Cresco Labs Delivers Q4 2025 Revenue of $162 Million and Sequential Margin Improvement

Company Website: https://www.crescolabs.com CHICAGO -- (Business Wire) Cresco Labs Inc. (CSE: CL) (OTCQX: CRLBF) (FSE: 6CQ) (“Cresco Labs” or the “Company”), the industry leader in branded cannabis products with a portfolio of America’s most popular brands and the operator of Sunnyside dispensaries, today released its financial and operating results for the fourth quarter ended and year ended December 31, 2025. All financial information presented in this release is reported in accordance with U.S. GAAP and in U.S. dollars, unless otherwise indicated, and is available on the Company’s investor website, here. Fiscal Year 2025 Highlights Revenue of $656 million. Operating cash flow of $73 million and Free Cash Flow1 of $38 million. Gross profit of $325 million. Adjusted gross profit1 of $329 million; and an Adjusted gross margin1 of 50.2%. SG&A of $218 million. Reduced Adjusted SG&A1 by 5.7% year-over-year to $200 million, or 30.4%. Net loss of $140 million, which includes one-time, non-cash charges of $105 million related to the Company’s impairment of intangibles and goodwill associated with the write-down of the New York reporting unit and fair value adjustments to the California reporting unit related to the sale of Sonoma’s Finest. Adjusted EBITDA1 of $157 million and Adjusted EBITDA margin1 of 24.0%. Retained the No. 1 share position in multiple billion dollar markets for the full year.2 Fourth Quarter 2025 Highlights Fourth quarter revenue of $162 million. Fourth quarter operating cash flow of $27 million. Gross profit of $83 million. Adjusted gross profit1 of $84 million; and an Adjusted gross margin1 of 52.2%. SG&A of $57 million or 35.3% of revenue. Net loss of $89 million, which includes one-time, non-cash charges of $93 million related to the write-down of the New York reporting unit. Fourth quarter Adjusted EBITDA1 of $40 million and Adjusted EBITDA margin1 of 25.0%. Retained the No. 1 share position in multiple billion dollar markets.2 Management Commentary “In Q4, we strengthened our financial foundation while expanding margins and generating meaningful cashflow. We delivered $162 million in revenue, $40 million in Adjusted EBITDA, and $27 million in operating cashflow, with sequential improvement across multiple profitability metrics. Our focused strategy continues to enhance our competitive position.” “The cannabis industry is consolidating in real time, and Cresco Labs is operating from a position of strength – we continue to show that we win where we operate. We are intentionally building a productive cash-generating platform, balancing organic expansion with selective, accretive acquisitions while maintaining a strong balance sheet. With leading brand share, differentiated retail execution, and embedded operating leverage, Cresco Labs is positioned to capitalize on industry consolidation and federal reform to create long-term value for shareholders.” 1 See “Non-GAAP Financial Measures” at the end of this press release for more information regarding the Company’s use of non-GAAP financial measures. 2 According to Hoodie Analytics. Balance Sheet, Liquidity, and Other Financial Information As of December 31, 2025, current assets were $259 million, including cash, cash equivalents, and restricted cash of $91 million. An additional $3 million of restricted cash was classified as a non-current asset. The Company had senior secured term loan debt, net of discount and issuance costs, of $311 million and a mortgage loan, net of discount and issuance costs, of $19 million. Total shares on a fully converted basis to Subordinate Voting Shares were 491,585,556 as of December 31, 2025. Conference Call and Webcast The Company will host a conference call and webcast to discuss its financial results on Thursday, March 5, 2026, at 8:30am Eastern Time (7:30am Central Time). The conference call may be accessed via webcast or by dialing 1-833-470-1428 (US Toll Free) or 1-646-844-6383 (US Local), and providing access code 152399. Archived access to the webcast will be available for one year on Cresco Labs’ investor website, here. Consolidated Financial Statements The financial information reported in this press release contains certain preliminary financial results for the three months and year ended December 31, 2025. These financial statements have been prepared in accordance with U.S. GAAP. These preliminary results for the three months and year ended December 31, 2025, are provided prior to completion of all internal reviews and external audit procedures and are therefore subject to adjustment until the filing of the Company's audited consolidated financial statements, which the Company expects to file on SEDAR+ and EDGAR on or about March 5, 2026. The audit of the consolidated financial statements for the year ended December 31, 2025, is currently in process. All financial information contained in this press release is qualified in its entirety with reference to such financial statements. While the Company does not expect there to be any material changes between the information contained in this press release and the consolidated financial statements it files on SEDAR+ and EDGAR, to the extent that the financial information contained in this press release is