After the market closed on Tuesday, Tilray (NASDAQ:TLRY) emailed a statement to financial news outlets that is not going over well with its shareholders. According to the company's statement, the licensed cannabis producer has already let go of 10% of its workforce to cut costs as part of a global restructuring effort.
Prepare for disappointment?
Tilray reported operating results for the quarter ended Sept. 30, 2019, back in November and it's nearly time to raise the curtain again. Letting go of around 140 employees shortly after expanding hiring them isn't a good look, but it sounds like Tilray wants to soften the landing for a disappointing earnings report that could land in another week or two.
Other than the staff layoffs, Tilray didn't share a lot of details concerning its restructuring effort or issue any facility closure announcements.
We know the cannabis producer finished September with $122 million in cash and securities on its balance sheet after losing a stunning $103 million during the first nine months of 2019. If Tilray continued bleeding money through the end of 2019, knowing the company has already taken cost-cutting measures could soften the blow.
Further to fall
Tilray cost investors billions last year, but the stock can still fall a lot further. When the market closed on Tuesday, Tilray was still a $1.8 billion company.
Investors realizing that Tilray's bleeding money in a nascent industry with slimmer profit margins are already losing their patience. Unless the Tilray issues some surprisingly good results later this month, the pain inflicted on shareholders could get much worse.