Canopy Growth (NASDAQ:CGC) announced its fiscal 2020 fourth-quarter and full-year results before the market opened on Friday. For the period ending March 31, the cannabis producer reported net revenue of 107.9 million Canadian dollars, an increase of 15% year over year but a 13% decline from its fiscal third quarter. Canopy also posted a net loss of CA$1.3 billion, or CA$3.72 per share.
The Ontario-based company didn't come close to meeting analysts' average estimates for revenue of CA$128.9 million and a net loss of CA$0.59 per share. Canopy's revenue miss resulted from a 28% quarter-over-quarter drop in Canadian adult-use (recreational) marijuana sales.
Its net loss was worse than expected in part because of the lower revenue, but asset impairment and restructuring costs of CA$743 million also weighed heavily on Canopy's bottom line. In addition, the company's operating expenses increased by 17% compared to the previous quarter.
Canopy Growth also lowered expectations for the future, withdrawing its previous forecasts about when it would achieve positive adjusted EBITDA and net income. Canopy is scaling back its ambitions as well, stating that it "no longer strives to be the first to every market, but strives to [be] the best."
Management thinks that fiscal 2021 will "be a transition year." Canopy is changing its strategy and organizational structure. Two key factors that will impact the cannabis producer's fortunes in the year ahead are the retail rebound from the COVID-19 pandemic and the momentum for the Canadian cannabis derivatives market.