TRLV 10-K & 10-Q changes, risk factors and insider trading
Trulieve Cannabis Corp. · NYSE · Medicinal Chemicals & Botanical Products · CIK 1754195 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
Removed heading “The cannabis industry is relatively new.”
Removed heading “We face risks due to industry immaturity or limited comparable, competitive or established industry best practices.”
Removed heading “The reclassification of cannabis or changes in U.S. controlled substance laws and regulations could have a material adverse effect on our business, financial condition, and results of operations.”
Removed heading “Potential regulation by the FDA could have a material adverse effect on our business, financial condition and results of operations.”
Removed heading “Our contractual arrangements may not be as effective in providing control over the variable interest entities as direct ownership.”
Removed heading “As a cannabis business, we are subject to certain tax provisions that have a material adverse effect on our business, financial condition and results of operations.”
Removed heading “Our internal controls over financial reporting have not historically been effective, and our independent auditors may not be able to certify as to their effectiveness, which could adversely affect our business results and operations.”
Removed heading “Our reputation and ability to do business may be negatively impacted by the improper conduct by our business partners, employees or agents.”
Removed heading “We may have increased labor costs based on union activity.”
Removed heading “We may be unable to obtain adequate insurance coverage.”
Largest changes
“Violations of any United States federal laws and regulations could result in significant fines, penalties, administrative sanctions, or settlements arising from civil proceedings conducted by either the United States federal government or private citizens. We may also be subject to criminal charges under the CSA, and if convicted could face a variety of penalties including, but not limited to, disgorgement of profits, cessation of business activities or divestiture. …”see in full comparison
Our ability to make certain payments or advances will be subject to applicable laws and contractual restrictions in the instruments governing our indebtedness. The contractual restrictions in the instruments governing such indebtedness include restrictive covenants that could limit our discretion with respect to certain business matters.see in full comparisonThese covenants place restrictions on, among other things, our ability to create liens or other encumbrances, to pay distributions or make certain other payments, and to sell or otherwise dispose of certain assets. A failure to comply with such obligations could result in a default, which, if not cured or waived, could permit acceleration of the relevant indebtedness. Our significant indebtedness could have important consequences, including: (i) our ability to obtain additional financing for working capital, capital expenditures, or acquisitions may be limited; and (ii) all or part of our cash flow from operations may be dedicated to the payment of the principal of and interest on our indebtedness, thereby reducing funds available for operations. These factors may adversely affect our cash flow.Our inability to generate sufficient cash flow to satisfy our debt obligations, or to refinance our indebtedness on commercially reasonable terms or at all, may materially and adversely affect our business, results of operations, and financial condition.
“The reclassification of cannabis or changes in U.S. controlled substance laws and regulations could have a material adverse effect on our business, financial condition, and results of operations.”see in full comparison
“Potential regulation by the FDA could have a material adverse effect on our business, financial condition and results of operations.”see in full comparison
“If cannabis is reclassified as a Schedule II or lower controlled substance under the CSA, the ability to conduct research on the medical benefits of cannabis would most likely be more accessible; however, if cannabis is recategorized as a Schedule II or lower controlled substance, the resulting reclassification could result in the need for approval by the FDA and other forms of FDA regulatory oversight. …”see in full comparison
“We may have increased labor costs based on union activity.”see in full comparison
Full comparison: every changed paragraph (39)
•the risks related to the newness of the cannabis industry;
•the effect of risks due to industry immaturity;
•our ability to comply with potential future FDA regulations;
•the risks related to control over variable interest entities;
•the effects of risks related to any reclassification of cannabis or changes in U.S. controlled substance laws and regulations;
•the effect of unfavorable tax treatment for cannabis businesses;
•the effect of risks related to ineffective internal controls over financial reporting;
•the effect of risks related to a material weakness in our internal control over financial reporting;
•the effect of risks related to misconduct by our service providers and business partners;
•the effect of risks related to labor union activity;
•our ability to obtain adequate insurance coverage;
In the United States, or the U.S., cannabis is largely regulated at the state level. Each state in which we operate (or are currently proposing to operate) authorizes, as applicable, medical and/or adult-use cannabis production and distribution by licensed or registered entities, and numerous other states have legalized cannabis in some form. However, under U.S. federal law, the possession, use, cultivation, and transfer of cannabis and any related drug paraphernalia is illegal, and any such acts are criminalized under the Controlled Substances Act, as amended, which we refer to as the CSA. Cannabis is a Schedule I controlled substance under the CSA, and is thereby deemed to have a high potential for abuse, no accepted medical use in the United States, and a lack of safety for use under medical supervision. The concepts of “medical cannabis,” “retail cannabis” and “adult-use cannabis” do not exist under U.S. federal law. However, inon OctoberDecember of18, 2022,2025, thePresident BidenTrump Administrationissued announcedan itsExecutive intentionOrder totitled review“Increasing theMedical regulation of cannabis under the CSA by directing the Secretary of HealthMarijuana and HumanCannabidiol ServicesResearch.” andThis Executive Order directed the Attorney General to initiate“take all necessary steps to complete the administrativerulemaking process related to expeditiouslyrescheduling reviewmarijuana marijuana’sto Schedule IIII status.of Therethe are no assurances if or when there could be any changeCSA in the classificationmost ofexpeditious marijuanamanner underin theaccordance CSA.with Federal law.” Although we believe that our business activities are compliant with applicable state and local laws in the United States, strict compliance with state and local cannabis laws would not provide a defense to any federal proceeding which may be brought against us. Any such proceedings may result in a material adverse effect on us. We derive 100%substantially all of our revenues from the cannabis industry. The enforcement of applicable U.S. federal laws poses a significant risk to us.
Violations of any United States federal laws and regulations could result in significant fines, penalties, administrative sanctions, or settlements arising from civil proceedings conducted by either the United States federal government or private citizens. We may also be subject to criminal charges under the CSA, and if convicted could face a variety of penalties including, but not limited to, disgorgement of profits, cessation of business activities or divestiture. Any of these penalties could have a material adverse effect on our reputation and ability to conduct our business, our holding (directly or indirectly) of medical and adult-use cannabis licenses in the United States, our financial position, operating results, profitability or liquidity or the market price of our publicly-traded shares. In addition, it is difficult for us to estimate the time or resources that would be needed for the investigation, settlement or trial of any such proceedings or charges, and such time or resources could be substantial.