inconsistent with the information contained in the Company’s financial statements, the financial information contained in this press release shall be deemed to be modified or superseded by the Company’s filed financial statements. The making of a modifying or superseding statement shall not be deemed an admission, for any purposes, that the modified or superseded statement, when made, constituted a misrepresentation for purposes of applicable securities laws. Further, the reader should refer to the additional disclosures in the Company’s audited financial statements for the year ended December 31, 2025, filed on SEDAR+ and EDGAR. Cresco Labs references certain non-GAAP financial measures throughout this press release, which may not be comparable to similar measures presented by other issuers. Please see the “Non-GAAP Financial Measures” section below for more detailed information. Non-GAAP Financial Measures This release reports its financial results in accordance with U.S. GAAP and includes certain non-GAAP financial measures that do not have standardized definitions under U.S. GAAP. The non-GAAP measures include: Earnings before interest, taxes, depreciation, and amortization (“EBITDA”); Adjusted EBITDA; Adjusted EBITDA margin; Adjusted gross profit; Adjusted gross profit margin; Adjusted selling, general, and administrative expenses (“Adjusted SG&A”), Adjusted SG&A margin; and Free Cash Flow are non-GAAP financial measures and do not have standardized definitions under U.S. GAAP. The Company defines these non-GAAP financial measures as follows: EBITDA as net loss (income) before interest, taxes, depreciation, and amortization; Adjusted EBITDA as EBITDA less other (expense) income, net, fair value mark-up for acquired inventory, adjustments for acquisition and non-core costs, impairment and share-based compensation; Adjusted EBITDA Margin as Adjusted EBITDA divided by revenues, net; Adjusted gross profit as gross profit less fair value mark-up for acquired inventory and adjustments for acquisition and non-core costs; Adjusted gross profit margin as Adjusted gross profit divided by revenues, net; Adjusted SG&A as SG&A less adjustments for acquisition and non-core costs; Adjusted SG&A margin as Adjusted SG&A divided by revenues, net; and Free Cash Flow as Net cash provided by operating activities less purchases of property and equipment and proceeds from tenant improvement allowances. The Company has provided the non-GAAP financial measures, which are not calculated or presented in accordance with U.S. GAAP, as supplemental information and in addition to the financial measures that are calculated and presented in accordance with U.S. GAAP and may not be comparable to similar measures presented by other issuers. These supplemental non-GAAP financial measures are presented because management has evaluated the financial results both including and excluding the adjusted items and believe that the supplemental non-GAAP financial measures presented provide additional perspective and insights when analyzing the core operating performance of the business. These supplemental non-GAAP financial measures should not be considered superior to, as a substitute for or as an alternative to, and should only be considered in conjunction with, the U.S. GAAP financial measures presented herein. Accordingly, the Company has included below reconciliations of the supplemental non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with U.S. GAAP. About Cresco Labs Inc. Cresco Labs’ mission is to normalize and professionalize the cannabis industry through a CPG approach to building national brands and a customer-focused retail experience, while acting as a steward for the industry on legislative and regulatory-focused initiatives. As a leader in cultivation, production, and branded product distribution, the Company is leveraging its scale and agility to grow its portfolio of brands that include Cresco, High Supply, FloraCal, Good News, Wonder Wellness Co., Mindy’s, and Remedi, on a national level. The Company also operates highly productive dispensaries nationally under the Sunnyside brand that focus on building patient and consumer trust and delivering ongoing education and convenience in a wonderfully traditional retail experience. Through year-round policy, community outreach and SEED initiative efforts, Cresco Labs embraces the responsibility to support communities through authentic engagement, economic opportunity, investment, workforce development, and legislative initiatives designed to create the most responsible, respectable and robust cannabis industry possible. Learn more about Cresco Labs’ journey by visiting www.crescolabs.com or following the Company on Facebook, X or LinkedIn. Forward-Looking Statements This press release contains “forward-looking information” within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995 (collectively, “forward-looking statements”). Such forward-looking statements are not representative of historical facts or information or current condition but instead represent only the Company’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of the Company’s control. Generally, such forward-looking statements can be identified by the use of forward-looking terminology such as, ‘may,’ ‘will,’ ‘should,’ ‘could,’ ‘would,’ ‘expects,’ ‘plans,’ ‘anticipates,’ ‘believes,’ ‘estimates,’ ‘projects,’ ‘predicts,’ ‘potential,’ or ‘continue,’ or the negative of those forms or other comparable terms. The Company’s forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including but not limited to those risks discussed under “Risk Factors” in the Company’s Annual Information Form for the year ended December 31, 2025, expected to be filed on or about March 5, 2026, other documents filed by the Company with Canadian securities regulatory authorities; and other factors, many of which are beyond the control of the Company. Readers are cautioned that the foregoing list of factors is not exhaustive. Because of these uncertainties, you should not place undue reliance on the Company’s forward-looking statements. No assurances are given as to the future trading price or trading volumes of Cresco Labs’ shares, nor as to the Company’s financial performance in future financial periods. The Company does not intend to update any of these factors or to publicly announce the result of any revisions to any of the Company’s forward-looking statements contained herein, whether as a result of new information, any future event, or otherwise. Except as otherwise indicated, this press release speaks as of the date hereof. The distribution of this press release does not imply that there has been no change in the affairs of the Company after the date hereof or create any duty or commitment to update or supplement any information provided in this press release or otherwise. Cresco Labs Inc. Financial Information and Non-GAAP Reconciliations (All amounts expressed in thousands of U.S. Dollars)                       Consolidated Statements of Operations For the Three Months Ended December 31, 2025, September 30, 2025, and December 31, 2024 and Years Ended December 31, 2025 and December 31, 2024                           For the Three Months Ended   For the Year Ended ($ in thousands)   December 31, 2025   September 30, 2025   December 31, 2024   December 31, 2025   December 31, 2024     (unaudited)   (unaudited)   (unaudited)         Revenues, net   $ 161,553     $ 164,913     $ 175,909     $ 655,847     $ 724,343   Cost of goods sold     78,232       85,553       91,883       331,279       359,889   Gross profit     83,321       79,360       84,026       324,568       364,454   Gross profit %     51.6 %     48.1 %     47.8 %     49.5 %     50.3 % Operating expenses:                     Selling, general, and administrative     57,014       51,640       56,030       217,863       221,269   Share-based compensation     3,415       1,891       3,133       9,413       11,803   Depreciation and amortization     4,966       5,636       5,457       20,178       21,770   Impairment loss     93,471       2,365       —       105,101       2,320   Total operating expenses     158,866       61,532       64,620       352,555       257,162   Income from operations     (75,545 )     17,828       19,406       (27,987 )     107,292                         Other (expense) income, net:                     Interest expense, net2     (14,264 )     (14,140 )     (13,195 )     (56,280 )     (54,601 ) Other income (expense) , net2     2,664       (13,789 )     (3,156 )     (11,155 )     (63,307 ) Total other expense, net     (11,600 )     (27,929 )     (16,351 )     (67,435 )     (117,908 ) (Loss) Income before income taxes     (87,145 )     (10,101 )     3,055       (95,422 )     (10,616 ) Income tax expense     (1,804 )     (11,867 )     (2,616 )     (44,622 )     (49,873 ) Net (loss) income1   $ (88,949 )   $ (21,968 )   $ 439     $ (140,044 )   $ (60,489 ) 1 Net (loss) income includes amounts attributable to non-controlling interests. 2 Certain immaterial prior period amounts were reclassified to conform to the current presentation. Cresco Labs Inc. Unaudited Reconciliation of Gross Profit to Adjusted Gross Profit (Non-GAAP) For the Three Months Ended December 31, 2025, September 30, 2025, and December 31, 2024 and Years Ended December 31, 2025 and December 31, 2024                           For the Three Months Ended   For the Year Ended ($ in thousands)   December 31, 2025   September 30, 2025   December 31, 2024   December 31, 2025   December 31, 2024 Revenues, net   $ 161,553     $ 164,913     $ 175,909     $ 655,847     $ 724,343   Cost of goods sold1     78,232       85,553       91,883       331,279       359,889   Gross profit   $ 83,321     $ 79,360     $ 84,026     $ 324,568     $ 364,454   Fair value mark-up for acquired inventory     28       —       —       28       123   Cost of goods sold adjustments for acquisition and other non-core costs     1,049       1,110       3,121       4,795       9,447   Adjusted gross profit (Non-GAAP)   $ 84,398     $ 80,470     $ 87,147     $ 329,391     $ 374,024   Adjusted gross profit % (Non-GAAP)     52.2 %     48.8 %     49.5 %     50.2 %     51.6 % 1 Production (cultivation, manufacturing, and processing) costs related to products sold during the period. Cresco Labs Inc. Summarized Consolidated Statements of Financial Position As of December 31, 2025 and December 31, 2024           ($ in thousands)   December 31, 2025   December 31, 2024 Cash, cash equivalents, and restricted cash (current)   $ 91,086   $ 141,003 Other current assets     168,187     153,254 Property and equipment, net     