Shares of Cronos Group (NASDAQ:CRON) surged 16.7% on Thursday, following the marijuana producer's third-quarter results.
Cronos Group's net revenue rocketed 96% higher to $11.4 million. That was above analysts' estimates for revenue of $10.8 million.
The gains were fueled by sales of Lord Jones cannabidiol (CBD) products, which Cronos acquired last year. Higher recreational cannabis sales in Canada and medical marijuana sales in Israel also played a role in Cronos Group's revenue growth.
However, Cronos Group's operating losses widened to $41.2 million, compared to $30.7 million in the year-ago period. Higher sales and marketing costs, research and development investments, and expenses related to its Lord Jones acquisition all contributed to the cannabis company's losses.
Investors are once again optimistic about the cannabis industry's growth prospects. Citizens in New Jersey, Arizona, and South Dakota recently voted to legalize recreational marijuana, and Democratic presidential candidate Joe Biden has promised to decriminalize marijuana at the federal level. All of these developments could help to fuel Cronos Group's growth in the coming years.
"The opportunities before Cronos Group are more exciting than ever," Executive chairman Mike Gorenstein said in a press release.