TLRY Tilray Brands Inc

Tilray Brands, Inc. (“Tilray”, “our”, “we” or the “Company”) (Nasdaq: TLRY; TSX: TLRY), a global lifestyle and consumer packaged goods company leading the forefront of beverage, cannabis and wellness industries, today reported financial results for its second quarter ended November 30, 2024. All financial information in this press release is reported in U.S. dollars, unless otherwise indicated.

Irwin D. Simon, Chairman and Chief Executive Officer of Tilray Brands, stated, "In our fiscal second quarter, Tilray achieved strong results while making significant progress on our strategic plan. Our dedication to operational excellence has improved Gross Margins, Gross Profit, and overall profitability across our business segments, positioning us favorably for future success."

Mr. Simon stated, “As we enter the second half of the year, we remain committed to delivering on our financial guidance and driving shareholder value. Tilray is a leading force at the forefront of the beverage industry, revitalizing the beer market, driving growth in spirits and non-alcoholic beverages, and advancing the legitimacy of cannabis for both recreational and medical use. Through our brew pubs, we focus on bringing people together, creating exceptional experiences through entertainment, and enhancing lives through moments of connection. As I've said in the past, new industries are not born, they are built. To that end, we are trailblazing the future of consumer products through the infrastructure we have built. I am enthusiastic about what lies ahead, including the potential future legalization of cannabis in the U.S.”

Financial Highlights – Second Quarter Fiscal Year 2025

• Net revenue increased 9% to $211 million in the second quarter compared to $194 million in the prior year quarter. On a constant currency basis, net revenue increased 10%.
• Gross profit increased by 29% to $61 million in the second quarter compared to $47 million in the prior year quarter, with growth across all four business segments. Gross margin increased to 29% in the second quarter compared to 24% in the prior year quarter.
• Adjusted gross profit increased by 20% to $63 million in the second quarter from $52 million in the prior year quarter.
• Net loss was $(85) million in the second quarter, of which $75 million was comprised of non-cash items (including foreign exchange loss, amortization, and stock-based compensation) and $8 million, of which were one-time non-recurring costs.
• Adjusted net loss was $(2) million in the second quarter compared to an adjusted net loss of $(3) million in the prior year quarter.
• Adjusted net loss per share was $(0.00) in both the second quarter and prior year quarter.
• Adjusted EBITDA in the second quarter was $9 million compared to $10 million in the prior year quarter due to the beverage segment’s SKU rationalization EBITDA impact of $1.8 million.
• Beverage alcohol net revenue increased 36% to $63 million in the second quarter compared to $47 million in the prior year quarter.
  • Beverage alcohol gross margin increased to 40% in the second quarter compared to 34% in the prior year quarter. Adjusted gross margin increased to 42% in the second quarter compared to 38% in the prior year quarter.
• Cannabis net revenue was $66 million in the second quarter compared to $67 million in the prior year quarter.
  • Cannabis gross margin increased to 35% in the second quarter compared to 31% in the prior year quarter. Adjusted gross margin was 35% in both the second quarter and prior year quarter.
• Distribution net revenue was $68 million in the second quarter compared to $67 million in the prior year quarter
  • Distribution gross margin increased to 12% in the second quarter compared to 11% in the prior year quarter.
• Wellness net revenue increased 13% to $15 million in second the quarter compared to $13 million in the prior year quarter.
  • Wellness gross margin increased to 31% in the second quarter compared to 29% in the prior year quarter.

Tilray Beverages, Project 420 Highlights

In December 2020, we entered the beverage category with the acquisition of SweetWater Brewing Company, one of the largest independent craft brewers in the U.S. by volume, with the vision of creating a larger and more diversified global lifestyle consumer products company. 

This initial acquisition provided us with a foundation to pursue additional acquisitions in the beverage category and scale our business on a national basis. We acquired Alpine Beer Company, Green Flash and Breckenridge Distillery in December 2021, Montauk Brewing Company in November 2022, Craft Acquisition I in October 2023 and Craft Acquisition II in September 2024. 

With Craft Acquisition I and Craft Acquisition II, we capitalized on opportunities to acquire additional beverage businesses that consisted of strong brands in decline and in need of investment in order to promote growth. To support the growth of these acquired brands and establish a clear path to profitability, we implemented Project 420, which is a comprehensive plan through which we expect to achieve our $25 million synergy plan based on the following initiatives:

• Operational optimization: As we increase our operational footprint, the optimization of those facilities has been our focus. Accordingly, we continuously evaluate our beverage operational footprint and have identified redundancies in our manufacturing and warehousing assets. By integrating our operations, we are obtaining better utilization of our facilities, decreasing the amount of excess capacity and gaining efficiencies through improved fixed cost absorption.
• Cost savings, cost avoidance and synergies: Our focus on cost savings, synergies and cost avoidance across our beverage segment has identified and, we are continuing to identify, the elimination of duplicative fixed costs, procurement, distribution and back-office costs.
• Portfolio optimization/SKU Rationalization: Today, our Beverage segment consists of an expansive portfolio comprised of over 20 beverage brands in different categories consisting of craft beer, spirits and non-alcoholic options. In response to the declining growth in the craft beer industry and consolidation of distributors, we worked with our distributors in various markets to streamline our portfolio to eliminate duplicative and slower growth products, which had the immediate effect of reducing revenue. However, by eliminating these slower growing SKUs, we are able to focus our attention and resources on our higher growth SKUs and the introduction of new innovation, which we expect will accelerate our revenue growth in future quarters. Going forward, we will continue to manage SKU performance within our portfolio on a “one in and one out basis” to maximize SKU productivity. In addition, in connection with our strategic review with the Boston Consulting Group, we are executing against our “regional jewel” strategy, which resulted in our decision to delist certain SKUs in certain geographies that were not considered key markets for those brands.For the six months ended November 30, 2024, our prioritization of certain products in key markets resulted in a reduction in net sales of approximately $6.0 million. Additionally, our decision to discontinue certain SKUs due to market conditions led to an additional reduction in net sales of $2.0 million. For the fiscal year ended May 31, 2025, it is anticipated that the cumulative impact of these initiatives will result in a reduction of approximately $20.0 million in net sales, which we believe will be offset by the growth of our new product innovation, including in new beverage categories, and brand extensions over the next 18 months. It is important to note, however, that there is a lag between the discontinuation of the SKUs and the associated reduction in revenue, which has an immediate effect, and the acceleration of the growth of our existing SKUs and the introduction of new innovation and the associated increase in revenue, which takes time due to retailer resets. We also expect these efforts will lead to improved sales and margins, with benefits realized through lower selling costs, as well as reduced requirements for working capital through inventory reductions and an improvement in our cash conversion cycle.

• Brand & Business investment: We have been and are continuing to increase our investment in the marketing, promotion and infrastructure of our recently acquired brands in order to reestablish their dominance in their core markets. Our intention is to fund this investment through the cost savings and synergies achieved through Project 420. 

As of the end of the second quarter ended November 30, 2024, we achieved $17 million of the $25 million synergy plan. However, these savings are not completely offsetting our investment at this time. As a result, our Adjusted EBITDA for the three and six months ended November 30, 2024 was lower by $1.8 million and $3.2 million, respectively, as a result of our SKU rationalization. Our operating cash flow in the quarter was also lower due to these investments.

Company's Fiscal Year 2025 Guidance

The Company reaffirms its fiscal year 2025 guidance of anticipated net revenues between $950 million and $1 billion.

Live Conference Call and Audio Webcast Tilray Brands will host a webcast to discuss these results today at 8:30 a.m. ET. Investors may join the live webcast available on the Investors section of the Company’s website at www.tilray.com. A replay will be available and archived on the Company’s website.

About Tilray Brands

Tilray Brands, Inc. (“Tilray”) (Nasdaq: TLRY; TSX: TLRY), is a leading global lifestyle and consumer packaged goods company with operations in Canada, the United States, Europe, Australia, and Latin America that is leading as a transformative force at the nexus of cannabis, beverage, wellness, and entertainment, elevating lives through moments of connection. Tilray’s mission is to be a leading premium lifestyle company with a house of brands and innovative products that inspire joy, wellness and create memorable experiences. Tilray’s unprecedented platform supports over 40 brands in over 20 countries, including comprehensive cannabis offerings, hemp-based foods, and craft beverages.

For more information on how we are elevating lives through moments of connection, visit Tilray.com and follow @Tilray on all social platforms.

For more information on Tilray Brands, visit www.Tilray.com and follow @Tilray

Cautionary Statement Concerning Forward-Looking Statements

Certain statements in this press release constitute forward-looking information or forward-looking statements (together, “forward-looking statements”) under Canadian securities laws and within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are intended to be subject to the “safe harbor” created by those sections and other applicable laws. Forward-looking statements can be identified by words such as “forecast,” “future,” “should,” “could,” “enable,” “potential,” “contemplate,” “believe,” “anticipate,” “estimate,” “plan,” “expect,” “intend,” “may,” “project,” “will,” “would” and the negative of these terms or similar expressions, although not all forward-looking statements contain these identifying words. Certain material factors, estimates, goals, projections or assumptions were used in drawing the conclusions contained in the forward-looking statements throughout this communication.