The cannabis industry is relatively new.
We are operating in a relatively new industry and market. In addition to being subject to general business risks, we must continue to build brand awareness in this industry and market share through significant investments in our strategy, production capacity, quality assurance and compliance with regulations. Research in Canada, the United States and internationally regarding the medical benefits, viability, safety, efficacy and dosing of cannabis or isolated cannabinoids, such as cannabidiol, or CBD, and tetrahydrocannabinol, or THC, remains in relatively early stages. Few clinical trials on the benefits of cannabis or isolated cannabinoids have been conducted. Future research and clinical trials may draw opposing conclusions to statements contained in the articles, reports and studies currently favored, or could reach different or negative conclusions regarding the medical benefits, viability, safety, efficacy, dosing or other facts and perceptions related to medical cannabis, which could adversely affect social acceptance of cannabis and the demand for our products and dispensary services.
Accordingly, there is no assurance that the cannabis industry and the market for medical and/or adult-use cannabis will continue to exist and grow as currently anticipated or function and evolve in a manner consistent with management’s expectations and assumptions. Any event or circumstance that adversely affects the cannabis industry, such as the imposition of further restrictions on sales and marketing or further restrictions on sales in certain areas and markets could have a material adverse effect on our business, financial condition and results of operations.
We face risks due to industry immaturity or limited comparable, competitive or established industry best practices.
As a relatively new industry, there are not many established operators in the medical and adult-use cannabis industries whose business models we can follow or build upon. Similarly, there is no or limited information about comparable companies available for potential investors to review in making a decision about whether to invest in us.
Shareholders and investors should consider, among other factors, our prospects for success in light of the risks and uncertainties encountered by companies, like us, that are in their early stages. For example, unanticipated expenses and problems or technical difficulties may occur, which may result in material delays in the operation of our business. We may fail to successfully address these risks and uncertainties or successfully implement our operating strategies. If we fail to do so, it could materially harm our business to the point of having to cease operations and could impair the value of the Subordinate Voting Shares to the extent that investors may lose their entire investments.
The reclassification of cannabis or changes in U.S. controlled substance laws and regulations could have a material adverse effect on our business, financial condition, and results of operations.
If cannabis is reclassified as a Schedule II or lower controlled substance under the CSA, the ability to conduct research on the medical benefits of cannabis would most likely be more accessible; however, if cannabis is recategorized as a Schedule II or lower controlled substance, the resulting reclassification could result in the need for approval by the FDA and other forms of FDA regulatory oversight. As a result of such a reclassification, the manufacture, importation, exportation, domestic distribution, storage, sale and use of such products could become subject to a significant degree of regulation by the DEA. In that case, we may be required to be registered to perform these activities and have the security, control, recordkeeping, reporting and inventory mechanisms required by the DEA to prevent drug loss and diversion. Obtaining the necessary registrations may result in delay of the manufacturing or distribution of our products. The DEA conducts periodic inspections of registered establishments that handle controlled substances. Failure to maintain compliance could have a material adverse effect on our business, financial condition and results of operations. The DEA may seek civil penalties, refuse to renew necessary registrations, or initiate proceedings to restrict, suspend or revoke those registrations. In certain circumstances, violations could lead to criminal proceedings.
Potential regulation by the FDA could have a material adverse effect on our business, financial condition and results of operations.
Should the United States federal government legalize cannabis, it is possible that the FDA would seek to regulate it under the Food, Drug and Cosmetics Act of 1938. Additionally, the FDA may issue rules and regulations, including good manufacturing practices related to the production of medical cannabis. Clinical trials may be needed to verify efficacy and safety of our medical cannabis products. It is also possible that the FDA would require that facilities where medical cannabis is grown register with the agency and comply with certain federally prescribed regulations. In the event that some or all of these regulations are imposed, the impact on the cannabis industry is uncertain and could include the imposition of new costs, requirements, and prohibitions. If we are unable to comply with the regulations or registration as prescribed by the FDA, it may have an adverse effect on our business, operating results, and financial condition.
Our contractual arrangements may not be as effective in providing control over the variable interest entities as direct ownership.
We rely on contractual arrangements with certain of our entities to operate dispensaries or own our licenses or assets, in certain states in which our direct ownership of operations is restricted or prohibited. If our variable interest entities or their equity holders fail to perform their respective obligations under the contractual arrangements, we may have to incur substantial costs and expend additional resources to enforce such arrangements. Accordingly, these contractual arrangements may not be as effective as direct ownership in providing us with control over our variable interest entities.
Under our contractual arrangements, we may not be able to directly change the members of the boards of directors of these entities and would have to rely on the variable interest entities and the variable interest entity equity holders to perform their obligations in order to exercise our control over the variable interest entities. The variable interest entity equity holders may have conflicts of interest with us and they may not act in our best interests or may not perform their obligations under these contracts. For example, our variable interest entities and their respective equity holders could breach their contractual arrangements with us by, among other things, failing to conduct their operations (including failing to maintain licenses or comply with applicable ownership or reporting requirements) or taking other actions that are detrimental to our interests. If any equity holder is uncooperative and any dispute relating to these contracts or the replacement of the equity holders remains unresolved, we will have to enforce our rights under the contractual arrangements and through arbitral or judicial agencies, which may be costly and time-consuming and may be limited by legal principles preventing the enforcement of a contract it involves a violation of law or public policy. See –"There is doubt regarding our ability to enforce contracts.” If we are unable to enforce the contractual arrangements, we may not be able to exert effective control over the variable interest entities, and our ability to conduct our business, as well as our financial condition and results of operations, may be materially and adversely affected.
As a cannabis business, we are subject to certain tax provisions that have a material adverse effect on our business, financial condition and results of operations.
Section 280E of the U.S. Internal Revenue Code of 1986, as amended ("IRC"), provides that “no deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if such trade or business (or the activities which comprise such trade or business) consists of trafficking in controlled substances (within the meaning of schedule I and II of the Controlled Substances Act) which is prohibited by Federal law or the law of any State in which such trade or business is conducted.” This provision has been applied by the United States Internal Revenue Service ("IRS") to cannabis operations, prohibiting taxpayers with cannabis operations from deducting expenses directly associated with cannabis businesses for U.S. federal income tax purposes. Section 280E and related IRS enforcement activity has had a significant impact on the operations of cannabis companies in the United States. As a result, an otherwise profitable business may, in fact, operate at a loss, after taking into account its United States income tax expenses. The Company has taken a position that Section 280E does not preclude it from deducting ordinary and necessary business expenditures on its tax returns.
