Tilray’s International Cannabis Revenue Grew 73% in Q3. Its Beverage Segment Shrank 24%. Then It Bought a British Beer Brand.

Tilray Brands dropped its fiscal third-quarter results this morning, and the headline number is a record: $206.7 million in net revenue, up 11% year-over-year, with adjusted EBITDA climbing 19% to $10.7 million. The company swung to adjusted net income of $2.4 million — the first time it has been in the black on that measure in recent memory. After years of losses, cost cuts, and restructuring noise, that’s genuinely notable.

But the topline obscures a more complicated story underneath. Tilray is bifurcating. On one side: a cannabis and pharmaceutical distribution business growing at a pace that would turn heads in any sector. On the other: a beverage operation losing revenue and margin ground despite significant investment. And then, right as those trends became visible in the numbers, the company acquired BrewDog — the UK’s leading craft beer brand — for roughly £40 million in cash.

That acquisition will not show up in Q3’s results. It closed after the quarter ended. But it shapes how you read everything in them.

The Cannabis Half Is Working

Tilray’s cannabis segment posted $64.8 million in net revenue this quarter, up 19% year-over-year. The growth is coming from two places: Canada and everywhere else.

In Canada, adult-use and medical cannabis revenue combined grew 8% year-over-year. Tilray maintains its position as the country’s top cannabis company by revenue — a title it has held for a while now and has shown no signs of losing. Canada’s cannabis market is mature and contested, so 8% growth without meaningful price erosion is a solid print.

The more striking number is international. International cannabis revenue grew 73% year-over-year in Q3, with cannabis flower sales volume doubling. The company called it the best quarterly international cannabis revenue in its history.

That growth is concentrated in Europe — Germany, in particular, which has become the most significant regulated medical cannabis import market in the world. Tilray has been building European distribution infrastructure for years while U.S.-focused operators were busy trying to survive 280E and state market fragmentation. The payoff is showing up now.

Cannabis gross margin was 40%, up from 41% a year ago — essentially flat, which is actually a win given the volume ramp. More volume at similar margin is how a commodity business scales.

The Beverage Half Is Not

Tilray’s beverage segment — which includes its portfolio of U.S. craft beer brands, the legacy of its SweetWater and Montauk acquisitions — posted $42.6 million in net revenue this quarter. That’s down from $55.9 million in the same period last year. A 24% decline. Gross margin compressed from 36% to 32%.

The company completed “Project 420” during the quarter — an internal cost-cutting program that delivered roughly $33 million in annualized savings and was largely focused on the beverage business. That program is now done. The savings are structural. But savings don’t reverse top-line revenue erosion, and $42.6 million in quarterly beverage revenue is not a business growing into its valuation.

The U.S. craft beer market has been in structural decline, squeezed between large-format national brands on one side and cannabis beverages (and hard seltzers, and RTD cocktails) on the other. Tilray’s brands have not been immune. The question was always whether the beverage diversification strategy would look prescient or expensive once the cannabis market matured.

The BrewDog Bet

Enter BrewDog.

To a casual observer, paying £40 million cash for a British craft brewery while your existing beverage segment is declining looks like an odd move. Irwin Simon, Tilray’s CEO, is framing it differently: not as a U.S. craft beer bet, but as infrastructure. BrewDog operates in the UK, Europe, the Middle East, Australia, and Asia-Pacific. Tilray also announced a partnership with Carlsberg — one of the world’s largest beer companies — beginning in 2027.

The logic, if you follow it, is geographic leverage. Tilray is building a global beverage distribution network that can carry cannabis products into new markets as those markets open. Germany’s medical cannabis framework is already live. Other European markets are watching. BrewDog’s retail and hospitality footprint across Europe gives Tilray something U.S.-centric MSOs cannot replicate quickly: a ready-made point of sale in jurisdictions where legal cannabis is coming.

Whether that thesis works depends on European regulatory timelines that no one controls. But the strategy — position now, monetize later — is coherent in a way that some of the earlier U.S. craft beer acquisitions were not.

The Balance Sheet Signal

One number that deserves more attention than it’s getting: Tilray ended Q3 with a net cash position of $3.5 million. In the same quarter last year, it was net debt of $36.6 million — a swing of more than $40 million. The company also holds $264.8 million in cash and marketable securities.

For a cannabis company, being net cash positive is not a given. Much of the sector remains capital-constrained, cut off from conventional lending, surviving on high-cost debt instruments or equity dilution. Tilray has navigated toward a balance sheet that gives it flexibility — including the flexibility to close a £40 million acquisition without going back to markets.

The company reconfirmed FY2026 adjusted EBITDA guidance of $62 million to $72 million, representing 13% to 31% growth over fiscal 2025.

What It Means for the Rest of the Industry

Tilray’s Q3 is a data point, not a blueprint. No U.S. MSO can replicate the international cannabis exposure that Tilray built through years of European investment and Canadian infrastructure. Green Thumb, Curaleaf, and Trulieve are fundamentally domestic businesses operating in a market that still does not have federal legalization, banking access, or interstate commerce.

But the earnings do underscore something operators watching from the sidelines already know: the growth in cannabis is increasingly happening outside the United States. Germany’s market is scaling. International flower volume doubling year-over-year at Tilray is not an anomaly — it reflects a regulatory opening that has been building since 2024.

For U.S. operators positioned entirely in domestic markets, Tilray’s international acceleration is a reminder of what the sector looks like without the structural handicaps they’re still carrying. That comparison gets harder to ignore the longer federal reform stalls.

Tilray hosts its Q3 earnings webcast today at 8:30 a.m. Eastern.