Forward-looking statements include statements regarding our intentions, beliefs, projections, outlook, analyses or current expectations concerning, among other things: the Company’s ability to transform the CPG industry for cannabis, hemp, beverages and entertainment; the Company’s ability to become a leading beverage alcohol Company; the Company’s ability to achieve long term profitability; the Company’s ability to achieve operational scale, market share, distribution, profitability and revenue growth in particular business lines and markets; the Company’s ability to achieve its FY 2025 guidance of net revenues between $950 million and $1 billion; the Company’s ability to successfully achieve revenue growth, margin and profitability improvements, production and supply chain efficiencies, synergies and cost savings; the Company’s expected revenue growth, sales volume, profitability, synergies and accretion related to any of its acquisitions; expected commercial opportunities and regulatory developments in the U.S., including upon U.S. federal cannabis legalization or rescheduling; the Company’s anticipated investments and acquisitions, including in organic and strategic growth, partnership efforts, product offerings and other initiatives; the Company’s ability to commercialize new and innovative products; market opportunities and regulatory risks for Hemp-Derived Delta-9 (HDD9) beverage products, and expected sales, distribution, margin, price and revenue generation projections; consumer sentiment regarding HDD9 beverage products; and Tilray’s strategy and anticipated offerings within the HDD9 beverage product segment.

Many factors could cause actual results, performance or achievement to be materially different from any forward-looking statements, and other risks and uncertainties not presently known to the Company or that the Company deems immaterial could also cause actual results or events to differ materially from those expressed in the forward-looking statements contained herein. Risks and uncertainties that may cause actual results to differ materially from forward-looking statements include, but are not limited to, those identified and described in our most recent Annual Report on Form 10-K as well as our other filings made from time to time with the SEC and in our Canadian securities filings. For a more detailed discussion of these risks and other factors, see the most recently filed annual information form of the Company and the Annual Report on Form 10-K (and other periodic reports filed with the SEC) of the Company made with the SEC and available on EDGAR. The forward-looking statements included in this communication are made as of the date of this communication and the Company does not undertake any obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless required by applicable securities laws.

Use of Non-U.S. GAAP Financial Measures

This press release and the accompanying tables include non-GAAP financial measures, including Adjusted gross margin (consolidated and for each of our reporting segments), Adjusted gross profit (consolidated and for each of our reporting segments), Adjusted EBITDA, Adjusted net income (loss), Adjusted net income (loss) per share, free cash flow, adjusted free cash flow, constant currency presentations of revenue and cash and marketable securities. Management believes that the non-GAAP financial measures presented provide useful additional information to investors about current trends in the Company's operations and are useful for period-over-period comparisons of operations. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures. In addition, these non-GAAP measures may not be the same as similar measures provided by other companies due to potential differences in methods of calculation and items being excluded. They should be read only in connection with the Company's Consolidated Statements of Operations and Cash Flows presented in accordance with GAAP.

Certain forward-looking non-GAAP financial measures included in this press release are not reconciled to the comparable forward-looking GAAP financial measures. The Company is not able to reconcile these forward-looking non-GAAP financial measures to their most directly comparable forward-looking GAAP financial measures without unreasonable efforts because the Company is unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to impact GAAP measures but would not impact the non-GAAP measures. Such items may include litigation and related expenses, transaction costs, impairments, foreign exchange movements and other items. The unavailable information could have a significant impact on the Company's GAAP financial results.

The Company believes presenting net sales at constant currency provides useful information to investors because it provides transparency to underlying performance in the Company's consolidated net sales by excluding the effect that foreign currency exchange rate fluctuations have on period-to-period comparability given the volatility in foreign currency exchange markets. To present this information for historical periods, current period net sales for entities reporting in currencies other than the U.S. dollar are translated into U.S. dollars at the average monthly exchange rates in effect during the corresponding period of the prior fiscal year, rather than at the actual average monthly exchange rate in effect during the current period of the current fiscal year. As a result, the foreign currency impact is equal to the current year results in local currencies multiplied by the change in average foreign currency exchange rate between the current fiscal period and the corresponding period of the prior fiscal year. A reconciliation of prior year revenue to constant currency revenue the most directly comparable GAAP measure, has been provided in the financial statement tables included above in this press release.

Adjusted EBITDA is calculated as net income (loss) before income tax benefits, net; interest expense, net; non-operating income (expense), net; amortization; stock-based compensation; change in fair value of contingent consideration; purchase price accounting step-up; facility start-up and closure costs; litigation costs; restructuring costs, and transaction (income) costs, net. A reconciliation of Adjusted EBITDA to net loss, the most directly comparable GAAP measure, has been provided in the financial statement tables included below in this press release.

Adjusted net income (loss) is calculated as net loss attributable to stockholders of Tilray Brands, Inc., less; non-operating income (expense), net; amortization; stock-based compensation; change in fair value of contingent consideration; facility start-up and closure costs; litigation costs; restructuring costs and transaction (income) costs, net. A reconciliation of Adjusted net income (loss) to net loss attributable to stockholders of Tilray Brands, Inc., the most directly comparable GAAP measure, has been included below in this press release.

