Company: CGC
Filing Date: 2025-02-07
Form Type: 10-Q
Source: 0000950170-25-015839
Chunk: 171

Company: Canopy Growth Corp
Filing Date: 2025-02-07
Form: 10-Q
Item: Item 2
Chunk 171
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 and gross margin percentage on a consolidated basis for the nine months ended December 31, 2024 and 2023:

    Nine months ended December 31,

    (in thousands of Canadian dollars except where indicated)
    2024

    2023

    $ Change

    % Change

    Net revenue
     
    $
    203,964

    $
    224,358

    $
    (20,394
    )

    (9
    %)

    Cost of goods sold
     
    $
    134,997

    $
    158,944

    $
    (23,947
    )

    (15
    %)

    Gross margin

    68,967

    65,414

    3,553

    5
    %

    Gross margin percentage

    34
    %

    29
    %

    -

    500 bps

Cost of goods sold was $135.0 million in the nine months ended December 31, 2024, as compared to $158.9 million in the nine months ended December 31, 2023. Our gross margin was $69.0 million in the nine months ended December 31, 2024, or 34% of net revenue, as compared to a gross margin of $65.4 million and gross margin percentage of 29% of net revenue in the nine months ended December 31, 2023. The year-over-year increase in the gross margin percentage is primarily attributable to:

•Improvement in our Canada cannabis segment, primarily attributable to: (i) the realized benefit of our cost savings program and strategic changes to our business that were initiated in the fourth quarter of fiscal 2023; (ii) a year-over-year decrease in write-downs of excess inventory; and (iii) a shift in channel mix to higher margin medical sales; and

•Improvement in our international markets cannabis segment, primarily due to an increase in sales mix to higher-margin Poland as well as a lower overall cost structure.

Partially offset by costs related to new product launches, increased price competition and indirect costs.

49

We report gross margin and gross margin percentage in four segments: (i) Canada cannabis; (ii) international markets cannabis; (iii) Storz & Bickel; and (iv) This Works. Cost of sales associated with the remainder of our operations are included within "other". The following table presents segmented gross margin