💸 The Tape

If you wanted a clean case study on what happens when a cannabis company stops trying to be everything to everyone and instead picks a lane, Aurora Cannabis Inc. just handed you one.

In fiscal Q3 2026 (quarter ended Dec. 31, 2025), Aurora continued its transformation into what is effectively a global medical cannabis pure play—and the financials are increasingly reflecting that pivot.

Medical Is Now the Engine Room

Aurora posted total net revenue of C$94.2 million, up 7% year over year. That’s respectable. What’s more telling is where the growth came from:

Medical cannabis revenue hit a record C$76.2 million, up 12% year over year. That single segment now accounts for:

• 81% of total revenue

• 95% of adjusted gross profit (pre-FV)

Translation: this is no longer a diversified cannabis company with a medical side hustle. It’s a medical platform with a few legacy appendages.

Geographically, growth was driven by Germany and Poland, along with stronger Canadian insurance-covered patient sales. Margins held firm at an eye-catching 69% adjusted gross margin in medical—numbers most CPG CEOs would frame on the wall.

Consumer Cannabis: The Strategic Sacrifice

The other side of that story is less glamorous but very intentional. Consumer (rec) cannabis revenue fell 48% year over year to C$5.2 million. That’s not a stumble—it’s a choice.

Aurora is deliberately diverting GMP-grade supply away from low-margin rec and toward high-margin medical markets. In corporate-speak, this is “portfolio optimization.” In plain English: why sell premium product into a discount aisle?

Management confirmed that beginning in Q4 FY26, Aurora will exit certain lower-margin consumer markets in Canada, expecting lower SG&A and better consolidated margins over time.

Plant Propagation: Deconsolidation Incoming

Aurora’s plant propagation business (Bevo) grew revenue 27% year over year to C$11.3 million, but margins compressed sharply. Rather than nurse a capital-intensive side business, Aurora is moving to financially restructure its involvement.

Under the pending Bevo transaction, Aurora will exchange common shares for preferred shares, step back from operational control, and collect:

• A 5% annual dividend,

• A share of cash flows, and

• Potential earnouts tied to facility performance.

It’s a shift from operator to financial stakeholder, freeing management focus for—you guessed it—medical cannabis.

Profitability & Cash Flow: Quietly Strong

Adjusted EBITDA came in at C$18.5 million, and Aurora generated C$15.5 million in free cash flow. Net income under GAAP swung to a small loss, but adjusted net income held steady at C$7.2 million.

For a company once synonymous with cash burn, this is a very different chapter.

Balance Sheet & Capital Strategy

Aurora also launched a US$100 million at-the-market (ATM) equity program. Management stresses this is for strategic and accretive uses only—read: capacity expansion or M&A in medical markets, not plugging operating holes.

Notably, the company says its only remaining debt is non-recourse debt tied to Bevo.

Outlook: Medical Flywheel

Full-year FY26 guidance calls for:

• Global medical revenue of C$269–281 million (10–15% growth),

• Adjusted EBITDA of C$52–57 million,
  driven primarily by the medical segment’s scale and margins.

Bottom line: Aurora has made a decisive bet that the future of cannabis—at least for them—is not mass-market consumer flower, but regulated, insurance-backed, international medical supply.

For once in this sector, strategy and financials appear to be telling the same story.

📈 Dog Walkers

$LOVFF ( ▲ 6.81% ) Taps Private Placement

Cannara Biotech Inc. has added a notable institutional-style endorsement to its cap table, closing a C$6.3 million non-brokered private placement with Phoenician Capital LLC—and doing so at a premium.

Under the agreement, Phoenician subscribed for 3 million common shares at C$2.10 per share, a roughly 16% premium to Cannara’s prior closing price. In a sector where discounts are the norm and “strategic” sometimes means “last resort,” pricing above market is a signal worth underlining. The financing remains subject to final acceptance from the TSX Venture Exchange.

Use of Proceeds: Build, Scale, Fortify

The fresh capital is earmarked for working capital and strategic investments, with a clear emphasis on continued buildout at Cannara’s Valleyfield facility. Management has been methodical about phasing in capacity rather than chasing volume at the expense of margins, and this raise effectively funds the next leg of that controlled expansion while preserving balance sheet flexibility.

