Posting true, unadjusted accounting profits in the cannabis industry is no small feat. That's especially true in Canada, where competition is fierce due to a growing number of competitors. One Canadian-based cannabis company that has been showing significant progress in strengthening its financials is Tilray Brands (TLRY -7.23%).

While the company has often posted positive adjusted earnings numbers, it finally looks like it may be on track to stay in the black on an unadjusted basis as well. That's a promising development, and it all goes back to one pivotal strategic move the company has made.

Tilray drastically shrinks its net loss in Q4

On July 29, Tilray reported its fourth-quarter results for the period ended May 31. Not only did the company achieve solid revenue growth of 25% on a year-over-year basis with its top line hitting $229.9 million, it also had a big improvement in its bottom line. For the quarter, Tilray incurred a net loss of $15.4 million, compared with a loss of $119.8 million in the same period last year.

It did benefit from a sizable income tax recovery of $27.6 million, but even its operating loss of just over $43 million was not nearly as steep as the $111.7 million operating loss that Tilray reported in the prior-year period. Whatever way you want to look at it, Tilray's bottom line has improved, significantly.

Why Tilray is doing so much better

The big reason Tilray's numbers are better is simple yet ironic: It's diversifying and is no longer just a cannabis company. Tilray has become one of the largest craft brewers in the U.S. through acquisitions. Last year, it acquired eight beverage brands from Anheuser-Busch InBev, which has helped Tilray secure approximately 5% of the craft beer market in the U.S.

And as a result of that move, Tilray's alcohol beverage business has been booming. Last quarter, revenue for that segment totaled $76.7 million, which was more than double the $32.4 million it generated last year. It was also more revenue than Tilray's core cannabis business, which brought in $71.9 million. The company also generates revenue from wellness products and its distribution business, which primarily relates to pharmaceutical products.

More importantly, Tilray achieves better margins on its alcohol products than it does on any other segment. Its adjusted gross margin for the beverage alcohol segment was 53% last quarter, compared to 40% for cannabis, 31% for wellness, and just 12% for distribution. By getting deeper into alcohol, Tilray is making strides, not just in growing revenue but also in boosting its gross profit margin, which puts it in a better position to stay out of the red. It isn't in that position just yet, but it's definitely trending in the right direction.

Is Tilray Brands a good stock to buy today?

Tilray Brands is showing signs of progress, but it still may be too early to invest in what remains a risky stock. In five years, shares of Tilray have plummeted by more than 95%. The company has a lot to prove, and while it is making progress, it still isn't generating true accounting profits. Until it does, investors are right to be cautious. The company may be on the hunt for more acquisitions to continue to grow its business, and depending on which companies Tilray Brands targets, that can have a drastic effect on its future growth prospects and its ability to turn a profit.

While Tilray did have a good quarter with some strong results on the top and bottom lines, investors should be careful not to read too much into these numbers, as there's still plenty of risk and uncertainty ahead for the stock. A wait-and-see approach may be the best one to take with Tilray to see if it can build on this solid quarterly performance. If it can, it may be time to finally consider taking a chance on the stock.

For now, however, it may be best to remain on the sidelines.