High Tide pushed quarterly revenue close to C$200 million and expanded profitability in its fiscal third quarter, as rapid growth in Germany added a second meaningful revenue engine to the Canadian cannabis retailer.
Revenue reached C$198.8 million for the three months ended July 31, up 33% from C$149.7 million a year earlier and 11% from the prior quarter. Adjusted EBITDA climbed 53% year over year to C$16.2 million, while the adjusted EBITDA margin rose to 8.2%, its highest level in three years.
Both numbers exceeded the analyst expectations High Tide disclosed in August. FactSet consensus at the time called for C$183.4 million of revenue and C$14.0 million of adjusted EBITDA. The results were less surprising than those comparisons suggest, however: High Tide had already issued preliminary guidance for revenue of C$195 million to C$200 million and adjusted EBITDA of C$15.2 million to C$16.5 million. The final numbers landed near the upper ends of those ranges.
Nasdaq-listed shares of High Tide rose about 8% in after-hours trading Monday after gaining roughly 4% during the regular session.
All financial figures in this article are in Canadian dollars unless otherwise noted.
Germany Is Becoming a Material Part of the Business
High Tide’s majority-owned German medical cannabis distributor, Remexian Pharma, generated C$38.2 million of quarterly revenue, up from C$31.6 million in the previous quarter. The business distributed 10.2 tonnes of medical cannabis during the period, an increase of 35% sequentially, while maintaining a 26% gross margin.
Remexian now accounts for roughly one-fifth of High Tide’s consolidated quarterly revenue.
That is an important qualification to the company’s 33% year-over-year growth rate because High Tide did not own the German business during the comparable quarter last year. The acquisition has substantially increased the company’s scale and reduced its dependence on Canadian recreational cannabis retail, where industry growth is considerably slower.
High Tide said Remexian’s German market share increased from 6.5% to 10.5% during the first six months following the transaction. The company continues to evaluate other European markets but has not committed to another major expansion.
The Canadian operation delivered a more restrained picture.
Canna Cabana ended the period with 232 Canadian stores and a 14% share of the recreational cannabis retail market in the provinces where it operates, excluding British Columbia, up from 13% a year ago. Total Canna Cabana sales rose faster than the broader market over the 12 months through June.
Same-store sales, however, were essentially flat for the full quarter compared with last year. June and July both returned to positive comparable growth, and same-store transaction counts increased 1.1%, but expansion remains an important contributor to overall Canadian growth.
High Tide opened stores in Toronto, Welland, Ottawa and Calgary during the quarter and acquired four Ontario stores through its purchase of Northern Helm. It continues to target more than 20 new Canna Cabana locations during calendar 2026 and ultimately more than 350 stores across Canada.
Profit Growth Outpaced Revenue
The strongest part of the quarter was the improvement below the top line.
Gross profit increased 32% to C$52.7 million, while gross margin held steady at 27%. Operating expenses grew more slowly than sales, falling to 18% of revenue from 20% a year earlier. General and administrative costs declined to 3.9% of revenue, while salaries, wages and benefits dropped to 11.4%.
Income from operations more than doubled to C$8.7 million from C$3.7 million.
Those figures provide a cleaner measure of the improvement than High Tide’s record C$12.7 million of reported net income.
The quarter included an C$11.8 million non-cash gain tied to the fair-value change of a derivative liability. After adjusting for that item and a change in a long-term contract asset, High Tide calculated adjusted net income of C$2.2 million, up from C$875,000 a year earlier.
The adjustment does not erase the improvement in profitability, but it means the jump from C$832,000 of year-ago net income to C$12.7 million this quarter should not be interpreted as a comparable increase in earnings generated by normal operations.
Cash Flow Remains the Next Test
High Tide produced C$7.0 million of free cash flow during the quarter, a substantial rebound from C$1.5 million in the second quarter.
Compared with a year ago, though, free cash flow declined 9% from C$7.7 million. Trailing 12-month free cash flow stood at C$12.8 million, below C$16.6 million at the same point last year. Some of that pressure reflects additional working-capital investment as High Tide expands.
Cash and restricted cash rose to C$47.1 million from C$36.5 million at the end of the previous quarter, although the balance remained below the C$63.8 million reported a year earlier.
The company also closed C$40 million of senior secured credit facilities with Bank of Montreal after the quarter ended, adding financing flexibility as it continues opening stores and integrating its German operation.
High Tide now has an annualized revenue run rate approaching C$800 million, but the next stage of the investment case is less about simply adding sales.
Remexian needs to keep scaling without giving up margin, while Canna Cabana must turn the positive comparable-sales trends seen in June and July into sustained same-store growth. At the same time, free cash flow will need to keep pace with the company’s store openings and working-capital needs if High Tide wants to finance expansion without leaning heavily on new debt or equity.
Management will discuss the quarter and the remainder of fiscal 2026 on its earnings call Tuesday. After a quarter in which much of the headline growth was already previewed, any new information on German demand, fourth-quarter same-store sales and the pace of cash generation could matter more than another revenue record.