Q2 2026 Vireo Growth Inc Earnings Call

August 11, 2026

Operator 3: Hello everyone. Thank you for joining us and welcome to the Vireo Growth Q2 2026 financial results call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to John Mazarakis, CEO. John, please go ahead.

Operator: Hello everyone. Thank you for joining us and welcome to the Vireo Growth Q2 2026 financial results call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to John Mazarakis, CEO. John, please go ahead.

Speaker #1: If you would like to ask a question, please press *1 to raise your hand. To withdraw your question, press *1 again. I will now hand the conference over to John Maserakis, CEO, John, please go ahead.

Speaker #2: Thank you, operator, and good morning, everyone. The second quarter was another important step forward for Vireo. We delivered strong financial performance while continuing to execute against what we believe is one of the most differentiated growth strategies in the cannabis industry.

John Mazarakis: Thank you, operator, and good morning, everyone. The Q2 was another important step forward for Vireo. We delivered strong financial performance while continuing to execute against what we believe is one of the most differentiated growth strategies in the cannabis industry. Tyson will review our financial results in a moment, but first, I'd like to discuss our progress, our expanding platform, and then spend a few minutes discussing the strategy that's driving these investments. We closed several important transactions over the last few months, including Eaze, The Hawthorne Gardening Company, and the Bridgewell Agribusiness.

Speaker #2: Tyson will review our financial results in a moment, but first, I'd like to discuss our progress, our expanding platform, and then spend a few minutes discussing the strategy that's driving these investments.

Speaker #2: We closed several important transactions over the last few months, including ease, Hawthorne, and the Bridgewell Agribusiness. In addition, we announced several transformative transactions during the second quarter that should significantly expand our platform, including the acquisition of Fluent to expand and deepen in Florida, C21 to broaden our Nevada presence with a strong operator, and Planet 13 that further solidifies both Nevada and cements our presence in Florida with a total of over 100 dispensaries.

John Mazarakis: In addition, we announced several transformative transactions during the Q2 that should significantly expand our platform, including the acquisition of FLUENT Corp. to expand and deepen in Florida, C21 Investments Inc. to broaden our Nevada presence with a strong operator, and Planet 13 Holdings Inc. that further solidifies both Nevada and cements our presence in Florida with a total of over 100 dispensaries. In July, we also announced two significant strategic transactions that further strengthen our platform. First, we entered into an asset purchase agreement to acquire certain assets from The Cannabist Company, a transaction that is important to us on many fronts. Then, at the end of July, we announced a four-deal transaction to enter Ohio, which will add the 15th state to our growing platform.

Speaker #2: In July, we also announced two significant strategic transactions that further strengthen our platform. First, we entered into an asset purchase agreement to acquire certain assets from the cannabis company, a transaction that is important to us on many fronts.

Speaker #2: Then, at the end of July, we announced a four-deal transaction to enter Ohio, which will add the 15th state to our growing platform. Together, these transactions meaningfully expand our scale, deepen our presence in key markets, and further position Vireo as one of the leading multi-state cannabis operators in the industry.

John Mazarakis: Together, these transactions meaningfully expand our scale, deepen our presence in key markets, and further position Vireo as one of the leading multi-state cannabis operators in the industry. Let me spend a few minutes here on some of the larger transactions I just covered. Bridgewell Agribusiness is part of our non-cannabis segment, along with The Hawthorne Gardening Company, and is an important example of how we're thinking beyond the traditional cannabis operator model. It expands our ancillary agribusiness platform, strengthens our supply chain capabilities, and provides exposure to agricultural markets that expand beyond cannabis. We believe these businesses will become increasingly valuable as we continue building a broader platform. FLUENT Corp. had substantial scale and operating leverage in one of the country's most important and largest limited license states, Florida. The Cannabist Company solidifies our market leadership in Colorado and also provides entry into three new states, Massachusetts, New Jersey, and Illinois.

Speaker #2: Let me spend a few minutes here on some of the larger transactions I just covered. Bridgewell is part of our non-cannabis segment, along with Hawthorne, and is an important example of how we're thinking beyond the traditional cannabis operator model.

Speaker #2: It expands our ancillary agribusiness platform, strengthens our supply chain capabilities, and provides exposure to agricultural markets that extend beyond cannabis. We believe these businesses will become increasingly valuable as we continue building a broader platform.

Speaker #2: Fluent had substantial scale and operating leverage in one of the country’s most important and largest limited-license states, Florida. The cannabis company solidifies our market leadership in Colorado and also provides entry into three new states: Massachusetts, New Jersey, and Illinois.