CEO Zohar Krivorot framed the deal as alignment-driven, pointing to Phoenician’s long-term, fundamentals-focused approach as a cultural and strategic fit. From an investor-relations perspective, that’s code for: patient capital, operating discipline, and less pressure for short-term theatrics.

Founder Liquidity—With Guardrails

Alongside the company financing, Krivorot entered into a separate, exempt secondary sale of 333,333 shares to Phoenician at the same C$2.10 price. Cannara receives none of those proceeds; the transaction was structured to offset personal tax liabilities tied to recently vested equity. Importantly, the shares are subject to a four-month-and-one-day hold, matching the private placement stock, which helps avoid the optics of immediate insider liquidity.

Post-transaction, Krivorot still controls roughly 25.8% of the company on a pro forma basis—meaning founder alignment remains very much intact.

Why This Matters

Cannara’s story has increasingly been about operational execution at scale in Québec, supported by large-format cultivation and tight cost controls. A premium-priced investment from a New York-based small- and mid-cap specialist adds a layer of external validation to that thesis. In a capital-constrained cannabis environment, credibility of funding sources matters almost as much as the dollars themselves.

For Cannara, this is less about plugging a hole and more about fueling a plan already in motion: expand capacity thoughtfully, defend margins, and keep the balance sheet sturdy enough to play offense when opportunities arise.

$TLRY ( ▼ 2.31% ) Expands Liquor Distribution

Breckenridge Distillery, the award-winning craft spirits brand owned by Tilray Brands, Inc., is tightening its distribution game in the Midwest. The company has expanded its partnership with Romano Beverage, which will now manage distribution of Breckenridge’s full spirits portfolio across Illinois.

That means Romano is taking the reins on everything from Breckenridge’s flagship bourbon and whiskey expressions to its rum, vodka, gin, and the newer Mountain Shot offering. For a brand that leans heavily on craftsmanship and premium positioning, having a distributor with deep local relationships and on-the-ground execution matters more than another glossy marketing campaign.

Romano Beverage isn’t a newcomer parachuting into a crowded market. With an established facility in Elmhurst and a strong footprint across retail and on-premise channels, the distributor brings scale where it counts: logistics, salesforce coverage, and store-level activation. In other words, fewer excuses for out-of-stocks and more chances for consumers to actually find the bottle they just read about.

From Breckenridge’s perspective, this is less about a flashy expansion and more about operational alignment. As EVP of Sales Mike Horan put it, Romano’s approach matches where the brand is headed, and the deeper collaboration is designed to accelerate growth while reinforcing Breckenridge’s presence statewide. Translation: tighten the supply chain, deepen market penetration, and let the liquid do the talking.

For Tilray, the move is another small but telling data point in its broader lifestyle CPG strategy. While the company is known in capital markets circles for cannabis, its beverage and spirits assets—like Breckenridge—represent a parallel growth engine that plays in fully federally legal channels. Strengthening distribution in a major state like Illinois is exactly the kind of incremental execution that builds durable revenue, one market at a time.

Breckenridge Distillery continues to position itself as a premium craft option for Illinois retailers and bars, and with Romano now handling the full lineup, the brand is betting that better distribution equals better shelf presence—and, ultimately, better sell-through.

🗞️ The News

📺 YouTube

Cannabis Enters the Execution Phase | TTB Powered by Flowhub

What we will cover:

✅ Coming up on Trade to Black, presented by Flowhub — ever wonder how the CBD model actually works once cannabis rescheduling is implemented? Or how real-world medical evidence is finally starting to tell a clearer story around cannabinoids? And finally, what might be one of the biggest earnings prints yet from a major cannabis company — who is it, and why does it matter?

We’re covering all of this in today’s episode.

Segment One: Pulak Sharma, co-founder and CEO of Kazmira Therapeutics, will join us to break down how CBD coverage, prescribing, and delivery could realistically take shape in a post-rescheduling environment. We’ll also dig into Kazmira’s January 20 press release announcing the launch of the first cannabis-grade dispensary in Colorado, and what that signals about where pharmaceutical-grade cannabinoid distribution is heading in the U.S.

Segment Two: High Tide (TSX: HITI | NASDAQ: HITI) CEO Raj Grover joins us following what may be the strongest earnings report in the company’s history — record revenue, positive free cash flow, expanding margins, and a loyalty-driven retail model showing real operating leverage.