We face competition from companies that may have greater capitalization, access to public equity markets, more experienced management or more maturity as a business. The vast majority of both manufacturing and retail competitors in the cannabis market consists of localized businesses (those doing business in a single state), although there are a few multistate operators with which we compete directly. Aside from this direct competition, out-of-state operators that are capitalized well enough to enter markets through acquisitive growth are also part of the competitive landscape. Similarly, as we execute our growth strategy, operators in our future state markets will inevitably become direct competitors. We are likely to continue to face increasing and intense competition from these companies.companies, Increased competition by larger and better financed competitorswhich could materially and adversely affect our business, financial condition and results of operations.
Our internal controls over financial reporting have not historically been effective, and our independent auditors may not be able to certify as to their effectiveness, which could adversely affect our business results and operations.
During the preparation of our consolidated financial statements for the year ended December 31, 2023, we identified certain material weaknesses in our internal control over financial reporting. The material weaknesses related to ineffective information technology general controls (“ITGCs”) and ineffective design, implementation, and documentation of management review controls related to the valuation of inventory. Although the previously identified material weakness noted were remediated as of December 31, 2024, we cannot assure you that other material weaknesses and control deficiencies will not be discovered in the future. If we identify any other material weaknesses in our internal control over financial reporting it may cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our Subordinate Voting Shares.
Our reputation and ability to do business may be negatively impacted by the improper conduct by our business partners, employees or agents.
In certain states, we depend on third-party suppliers to produce and ship our orders. Products purchased from our suppliers are resold to our customers. These suppliers could fail to produce products to our specifications or quality standards and may not deliver units on a timely basis. Any changes in our suppliers’ production or product availability could impact our ability to fulfill orders and could also disrupt our business due to delays in finding new suppliers. Furthermore, we cannot provide assurance that our internal controls and compliance systems will protect us from acts committed by our employees, agents or business partners in violation of U.S. federal or state or local laws. Any failure by third-party suppliers to fulfill our production requirements or any improper acts by employees or third-parties acting on our behalf could, depending on the nature of any such failure, adversely impact our reputation and results of operations.
We may have increased labor costs based on union activity.
Labor unions are working to organize workforces in the cannabis industry in general. Currently, labor organizations have been recognized as a representative of our employees at two cultivation and processing facilities and at two dispensaries. In addition, a union was recently voluntarily decertified at the employees’ request at one dispensary. It is possible that additional certain retail and/or manufacturing locations will be organized in the future, which could lead to work stoppages or increased labor costs and adversely affect our business, profitability and our ability to reinvest into the growth of our business. We cannot predict how stable our relationships with U.S. labor organizations would be or whether we would be able to meet any unions’ requirements without impacting our financial condition. Labor unions may also limit our flexibility in dealing with our workforce. Work stoppages and instability in our union relationships could delay the production and sale of our products, which could strain relationships with customers and cause a loss of revenues which would adversely affect our operations.
Our significant indebtedness may adversely affect our business, financial condition and financial results.
Our ability to make certain payments or advances will be subject to applicable laws and contractual restrictions in the instruments governing our indebtedness. The contractual restrictions in the instruments governing such indebtedness include restrictive covenants that could limit our discretion with respect to certain business matters. These covenants place restrictions on, among other things, our ability to create liens or other encumbrances, to pay distributions or make certain other payments, and to sell or otherwise dispose of certain assets. A failure to comply with such obligations could result in a default, which, if not cured or waived, could permit acceleration of the relevant indebtedness. Our significant indebtedness could have important consequences, including: (i) our ability to obtain additional financing for working capital, capital expenditures, or acquisitions may be limited; and (ii) all or part of our cash flow from operations may be dedicated to the payment of the principal of and interest on our indebtedness, thereby reducing funds available for operations. These factors may adversely affect our cash flow. Our inability to generate sufficient cash flow to satisfy our debt obligations, or to refinance our indebtedness on commercially reasonable terms or at all, may materially and adversely affect our business, results of operations, and financial condition.
We may be unable to obtain adequate insurance coverage.
We have obtained insurance coverage with respect to workers’ compensation, general liability, directors’ and officers’ liability, fire and other similar policies customarily obtained for businesses to the extent commercially appropriate; however, because we are engaged in and operate within the cannabis industry, there are exclusions and additional difficulties and complexities associated with our insurance coverage that could cause us to suffer uninsured losses, which could adversely affect our business, results of operations, and profitability. There is no assurance that we will be able to obtain insurance coverage at a reasonable cost or fully utilize such insurance coverage, if necessary.
Management's Discussion & Analysis (MD&A)
Removed heading “Sales and Marketing”
Removed heading “Sales and Marketing Expense”
Removed heading “Impairment of Goodwill”
Largest changes
“Impairment of goodwill was zero for the year ended December 31, 2024 compared to $307.6 million for the year ended December 31, 2023. Based on the results of the Company's goodwill impairment procedures in the second quarter of 2023, the Company recorded a $307.6 million goodwill impairment for its single reporting unit.”see in full comparison
“For the Company's 2024 annual impairment test, the Company performed a Step Zero assessment and did not identify any events or changes in circumstances that would indicate the carrying amount of goodwill may be impaired.”see in full comparison
Adjusted EBITDA wassee in full comparison$322.3$427.3 million for the year ended December 31,2023,2025,aandecreaseincrease of$75.9$7.1 million, or19%,1.7%, from$398.2$420.2 million for the year ended December 31,2022.2024. Adjusted EBITDA as a percentage of revenue was 36.2% for the year ended December 31, 2025 as compared to 35.4% for the year ended December 31, 2024. Thedecrease wasincrease primarilydueresultedtofromincreasedexpensecompetition and margin pressure, which was partially offset by efficiencies in payroll costs primarilycontrol in ourretailcorelocations and streamlining efforts.business.