Speaker #2: We're already working to bring these assets under management services agreements as we await the necessary state regulatory approvals to complete the transaction. Planet 13 is also a major transaction with its iconic superstore in Las Vegas, plus a second Nevada location to add to our growing market leadership.

John Mazarakis: We're already working to bring these assets under management services agreements as we await the necessary state regulatory approvals to complete the transaction. Planet 13 Holdings Inc. is also a major transaction with its iconic superstore in Las Vegas, plus a second Nevada location to add to our growing market leadership. This transaction provides an additional store in Illinois and 33 stores in Florida, which combined with Eaze, Green Dragon, and the announced FLUENT Corp. acquisition, brings us to over 100 stores and the second-largest retail footprint in the Florida market. The Ohio transaction will establish Vireo in a new state with immediate scale and a vertically integrated platform, including eight dispensaries. Last quarter, I discussed becoming the fourth largest cannabis company in the United States on a pro forma revenue basis. Since then, that position has only strengthened. Our pro forma revenue this quarter exceeded $1 billion on an annualized basis.

Speaker #2: This transaction provides an additional store in Illinois and 33 stores in Florida, which combined with ease Green Dragon and the announced Fluent acquisition brings us to over 100 stores and the second largest retail footprint in the Florida market.

Speaker #2: The Ohio transaction will establish Vireo in a new state with immediate scale and a vertically integrated platform, including eight dispensaries. Last quarter, I discussed becoming the fourth-largest cannabis company in the United States on a pro forma revenue basis.

Speaker #2: Since then, that position has only strengthened. Our proforma revenue this quarter exceeded $1 billion on an annualized basis and, to be clear, that does not include future revenues associated with Fluent, the cannabis, Planet 13, and Ohio, which have not closed yet.

John Mazarakis: And to be clear, that does not include future revenues associated with FLUENT, The Cannabist Company, Planet 13 Holdings Inc., and Ohio, which have not closed yet. Today, Vireo operates across 10 states with approximately 170 dispensaries and holds a non-operational Pennsylvania dispensary license for up to six stores alongside our growing ancillary agribusiness. Upon completion of our announced and pending transactions, we expect to operate approximately 270 dispensaries across 15 states, which we believe would create one of the industry's broadest multi-state operating platforms and the largest operational retail footprint in the United States. Building a platform of this scale over a relatively short period of time naturally raises questions about execution. We believe that's where Vireo has a distinct competitive advantage. First, experience. Our executive team brings decades of experience integrating and operating complex businesses. Second, talent. We build a deep bench of operational talent to support our strategy.

Speaker #2: Today, Vireo operates across 10 states with approximately 170 dispensaries and holds a non-operational Pennsylvania dispensary license for up to six stores alongside our growing ancillary agribusiness.

Speaker #2: Upon completion of our announced and pending transactions, we expect to operate approximately 270 dispensaries across 15 states, which we believe would create one of the industry's broadest multi-state operating platforms and the largest operational retail footprint in the United States.

Speaker #2: Building a platform of this scale over a relatively short period of time naturally raises questions about execution. We believe that's where Vireo has a distinct competitive advantage.

Speaker #2: First, experience. Our executive team brings decades of experience integrating and operating complex businesses. Second, talent. We build a deep bench of operational talent to support our strategy.

Speaker #2: And third, our operating model. Our decentralized operating model supports speed, flexibility, and local market knowledge. We believe these capabilities position us to successfully integrate these businesses, optimize performance, and create a platform that is greater than the sum of its parts.

John Mazarakis: And third, our operating model. Our decentralized operating model supports speed, flexibility, and local market knowledge. We believe these capabilities position us to successfully integrate these businesses, optimize performance, and create a platform that is greater than the sum of its parts. I'd now like to share a high-level view of our strategy. We're not the loudest operator out there, and that is by design. We have been quietly amassing a platform that is becoming something different than a traditional cannabis operator. So what are we building? We're building a diversified cannabis and agribusiness platform that combines disciplined consolidation, operational excellence, and thoughtful capital allocation. We don't pursue acquisitions to plant a flag or simply to become larger. Every investment must strengthen an existing market, improve free cash flow, expand our supply chain capabilities, or create strategic advantages that make the broader platform more valuable.

Speaker #2: I'd now like to share a high-level view of our strategy. We're not the loudest operator out there, and that is by design. We have been quietly amassing a platform that is becoming something different than traditional cannabis operator.

Speaker #2: So, what are we building? We're building a diversified cannabis and agribusiness platform that combines disciplined consolidation, operational excellence, and thoughtful capital allocation. We don't pursue acquisitions to plant a flag or simply to become larger.

