Cronos Group (NASDAQ:CRON) reported record third-quarter revenue, gross profit and adjusted EBITDA as cannabis sales grew in Israel, Canada and Germany, while executives outlined plans to expand in Europe following the company’s acquisition of Dutch cannabis producer CanAdelaar.
Consolidated net revenue rose 75% from a year earlier to $63.5 million in the third quarter of 2026. Gross profit increased 76% to $32.3 million, and adjusted EBITDA climbed by $11.4 million to a record $17.1 million.
Chief Financial Officer Anna Shlimak said revenue growth was driven primarily by higher cannabis flower sales in Israel, Canada and other countries, particularly Germany, as well as higher sales of cannabis extracts in Canada. She cautioned that Canadian provincial board purchasing has historically softened in the fourth quarter and that international sales outside Israel can fluctuate because of export permit and shipment timing.
International Sales and Canadian Market Share
Chairman, President and CEO Mike Gorenstein said Israel posted its 11th consecutive quarter of record net revenue, with sales rising 33% year over year, or 19% on a constant-currency basis. He said the PEACE NATURALS and LIT brands contributed to growth.
Revenue in international markets outside Israel rose to $13.2 million from $1.9 million a year earlier, led by demand in Germany. Asked about German pricing, Gorenstein acknowledged price compression but said the market remained accretive to the company’s overall margins.
Gorenstein said Cronos had more product available to ship as supply ramped up, while noting that results should be considered over a 12-month period because shipments can be uneven. “We still see growth ahead in Germany,” he said.
In Canada, Cronos reported record net revenue as its brands generated 41% year-over-year retail sales growth, compared with 1% growth for the industry, according to Gorenstein. The company said Spinach held the top position in vapes for a third consecutive quarter, with an 11.4% share, while SOURZ remained the leading edibles brand for a ninth consecutive quarter, with a 21.8% share.
Gorenstein said strong demand continued to constrain flower supply despite additional capacity from the late-2025 GrowCo expansion. Asked about further expansion, he said the company was considering future growth but wanted any investment to be durable and efficient over the long term.
Netherlands Acquisition
Cronos completed its acquisition of CanAdelaar in October. Gorenstein said the base purchase price was less than three times trailing adjusted EBITDA and that the company did not base the deal on an expectation of short-term price stability or immediate growth.
CanAdelaar operates within a Dutch cannabis experiment that allows participating retailers to carry additional product formats and inventory. Gorenstein said the company sees opportunities to introduce products, improve operating efficiency and use the Netherlands as a platform for branded products elsewhere in Europe.
He said the experiment currently covers less than 10% of the Dutch population. While Gorenstein sees potential for expansion, he said he was referring to the end of the pilot period and would not rely on an earlier expansion given the legislative process.
Gorenstein also expects price compression as suppliers increase output. He said CanAdelaar was not close to full capacity and could ramp up production, adding that Cronos planned to pace the introduction of derivative products rather than launch everything at once.
Margins and Cash Position
Shlimak said higher average selling prices, reflecting a greater mix of sales to Israel and other countries without excise taxes, contributed to gross profit growth. Higher volumes also helped the company absorb overhead costs.
Operating expenses rose 23% to $23.3 million, driven by general and administrative and sales and marketing costs. As a share of revenue, operating expenses fell to 37% from 52% a year earlier.
Shlimak said gross margins could vary with seasonality, product and geographic mix, production volumes and price compression. She said trailing 12-month performance provides more useful context than a single quarter and indicated that management viewed that period as a guide going forward.
Cronos ended the quarter with $841 million in cash equivalents, restricted cash, short-term investments and non-current interest-bearing deposits, up $14 million from the second quarter. Operating cash flow was $34 million, including a $12 million working-capital inflow, partly offset by $10 million in capital spending and $9 million in share repurchases. The company also held $18 million in loans receivable and $5 million in other investments.
About Cronos Group (NASDAQ:CRON)
Cronos Group Inc is a Canadian cannabinoid company focused on developing, producing and commercializing cannabis and cannabis-derived consumer products. The company serves adult-use and medical cannabis markets through a portfolio of brands and sells products such as dried flower, pre-rolls, vaporizers, edibles, oils and other cannabis formats, subject to applicable regulations.
Its brand portfolio has included Spinach, which is positioned primarily in the adult-use cannabis market, as well as Lord Jones and PEACE NATURALS.
