Strong Margins And Cash Flow Drive Cresco's Q3 Performance Despite Revenue Decline
Portfolio Pulse from Jelena Martinovic
Cresco Labs Inc. reported a 9.4% year-over-year revenue decline in Q3 2023 to $190.5 million, despite strong margins and cash flow. The company's adjusted gross margin and EBITDA margin increased significantly, and it generated $62 million in operating cash flow in the first nine months. However, a net loss of $113.4 million was reported, mainly due to one-time impairment charges. Cresco's shares fell 3.125% to $1.55 post-market on Tuesday.
November 15, 2023 | 3:16 pm
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Cresco Labs Inc. experienced a revenue decline but improved margins and cash flow in Q3 2023. The stock dropped after reporting a significant net loss due to impairment charges.
The reported revenue decline and significant net loss due to impairment charges are likely to negatively impact investor sentiment in the short term, despite the improvements in margins and cash flow. The post-market share price drop indicates an immediate negative reaction to the earnings report.
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IMPORTANCE 90
RELEVANCE 100