Speaker #2: Every investment must strengthen an existing market, improve free cash flow, expand our supply chain capabilities, or create strategic advantages that make the broader platform more valuable.

Speaker #2: We built this business through disciplined consolidation and we focused on acquiring strong operators and quality assets where we believe our operating platform and balance sheet can unlock additional value.

John Mazarakis: We built this business through disciplined consolidation, and we focused on acquiring strong operators and quality assets where we believe our operating platform and balance sheet can unlock additional value. While many opportunities originate from companies facing capital constraints, we're not exclusively pursuing distressed situations. C21 Investments Inc. is a good example. It is a well-run business with attractive assets, strong cash flow, and an excellent team that strengthens our leadership position in Nevada. We also believe great operators should remain close to their markets. Our model combines centralized capital allocation, financial discipline, and strategic direction with a decentralized operating leadership. We believe local teams make better decisions for local consumers while benefiting from the scale of a larger organization. Looking ahead, our long-term objectives remain straightforward. Generate non-volatile free cash flow through disciplined capital allocation and continued operational improvement. Build $100 million-plus revenue businesses across each of our core states.

Speaker #2: While many opportunities originate from companies facing capital constraints, we're not exclusively pursuing distress situations. C21 is a good example. It is a well-run business with attractive assets, strong cash flow, and an excellent team that strengthens our leadership position in Nevada.

Speaker #2: We also believe great operators should remain close to their markets. Our model combines centralized capital allocation, financial discipline, and strategic direction with a decentralized operating leadership.

Speaker #2: We believe local teams make better decisions for local consumers while benefiting from the scale of our larger organization. Looking ahead, our long-term objectives remain straightforward: generate non-volatile free cash flow through disciplined capital allocation and continued operational improvement.

Speaker #2: Build $100 million-plus revenue businesses across each of our core states. Deliver consistent same-store sales growth through optimization efforts, and continue building one of the industry's broadest, integrated cannabis and agribusiness platforms.

John Mazarakis: Deliver consistent same-store sales growth through optimization efforts, and continue building one of the industry's broadest integrated cannabis and agribusiness platforms. As we continue through the end of the year, we will not be slowing down. However, we do expect that 2027 will bring a clearer financial picture of our strategic vision in action. And on that note, I now hand over the call to Tyson.

Speaker #2: As we continue through the end of the year, we will not be slowing down. However, we do expect that 2027 will bring a clearer financial picture of our strategic vision in action.

Speaker #2: And on that note, I now hand over the call to Tyson.

Speaker #3: Thank you, John, and thanks to everyone for joining us. I'll run through a quick summary of key income statement line items, and then review our balance sheet in more detail.

Tyson Macdonald: Thank you, John, and thanks to everyone for joining us. I will run through a quick summary of key income statement line items and then review our balance sheet in more detail. Q2 GAAP revenue of $209.3 million increased 335% year over year on a reported basis. On a segment basis, cannabis revenue was $175.8 million, up 265% year over year. In our non-cannabis segment, a new contributor following the Hawthorne and Bridgewell acquisitions that closed during the quarter contributed $33.5 million. Giving effect to the acquisitions of Vireo Health of Rocky Mountain, Eaze Inc., The Hawthorne Gardening Company, Bridgewell Agribusiness LLC, and PharmCan, as if they were completed on 1 April 2026, Q2 pro forma revenue was $254.9 million, eclipsing a billion-dollar run rate. This run rate does not include FLUENT Corp., C21 Investments Inc., The Cannabist Company assets, Planet 13 Holdings Inc., or the Ohio transactions.

Speaker #3: Second quarter gap revenue of $209.3 million increased 335% year over year on a reported basis. On a segment basis, cannabis revenue was $175.8 million, up 265% year over year, and our non-cannabis segment, a new contributor following the Hawthorne and Bridgewell acquisitions that closed during the quarter, contributed 33.5 million.

Speaker #3: Giving effect to the acquisitions of Vireo Health of Rocky Mountain, EASE Hawthorne, Bridgewell, and Pharmacan as if they were completed on April 1, 2026.

Speaker #3: Second quarter pro forma revenue was $254.9 million, eclipsing a billion-dollar run rate. And I will note, this run rate does not include Fluent, C21, the cannabis assets, Planet 13, or the Ohio transactions.

Speaker #3: For our cannabis segment specifically, we show pro forma year-over-year retail revenue growth of 7%. If we use this as a proxy for the same-store sales metric, we can see our optimization at work, with particularly strong performance in markets where integration of recent acquisitions is substantially complete.

