Ascend Wellness Q2 Earnings Call Highlights

Ascend Wellness Q2 Earnings Call Highlights

Second-quarter performance improved: Net revenue rose 7.9% sequentially to $126.1 million, while adjusted EBITDA increased 10.5% to $29.1 million and margin expanded to 23.1%. Retail sales drove growth, rising 11.5% to $92.7 million, while wholesale revenue declined amid pricing pressure and Illinois strike-related disruptions.

Ascend continued expanding its retail footprint: The company ended the quarter with 55 stores and expects to meet or exceed 60 locations by year-end, with additional opportunities in New Jersey and a pending strategic relationship in Ohio. It also reported a 6.7% increase in transactions, nearly 5% market-share growth across its seven-state footprint, and 199 new product launches.

Management is targeting further growth while preserving profitability: Cash increased to $67 million, and Ascend is evaluating acquisitions expected to generate at least a 35% return on invested capital. Third-quarter revenue is projected to rise 2% to 4% sequentially, though July wholesale sales will be affected by the Illinois strike; shareholders will also vote on a proposed reverse stock split aimed at supporting a potential major-exchange uplisting.

Ascend Wellness OTCMKTS: AAWH reported second-quarter 2026 net revenue of $126.1 million, up 7.9% sequentially, as new dispensary openings and higher retail sales helped offset pricing pressure and competitive conditions in several markets. Adjusted EBITDA rose 10.5% from the first quarter to $29.1 million, while adjusted EBITDA margin increased to 23.1% from 22.5%.

Chief Executive Officer Sam Brill said the quarter supported management’s view that the company has reached an operational inflection point, with retail expansion, vertically integrated sales and product launches reinforcing one another.

Retail sales lead quarterly growth Retail revenue totaled $92.7 million, an 11.5% sequential increase, and represented 73.5% of total net revenue, compared with 71.1% in the prior quarter. Chief Financial Officer Roman Nemchenko said new stores accounted for most of the retail increase, though the same-store portfolio also posted a strong quarter.

Wholesale revenue declined about 1% sequentially to $33.4 million. Nemchenko attributed the decline primarily to volume and pricing pressure in New Jersey, as well as missed delivery days in Illinois caused by a union strike that began near the end of the quarter. Bulk biomass sales in Michigan offset part of the decline, though those sales carried lower margins, he said.

The company said its Lansing, Michigan site remains closed for repairs. The Illinois strike has since ended and operations have resumed at full capacity, according to Nemchenko.

Ascend’s adjusted gross profit increased 8% sequentially to $58.3 million, while adjusted gross margin was relatively flat at 46.2%.

Store network expands, with Ohio and New Jersey in focus Ascend ended the second quarter with 55 stores, including partner-owned and operated locations, and said it currently operates or supports 56 locations. Brill said the company had 39 such locations when he became CEO in late August 2024 and had 44 locations a year ago. The company expects to meet or exceed its target of 60 stores by year-end.

In New Jersey, Ascend opened a location in Eatontown on April 20 and added a partner store in Matawan after the quarter ended. It has three additional partner-store opportunities in its pipeline, which could bring its New Jersey presence to nine locations by year-end. Its partner store in Marlton received approval from the state’s Cannabis Regulatory Commission after the close of the quarter. Massachusetts raised the cap on retail licenses an operator can own from three...