Full comparison: every changed paragraph (53)
Trulieve is a vertically integrated cannabis company and multi-state operator with operations in nine states. Headquartered in Quincy,Tallahassee, Florida, we are the largest cannabis retailer in the United States with market leading retail operations in Arizona, Florida, Georgia, Pennsylvania, and West Virginia. We are committed to delivering exceptional customer experiences through elevated service and high-quality branded products. We aim to be the brand of choice for medical and adult-use customers in all of the markets that we serve. The Company operates in highly regulated markets that require expertise in cultivation, manufacturing, and retail. We have developed proficiencies in each of these functional areas and are passionate about expanding access to regulated cannabis products through advocacy, education and expansion of our distribution network.
All of the states in which we operate have developed programs to permit the use of cannabis products for medicinal purposes to treat specific conditions and diseases, which we refer to as medical cannabis. Recreational cannabis, or adult-use cannabis, is legal cannabis sold in licensed dispensaries to adults ages 21 and older. Thus far, of the states in which we operate, Arizona, Colorado, Connecticut, Maryland, and Ohio, have already launched programs legalizing the sale of adult-use cannabis products. Trulieve operates its business through its owned subsidiaries which hold licenses in the states in which they operate. In Texas, Trulieve was granted conditional approval for a dispensing organization license under the Texas Compassionate Use Program.
Sales and Marketing
Sales and marketing expenses primarily consist of personnel costs to manage and staff our dispensaries and other operating dispensary costs such as facility costs, advertising costs, and costs for marketing programs of our products. As we continue to expand and open additional dispensaries, and gain additional customers, we expect our sales and marketing expenses to continue to increase.
GeneralSelling, General, and Administrative
GeneralSelling, general, and administrative expenses are primarily relatedconsist of personnel costs to (i)manage personneland costs,staff includingour dispensaries, other operating dispensary costs such as facility expenses, advertising, and marketing programs for our products. These expenses also include salaries, incentive compensation and benefits,benefits (ii)for otheradministrative personnel, professional service costs,costs such as legal, accounting, and acquisition-related fees, campaign and political contributions, and other general corporate expenses including legal, accounting and acquisition related costs, and (iii) legislative campaign contributions. We expect to continue to invest in this area to support our expansion plans and to further support the growth of the cannabis industry. Other general and administrative expenses consist of travel, general office supplies andsupplies, monthly services, facilities and occupancy, insurance, and director fees. As we continue to expand and open additional dispensaries, gain additional customers, and support our growth initiatives, we expect these expenses to continue to increase.
Total other expense, net consists primarily of interest expense, interest income on money market accounts, time deposits, and notes receivable, debt extinguishments, the impact of the revaluation of the liability classified warrants, the interest rate swap, the provision for credit losses recorded on non-operating notes receivable, and the loss or gain recognized on sales of non-operating assets.assets, and loss or gain on debt extinguishments.
For the comparison of fiscal years 20232024 and 2022,2023, refer to Part II, Item 7 "Management's discussion and analysis of financial condition and results of operations" on Form 10-K for our fiscal year ended December 31, 2023,2024, filed with the SEC on February 29,27, 2024,2025, under the subheadings "Year Ended December 31, 20232024 Compared to Year Ended December 31, 20222023," "Management's Use of Non-GAAP Measures" and "Liquidity and Capital Resources".
Revenue for the year ended December 31, 20242025 was $1.19$1.18 billion, ana increasedecrease of $57.3$5.3 million, or 5.1%,0.4%, from $1.13$1.19 billion for the year ended December 31, 2023.2024. The increasedecrease was primarily driven by a $45.3$18.4 million increasedecrease in retail revenue andoffset by a $12.0$13.1 million increase in wholesale and other revenue.
The increase in wholesale and other revenue was driven primarily by new and expanded relationships with wholesale partners, resulting in higher wholesale revenue in Maryland, Ohio, and Pennsylvania.
The decrease in retail revenue was driven by price compression, partially offset by higher traffic and units sold in the current period. The increase in traffic and units sold was partially driven by higher retail sales in the current period in Ohio due to Ohio being a medical-only market in the prior year comparative period and an adult-use and medical market in the current period.
The increase in retail revenue was partially driven by the opening of additional dispensaries and increased productivity in existing dispensaries; the Company operated 225 dispensaries as of December 31, 2024, compared to 192 as of December 31, 2023. Additionally, Maryland became an adult-use market in July 2023 providing a full twelve months of adult-use revenue for 2024 in comparison to 2023.
The increase in wholesale and other revenue was primarily driven by higher wholesale revenue in Maryland with a full year of adult-use sales in 2024 compared to six months of adult-use sales in 2023. Additionally, wholesale revenue in Pennsylvania saw an increase over the comparable period through growth in the wholesale customer base in Pennsylvania in 2024.
Cost of goods sold for the year ended December 31, 20242025 was $470.7$470.0 million, a decrease of $69.8$0.7 million, or 12.9%,0.2%, from $540.6$470.7 million for the year ended December 31, 2023.2024. Cost of goods sold as a percentage of revenue was 39.8% for the year ended December 31, 2025 as compared to 39.7% for the year ended December 31, 2024 as compared to 47.9% for the year ended December 31, 2023.2024. Gross profit for the year ended December 31, 20242025 was $715.7$711.2 million, ana increasedecrease of $127.1$4.6 million, or 21.6%,0.6%, from $588.6$715.7 million for the year ended December 31, 2023.2024. Gross profit as a percentage of revenue was 60.2% for the year ended December 31, 2025 as compared to 60.3% for the year ended December 31, 20242024. asGross comparedmargin will continue to 52.1%fluctuate forperiod theto yearperiod endeddepending Decemberon 31, 2023, which was primarily driven by increased revenueproduct and decreasedmarket costmix, ofinventory goodssell sold reflecting year-over-year improvements in at-scale cost efficiencies from our production facilities as well as a disciplined approach tothrough, promotional activity inand theidle currentcapacity year.costs.
Sales and Marketing Expense
Sales and marketing expense for the year ended December 31, 2024 was $257.7 million, an increase of $17.6 million, or 7.3%, from $240.2 million for the year ended December 31, 2023. The increase was primarily driven by 33 new stores, which was partially offset by retail payroll efficiencies. Sales and marketing expense as a percentage of revenue was 21.7% for the year ended December 31, 2024, compared to 21.3% for the year ended December 31, 2023. Even though there was an increase in the number of operating stores, sales and marketing expense as a percentage of revenue remained relatively consistent as a result of retail payroll efficiencies.