Tyson Macdonald: For our cannabis segment specifically, we show pro forma year-over-year retail revenue growth of 7%. If we use this as a proxy for the same-store sales metric, we can see our optimization at work with particularly strong performance in markets where integration of recent acquisitions is substantially complete. For a complete review of our revenue performance by state and sales channel for Q2, please refer to the accompanying market sales tables in today's earnings release. Excluding the impact of non-cash inventory valuation adjustments primarily related to the required GAAP fair value step-up associated with our closed transactions, gross margin was 47%, a decline of 430 basis points compared to the prior year quarter. The primary driver here is the addition of our non-cannabis segment, which carries a structurally lower margin profile than our core cannabis business.

Speaker #3: For a complete review of our revenue performance by state and sales channel for the second quarter, please refer to the accompanying market sales tables in today's earnings release.

Speaker #3: Excluding the impact of non-cash inventory valuation adjustments, primarily related to the required gap fair value step-up associated with our closed transactions, gross margin was 47%, a decline of 430 basis points compared to the prior year quarter.

Speaker #3: The primary driver here is the addition of our non-cannabis segment, which carries a structurally lower margin profile than our core cannabis business. On a segment basis, cannabis adjusted gross margin was 53%, up 120 basis points year over year, while our non-cannabis segment adjusted gross margin was 18%, reflecting the lower-margin, higher-value nature of that business.

Tyson Macdonald: On a segment basis, cannabis adjusted gross margin was 53%, up 120 basis points year over year, while our non-cannabis segment adjusted gross margin was 18%, reflecting the lower margin, higher value nature of that business. Q2 net loss was $0.1 million compared to a net loss of $14.9 million in the year ago period. Adjusted EBITDA was approximately $41.5 million or 19.8% of sales, reflecting an improvement of approximately $28.2 million year over year. As a percentage of sales, adjusted EBITDA margin declined 790 basis points compared to 27.7% in Q2 of last year. This decline was driven by the addition of our non-cannabis business segment, as well as recently acquired cannabis operations that carry historically lower EBITDA margins.

Speaker #3: Second quarter net loss was 0.1 million compared to a net loss of 14.9 million in the year ago period. Adjusted EBITDA was approximately $41.5 million, or 19.8% of sales, reflecting an improvement of approximately 28.2 million year over year.

Speaker #3: As a percentage of sales, adjusted EBITDA margin declined 790 basis points compared to 27.7% in the second quarter of last year. This decline was driven by the addition of our non-cannabis business segment, as well as recently acquired cannabis operations that carry historically lower EBITDA margins.

Speaker #3: On a segment basis, cannabis adjusted EBITDA margin was 22.4% for the quarter, compared to 27.7% in the year-ago period, and our non-cannabis adjusted EBITDA margin was 6.3%.

Tyson Macdonald: On a segment basis, cannabis adjusted EBITDA margin was 22.4% for the quarter compared to 27.7% in the year ago period, and our non-cannabis adjusted EBITDA margin was 6.3%. Moving on to the balance sheet. We ended the quarter with cash and cash equivalents of $122.7 million and an additional $1 million of marketable liquid securities, providing Vireo with significant financial flexibility. Combined with improving industry fundamentals and our disciplined capital allocation strategy, we believe we are positioned to continue executing on both organic growth initiatives and accretive acquisitions. I will also mention here, in support of executing these growth initiatives and acquisitions, Vireo, through our non-cannabis segment, recently entered into a new asset-based lending credit facility with certain financial institutions in Bank of Montreal, providing a $65 million initial commitment, expandable to $85 million, and further to $105 million through a $20 million accordion feature.

Speaker #3: Moving on to the balance sheet, we ended the quarter with cash and cash equivalents of $122.7 million and an additional $1 million of marketable liquid securities, providing Vireo significant financial flexibility.

Speaker #3: Combined with improving industry fundamentals and our disciplined capital allocation strategy, we believe we're positioned to continue executing on both organic growth initiatives and accretive acquisitions.

Speaker #3: I'll also mention here, in support of executing these growth initiatives and acquisitions, Vireo, through our non-cannabis segment, recently entered into a new asset-based lending credit facility with certain financial institutions and Bank of Montreal, providing a $65 million initial commitment, expandable to $85 million, and further to $105 million through a $20 million accordion feature.

Speaker #3: This ABL, priced at an industry-leading rate of Term SOFR plus 1.75% to 2%, currently 5.37% to 5.62%, will provide us with additional liquidity and financial flexibility through a revolving credit facility to support working capital, capital expenditures, strategic M&A, and other general corporate purposes, while diversifying our sources of capital.