Adjusted net income (loss) per share is calculated as net loss attributable to stockholders of Tilray Brands, Inc., net; non-operating income (expense), net; amortization; stock-based compensation; change in fair value of contingent consideration; facility start-up and closure costs; litigation costs; restructuring costs and transaction (income) costs, divided by weighted average number of common shares outstanding. A reconciliation of Adjusted net income (loss) per share to net loss attributable to stockholders of Tilray Brands, Inc., the most directly comparable GAAP measure, has been included below in this press release. Adjusted net income (loss) per share is not calculated in accordance with GAAP and should not be considered an alternative for GAAP net income (loss) per share or as a measure of liquidity.

Adjusted gross profit (consolidated and for each of our reporting segments), is calculated as gross profit adjusted to exclude the impact of purchase price accounting valuation step-up. A reconciliation of Adjusted gross profit, excluding purchase price accounting valuation step-up, to gross profit, the most directly comparable GAAP measure, has been provided in the financial statement tables included above in this press release. Adjusted gross margin (consolidated and for each of our reporting segments), excluding purchase price accounting valuation step-up, is calculated as revenue less cost of sales adjusted to add back amortization of inventory step-up, divided by revenue. A reconciliation of Adjusted gross margin, excluding purchase price accounting valuation step-up, to gross margin, the most directly comparable GAAP measure, has been provided in the financial statement tables included above in this press release.

Free cash flow is comprised of two GAAP measures which are net cash flow provided by (used in) operating activities less investments in capital and intangible assets, net. A reconciliation of net cash flow provided by (used in) operating activities to free cash flow, the most directly comparable GAAP measure, has been provided in the financial statement tables included above in this press release. Adjusted free cash flow is comprised of two GAAP measures which are net cash flow provided by (used in) operating activities less investments in capital and intangible assets, net, and the exclusion of growth CAPEX from investments in capital and intangible assets, net, which excludes the amount of capital expenditures that are considered to be associated with growth of future operations rather than to maintain the existing operations of the Company, and excludes our integration costs related to HEXO and the cash income taxes related to Aphria Diamond to align with management’s prescribed guidance. A reconciliation of net cash flow provided by (used in) operating activities to adjusted free cash flow, the most directly comparable GAAP measure, has been provided in the financial statement tables included above in this press release.

Cash and marketable securities are comprised of two GAAP measures, cash and cash equivalents added to marketable securities. The Company’s management believes that this presentation provides useful information to management, analysts and investors regarding certain additional financial and business trends relating to its short-term liquidity position by combing these two GAAP metrics.

For further information: Media Contact: news@tilray.com Investor Contact: investors@tilray.com

Consolidated Statements of Financial Position
		November 30,				May 31,
(in thousands of US dollars)			2024				2024
Assets
Current assets
Cash and cash equivalents		$	189,698			$	228,340
Marketable securities			62,551				32,182
Accounts receivable, net			112,739				101,695
Inventory			266,007				252,087
Prepaids and other current assets			44,861				31,332
Assets held for sale			31,483				32,074
Total current assets			707,339				677,710
Capital assets			554,419				558,247
Operating lease, right-of-use assets			18,243				16,101
Intangible assets			866,645				915,469
Goodwill			2,000,595				2,008,884
Long-term investments			7,416				7,859
Convertible notes receivable			32,000				32,000
Other assets			5,097				5,395
Total assets		$	4,191,754			$	4,221,665
Liabilities
Current liabilities
Bank indebtedness		$	17,751			$	18,033
Accounts payable and accrued liabilities			221,668				241,957
Contingent consideration			15,000				15,000
Warrant liability			1,695				3,253
Current portion of lease liabilities			6,572				5,091
Current portion of long-term debt			15,838				15,506
Current portion of convertible debentures payable			—				330
Total current liabilities			278,524				299,170
Long - term liabilities
Lease liabilities			62,024				60,422
Long-term debt			148,871				158,352
Convertible debentures payable			122,735				129,583
Deferred tax liabilities, net			125,975				130,870
Other liabilities			17				90
Total liabilities			738,146				778,487
Stockholders' equity
Common stock ($0.0001 par value; 1,198,000,000 common shares authorized; 929,257,945 and 831,925,373 common shares issued and outstanding, respectively)			93				83
Preferred shares ($0.0001 par value; 10,000,000 preferred shares authorized; nil and nil preferred shares issued and outstanding, respectively)			—				—
Treasury Stock (3,682,609 and nil treasury shares issued and outstanding, respectively)			—				—
Additional paid-in capital			6,305,787				6,146,810
Accumulated other comprehensive loss			(47,957	)			(43,499	)
Accumulated deficit			(2,784,995	)			(2,660,488	)
Total Tilray Brands, Inc. stockholders' equity			3,472,928				3,442,906
Non-controlling interests			(19,320	)			272
Total stockholders' equity			3,453,608				3,443,178
Total liabilities and stockholders' equity		$	4,191,754			$	4,221,665