GeneralSelling, General, and Administrative Expense
Selling, general, and administrative expense for the year ended December 31, 2025 was $445.2 million, a decrease of $65.2 million, or 12.8%, from $510.5 million for the year ended December 31, 2024. The decrease in current‑period expenditures compared to the prior period primarily reflects a reduction in campaign and political contributions, totaling $66.1 million in 2025 versus $117.5 million in 2024, in addition to general operating expense reductions.
General and administrative expense for the year ended December 31, 2024 was $252.7 million, an increase of $106.7 million or, 73.1%, from $146.0 million for the year ended December 31, 2023. The increase was primarily from legislative campaign contributions totaling $117.5 million for the year ended December 31, 2024 as compared to $20.1 million for the year ended December 31, 2023. The increase from prior year also resulted from increases in compensation-related expenses, including share based compensation expense driven by the timing of award grants and decreased forfeitures, along with increased expenses for information technology upgrades in 2024 compared to 2023.
Depreciation and amortization expense for the year ended December 31, 20242025 was $112.8$117.6 million, an increase of $3.0$4.8 million, or 2.7%,4.3%, from $109.8$112.8 million for the year ended December 31, 2023.2024. The increase was primarily attributable to higher amortization expense driven by continued investments in internal-use software in 2024.software.
Impairment and DisposalOther of Long-lived Assets,Charges, Net of (Recoveries)
Impairment and disposalother of long-lived assets,charges, net of recoveries for the year ended December 31, 20242025 was a gainloss of $5.3$4.8 million compared to a lossgain of $6.7$5.3 million for the year ended December 31, 2023.2024. In 20242025, results reflected a loss due to asset disposal activities of underperforming assets offset by insurance recoveries. In 2024, we receivedrecognized insurance recoveries totaling $8.4 million,recoveries, which waswere partially offset by asset disposal activities of underperforming assets. In 2023 we had asset disposal activities of underperforming assets.activity.
Impairment of Goodwill
Impairment of goodwill was zero for the year ended December 31, 2024 compared to $307.6 million for the year ended December 31, 2023. Based on the results of the Company's goodwill impairment procedures in the second quarter of 2023, the Company recorded a $307.6 million goodwill impairment for its single reporting unit.
Interest expense, net for the year ended December 31, 20242025 was $62.2$63.5 million, aan decreaseincrease of $19.4$1.3 million, or 23.8%,2.0%, from $81.6$62.2 million for the year ended December 31, 2023. The decrease in interest expense primarily resulted from debt retirements in September 2023 and December 2023 of $57.0 million and $130.0 million, respectively. The decrease was partially offset by interest expense on a $25.0 million mortgage note executed in December 2023.2024.
Interest income for the year ended December 31, 20242025 was $14.7$14.5 million, ana increasedecrease of $8.5$0.2 million, or 138.1%,1.1%, from $6.2$14.7 million for the year ended December 31, 2023. The increase was due to an increase in funds invested in high-yield money market funds and short-term certificates of deposit in 2024.
DebtLoss Extinguishments,on Netdebt extinguishments, net
Loss on debt extinguishments, net for the year ended December 31, 2025 was $1.7 million, compared to zero for the year ended December 31, 2024.
Debt extinguishments, net for the year ended December 31, 2024 was zero compared to a net gain totaling $5.9 million for the year ended December 31, 2023. In 2023, the Company repurchased senior secured notes at a 16.5% discount to par which resulted in a $8.2 million gain on extinguishment. This was partially offset by a $2.4 million loss on extinguishment in the fourth quarter of 2023 when we completed an early redemption of two private placement notes, totaling $130.0 million, which represented a redemption price of 100% of the principal amounts outstanding.
Other (Expense) Income,Expense, Net
Other expense, net was $1.4 million for the year ended December 31, 2025, a decrease of $6.2 million from other expense, net of $7.6 million for the year ended December 31, 2024, a change of $14.1 million from other income, net of $6.5 million for the year ended December 31, 2023.2024. The change was primarily a result of the provision for credit losses recorded on non-operating notes receivable in 2024, compared to gains recognized on sales of non-operating assets and non-recurring settlements in 2023.2024.
The provision for income taxes for the year ended December 31, 20242025 was $197.6$208.1 million, an increase of $46.2$10.5 million, or 30.5%,5.3%, from $151.4$197.6 million for the year ended December 31, 2023.2024. The provision for income taxes as a percentage of gross profit was 29.3% for the year ended December 31, 2025, compared to 27.6% for the year ended December 31, 2024, compared to 25.7% for the year ended December 31, 2023.2024. The increase in tax expense for 20242025 was driven by an increase in grossinterest profitexpense foron theuncertain period,tax positions and the one-time impact in 2024 of changing certain state tax filing methods which requiresrequired a revaluation of deferred taxes in those states, and an increase in interest expense on uncertain tax positions.states.
Our management uses a financial measure that is not in accordance with generally accepted accounting principles in the U.S., or GAAP, in addition to financial measures in accordance with GAAP to evaluate our operating results. This non-GAAP financial measure should be considered supplemental to, and not a substitute for, our reported financial results prepared in accordance with GAAP. Adjusted EBITDA is a financial measure that is not defined under GAAP. Our management uses this non-GAAP financial measure and believes it enhances an investor’s understanding of our financial and operating performance from period to period because it excludes certain material non-cash items and certain other adjustments management believes are not reflective of our ongoing operations and performance. EBITDA is calculated as net loss before net: interest expense, interest income, provision for income taxes, and depreciation and amortization. Adjusted EBITDA is calculated as net loss before net interest expense, interest income, provision for income taxes,taxes and depreciation and amortization, which is then adjusted for certain contributions, such as campaign and political initiatives, items that we do not believe represent the operations of the core business such as acquisition, transaction and other non-recurring costs including major system changes as well as contributions to specific initiatives,changes, impairments and disposals of long-lived assets including goodwill, discontinued operations, share-based compensation, debt extinguishments, and other income and expense items.items, and loss on debt extinguishments.
