Cronos Expands Margins as International Sales Accelerate
Second-quarter net revenue reached $53.0 million, rising 58% from a year earlier.
Cronos Group (CRON), the cannabis-products company, posted record adjusted EBITDA as stronger international sales and a richer product mix lifted profitability.
Growth accelerated for a third consecutive quarter, while gross margin widened sharply as Cronos sold more products in markets without excise taxes. Israel extended its run of quarterly revenue records, and demand in Germany helped international revenue excluding Israel reach a new high.
Net revenue rose 58% from $33.5 million a year earlier and increased 17% sequentially. Organic constant-currency growth was 51%. The reported year-over-year pace accelerated from 40% in the first quarter and 47% in the fourth quarter of 2024.
Gross profit nearly doubled to $28.5 million, while gross margin expanded to 54% from 43% a year earlier and 42% in the preceding quarter. Higher sales volume spread fixed overhead across more units, and average selling prices benefited from a mix shift toward Israel and other international markets.
Adjusted EBITDA increased to a record $13.1 million from $1.7 million a year earlier and $5.1 million in the first quarter. Net income reached $35.7 million, compared with a $38.5 million loss a year earlier, as higher gross profit and foreign-currency transaction gains outweighed increased operating expenses.
Cronos Israel recorded its 10th consecutive quarterly revenue high, with sales rising 60% year over year, or 32% in constant currency. Revenue from other international markets increased 88%, led by demand for flower products in Germany.
In Canada, Spinach retained the top vape position for a second consecutive quarter and increased its category share to 10.6%. The brand held each of the country’s five best-selling vape-product slots during the quarter, while its overall cannabis-market share expanded to 5.9%.
Cronos repurchased 12.3 million shares during the first half and renewed its buyback authorization in May. There is renewed uncertainty in Israel after authorities opened another anti-dumping investigation into Canadian cannabis imports on Aug. 5; Cronos could not predict whether the proceeding would lead to duties or import restrictions.