Condensed Consolidated Statements of Net Income (Loss) and Comprehensive Income (Loss)
		For the three months ended															For the six months ended
(in thousands of U.S. dollars, except for per share data)		November 30,				November 30,				Change				% Change			November 30,				November 30,				Change				% Change
			2024				2023			2024 vs. 2023								2024				2023			2024 vs. 2023
Net revenue		$	210,950			$	193,771			$	17,179			9	%		$	410,994			$	370,720			$	40,274			11	%
Cost of goods sold			149,730				146,362				3,368			2	%			290,068				279,115				10,953			4	%
Gross profit			61,220				47,409				13,811			29	%			120,926				91,605				29,321			32	%
Operating expenses:
General and administrative			45,997				43,313				2,684			6	%			90,110				83,829				6,281			7	%
Selling			16,162				7,583				8,579			113	%			27,852				14,442				13,410			93	%
Amortization			22,927				21,917				1,010			5	%			44,731				44,142				589			1	%
Marketing and promotion			9,720				9,208				512			6	%			21,286				17,743				3,543			20	%
Research and development			60				56				4			7	%			165				135				30			22	%
Change in fair value of contingent consideration			—				300				(300	)		(100	)%			—				(10,807	)			10,807			(100	)%
Litigation costs, net of recoveries			901				3,042				(2,141	)		(70	)%			2,496				5,076				(2,580	)		(51	)%
Restructuring costs			6,869				2,655				4,214			159	%			11,116				3,570				7,546			211	%
Transaction costs (income), net			802				1,094				(292	)		(27	)%			1,958				9,596				(7,638	)		(80	)%
Total operating expenses			103,438				89,168				14,270			16	%			199,714				167,726				31,988			19	%
Operating loss			(42,218	)			(41,759	)			(459	)		1	%			(78,788	)			(76,121	)			(2,667	)		4	%
Interest expense, net			(7,766	)			(8,625	)			859			(10	)%			(17,608	)			(18,460	)			852			(5	)%
Non-operating income (expense), net			(33,255	)			821				(34,076	)		(4,151	)%			(20,609	)			(3,581	)			(17,028	)		476	%
Loss before income taxes			(83,239	)			(49,563	)			(33,676	)		68	%			(117,005	)			(98,162	)			(18,843	)		19	%
Income tax expense (recovery), net			2,036				(3,380	)			5,416			(160	)%			2,922				3,884				(962	)		(25	)%
Net loss		$	(85,275	)		$	(46,183	)		$	(39,092	)		85	%			(119,927	)			(102,046	)			(17,881	)		18	%
Net loss per share - basic and diluted		$	(0.10	)		$	(0.07	)		$	(0.03	)		43	%		$	(0.14	)		$	(0.17	)		$	0.03			(18	)%

Condensed Consolidated Statements of Cash Flows
		For the six months ended
		November 30,				November 30,				Change				% Change
(in thousands of US dollars)			2024				2023			2024 vs. 2023
Cash provided by (used in) operating activities:
Net loss		$	(119,927	)		$	(102,046	)		$	(17,881	)		18	%
Adjustments for:
Deferred income tax expense (recovery), net			1,529				(4,042	)			5,571			(138	)%
Unrealized foreign exchange loss (gain)			9,627				(5,604	)			15,231			(272	)%
Amortization			65,864				62,341				3,523			6	%
Accretion of convertible debt discount			5,985				8,567				(2,582	)		(30	)%
Other non-cash items			3,281				(11,210	)			14,491			(129	)%
Stock-based compensation			14,154				16,458				(2,304	)		(14	)%
Loss (gain) on long-term investments & equity investments			66				(412	)			478			(116	)%
(Gain) loss on derivative instruments			(1,558	)			7,992				(9,550	)		(119	)%
Change in fair value of contingent consideration			—				(10,807	)			10,807			(100	)%
Change in non-cash working capital:
Accounts receivable			(9,051	)			4,524				(13,575	)		(300	)%
Prepaids and other current assets			(13,046	)			3,764				(16,810	)		(447	)%
Inventory			(8,127	)			8,669				(16,796	)		(194	)%
Accounts payable and accrued liabilities			(24,828	)			(24,445	)			(383	)		2	%
Net cash used in operating activities			(76,031	)			(46,251	)			(29,780	)		64	%
Cash provided by (used in) investing activities:
Investment in capital and intangible assets			(12,172	)			(10,011	)			(2,161	)		22	%
Proceeds from disposal of capital and intangible assets			631				365				266			73	%
(Purchase) disposal of marketable securities, net			(30,369	)			125,479				(155,848	)		(124	)%
Business acquisitions, net of cash acquired			(18,210	)			(60,626	)			42,416			(70	)%
Net cash (used in) provided by investing activities			(60,120	)			55,207				(115,327	)		(209	)%
Cash provided by (used in) financing activities:
Share capital issued, net of cash issuance costs			111,517				—				111,517			NM
Proceeds from long-term debt			—				32,621				(32,621	)		(100	)%
Repayment of long-term debt			(10,388	)			(14,901	)			4,513			(30	)%
Proceeds from convertible debt			—				21,553				(21,553	)		(100	)%
Repayment of convertible debt			(330	)			(107,330	)			107,000			(100	)%
Repayment of lease liabilities			(1,724	)			(91	)			(1,633	)		1,795	%
Net decrease in bank indebtedness			(282	)			(3,200	)			2,918			(91	)%
Net cash provided by (used in) financing activities			98,793				(71,348	)			170,141			(238	)%
Effect of foreign exchange on cash and cash equivalents			(1,284	)			709				(1,993	)		(281	)%
Net decrease in cash and cash equivalents			(38,642	)			(61,683	)			23,041			(37	)%
Cash and cash equivalents, beginning of period			228,340				206,632				21,708			11	%
Cash and cash equivalents, end of period		$	189,698			$	144,949			$	44,749			31	%