We report Adjusted EBITDA to help investors assess the operating performance of the Company’s business. The financial measure noted above is a metric that has been adjusted from the GAAP net incomeloss measure in an effort to provide readers with a normalized metric in making comparisons more meaningful across the cannabis industry, as well as to remove non-recurring, irregular and one-time items that may otherwise distort the GAAP net incomeloss measure.
As noted above, our Adjusted EBITDA is not prepared in accordance with GAAP, and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with GAAP. There are a number of limitations related to the use of Adjusted EBITDA rather than net income,loss, which is the most directly comparable financial measure calculated and presented in accordance with GAAP. Because of these limitations, we consider, and you should consider, Adjusted EBITDA together with other operating and financial performance measures presented in accordance with GAAP. A reconciliation of net income,loss, the most directly comparable financial measure calculated in accordance with GAAP, to Adjusted EBITDA, has been included herein immediately following our discussion of “Adjusted EBITDA”.
Adjusted EBITDA was $420.2 million for the year ended December 31, 2024, an increase of $97.9 million, or 30.4%, from $322.3 million for the year ended December 31, 2023. Adjusted EBITDA as a percentage of revenue was 35.4% for the year ended December 31, 2024 as compared to 28.5% for the year ended December 31, 2023. The increase primarily resulted from increased revenue and improved gross profit.
Adjusted EBITDA was $322.3$427.3 million for the year ended December 31, 2023,2025, aan decreaseincrease of $75.9$7.1 million, or 19%,1.7%, from $398.2$420.2 million for the year ended December 31, 2022.2024. Adjusted EBITDA as a percentage of revenue was 36.2% for the year ended December 31, 2025 as compared to 35.4% for the year ended December 31, 2024. The decrease wasincrease primarily dueresulted tofrom increasedexpense competition and margin pressure, which was partially offset by efficiencies in payroll costs primarilycontrol in our retailcore locations and streamlining efforts.business.
Since our inception, we have funded our operations and capital spending through cash flows from product sales, third-party debt, proceeds from the sale of our capital stock and loans from affiliates and entities controlled by our affiliates. We are generating cash from operations and are deploying our capital reserves to acquire and develop assets capable of producing additional revenues to support our business growth.growth when advisable. Our current principal sources of liquidity are our cash and cash equivalents provided by our operations as well as debt and equity offerings. The Company has generated, and expects to continue to generate, additional cash from operations. Cash and cash equivalents consist primarily of cash on deposit with banks and money market funds.
Our primary uses of cash are for working capital requirements, capital expenditures, debt service payments, and income tax payments. Additionally, we may use cash to support cannabis market expansion related initiatives, such as Smart & Safe FloridaFlorida, thatwhich we contributed to in 2023both 2024 and 2024.2025. Working capital is used principally for personnel expenses as well as costs related to the cultivation, processing and distribution of our products. Our capital expenditures consist primarily of additional cultivation and processing facilities and retail dispensaries, and improvements to existing facilities to support the long-term growth in markets with adult-use catalysts.catalysts Inas 2024,well ouras debtinvestments servicein paymentstechnology consist primarily of interest payments.infrastructure.
As of December 31, 2024,2025, cash and cash equivalents were $238.8$255.5 million and we had $60.4 million invested in certificates of deposit, classified as short-term investments due to their original maturity dates which all matured in January 2025.million. We believe our existing cash balances and short-term investments will be sufficient to meet our anticipated cash requirements from the date of filing of this Annual Report on Form 10-K through at least the next 12 months. Any additional future requirements willwould likely be funded through the following sources of capital:
•EquityDebt or debtequity financings.
Net cash provided by operating activities was $272.8 million for the year ended December 31, 2025, an increase of $1.3 million, compared to $271.5 million in net cash provided by operating activities during the year ended December 31, 2024.
Net cash provided by operating activities was $271.5 million for the year ended December 31, 2024, an increase of $69.6 million, compared to $201.8 million in net cash provided by operating activities during the year ended December 31, 2023. The improvement was primarily due to the $127.1 million increase in gross profit driven by higher revenues and improved gross margin as well as the reduction in net tax payments of $99.6 million, primarily related to the impact from the Company's position that it does not owe taxes attributable to the application of Section 280E of the Internal Revenue Code (inclusive of $52.0 million in refunds received from amended returns based on this position). This was partially offset by a $97.4 million increase in payments for legislative campaign contributions. Operating cash flows in the comparative period benefited from the $83.3 million decrease in inventories versus the $18.7 million increase for the current period.
Net cash usedprovided inby investing activities was $206.6$13.5 million for the year ended December 31, 2024,2025, ana increasechange of $169.1$220.1 million, compared to $37.5$206.6 million in net cash used in investing activities for the year ended December 31, 2023.2024. The increasechange was primarily reflectsdriven the Company's $60.4 million net investment intoby certificates of deposit asentered well as higher purchases of property and equipment and internal-use softwareinto in 2024 to support the long-termthird growthquarter of the business. Additionally, there was a decrease in disposal of assets activity in 2024 which resultedmatured in athe decreasefirst quarter of $11.42025. millionAdditionally, higher proceeds from asset sales and a reduction in proceeds.capital expenditures in the current period contributed to the change in net cash provided by investing activities.
Net cash used in financing activities was $33.4$270.5 million for the year ended December 31, 2024,2025, aan decreaseincrease of $142.1$237.1 million, compared to $175.6$33.4 million in net cash used in financing activities for the year ended December 31, 2023.2024. The decreasechange is primarily relatedattributable to $160.8$383.9 million in netof debt activityretirement comparedpartially tooffset theby comparable$140.0 period.million debt issuance in 2025. This was partially offset by a $12.2 million tax payment made in 2024 for taxes related to a one-timeone‑time net share settlement of RSUs for two executive officersofficers, as well as costs associated with a consolidated VIE settlement transaction and the related costs incurred.transaction.
As of December 31, 20242025 and 2023,2024, 100%substantially all of our consolidated balance sheets are exposed to U.S. cannabis-related activities, and substantially all our revenue is from U.S. cannabis operations. We believe our operations are in material compliance with all applicable state and local laws, regulations, and licensing requirements in the states in which we operate. However, cannabis remains illegal under U.S. federal law. For information about risks related to U.S. cannabis operations, please refer to the “Risk Factors” section of this Annual Report on Form 10-K.
