Canopy Growth (NASDAQ:CGC), a bellwether marijuana stock, reported its Q1 results for fiscal 2020 after the market closed today. Although the company showed strong growth in certain fundamental and operational metrics, it fell short of expectations.

For the period, Canopy Growth's net revenue amounted to $90.5 million Canadian, more than triple the CA$25.9 million it made in the same quarter of fiscal 2019. The company harvested 40,960 kilos of cannabis, well up from the 9,685 in the year-ago quarter. 

Net loss deepened to CA$1.28 million, or CA$3.70, from the CA$91,000 shortfall in Q1 2019.

Hand holding a marijuana cigarette

Image source: Getty Images

On average, the clutch of analysts who track the marijuana stock were anticipating just over CA$109 million for gross revenue, and a per-share net loss of merely CA$0.38

The bulk of Canopy Growth's significant top-line growth derived from sales of recreational cannabis, as this category was nonexistent at this time last year -- Canada legalized this type of use in October. All told, the company drew CA$61 million from recreational, accounting for nearly 60% of overall gross Q1 revenue. In the same quarter last year, naturally, it booked no sales at all in the category.

Comparing Q1 recreational cannabis gross revenue to that of Q4 2019 reveals that the line item declined by 11% on a sequential basis.

One bright spot for Canopy Growth was its international markets, for which it supplies medical cannabis. It took in CA$10.5 million from such customers, over three times the CA$3.4 million in the same quarter of fiscal 2019.

As with rival cannabis growers and suppliers, Canopy Growth considers overseas markets -- particularly Europe -- to be enticing targets for expansion. That's because many of those countries have a relatively high level of acceptance of cannabis and its derivatives, and often their laws regarding these are comparatively relaxed.

On the other hand, Canopy Growth's costs also grew considerably, with total operating expenses rising 73% to just over CA$229 million.

The company attributed this to factors such as an increase in employee headcount in its retail stores, investments into branding, and pilot marketing campaigns attacking future developments such as the so-called "second wave" of recreational cannabis legalization in Canada. Costs related to the company's frequent acquisitions also weighed on results.

Investors are showing their disapproval of these results in after-hours trading. Canopy Growth is certainly not the favored marijuana stock of the moment -- it's currently down by 12%.

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