It's exactly what the marijuana sector needed -- an impressive earnings report.

Industry leader Canopy Growth (CGC -4.29%) reported its Q3 2020 results Friday morning. For the quarter, net revenue was almost 124 million Canadian dollars ($94 million), 62% higher than the Q2 tally. Although there was a net loss -- slightly over CA$124 million -- it was significantly narrower than the previous quarter's shortfall of CA$375 million ($283 million). On a per-share basis, the Q3 loss was CA$0.38 ($0.29).

Marijuana bud on fire.

Image source: Getty Images

Those numbers trounced the average analyst estimates. Collectively, prognosticators who track the company were modeling net revenue of CA$105 million ($79 million), and a deeper net loss of CA$0.52 ($0.39) per share.

Q3 saw Canopy Growth post nearly across-the-board improvements in its cannabis and derivatives sales segment.

All told, the company's take from recreational marijuana in its native Canada -- minus adjustments like product returns and pricing modifications -- rose 131% to almost CA$69 million ($52 million), fueled by the opening of new dispensaries. Its global sales of medical cannabis ticked up modestly, by 4% to CA$33.5 million ($25 million).

Although the company managed to shave its expenses during the quarter, it acknowledged it still has work to do in this area. "Actions taken earlier this year are expected to meaningfully reduce stock-based
compensation in [fiscal 2021]," the company wrote in the earnings report, addressing a cost item that has been significant. "[A]nd we have started to implement tighter cost controls across the organization."

In a market starved for good news from marijuana stocks, Canopy Growth is being rewarded today. Its stock is up nearly 17% in mid-afternoon trading. This optimism is spreading around the sector, with other cannabis companies seeing increases in their share prices.