Critical Accounting Policies and Estimates
Our consolidated financial statements have been prepared in conformity with GAAP. In preparation of these consolidated financial statements, our management is required to use judgment in making estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements, as well as the reported expenses incurred during the reporting periods. Management considers an accounting judgment, estimate, or assumption to be critical when (1) the estimate or assumption is complex in nature or requires a high degree of judgment and (2) the use of different judgments, estimates, and assumptions could have a material impact on the consolidated financial statements. Our significant accounting policies are described in Note 3. Summary Of Significant Accounting Policies to the consolidated financial statements included in Item 8 of this Annual Report on Form 10-K for further information.
In preparation of these consolidated financial statements, management applied critical estimates and assumptions while determining netthe realizable valuevaluation of inventory, estimating uncertain tax provisions, and performing impairment assessments on long-lived assets and goodwill.
In accordance with GAAP, we value inventory at the lower of cost or net realizable value. Our assessment of net realizable value is a critical accounting estimate due to the emerging and evolving cannabis industry, which makes it subject to significant fluctuations and uncertainty. These estimates rely on historical harvest data, expected plant survival, moisture‑loss assumptions, and production conversion metrics. Changes in these inputs can materially impact inventory valuation and cost of goods sold. Inventory valuation adjustments are reflected in cost of goods sold on the consolidated statements of operations.
The IRS has taken the position Section 280E of the IRC prevents cannabis companies from deducting any business expenses other than those properly included in cost of goods sold (e.g., costs associated with producing the products or costs of production). The Company has taken a position that Section 280E of the IRC does not preclude it from deducting ordinary and necessary business expenditures on its tax returns. As outlined in Item 3. Legal Proceedings, the Company believes its tax position is supportable and that it has substantive legal arguments. However, management has concluded that the position does not yet meet the recognition threshold required by ASC 740. As a result, no reduction or elimination of the related uncertain tax position liability has been recognized as of December 31, 2025. As a result, as of December 31, 2024,2025, $412.6$630.3 million in uncertain tax positions were recorded for the Company's tax positions.positions while $38.1 million related to other matters.
Goodwill is allocated at the date the goodwill is initially recorded. We have one operating segment and reporting unit, and evaluate goodwill for impairment as one singular reporting unit. We evaluate our goodwill for impairment annually at the beginning of the fourth quarter or earlier upon the occurrence of a triggering event, such as substantive unfavorable changes in economic conditions, industry trends, costs, cash flows, or ongoing declines in market capitalization. The Company applies the guidance in ASC 350 Intangibles - Goodwill and Other which provides entities with an option to perform a qualitative assessment (commonly referred to as “Step Zero”) to determine whether further quantitative analysis for impairment of goodwill is necessary. In performing Step Zero for the Company’s goodwill impairment test, the Company is required to make assumptions and judgments including but not limited to the following: the evaluation of macroeconomic conditions as related to the Company’s business, industry and market trends, trending of the Company's share price and the resulting market capitalization of the Company, and the overall future financial performance of its reporting unitsunit and future opportunities in the markets in which theywe operate. If impairment indicators are present after performing Step Zero, the Company would perform a quantitative impairment analysis to estimate the fair value of goodwill.
For the Company's 2024 annual impairment test, the Company performed a Step Zero assessment and did not identify any events or changes in circumstances that would indicate the carrying amount of goodwill may be impaired.
What changed in the latest 10-Q
Risk Factors
New heading “The fair value of our equity method investment in Harvest is potentially volatile and a significant reduction in the value of Harvest could have a material adverse effect on our financial condition and future prospects.”
Removed heading “Adult use cannabis is illegal under United States federal law.”
Removed heading “We may not be able to adequately protect our intellectual property.”
Removed heading “Our property may be subject to risk of civil asset forfeiture.”
Removed heading “We could be subject to criminal prosecution or civil liabilities under RICO.”
Largest changes
“The fair value of our equity method investment in Harvest is potentially volatile and a significant reduction in the value of Harvest could have a material adverse effect on our financial condition and future prospects.”see in full comparison
“We could be subject to criminal prosecution or civil liabilities under RICO.”see in full comparison
“We may not be able to adequately protect our intellectual property.”see in full comparison
“Adult use cannabis is illegal under United States federal law.”see in full comparison
“Our property may be subject to risk of civil asset forfeiture.”see in full comparison
“The Racketeer Influenced Corrupt Organizations Act (“RICO”) criminalizes the use of any profits from certain defined “racketeering” activities in interstate commerce. While intended to provide an additional cause of action against organized crime, due to the fact that adult use cannabis is illegal under U.S. federal law, the Company’s adult use cannabis operations could qualify as “racketeering” as defined by RICO. As such, all officers, managers and owners in a cannabis related business could be subject to criminal prosecution under RICO. …”see in full comparison
Full comparison: every changed paragraph (12)
Investing in our Subordinate Voting Shares involves a high degree of risk. Our 2025 Form 10-K includes detailed discussions of our risk factors under the heading “Part I, Item 1A—Risk Factors". In addition to the risk factors previously disclosed in Part I, Item 1A, "Risk Factors" of the 2025 Form 10-K, the additional risk factor set forth below should be carefully considered. You should consider carefully the risk factors discussed herein, in our 2025 Form 10-K and all other information contained in or incorporated by reference in this Quarterly Report on Form 10-Q before making an investment decision. If any of the risks discussed herein and in the 2025 Form 10-K actually occur, they may materially harm our business, financial condition, operating results, cash flows or growth prospects. As a result, the market price of our Subordinate Voting Shares could decline, and you could lose all or part of your investment. Additional risks and uncertainties that are not yet identified or that we think are immaterial may also materially harm our business, financial condition, operating results, cash flows or growth prospects and could result in a complete loss of your investment. The following risk factors supplement the risk factors previously disclosed in our 2025 Form 10-K.
The fair value of our equity method investment in Harvest is potentially volatile and a significant reduction in the value of Harvest could have a material adverse effect on our financial condition and future prospects.
Through our ownership in the Non-Voting Units, we own a non-participating and non-voting interest in Harvest, and we classify such interest in Harvest as an equity method investment. The fair value of our equity investment in Harvest is subject to certain assumptions and, accordingly, such valuation is uncertain and potentially volatile. A significant reduction in the value of Harvest could have a material adverse effect on our financial condition and future prospects as a result of our interest in Harvest.
