Ascend Wellness Holdings, Inc. (AAWH)·Q1 2025 Earnings Summary

Executive Summary

• Q1 2025 net revenue declined sequentially to $128.0M as pricing pressure in IL/MI/NJ/MA offset contributions from Ohio adult-use and Illinois partner-store ramps; Adjusted EBITDA was $27.0M (21.1% margin), and GAAP EPS was -$0.09 .
• Versus S&P Global consensus, revenue modestly missed ($128.0M vs $130.0M*) while EPS was in line (-$0.09 vs -$0.09*); Street coverage remains thin (2 EPS, 5 revenue estimates*) [functions.GetEstimates].
• Liquidity/FCF positive: ninth straight quarter of positive operating cash flow ($5.9M) and quarter-end cash of $100.0M; Net Debt was $233.0M .
• Strategic updates: densification on track (targeting 10 new stores in 2025; added IL partner stores; NJ partner pipeline expanding) and capital structure actions (subsequent $50M add-on 12.75% notes to retire remaining 2021 facility balance) potentially catalyst for medium-term de-levering and footprint expansion .

What Went Well and What Went Wrong

• What Went Well

  • Cost actions and discipline supported solid profitability: Adjusted EBITDA of $27.0M (21.1% margin) and Adjusted Gross Margin of 40.8% despite competitive pressure .
  • Operating cash flow remained positive for the ninth straight quarter ($5.9M), ending cash at $100.0M, enabling opportunistic capital deployment and resilience .
  • Strategic execution with clear tone from management: “Our priorities remain on improving our profitability, maximizing our asset efficiency, and enhancing our cash flow generation… We expect the actions we’ve taken will begin to deliver measurable benefits in the second half of the year.” — CEO Sam Brill .

• What Went Wrong

  • Sequential revenue pressure: total net revenue -5.9% QoQ to $128.0M; retail -6.6% to $84.4M and wholesale -4.4% to $43.6M, with softness tied to pricing and volume headwinds across IL/MI/NJ/MA .
  • Margin pressure: GAAP gross profit fell to $39.6M (from $46.9M in Q4), and Adjusted EBITDA margin declined 110 bps QoQ to 21.1% on lower margins from competitive pricing .
  • Net loss widened to $19.3M (vs $16.8M in Q4), reflecting lower margins and ongoing interest/tax burdens (interest expense $11.2M; tax expense $11.0M) .

Financial Results

Summary P&L and Margins

Notes: All Adjusted figures are non-GAAP as defined by the company; see non-GAAP reconciliations in the respective releases .

Segment Revenue

KPIs and Operating Metrics

Q1 2025 vs S&P Global Consensus

Coverage: Revenue - # of estimates: 5*; EPS - # of estimates: 2*. Values retrieved from S&P Global.

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “Building on the groundwork we laid in 2024, we have begun to execute the key steps needed to drive long-term value… We expect the actions we’ve taken will begin to deliver measurable benefits in the second half of the year.” — Sam Brill, CEO .
• “We have done the work to position the business for success… launching new products, as well as opening locations to advance our densification strategy.” — Frank Perullo, Co-Founder & President .
• “We further strengthened our balance sheet and ended the quarter with a strong cash position… [to] capitalize on accretive transactions… and reduce near-term debt pressures.” — Roman Nemchenko, CFO .

Q&A Highlights

• Full Q1 2025 earnings call transcript was not available in our document set; the company hosted the call on May 12, 2025 with webcast posted on its investor site. As a result, Q&A specifics and any intra-quarter clarifications cannot be verified directly here .
• Based on prepared remarks, management emphasized H2 benefits from cost actions, densification, and consumer-focused retail initiatives (e-commerce refresh), while highlighting liquidity to pursue accretive opportunities .

Estimates Context

• S&P Global consensus for Q1 2025: Revenue ~$130.0M (5 estimates)* vs actual $128.0M (miss); EPS -$0.09 (2 estimates)* vs actual -$0.09 (in line) . Values retrieved from S&P Global.
• Street tracking of EBITDA uses S&P “EBITDA” (estimate ~$26M*); company reports Adjusted EBITDA of $27.0M (non-GAAP). Definitions differ; compare with caution . Values retrieved from S&P Global.

Key Takeaways for Investors

• Sequential step-down driven by broad pricing pressure across key states; retail and wholesale both declined QoQ despite Ohio adult-use support .
• Profitability resilient on cost discipline (Adj. EBITDA $27.0M; 21.1% margin); nonetheless, margins compressed QoQ on pricing .
• Balance sheet/liquidity strengthened (cash $100.0M; ninth straight positive CFO), with subsequent $50M notes issuance to retire remaining 2021 facility balance, reducing near-term refinancing risk .
• Densification is the core growth vector in 2025 (10 store targets; partner-store model scaling in IL/NJ), positioning the footprint for H2 and 2026 .
• Against consensus, revenue modestly missed while EPS met; weak pricing and competitive intensity suggest estimates for top-line/margins may modestly drift lower near term without accelerating mix/price or faster store ramps* . Values retrieved from S&P Global.
• Watch catalysts: pace of IL/NJ partner openings, Ohio adult-use momentum, pricing stabilization, and further capital structure actions (buybacks under NCIB; debt reduction) .

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Supporting documents and data:

• Q1 2025 8-K press release with non-GAAP reconciliations and financial statements .
• Q4 2024 8-K press release and schedules .
• Q3 2024 8-K press release and schedules .
• Financing update: 12.75% Senior Secured Notes due 2029 ($50M add-on) .
• Earnings webcast reference (company IR) .

Footnote: Items marked with an asterisk (*) are S&P Global consensus/estimate values. Values retrieved from S&P Global.