Ascend Wellness Holdings reported third‑quarter 2025 results that showed a 2.0% sequential decline in net revenue to $124.7 million, a drop of $2.6 million from the $127.3 million earned in Q2. The decline was driven by a 3% fall in retail sales, largely due to price compression and lower transaction volumes in Illinois and New Jersey, while third‑party wholesale revenue edged up 0.1% and helped offset the retail weakness.
Net loss for the quarter was $25.8 million, a $2.5 million improvement over the $28.3 million loss reported in Q3 2024. Earnings per share fell to –$0.13, missing the consensus estimate of –$0.07. The miss reflects the combined impact of lower retail revenue and the company’s higher cost base, even as it continues to invest in automation and a new e‑commerce platform.
Margin performance was a bright spot: adjusted gross margin rose 300 basis points to 46.4%, and adjusted EBITDA margin increased 250 basis points to 24.9%. The margin expansion was largely driven by a higher vertical sales mix—more sales of Ascend’s own brands—and improved margins on third‑party products, offsetting the revenue decline. Adjusted EBITDA reached $31.1 million, up 8.7% from the $28.5 million earned in Q2.
The company added seven new retail locations during the quarter, bringing its total footprint to 46 stores nationwide. It also closed a $9.3 million mortgage financing on three Ohio properties, strengthening its balance sheet for future expansion. Management reiterated its densification strategy, noting that the company expects revenue to remain relatively stable, with a slight decline from Q3, and that adjusted EBITDA margin should stay above 23% in the coming quarters.
Management highlighted the importance of cost discipline and operational efficiency. CFO Roman Nemchenko said the company was pleased to report the margin gains and that the vertical mix shift was a key driver. CEO Sam Brill emphasized the focus on “greater scale and sustainability in our core markets,” underscoring the company’s commitment to expanding its retail network while maintaining profitability.
Investors responded positively to the earnings release, reflecting confidence in the company’s margin expansion and operational strategy, despite the revenue and EPS misses.
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