327,192     344,846 Intangible assets, net     275,342     293,994 Goodwill     208,173     283,484 Other non-current assets     127,320     138,774 Total assets   $ 1,197,300   $ 1,355,355           Total current liabilities   $ 100,180   $ 94,338 Total non-current liabilities     844,618     872,841 Total shareholders’ equity     252,502     388,176 Total liabilities and shareholders’ equity   $ 1,197,300   $ 1,355,355 Cresco Labs Inc. Unaudited Reconciliation of SG&A to Adjusted SG&A (Non-GAAP) For the Three Months Ended December 31, 2025, September 30, 2025, and December 31, 2024 and Years Ended December 31, 2025 and December 31, 2024                           For the Three Months Ended   For the Year Ended ($ in thousands)   December 31, 2025   September 30, 2025   December 31, 2024   December 31, 2025   December 31, 2024 Selling, general, and administrative   $ 57,014     $ 51,640     $ 56,030     $ 217,863     $ 221,269   Adjustments for acquisition and other non-core costs     7,702       3,920       2,299       18,327       9,656   Adjusted SG&A (Non-GAAP)   $ 49,312     $ 47,720     $ 53,731     $ 199,536     $ 211,613   Adjusted SG&A % (Non-GAAP)     30.5 %     28.9 %     30.5 %     30.4 %     29.2 % Cresco Labs Inc. Unaudited Reconciliation of Net Loss to Adjusted EBITDA (Non-GAAP) For the Three Months Ended December 31, 2025, September 30, 2025, and December 31, 2024 and Years Ended December 31, 2025 and December 31, 2024                           For the Three Months Ended   For the Year Ended ($ in thousands)   December 31, 2025   September 30, 2025   December 31, 2024   December 31, 2025   December 31, 2024 Net (loss) income1   $ (88,949 )   $ (21,968 )   $ 439     $ (140,044 )   $ (60,489 ) Depreciation and amortization     10,758       12,858       13,904       48,712       59,096   Interest expense, net2     14,264       14,140       13,195       56,280       54,601   Income tax expense     1,804       11,867       2,616       44,622       49,873   EBITDA (Non-GAAP)   $ (62,123 )   $ 16,897     $ 30,154     $ 9,570     $ 103,081                         Other (expense) income, net2     (2,664 )     13,789       3,156       11,155       63,307   Fair value mark-up for acquired inventory     28       —       —       28       123   Adjustments for acquisition and other non-core costs     8,071       4,443       4,493       20,263       16,851   Impairment loss     93,471       2,365       —       105,101       2,320   Share-based compensation     3,652       2,311       3,705       11,232       14,164   Adjusted EBITDA (Non-GAAP)   $ 40,435     $ 39,805     $ 41,508     $ 157,349     $ 199,846   Adjusted EBITDA % (Non-GAAP)     25.0 %     24.1 %     23.6 %     24.0 %     27.6 % 1 Net (loss) income includes amounts attributable to non-controlling interests. 2 Certain immaterial prior period amounts were reclassified to conform to the current presentation. Cresco Labs Inc. Summarized Consolidated Statements of Cash Flows For the Three Months Ended December 31, 2025, September 30, 2025, and December 31, 2024 and Years Ended December 31, 2025 and December 31, 2024                           For the Three Months Ended   For the Year Ended ($ in thousands)   December 31, 2025   September 30, 2025   December 31, 2024   December 31, 2025   December 31, 2024     (unaudited)   (unaudited)   (unaudited)         Net cash provided by operating activities   $ 27,432     $ 6,164     $ 29,486     $ 72,890     $ 132,480   Net cash used in investing activities     (13,242 )     (6,124 )     (3,013 )     (40,704 )     (25,229 ) Net cash used in financing activities     (1,793 )     (71,096 )     (42,034 )     (82,088 )     (71,478 ) Effect of foreign currency exchange rate changes on cash and cash equivalents     (17 )     —       9       (17 )     (39 ) Net increase (decrease) in cash and cash equivalents   $ 12,380     $ (71,056 )   $ (15,552 )   $ (49,919 )   $ 35,734   Cash and cash equivalents and restricted cash, beginning of period     81,956       153,012       159,806       144,254       108,520   Cash and cash equivalents and restricted cash, end of period   $ 94,336     $ 81,956     $ 144,254     $ 94,335     $ 144,254   Cresco Labs Inc. Unaudited Reconciliation of Operating Cash Flow to Free Cash Flow (Non-GAAP) For the Three Months Ended December 31, 2025, September 30, 2025, and December 31, 2024 and Years Ended December 31, 2025 and December 31, 2024                           For the Three Months Ended   For the Year Ended ($ in thousands)   December 31, 2025   September 30, 2025   December 31, 2024   December 31, 2025   December 31, 2024 Net cash provided by operating activities   $ 27,432     $ 6,164     $ 29,486     $ 72,890     $ 132,480   Purchases of property and equipment     (9,016 )     (7,180 )     (3,204 )     (35,138 )     (19,492 ) Proceeds from tenant improvement allowances     —       —       439       501       1,055   Free Cash Flow (Non-GAAP)   $ 18,416     $ (1,016 )   $ 26,721     $ 38,253     $ 114,043     View source version on businesswire.com: https://www.businesswire.com/news/home/20260305447476/en/ Contacts: Media [email protected] Investors TJ Cole, Cresco Labs SVP, Corporate Development & Investor Relations [email protected] For general Cresco Labs inquiries: 312-929-0993 [email protected] Source: Cresco Labs