Aug 13, 2026 earnings call — Oasis growth and Kava beverage launch amid regulation
Net sales grew 20% year-over-year to $5.6 million, led by wholesale growth and Oasis momentum.
Revenue $0.0B (est $0.0B) · EPS $-0.11 (est $-0.03)
Key quotes
"Depletions from distributors, which is unit sales from our distribution, hit record in July, up 35% over the third quarter average, and August is on pace to more than double."
"The single most important recent development is the Senate stopgap appropriations proposal would through December 11, 2026, temporarily exempt natural occurring cannabinoids from those revised restrictions."
"In particular, beginning in the fourth quarter, we implemented a cost reduction and rightsizing program targeting approximately $100,000 to $150,000 of monthly savings or approximately $1.2 million to $1.8 million on an annualized basis."
Analyst Q&A 3
cost savings timing and breakeven
Q (Adam Waldo · Lismore Partners,): He asked whether the $100,000 to $150,000 monthly OpEx reduction number is on a cash or accrual basis, how much of that is cash savings, and when those savings will be fully realized. He also asked if marketing and product launches will be cautious until there is clearer federal regulation.
A: Management said the $100,000 to $150,000 savings guidance is cash-related and comes mostly from operating expenses and supply-chain savings that should start in September. They said a warehouse lease amendment affects timing, with about $10,000 a month occurring in October, so most savings should be captured by the end of the current fiscal fourth quarter. They also said they will be cautious with marketing, leveraging existing channels and planning only a few new launches while monitoring regulatory clarity.
"So -- and they come mostly out of our operating expenses with some identified cost savings through our supply chain, which we think will start being realized more so in September, the supply chain savings." — T. Kennedy (CEO)
Oasis growth, new Texas distributor, Kava launch
Q (Thomas McGovern · Maxim Group): He asked whether Oasis momentum is from more distribution points or higher sell-through at existing doors, when the new Texas distributor was signed and how their sell-through is performing. He also asked about the Kava Oasis launch timing, go-to-market differences, and whether other botanicals will be developed internally or via acquisition, plus the outlook for wholesale vs DTC mix.
A: Management said the Oasis acceleration is both expanding distribution and improving sell-through by investing in territory sales resources and distributor/retailer programs. They said the Texas distribution move was made right at the end of June, contributed to some revenue, and has strengthened since, especially after August 1 restrictions that increased demand for hemp-derived THC and CBD products. They said Kava launched "today," they focused on flavor to make a best-tasting product, have "1 or 2" other botanicals in formulation with announcements expected before the end of the year, are open to acquisitions, and noted regulation could push more revenue into wholesale through a three-tier system with examples like Tennessee restricting DTC.
"I think we've been very focused on our territory and investing in sales resource and programming within our distributors and retailers." — T. Kennedy (CEO)
M&A approach amid regulation and cash focus
Q (Adam Waldo · Lismore Partners,): He asked how management is thinking about structuring acquisitions given regulatory uncertainty vs accelerating revenue and cost cuts, whether they prefer more regulatory clarity before doing deals, and if they target immediate cash-flow accretion within 1 to 2 quarters after closing.
A: Management said they are trying to be flexible and opportunistic and are looking for targets where their infrastructure can create outsized value. They said they plan to pursue transactions they believe will be accretive irrespective of regulatory changes and will focus on driving short-term cash flow as quickly as possible in both the core business and any M&A.
"I think we are looking at opportunities where we think our infrastructure can create a 1 and 1 equals 3 opportunity, and continue to pursue those in ways that we believe create value for the targets as well as for our shareholders." — T. Kennedy (CEO)