Verano Holdings Corp. (VRNOF)·Q3 2025 Earnings Summary

Executive Summary

• Q3 revenue was $202.8M, up slightly quarter-over-quarter (+0.3% q/q) but down year-over-year (-6.4% y/y), with gross margin compressing to 47% amid price pressure and promotions; Adjusted EBITDA was $53.1M (26% margin). Drivers included price compression/competition and higher short-term COGS from operational enhancements .
• Results vs S&P Global consensus: revenue modestly beat (+$0.25M, +0.1%); EPS missed (actual -$0.0599 vs -$0.0465 consensus); EBITDA missed (actual $46.24M vs $59.96M consensus). Values retrieved from S&P Global*.
• Net loss widened to -$43.8M due to a $5M impairment and $10M legal loss contingencies (partly offset by lower taxes vs prior year) .
• Strategic/catalyst updates: shareholder approval to redomicile to Nevada (completion pending BC Registrar strike), a new $75M revolver ($50M drawn to retire higher-rate debt), retail footprint expansions (Zen Leaf Antwerp, MÜV Crystal River), and product innovation (HYPHEN modular vape, Edie Parker partnership) .

What Went Well and What Went Wrong

What Went Well

• Adjusted EBITDA of $53.1M (26% margin) and SG&A reduced to $80.6M (40% of revenue), reflecting operating efficiencies and discipline; management emphasized groundwork for long-term growth and stronger wholesale/brand performance .
• Balance sheet actions: secured a $75M revolver, drew $50M to retire higher-rate debt with no prepayment penalty, preserving $25M for strategic initiatives; working capital stood at $242M, with $82.6M cash on hand at quarter-end .
• Network and product momentum: opened Zen Leaf Antwerp (sixth Ohio dispensary), MÜV Crystal River (82nd in Florida), launched HYPHEN modular vape system and an exclusive Edie Parker partnership to drive brand and category innovation .

What Went Wrong

• Gross margin fell to 47% from 56% in Q2 and 50% in Q3’24 due to promotions and higher short-term COGS tied to operational enhancements; revenue declined y/y on price compression and competition .
• Net loss widened to -$43.8M, impacted by a $5.4M impairment (fixed/held-for-sale assets) and $10M legal loss contingencies; other income/expense swung negative, pressuring bottom line .
• Consensus misses: EPS and EBITDA came in below S&P Global expectations, reflecting margin pressure and non-operating items. Values retrieved from S&P Global*.

Financial Results

Income Statement and Profitability (Quarterly)

EPS Trend (company EPS from S&P Global)

Values retrieved from S&P Global*.

Cash Flow and Capex

Balance Sheet KPIs (end of period)

Estimates vs Actuals (S&P Global)

Values retrieved from S&P Global*. Note: Company-reported Adjusted EBITDA was $53.109M (26% margin), which is not directly comparable to S&P Global “EBITDA” consensus .

Segment Breakdown

Guidance Changes

Management commentary referenced ambition to “close the year on a high note” and highlighted ongoing efficiency and brand/wholesale initiatives, but the company did not provide quantitative guidance ranges in Q3 materials .

Earnings Call Themes & Trends

Note: A Q3 2025 earnings call/webcast was scheduled and link provided, but a transcript was not available in the document catalog for review .

Management Commentary

• “This quarter reflects our hard work positioning Verano ahead of long-term growth opportunities by investing in infrastructure, generating efficiencies, improving wholesale and brand performance, and strengthening our capital structure and financial foundation for the future.” — George Archos, Founder, Chairman & CEO .
• “With more exciting new product innovation planned for the busy retail holiday season... we look forward to closing the year on a high note and hitting the ground running in what we hope will be a transformative year for Verano and the industry in 2026.” — George Archos .

Q&A Highlights

• The company scheduled a Q3 call/webcast and provided registration and webcast links, but an earnings call transcript was not available in the catalog; therefore, specific Q&A themes and clarifications cannot be provided from primary transcripts .

Estimates Context

• Revenue slightly beat S&P Global consensus ($202.81M actual vs $202.56M estimate); EPS missed (actual -$0.0599 vs -$0.0465 estimate); EBITDA missed (actual $46.24M vs $59.96M estimate). Values retrieved from S&P Global*.
• Consensus may need to reflect continued gross margin pressure from promotions and operational enhancements and the impact of non-operating items (impairments, legal contingencies) on profitability noted in Q3 .

Key Takeaways for Investors

• Margins compressed sharply q/q (gross margin 47% vs 56% in Q2) on promotions and short-term COGS increases; watch for margin recovery as operational enhancements mature .
• Revenue trajectory is stabilizing q/q (+0.3%) but remains lower y/y (-6.4%); price compression and competition remain core headwinds .
• Liquidity improved: $75M revolver ($50M used to retire higher-rate debt) plus $82.6M cash and $242M working capital; enhances flexibility for strategic initiatives .
• Adjusted EBITDA held at $53.1M despite top-line and margin pressures, evidencing cost control in SG&A ($80.6M, 40% of revenue) .
• Near-term catalysts: redomicile completion to Nevada (pending BC Registrar strike resolution), continued retail expansion, and product launches (HYPHEN, Edie Parker) that could support brand mix and retail traffic .
• Non-GAAP reconciliation shows sizable add-backs across COGS and SG&A plus “Acquisition Adjustments and Other Income & Expense”; investors should anchor valuation on consistent GAAP-to-non-GAAP bridges .
• Without formal guidance, monitor holiday season sell-through, wholesale accounts receivable dynamics, and margin cadence into Q4 as key drivers of estimate revisions and stock narrative .

Footnote: Values retrieved from S&P Global* for estimates and EPS where noted.