Net Revenue by Operating Segment
		For the three months ended							For the three months ended							For the six months ended							For the six months ended
(In thousands of U.S. dollars)		November 30, 2024				% of Total Revenue			November 30, 2023				% of Total Revenue			November 30, 2024				% of Total Revenue			November 30, 2023				% of Total Revenue
Beverage business		$	63,081			30	%		$	46,505			23	%		$	119,053			29	%		$	70,667			19	%
Cannabis business			65,652			31	%			67,114			35	%			126,901			31	%			137,447			37	%
Distribution business			67,611			32	%			67,223			35	%			135,682			33	%			136,380			37	%
Wellness business			14,606			7	%			12,929			7	%			29,358			7	%			26,226			7	%
Total net revenue		$	210,950			100	%		$	193,771			100	%		$	410,994			100	%		$	370,720			100	%
Net Revenue by Operating Segment in Constant Currency
		For the three months ended							For the three months ended							For the three months ended							For the three months ended
		November 30, 2024							November 30, 2023							November 30, 2024							November 30, 2023
(In thousands of U.S. dollars)		as reported in constant currency				% of Total Revenue			as reported in constant currency				% of Total Revenue			as reported in constant currency				% of Total Revenue			as reported in constant currency				% of Total Revenue
Beverage business		$	63,081			30	%		$	46,505			23	%		$	119,053			29	%		$	70,667			19	%
Cannabis business			65,853			31	%			67,114			35	%			128,645			31	%			137,447			37	%
Distribution business			69,411			32	%			67,223			35	%			139,807			33	%			136,380			37	%
Wellness business			14,629			7	%			12,929			7	%			29,569			7	%			26,226			7	%
Total net revenue		$	212,974			100	%		$	193,771			100	%		$	417,074			100	%		$	370,720			100	%
Net Cannabis Revenue by Market Channel
		For the three months ended							For the three months ended							For the six months ended							For the six months ended
(In thousands of U.S. dollars)		November 30, 2024				% of Total Revenue			November 30, 2023				% of Total Revenue			November 30, 2024				% of Total Revenue			November 30, 2023				% of Total Revenue
Revenue from Canadian medical cannabis		$	6,673			10	%		$	6,288			9	%		$	12,934			10	%		$	12,430			9	%
Revenue from Canadian adult-use cannabis			59,077			90	%			72,048			107	%			116,312			92	%			143,243			104	%
Revenue from wholesale cannabis			6,593			10	%			4,289			7	%			12,100			10	%			9,584			7	%
Revenue from international cannabis			14,865			23	%			11,931			18	%			27,056			21	%			26,183			19	%
Less excise taxes			(21,556	)		(33	)%			(27,442	)		(41	)%			(41,501	)		(33	)%			(53,993	)		(39	)%
Total		$	65,652			100	%		$	67,114			100	%		$	126,901			100	%		$	137,447			100	%
Net Cannabis Revenue by Market Channel in Constant Currency
		For the three months ended							For the three months ended							For the six months ended							For the six months ended
		November 30, 2024							November 30, 2023							November 30, 2024							November 30, 2023
(In thousands of U.S. dollars)		as reported in constant currency				% of Total Revenue			as reported in constant currency				% of Total Revenue			as reported in constant currency				% of Total Revenue			as reported in constant currency				% of Total Revenue
Revenue from Canadian medical cannabis		$	6,707			10	%		$	6,288			9	%		$	13,139			10	%		$	12,430			9	%
Revenue from Canadian adult-use cannabis			59,346			90	%			72,048			107	%			118,152			92	%			143,243			104	%
Revenue from wholesale cannabis			6,697			10	%			4,289			7	%			12,355			10	%			9,584			7	%
Revenue from international cannabis			14,759			23	%			11,931			18	%			27,147			21	%			26,183			19	%
Less excise taxes			(21,656	)		(33	)%			(27,442	)		(41	)%			(42,148	)		(33	)%			(53,993	)		(39	)%
Total		$	65,853			100	%		$	67,114			100	%		$	128,645			100	%		$	137,447			100	%