Tyson Macdonald: This ABL, priced at an industry-leading rate of Term SOFR plus 1.75% to 2%, currently 5.37% to 5.62%, will provide us with the additional liquidity and financial flexibility through a revolving credit facility to support working capital expenditures, strategic M&A, and other general corporate purposes while diversifying our sources of capital. Total current assets, excluding income tax receivables, were $374 million, compared to our current liabilities, excluding uncertain tax liabilities, and contingent consideration of $181.4 million. During Q2, after our annual meeting, the company consolidated its subordinated voting shares. As of 30 June, Vireo had a total of 54.4 million subordinate voting shares outstanding on a treasury method basis using a share price of $15. This was comprised of 45.8 million subordinate voting shares outstanding on an as converted basis.

Speaker #3: Total current assets, excluding income tax receivables, were $374 million, compared to a current liabilities excluding uncertain tax liabilities and contingent consideration of $181.4 million.

Speaker #3: During the second quarter, after our annual meeting, the company consolidated its subordinated voting shares. As of June 30th, Vireo had a total of 54.4 million subordinate voting shares outstanding on a treasury method basis, using a share price of $15.

Speaker #3: This was comprised of 45.8 million subordinate voting shares outstanding on an as-converted basis, 2.1 million RSUs, 1.2 million shares issuable upon conversion of convertible debt, 3.5 million shares held in escrow, 1.2 million shares expected to be issued in connection with the satisfaction of earn-out liabilities, and 0.6 million in the money warrants and options adjusted for the treasury method.

Tyson Macdonald: 2.1 million RSUs, 1.2 million shares issuable upon conversion of convertible debt, 3.5 million shares held in escrow, 1.2 million shares expected to be issued in connection with the satisfaction of earn out liabilities, and 0.6 million in the money warrants and options adjusted for the treasury method. Finally, at the end of June, we appointed BDO as our independent registered public accounting firm. We view this as another important step in the continued evolution of Vireo as we build a larger, more diversified business with a strong foundation of financial discipline and corporate governance. That concludes my prepared remarks. I'll now hand the call back to John for closing comments.

Speaker #3: Finally, at the end of June, we appointed BDO as our independent registered public accounting firm. View this as another important step in the continued evolution of Vireo, as we build a larger, more diversified business with a strong foundation of financial discipline and corporate governance.

Speaker #3: That concludes my prepared remarks. I'll now hand the call back to John for his closing comments.

Speaker #2: Thank you, Tyson. Before we open the call for Q&A, I'd like to leave you with one final thought. Over the past 18 months, we've demonstrated that we can successfully identify, acquire, integrate, and optimize businesses while maintaining financial discipline, and we are starting to see the financial model take shape.

John Mazarakis: Thank you, Tyson. Before we open the call for Q&A, I'd like to leave you with one final thought. Over the past 18 months, we've demonstrated that we can successfully identify, acquire, integrate, and optimize businesses while maintaining financial discipline, and we are starting to see the financial model take place. Each transaction that we've announced is intentional, selected to strengthen our platform. We believe the combination of leading market positions, disciplined capital allocation, and a differentiated cannabis and agribusiness strategy positions Vireo to create meaningful long-term shareholder value. We're excited about the opportunities ahead and appreciate your continued support. Thank you for joining us today. Operator.

Speaker #2: Each transaction that we've announced is intentional, selected to strengthen our platform. We believe the combination of leading market positions, disciplined capital allocation, and a differentiated cannabis and agribusiness strategy positions Vireo to create meaningful long-term shareholder value.

Speaker #2: We're excited about the opportunities ahead and appreciate your continued support. Thank you for joining us today, operator.

Speaker #1: We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand.

Operator 3: We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Pablo Zuanic from Zuanic & Associates. Your line is now open. Please go ahead.

Operator: We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Pablo Zuanic from Zuanic & Associates. Your line is now open. Please go a head.

Speaker #1: To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality.

Speaker #1: If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Pablo Zuanic.

Speaker #1: From Zuanic and Associates, your line is now open. Please go ahead.

Speaker #4: Thank you. Good morning, everyone. John, thank you very much for those prepared remarks. I think you gave a great color that explains the strategy, so that was very, very helpful.

Pablo Zuanic: Thank you. Good morning, everyone. John, thank you very much for those prepared remarks. I think you gave a great color that explains the strategy, so that was very helpful. Not to make you repeat what you already said, but we have seen companies, The Cannabist Company, that were very aggressive in terms of expanding in this industry, taking on a lot of leverage, probably overpaying, and we all know what happened with them eventually, right? I think you made it very clear why your strategy is different, but you might want to expand a little bit on that in terms of why this is different. Thank you.

