequentially higher than in the fiscal first quarter.
- NoteThe Company intends to invest approximately $3.5 million over the next three years in growth capital improvements for Safari Flower Company.
What drove it
- International medical cannabis net revenue increased to $43.3 million from $37.1 million, mainly due to higher sales in Germany driven by increased patient demand.
- Canadian medical cannabis reimbursement rates were lowered by approximately 30% effective April 1, 2026.
- The Company is winding down its consumer cannabis business and exiting its low-margin Canadian Consumer and Plant Propagation businesses.
- Safari received EU-GMP certification for its Ontario facility on July 23, 2026, granted for a three-year term.
- The increase in gross profit included an increase in gain on changes in fair value of biological assets of $12.6 million, partially offset by a decrease in net revenue of $6.5 million.
Concerns
- Total net revenue declined 9% to 67,554 ($ thousands).
- Adjusted gross margin before fair value adjustments on total net revenue declined to 58% from 64%.
- Canadian medical cannabis net revenue declined 25% to 20,699 ($ thousands) following the reimbursement-program change.
- Consumer cannabis net revenue declined to 2,060 ($ thousands) from 7,875 ($ thousands), and its adjusted gross margin before fair value adjustments declined to 20% from 33%.
- Adjusted EBITDA declined to 3,443 ($ thousands) from 10,815 ($ thousands), while free cash flow moved to an outflow of (5,793) ($ thousands).
What to watch
- Whether fiscal second-quarter revenue and adjusted EBITDA are sequentially higher than fiscal first-quarter levels, as management expects.
- Growth in Germany and other international medical cannabis markets, which management identifies as its highest-margin markets.
- The effect of reduced Canadian federal reimbursement rates on Canadian medical cannabis revenue and medical cannabis adjusted gross margin.
- Safari's contribution to product availability, speed to market, manufacturing costs and international revenue growth following its EU-GMP certification.
- Cash flow performance as the Company funds growth capital improvements and international sales initiatives.
Balance sheet and cash flow
- $149.1 million of cash, cash equivalents and short-term investments with no debt.
- Net cash provided by (used in) operating activities from continuing operations was (4,446) ($ thousands), compared to 7,679 ($ thousands) in the prior year period.
- Free cash flow was (5,793) ($ thousands), compared to 6,772 ($ thousands) in the prior year period.
- Working capital was 320,020 ($ thousands), compared to 308,416 ($ thousands) in the prior year period.
- Safari acquisition closed on April 14, 2026. The Company intends to invest approximately $3.5 million over the next three years in growth capital improvements.
Analysis
Aurora reported a mixed fiscal 2027 first quarter. Total net revenue declined 9% to 67,554 ($ thousands) from 74,076 ($ thousands), as lower Canadian medical cannabis revenue and the consumer-cannabis wind-down outweighed growth in international medical cannabis and wholesale bulk cannabis. Medical cannabis revenue was broadly stable at 64,036 ($ thousands), with international medical cannabis up 17% to 43,337 ($ thousands), led by German patient demand, while Canadian medical cannabis declined 25% to 20,699 ($ thousands).
Margin performance weakened on the underlying measures. Adjusted gross margin before fair value adjustments on total net revenue declined to 58% from 64%, and the corresponding medical cannabis metric declined to 61% from 69%. Aurora attributed the medical margin pressure to Canadian federal reimbursement changes effective April 1, 2026, which lowered reimbursement rates by approximately 30%. Consumer cannabis adjusted gross margin before fair value adjustments declined to 20% from 33% as the Company sold products at reduced prices to reduce wind-down-related inventory impairments.
Reported profitability improved in selected IFRS measures, but adjusted earnings and cash generation deteriorated. Gross profit was 35,622 ($ thousands), compared with 33,528 ($ thousands), supported by an increase in gain on changes in fair value of biological assets of $12.6 million. Net loss from continuing operations narrowed to (4,033) ($ thousands) from (10,186) ($ thousands), helped by higher gross profit, lower operating expenses and higher other income. However, adjusted gross profit before fair value adjustments declined by $8.3 million, adjusted EBITDA fell to 3,443 ($ thousands) from 10,815 ($ thousands), and adjusted net income declined to 3,811 ($ thousands) from 6,598 ($ thousands).
Cash conversion was negative during the quarter. Net cash used in operating activities from continuing operations was (4,446) ($ thousands), and free cash flow was an outflow of (5,793) ($ thousands), compared with an inflow of 6,772 ($ thousands) in the prior-year period. Aurora reported $149.1 million of cash, cash equivalents and short-term investments with no debt, and working capital of 320,020 ($ thousands). The Company closed the Safari acquisition on April 14, 2026 and plans approximately $3.5 million of growth-capital investment over the next three years.
The full-year outlook was reiterated without quantitative targets. Management expects fiscal second-quarter revenue and adjusted EBITDA to be sequentially higher than the first quarter, supported by increasing global medical-cannabis patient demand, international sales initiatives and EU-GMP capacity expansion. Safari's July 23, 2026 EU-GMP certification, granted for three years, is central to the strategy to add supply capacity for high-margin international medical markets and reduce reliance on third-party suppliers.
Management, verbatim
We remain confident in our commercial execution, supported by our genetics program and regulatory and operational expertise which underpin our leadership in Canada, Germany, Poland, Australia, and New Zealand. These competitive advantages support our strategy to invest further in EU-GMP manufacturing capacity so that we can supply growing international markets for medical cannabis and thereby maintain and expand our market share.
Miguel Martin, Executive Chairman and Chief Executive Officer
The first quarter reflects our continued strength, as we delivered international revenue growth and leading adjusted gross margins 1, anchored by a cost structure designed to support topline growth. In the second quarter, we expect both revenue and Adjusted EBITDA 1 to improve sequentially, driven by increasing global patient demand for medical cannabis.
Miguel Martin, Executive Chairman and Chief Executive Officer
Not in the filing
stated, not guessed- GAAP or IFRS earnings per share and adjusted earnings per share were not reported.
- Prior-quarter comparisons were not reported for the financial metrics.
- Quantitative fiscal full-year 2027 revenue, gross margin, operating-expense and tax-rate guidance were not reported.
- A prior outlook document was not provided, so comparison with prior guidance is unavailable.
- Share repurchases, dividends and other capital-return activity were not reported.
- Total debt amount, debt maturities and interest expense were not reported.
- Cash, cash equivalents and short-term investments were reported as $149.1 million, but the filing did not provide a tabular period-end cash balance or prior-year cash comparison.
- Revenue and profitability contribution from Safari Flower Company were not reported.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.