Other Financial Information: Key Operating Metrics
		For the three months ended								For the six months ended
		November 30,				November 30,				November 30,				November 30,
(in thousands of U.S. dollars)			2024				2023				2024				2023
Net beverage revenue		$	63,081			$	46,505			$	119,053			$	70,667
Net cannabis revenue			65,652				67,114				126,901				137,447
Distribution revenue			67,611				67,223				135,682				136,380
Wellness revenue			14,606				12,929				29,358				26,226
Beverage costs			37,925				30,513				70,975				41,779
Cannabis costs			42,475				46,472				79,529				96,989
Distribution costs			59,207				60,147				119,345				121,615
Wellness costs			10,123				9,230				20,219				18,732
Adjusted gross profit (excluding PPA step-up)			62,596				52,110				122,477				101,412
Beverage adjusted gross margin (excluding PPA step-up)			42	%			38	%			42	%			44	%
Cannabis adjusted gross margin (excluding PPA step-up)			35	%			35	%			37	%			35	%
Distribution gross margin			12	%			11	%			12	%			11	%
Wellness gross margin			31	%			29	%			31	%			29	%
Adjusted EBITDA		$	9,017			$	10,086			$	18,351			$	20,820
Cash and marketable securities as at the period ended:			252,249				259,791				252,249				259,791
Working capital as at the period ended:		$	428,815			$	247,041			$	428,815			$	247,041

Other Financial Information: Gross Margin and Adjusted Gross Margin
		For the three months ended November 30, 2024
(In thousands of U.S. dollars)		Beverage				Cannabis				Distribution				Wellness				Total
Net revenue		$	63,081			$	65,652			$	67,611			$	14,606			$	210,950
Cost of goods sold			37,925				42,475				59,207				10,123				149,730
Gross profit			25,156				23,177				8,404				4,483				61,220
Gross margin			40	%			35	%			12	%			31	%			29	%
Adjustments:
Purchase price accounting step-up			1,376				—				—				—				1,376
Adjusted gross profit			26,532				23,177				8,404				4,483				62,596
Adjusted gross margin			42	%			35	%			12	%			31	%			30	%
		For the three months ended November 30, 2023
(In thousands of U.S. dollars)		Beverage				Cannabis				Distribution				Wellness				Total
Net revenue		$	46,505			$	67,114			$	67,223			$	12,929			$	193,771
Cost of goods sold			30,513				46,472				60,147				9,230				146,362
Gross profit			15,992				20,642				7,076				3,699				47,409
Gross margin			34	%			31	%			11	%			29	%			24	%
Adjustments:
Purchase price accounting step-up			1,763				2,938				—				—				4,701
Adjusted gross profit			17,755				23,580				7,076				3,699				52,110
Adjusted gross margin			38	%			35	%			11	%			29	%			27	%
		For the six months ended November 30, 2024
(In thousands of U.S. dollars)		Beverage				Cannabis				Distribution				Wellness				Total
Net revenue		$	119,053			$	126,901			$	135,682			$	29,358			$	410,994
Cost of goods sold			70,975				79,529				119,345				20,219				290,068
Gross profit			48,078				47,372				16,337				9,139				120,926
Gross margin			40	%			37	%			12	%			31	%			29	%
Adjustments:
Purchase price accounting step-up			1,551				—				—				—				1,551
Adjusted gross profit			49,629				47,372				16,337				9,139				122,477
Adjusted gross margin			42	%			37	%			12	%			31	%			30	%
		For the six months ended November 30, 2023
(In thousands of U.S. dollars)		Beverage				Cannabis				Distribution				Wellness				Total
Net revenue		$	70,667			$	137,447			$	136,380			$	26,226			$	370,720
Cost of goods sold			41,779				96,989				121,615				18,732				279,115
Gross profit			28,888				40,458				14,765				7,494				91,605
Gross margin			41	%			29	%			11	%			29	%			25	%
Adjustments:
Purchase price accounting step-up			2,353				7,454				—				—				9,807
Adjusted gross profit			31,241				47,912				14,765				7,494				101,412
Adjusted gross margin			44	%			35	%			11	%			29	%			27	%

