Grown Rogue International Inc.

What they do

Grown Rogue is a multi-state cannabis operator focused on flower production and branded packaged products. It operates cultivation facilities and sells cannabis flower, pre-rolls, and vape products to wholesalers and retailers. The company has operations in Oregon, Michigan, New Jersey, and is building facilities in Illinois and Minnesota.

Revenue drivers

• New Jersey — Fastest-growing segment; Q2 2026 revenue up 65% year-over-year, with 100% from packaged products. Expanding flowering canopy from 10,000 to 16,000 sq ft by year-end.
• Michigan — Q2 2026 revenue up 49% year-over-year (31% excluding excise tax). Yield improved to 90 g/sf, cost per pound down to $277.
• Oregon — Mature market with 14% revenue growth in Q2 2026. Indoor bulk ASP rose to $592 per pound from $480 in Q1.

Recent performance

Q2 2026 revenue was $11.3M, up 41% from $8.0M in Q2 2025 (36% excluding Michigan excise tax). GAAP net loss was $1.5M, versus net income of $1.7M a year ago, due to ~$0.8M non-cash fair-value losses on derivative and warrant instruments. Adjusted EBITDA was $2.1M (18.2% margin). Cash and equivalents were $11.5M at quarter end. Full-year 2025 revenue was $32.4M with net income of $3.2M.

Strategy

Management is executing a flower-forward strategy with disciplined expansion into new states. Investments focus on increasing flowering canopy in New Jersey, Illinois (via SEA Craft, not consolidated), and Minnesota (construction at Fridley). The company is also rolling out single-source cured-resin vape products and infused pre-rolls to drive wallet share. Emphasis remains on cost per pound, yield, and packaged-product mix across markets.

Risks

• Regulatory and legal risks — Cannabis remains federally illegal in the U.S., and the company is subject to state-specific regulatory approvals and changes; SEC administrative proceeding was dismissed in June 2026.
• Expansion execution risk — Illinois and Minnesota facilities depend on regulatory approvals, construction timelines, and partner performance; delays could push revenue expectations.
• Pricing and competition — Mature markets (Oregon, Michigan) face pricing volatility and competitive pressure, which can compress margins.
• Non-cash fair value volatility — Derivative and warrant instruments caused significant non-cash losses in Q2 2026, potentially clouding underlying operating performance.

Outlook

Management increased 2026 revenue guidance to $38-41M (from $34-37M) and Adjusted EBITDA to $7-9M (from $6-8M). 2027 revenue guidance raised to $55-63M (from $50-58M), with Adjusted EBITDA guidance maintained. Initial sales from Illinois are expected in Q4 2026; Minnesota first revenue targeted for Q1 2027.