Speaker #4: And not to make you repeat what you already said, but we've seen companies, whether cannabis or others, that were very aggressive—intentionally expanding in this industry, taking on a lot of leverage, probably overpaying—and we all know what happened with them eventually, right?

Speaker #4: And I think you made it very clear why your strategy is different. But you might want to expand a little bit on that, in terms of why this is different.

Speaker #4: Thank you.

Speaker #5: Well, Pablo, first of all, we're not levered. We're one of the most underlevered companies in cannabis. And second of all, I think we're buying at the right multiples.

John Mazarakis: Well, Pablo, first of all, we are not levered. We are one of the most under-levered companies in cannabis. Second of all, I think we are buying at the right multiples, and we are running a very decentralized model, which enables us to move fast, integrate quickly, and maintain local control. Our objective is to get every market to what we think is a sustainable long-term market share, with meaningful tailwinds, and that is at least 100 million. So that is the litmus test. That 100 million is not just a random number. It allows us to have the right leadership, the proper comp, so that we can run this decentralized model. I am just not sure that anyone else has done it in this way. So I do not see how we compare to others of the past.

Speaker #5: And we're running a very decentralized model, which enables us to move fast, integrate quickly, and maintain local control. Our objective is to get every market to what we think is a sustainable long-term market share with meaningful tailwinds.

Speaker #5: And that is $100 million at least $100 million. So that's the litmus test. And that $100 million is not just a random number. It allows us to have the right leadership, the proper comp, so that we can run this decentralized model.

Speaker #5: And I'm just not sure that anyone else has done it in this way, so I don't see how we compare to others of the past.

Speaker #4: Yeah. Of course, I totally agree.

Pablo Zuanic: No, of course. I totally agree.

John Mazarakis: For all the concerns.

Speaker #5: For all the businesses, that's a great caller.

Pablo Zuanic: That's well colored. Yeah, thank you very much. Very useful. Thank you. Just on the same topic, when you talk about you're not done yet, does that mean that you may go into other states also, or just keep the 15 that you have right now and just gain depth? If you can expand on that would help. Related to that, you said that by 2027, it would be easier for people to get financials. Does that mean that you wouldn't be doing many deals in 2027? Maybe you want to explain that also. Thank you.

Speaker #4: One, yeah. Thank you very much. That was very useful, thank you. And then, just on the same topic, when you talk about you're not done yet, does that mean that you may go into other states also, or just keep the fifteen that you have right now and just gain depth?

Speaker #4: If you can expand on that, that would help. And related to that, you said that by 2027, it would be easier for people to get financials.

Speaker #4: Does that mean that you wouldn't be doing many deals in 2027? Maybe you want to explain that also. Thank you.

Speaker #5: We will never say no to deals that are rightly priced. So we continue to evaluate every company that is out there. We're open to doing deals that make sense for the shareholders.

John Mazarakis: We will never say no to deals that are rightly priced. We continue to evaluate every company that is out there. We're open to doing deals that make sense for the shareholders. Whether those deals are in existing states or new states, I explained how we think about existing states and new states. We think that a state can bring in $100 million in revenue, even if it's not immediate. We will be pursuing that state at the right price.

Speaker #5: Whether those deals are in existing states or new states, I explain how we think about existing states and new states. We think that a state can bring in $100 million in revenue, even if it's not immediate.

Speaker #5: We will be pursuing that state at the right price.

Speaker #4: Yeah, no, thank you. And then, just if I may—and apologies if there are more people on the line here waiting in the Q&A queue.

Pablo Zuanic: Yeah, no, thank you. Just, if I may, and apologies if there's more people on the line here waiting on the Q&A queue. You were yesterday at the NYSE, right, with the MSOS ETF people and other CEOs from several MSOs. You might want to share your impressions from that experience and what that means for the industry. Let's start with that first.

Speaker #4: You were yesterday at the NYSE, right, with the MSOS ETF people and other CEOs from several MSOs. You might want to share your impressions from that experience, and what that means for the industry.

Speaker #4: Let's start with that first.

Speaker #5: Yeah, great experience. At Vireo, we just try—we love everyone. So it was great seeing all the CEOs kind of come together. MSOS is really the only institutional pathway to meaningful liquidity.

John Mazarakis: Yeah, great experience. At Vireo, we love everyone, so it was great seeing all the CEOs kind of come together. MSOS is really the only institutional pathway to meaningful liquidity. So obviously it's a meaningful platform for all of us. We need to support MSOS. I have a lot of respect for those guys. Yeah, it was a great experience. We had great conversations, and we got to meet some people that we just didn't know prior to the event.