Other Financial Information: Adjusted Earnings Before Interest, Taxes and Amortization
		For the three months ended															For the six months ended
(In thousands of U.S. dollars)		November 30,				November 30,				Change				% Change			November 30,				November 30,				Change				% Change
			2024				2023			2024 vs. 2023								2024				2023			2024 vs. 2023
Net loss		$	(85,275	)		$	(46,183	)		$	(39,092	)		85	%		$	(119,927	)		$	(102,046	)		$	(17,881	)		18	%
Income tax expense (recovery), net			2,036				(3,380	)			5,416			(160	)%			2,922				3,884				(962	)		(25	)%
Interest expense, net			7,766				8,625				(859	)		(10	)%			17,608				18,460				(852	)		(5	)%
Non-operating income (expense), net			33,255				(821	)			34,076			(4,151	)%			20,609				3,581				17,028			476	%
Amortization			34,050				31,552				2,498			8	%			65,864				62,341				3,523			6	%
Stock-based compensation			7,237				8,201				(964	)		(12	)%			14,154				16,458				(2,304	)		(14	)%
Change in fair value of contingent consideration			—				300				(300	)		(100	)%			—				(10,807	)			10,807			(100	)%
Purchase price accounting step-up			1,376				4,701				(3,325	)		(71	)%			1,551				9,807				(8,256	)		(84	)%
Facility start-up and closure costs			—				300				(300	)		(100	)%			—				900				(900	)		(100	)%
Litigation costs, net of recoveries			901				3,042				(2,141	)		(70	)%			2,496				5,076				(2,580	)		(51	)%
Restructuring costs			6,869				2,655				4,214			159	%			11,116				3,570				7,546			211	%
Transaction costs (income), net			802				1,094				(292	)		(27	)%			1,958				9,596				(7,638	)		(80	)%
Adjusted EBITDA		$	9,017			$	10,086			$	(1,069	)		(11	)%		$	18,351			$	20,820			$	(2,469	)		(12	)%
		For the three months ended															For the six months ended
		November 30,				November 30,				Change				% Change			November 30,				November 30,				Change				% Change
			2024				2023			Change								2024				2023			Change
Net loss attributable to stockholders of Tilray Brands, Inc.		$	(85,342	)		$	(49,008	)		$	(36,334	)		74	%		$	(124,507	)		$	(120,533	)		$	(3,974	)		3	%
Non-operating income (expense), net			33,255				(821	)			34,076			(4,151	)%			20,609				3,581				17,028			476	%
Amortization			34,050				31,552				2,498			8	%			65,864				62,341				3,523			6	%
Stock-based compensation			7,237				8,201				(964	)		(12	)%			14,154				16,458				(2,304	)		(14	)%
Change in fair value of contingent consideration			—				300				(300	)		(100	)%			—				(10,807	)			10,807			(100	)%
Facility start-up and closure costs			—				300				(300	)		(100	)%			—				900				(900	)		(100	)%
Litigation costs, net of recoveries			901				3,042				(2,141	)		(70	)%			2,496				5,076				(2,580	)		(51	)%
Restructuring costs			6,869				2,655				4,214			159	%			11,116				3,570				7,546			211	%
Transaction costs (income)			802				1,094				(292	)		(27	)%			1,958				9,596				(7,638	)		(80	)%
Adjusted net income (loss)		$	(2,228	)		$	(2,685	)		$	457			(17	)%		$	(8,310	)		$	(29,818	)		$	21,508			(72	)%
Adjusted net income (loss) per share - basic and diluted		$	—			$	—			$	—			0	%		$	(0.01	)		$	(0.04	)		$	0.03			(75	)%
Other Financial Information: Free Cash Flow
		For the three months ended															For the six months ended
		November 30,				November 30,				Change				% Change			November 30,				November 30,				Change				% Change
(In thousands of U.S. dollars)			2024				2023			2024 vs. 2023								2024				2023			2024 vs. 2023
Net cash used in operating activities		$	(40,724	)		$	(30,409	)		$	(10,315	)		34	%		$	(76,031	)		$	(46,251	)		$	(29,780	)		64	%
Less: investments in capital and intangible assets, net			(4,833	)			(5,836	)			1,003			(17	)%			(11,541	)			(9,646	)			(1,895	)		20	%
Free cash flow		$	(45,557	)		$	(36,245	)		$	(9,312	)		26	%		$	(87,572	)		$	(55,897	)		$	(31,675	)		57	%
Add: growth CAPEX			1,970				3,158				(1,188	)		(38	)%			4,510				4,845				(335	)		(7	)%
Add: cash income taxes related to Aphria Diamond			—				8,502				(8,502	)		(100	)%			—				14,216				(14,216	)		(100	)%
Add: integration costs related to HEXO			—				6,230				(6,230	)		(100	)%			—				12,145				(12,145	)		(100	)%
Adjusted free cash flow		$	(43,587	)		$	(18,355	)		$	(25,232	)		137	%		$	(83,062	)		$	(24,691	)		$	(58,371	)		236	%