Tilray Brands Hits Multi-Year Lows as Cannabis Investors Await Regulatory Clarity

Tilray Brands shares have continued their steep decline, falling to their lowest level since June last year. The stock has lost 57% since the beginning of the year, reflecting the broader weakness across the cannabis sector, with peers such as Green Thumb Industries, Trulieve Cannabis, and Curaleaf also facing significant pressure.

The main factor behind Tilray’s sell-off is uncertainty surrounding potential cannabis reform in the United States. Investors have been closely monitoring the possible reclassification of marijuana under the Controlled Substances Act. President Donald Trump signed an executive order calling on the Department of Justice (DoJ) to accelerate the review process for moving cannabis from Schedule I to Schedule III.

Regulatory Uncertainty Weighs on Tilray’s Shares

The process advanced further when Acting Attorney General Todd Blanche issued a final order regarding FDA-approved cannabis products and state-licensed medical marijuana. The Drug Enforcement Administration (DEA) later held an administrative hearing to assess the proposed reclassification. Following the hearing, additional submissions are expected before a final recommendation is issued.

A favorable regulatory outcome could provide a major boost for Tilray. The Canadian company has previously indicated that it would consider expanding into the US market if clearer regulations emerge. Management believes a US medical cannabis platform could create new opportunities through research, education, cannabinoid-based medicines, and patient access rather than focusing on recreational retail.

Weak Beverage Growth and Technical Pressure Challenge Recovery

Beyond regulatory uncertainty, Tilray’s performance has also been affected by slowing growth in its beverage business. The company has diversified beyond cannabis through acquisitions, including BrewDog and Lyphe, but investors remain cautious about whether these businesses can generate sustainable growth.

Tilray’s latest results showed total revenue increased 11% in the fourth quarter, supported partly by acquisitions. Beverage revenue rose 6% year-over-year to $254 million, while cannabis revenue increased 6% to $268 million. Distribution revenue was the strongest segment, climbing 21% to $327 million, while the wellness division advanced 9%.

However, profitability remains a challenge. Tilray reported a net loss of $105 million, mainly due to non-cash charges. Despite these difficulties, management provided a more optimistic outlook, forecasting adjusted EBITDA of between $68 million and $75 million for the fiscal year ending in May next year, representing double-digit growth compared with the previous year.

From a technical perspective, Tilray shares remain under pressure. The stock has fallen below key support levels, including $5.96, and is trading beneath its 50-day exponential moving average. Momentum indicators such as the relative strength index (RSI) continue to weaken, although the stock is approaching oversold territory.

The sharp decline may attract investors looking for a recovery opportunity, especially if cannabis regulation improves or market sentiment toward the sector strengthens. A potential rebound could push shares back toward the $5.96 resistance level, representing significant upside from current prices. However, until regulatory clarity improves and profitability concerns are addressed, Tilray remains a high-risk turnaround investment.

__

(Featured image by Elsa Olofsson via Unsplash)

DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.

This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.

First published in TradingView. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.