Speaker #5: So obviously, it's a meaningful platform for all of us. We need to support MSOS, and I have a lot of respect for those guys.

Speaker #5: So yeah, it was a great experience. We had great conversations, and we got to meet some people that we just—we didn't know prior to the event.

Speaker #4: Yeah, thank you. And one very last one. Everything you explained was very clear in terms of how you're thinking about the strategy and expanding. But you have these other companies, like Glass House, talking about the anti-dormant commerce laws, right?

Pablo Zuanic: Yeah. Thank you. And one very last one. Very clear, everything you explained in terms of how you are thinking about the strategy and expanding, but you have these other companies like Glass House Brands talking about the dormant Commerce Clause, right? You have some of the Canadian companies publicly saying that they expect interstate trade sooner or later in the US. Do you agree with that view that interstate trade is imminent after rescheduling? If you agree with that view, how does that color or impact the way that you are building the company right now? Thank you. That is all for me.

Speaker #4: You have some more Canadian companies publicly saying that they expect interstate trade sooner or later in the US. Do you agree with that view—that interstate trade is imminent after rescheduling?

Speaker #4: And if you agree with that view, how does that color or impact the way that you are building the company right now? Thank you.

Speaker #4: That's all for me.

Speaker #5: Thank you, Pablo. It's not a matter of agreeing or disagreeing. What we do is managers is mitigate risk. And risk is embedded in change.

John Mazarakis: Thank you, Pablo. It is not a matter of agreeing or disagreeing. What we do as managers is mitigate risk, and risk is embedded in change. So what we do daily is evaluate how that change may impact our billion-dollar platform. Of course, we have plan A, plan B, and plan C. I will refrain from using a crystal ball because I do not think it benefits anyone. Just being a student of other regulated industries, and cannabis is very, very regulated, both at the federal level and at the state level. I think it is fair to say that change will come slowly. Regardless, we are prepared to mitigate the risk that comes with that change, whether that is interstate commerce. Obviously, we have a plan if and if or when this happens. I do not think it will be anytime soon.

Speaker #5: So what we do daily is evaluate how that change may impact our billion-dollar platform. And of course, we have Plan A, Plan B, and Plan C.

Speaker #5: I will refrain from kind of using a crystal ball because I don't think it benefits anyone. But just being a student of other regulated industries and cannabis is very, very regulated, both at the federal level and at the state level, I think change is fair to say that change will come slowly.

Speaker #5: And regardless, we are prepared to mitigate the risk that comes with that change. Whether that's interstate commerce, obviously, we have a plan if and if or when this happens.

Speaker #5: But I don't think it will be anytime soon.

Speaker #4: Yeah, right. Thank you very much.

Pablo Zuanic: Yeah. Right. Thank you very much.

Speaker #3: Reminder. If you would like to ask a question, please press star one. To raise your hand. To withdraw your question, press star one again.

Operator 3: Reminder.

Operator: Reminder.

John Mazarakis: Thank you.

Operator 3: If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. The next question comes from the line of Tom Kerr with Zacks Small Cap Research. Your line is now open.

Operator: If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. The next question comes from the line of Tom Kerr with Zacks Small Cap Research. Your line is now open.

Speaker #3: The next question comes from the line of Tom Kerr with Zach's Small Cap Research. Your line is now open.

Speaker #4: Good morning, guys. Just a couple of clarifications. I think I heard you said 7%, same store sales. Is that organic growth on the legacy assets, or what is that 7%?

Tom Kerr: Good morning, guys. Just a couple of clarifications. I think I heard you said 7% same-store sales. Is that organic growth on the legacy assets, or what is that 7%? Can you clarify that a little bit?

Speaker #4: Can you clarify that a little bit?

Speaker #5: It's organic growth on the legacy assets. We've been announcing same store sales for the last few quarters. And that is yeah, that is organic growth.

John Mazarakis: It is organic growth in the legacy assets. We have been announcing same-store sales for the last few quarters.

Tom Kerr: Right.

John Mazarakis: And that is, yeah, that is organic growth. Same-store sales.

Speaker #5: Same store sales.

Speaker #4: And is that a goal or an expectation, or is it based on these recent acquisitions or future ones? Is that a good target or goal that you have in that range?

Tom Kerr: Is that a goal or an expectation, or based on these recent acquisitions or future ones, is that a good target or goal that you have in that range?

Speaker #5: So, I'm not sure that it's realistic for a platform with 270 dispensaries to have 7% same-store sales year over year. But we would definitely target low single digits.

John Mazarakis: I am not sure that it is realistic for a platform with 270 dispensaries to have 7% same-store sales year over year. But we would definitely target low single digits above, of course, above the inflation rate. That is my perspective.

