OrganiGram (OGI) Q2 2026 earnings summary

Executive summary

• Q2 fiscal 2026 was challenging, with net revenue down 9% year-over-year to $59.8 million due to operational issues in vapes and infused pre-rolls, and a slowdown in Canadian recreational market growth from 5% to 2.2%.

• Achieved #1 market share in Canadian recreational cannabis, with leadership in vapes, concentrates, milled flower, and pre-rolls as of March 2026.

• Completed acquisition of Sanity Group, establishing leadership in both Canada and Germany, and expanding branded international sales, including launches in Australia and the U.S.

• Record quarterly harvest of over 32,000 kg (+56% year-over-year) and highest average THC potency at Moncton facility.

• Operational remediation and product enhancements are underway, with early signs of improvement and confidence in regaining share in the second half.

Financial highlights

• Q2 FY26 net revenue was $59.8M, down 9% year-over-year; adjusted gross margin was $18.4M (31%), down from $21.9M (33%).

• Adjusted EBITDA was $0.9M, down from $4.9M in the prior year period and $5.7M in Q2 FY25.

• Net loss was $0.9M, versus net income of $42.5M last year, impacted by lower fair value gains and a $5.8M impairment in the U.S. hemp business.

• Free cash flow outflow was $7M, improved from $23.1M outflow year-over-year.

• Cash and short-term investments at March 31, 2026, totaled $54.8M, down from $84.4M at December 31, 2025.

Outlook and guidance

• Fiscal 2026 net revenue is projected to exceed $350 million, up from previous guidance of $300 million, reflecting the Sanity Group acquisition.

• Adjusted EBITDA and gross margin expected to surpass fiscal 2025 levels; free cash flow to be approximately break even.

• Capital expenditures forecasted at less than $10 million for the year.

• Sanity Group expected to contribute an average of €25M per quarter in net revenue over the next year.

• EU-GMP certification for Moncton facility in progress, anticipated to boost international sales and margins.