Mercanto Holdings loses $146,213 in fiscal Q1 2026

Executive Summary

• Mercanto Holdings Inc. reported financial results for Q1 fiscal 2026 (three months ended Oct. 31, 2025), showing a 9% year-over-year increase in revenue to $900,013.
• The company reported a net loss of $146,213, widening from the $55,222 net loss in Q1 fiscal 2025, driven by temporary product-mix dynamics and gross margin pressures.
• Management highlighted successful execution of new vape product launches in November 2025 and improved listing frameworks in Quebec, positioning the company for improved revenue diversification and operational momentum in calendar 2026.

Key Details

• Revenue: $900,013 for Q1 fiscal 2026, an increase of 9% from $824,225 in the same period last year.
• Net Revenue: $784,529 after excise taxes.
• Net Loss: $146,213 for Q1 fiscal 2026, compared to a net loss of $55,222 in Q1 fiscal 2025.
• Cash Balance: $310,237 at quarter-end.
• Share Count: 51,674,683 common shares outstanding.
• Debt Status: No long-term debt.
• Cost Management: Material reductions in selling and marketing expenses; continued asset-light cost structure.
• Gross Margin Impact: Impacted by temporary product-mix dynamics, including a higher proportion of flow-through SKUs in Ontario and concentrates.
• Operational Highlights (Subsequent to Quarter-End):
  • Quebec implemented revised listing procedures requiring minimum one-year in-store listing in some product categories, enhancing planning and category stability.
  • Launched one vape battery and three vape cartridges in Quebec in November 2025.
  • Transitioned two existing SKUs from the discontinued nursery program to full-store availability.
  • Early indicators from new vape launches described as "very encouraging."
• Outlook: Management expects improved revenue diversification and operational momentum in calendar 2026 due to improved listing mechanics, new vape introductions, and continued cost discipline.

Notable Quotes

• "Management believes its current liquidity profile, combined with favourable supplier terms and a capital-efficient operating model, provides adequate flexibility to support near-term operations and product rollouts."
• "While Q1 fiscal 2026 reflected a period of transition following product rationalization and category shifts in Quebec, management believes the combination of improved listing mechanics, new vape product introductions and continued cost discipline positions Mercanto for improved revenue diversification and operational momentum in calendar 2026."