Speaker #5: Above, of course, above the inflation rate. So that is my perspective.

Speaker #4: Got it. That makes sense.

Tom Kerr: Got it. That makes sense.

John Mazarakis: Being in retail my whole life, 7% in perpetuity is just not realistic.

Speaker #5: Being in retail my whole life, 7% in perpetuity is not it's just not realistic.

Speaker #4: Yeah. Yeah. That makes sense. I just wanted to clarify that. And then one more clarification. I had a bad connection on the adjusted EBITDA margin decline.

Tom Kerr: Yep. That makes sense. Just wanted to clarify that. One more clarification. I had a bad connection. On the adjusted EBITDA margin decline, I kind of missed the reasons. Can you give more color on that and the expectations of that going forward?

Speaker #4: I kind of missed the reasons. Can you give more color on that, and the expectations for that going forward?

Speaker #5: The reasons are primarily Colorado. Obviously, this is a different market. We happen to think that Colorado is a mature market, and we understand the free cash flow coming from Colorado.

John Mazarakis: The reasons are primarily Colorado. Obviously, this is a different market. We happen to think that Colorado is a mature market, and we understand the free cash flow coming from Colorado as being non-volatile. Therefore, we see the Colorado margin around 20% being a long-term equilibrium for the industry. What has really impacted our overall margin is our agribusiness, which that is high single digits, going to low double digits. Our main assets have the same margins that they had. So limited license states have maintained very similar margins to the previous quarters. Going back to your other question about same-store sales, if you are asking if this was an anomaly, actually, we are expecting same-store sales for the foreseeable future to hover around that level. It was not an anomaly.

Speaker #5: It's being non-volatile. Therefore, we see the Colorado margin around 20% being a long-term equilibrium for the industry. What has really impacted our overall margin is our agribusiness, which that is low I mean, high single digits.

Speaker #5: Going to low double digits. And that's also but our main assets have the same margins that they had. So limited license states have maintained very similar margins to the previous quarters.

Speaker #5: And going back to your other question about same-store sales, we do expect—if you're asking if this was an anomaly—actually, we are expecting same-store sales for the foreseeable future to hover around that level.

Speaker #5: It wasn't an anomaly.

Tom Kerr: Okay. But it is not a long-term target. It is just what is happening in the industry, in other words, or in your business. Does that make sense?

Speaker #4: Okay. But it's not a long-term target. It's just what's happening in the industry in other words. Or in your business. Does that make sense?

Speaker #5: I mean, if you take the best retailer on the planet, I don't think long-term for me is 10 years. So, if you're asking me if we're going to have 7% same-store sales increase year over year for the next 10 years, that's just not realistic.

John Mazarakis: If you take the best retailer on the planet, I do not think long-term for me is 10 years. So if you are asking me if we are going to have 7% same-store sales increase year over year for the next 10 years, that is just not realistic.

Speaker #5: But if you're asking me if, for the next 24 months—which for me is the short term—we're going to have growth in same-store sales, I'd be inclined to agree with that.

Tom Kerr: Yeah. Okay.

John Mazarakis: But if you are asking me if for the next 24 months, which for me is the short-term, we are going to have growth in same-store sales, I would be inclined to agree with that statement.

Speaker #5: Statement.

Speaker #4: Got it, that clarifies it for me. Okay, I'll jump back in the line. Thank you.

Tom Kerr: Got it. That clarifies it for me. Okay, I will jump back in the line. Thank you.

Speaker #5: Thank you, Tom.

John Mazarakis: Thank you, Tom.

Speaker #3: There are no further questions at this time. I will now turn the call back to John Maserakis for closing remarks.

Operator 3: There are no further questions at this time. I will now turn the call back to John Mazarakis for closing remarks.

Operator: There are no further questions at this time. I will now turn the call back to John Mazarakis for closing remarks.

Speaker #5: I just wanted to thank all the stakeholders for the support. And have a wonderful morning. Thank you.

John Mazarakis: I just wanted to thank all the stakeholders for the support, and have a wonderful morning. Thank you.

Speaker #3: This concludes today's call. Thank you for attending. You may now disconnect.

Operator 3: This concludes today's call. Thank you for attending. You may now disconnect.

Operator: This concludes today's call. Thank you for attending. You may now disconnect.

Operator 1: This event has now concluded. Thank you for joining Vireo Growth Inc. Q2 2026 Financial Results Call. The line will disconnect automatically.

Q2 2026 Vireo Growth Inc Earnings Call

Request DemoDemo

Vireo Growth

Earnings