Adult use cannabis is illegal under United States federal law.
In the U.S. cannabis is largely regulated at the state level. Each state in which we operate (or are currently proposing to operate) authorizes, as applicable, medical and/or adult-use cannabis production and distribution by licensed or registered entities, and numerous other states have legalized cannabis in some form. On April 23, 2026, the DOJ announced the finalization of the rescheduling of medical marijuana under the CSA from Schedule I to Schedule III. As a result of the rescheduling, certain federal tax, regulatory, and research restrictions applicable to Schedule I substances no longer apply to medical marijuana. The DOJ announcement also provided state-legal medical marijuana businesses an expedited process for registration with the DEA. The Company has applied for DEA licenses in Florida, Pennsylvania, Georgia and West Virginia, with the expected effect that the Company’s operations in those medical-only states are federally legal.
However, although the DOJ announcement restarted the process for rescheduling adult use marijuana from Schedule I to Schedule III, until that process is complete, the Company’s adult use cannabis operations remain illegal under U.S. federal law. Although we believe that our adult use cannabis business activities are compliant with applicable state and local laws in the United States, strict compliance with such state and local laws would not provide a defense to any federal proceeding which may be brought against us. Any such proceedings may result in a material adverse effect on us, including our business, financial condition, and results of operations.
We may not be able to adequately protect our intellectual property.
As long as adult use cannabis remains illegal under U.S. federal law as a Schedule I controlled substance under the CSA, the benefit of certain federal laws and protections that may be available to most businesses, such as federal trademark and patent protection, may not be available to us. As a result, our intellectual property may not be adequately or sufficiently protected against the use or misappropriation by third parties.
Our property may be subject to risk of civil asset forfeiture.
Because the adult use cannabis industry remains illegal under U.S. federal law, any associated property that is either used in the course of conducting or comprises the proceeds of an adult use cannabis business could be subject to seizure by law enforcement and subsequent civil asset forfeiture.
We could be subject to criminal prosecution or civil liabilities under RICO.
The Racketeer Influenced Corrupt Organizations Act (“RICO”) criminalizes the use of any profits from certain defined “racketeering” activities in interstate commerce. While intended to provide an additional cause of action against organized crime, due to the fact that adult use cannabis is illegal under U.S. federal law, the Company’s adult use cannabis operations could qualify as “racketeering” as defined by RICO. As such, all officers, managers and owners in a cannabis related business could be subject to criminal prosecution under RICO. Trulieve or its subsidiaries, as well as its officers, managers and owners could all be subject to civil claims under RICO.
Management's Discussion & Analysis (MD&A)
New heading “Investment in Harvest”
New heading “Comparability of Results”
New heading “Loss on Deconsolidation Transaction”
New heading “Equity in net loss of Harvest”
New heading “Cost of Goods Sold and Gross Profit”
New heading “Selling, General and Administrative Expense”
New heading “Depreciation and Amortization Expense”
New heading “Loss on disposal or impairment of assets”
New heading “Loss on Deconsolidation Transaction”
New heading “Interest Expense, Net”
New heading “Interest Income”
New heading “Equity in net loss of Harvest”
New heading “Other Income (Expense), Net”
New heading “Provision for Income Taxes”
Largest changes
“1)Harvest and its members (including Company Subsidiary), entered into a limited liability company agreement, dated June 3, 2026 (the “LLC Agreement”), which provides for, among other things, three classes of units (the “Units”): the Class A units (the “Voting Units”), the Common Units and the Non-Voting Units. The Harvest Investor (as defined below) holds all of the Voting Units, which provide for standard voting and dividend rights, including rights upon dissolution of Harvest. …”see in full comparison
“Following federal rescheduling of medical marijuana under the Controlled Substances Act (the “CSA”) from Schedule I to Schedule III in April 2026, we applied to register all of our state licensed medical operations with the Drug Enforcement Agency ("DEA") in Florida, Georgia, Pennsylvania, and West Virginia. As outlined in the rescheduling final order by the Department of Justice ("DOJ"), our state licensed operations are deemed federally lawful while application reviews are ongoing. We have been working with the DEA to complete site inspections. …”see in full comparison
“As further described below, as a result of the implementation of the Deconsolidation Transaction, an indirect wholly-owned subsidiary of the Company (“Company Subsidiary”) holds non-voting and non-participating units (the “Non-Voting Units”) in the capital of Harvest. …”see in full comparison
“On April 23, 2026, the U.S. Department of Justice (the "DOJ") announced the finalization of the rescheduling of medical marijuana under the Controlled Substances Act (the “CSA”) from Schedule I to Schedule III. As a result of the rescheduling, certain federal tax, regulatory, and research restrictions applicable to Schedule I substances no longer apply to medical marijuana. The DOJ announcement also provided state-legal medical marijuana businesses an expedited process for registration with the Drug Enforcement Administration (the "DEA"). …”see in full comparison
Full comparison: every changed paragraph (84)
This "Management's Discussion and Analysis of Financial Condition and Results of Operations" of Trulieve Cannabis Corp., together with its consolidated subsidiaries ("Trulieve," the "Company," "we," "our," or "us") should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and the related notes included elsewhere within this Quarterly Report on Form 10-Q and the Audited Consolidated Financial Statements and the related Notes thereto and "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (our "2025 Form 10-K").
This discussion contains forward-looking statements and involves numerous risks and uncertainties, including but not limited to those described in the “Risk Factors” section of this Quarterly Report on Form 10-Q and in “Part I, Item 1A. Risk Factors” in our 2025 Form 10-K. Actual results may differ materially from those contained in any forward-looking statements. You should read “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” contained herein and in our 2025 Form 10-K. See “Special Note Regarding Forward-Looking Statements and Projections” in “Part II. Other Information” of this report.Quarterly Report. You should consider our forward-looking statements in light of the risks discussed in “Item 1A. Risk Factors” in “Part II. Other Information” of this reportQuarterly Report and our unaudited condensed consolidated financial statements, related notes and other financial information appearing elsewhere in this report,Quarterly Report, and the risks discussed in "Item 1A, Risk Factors" of the 2025 Form 10-K and our other filings with the Securities and Exchange Commission (the “SEC”).SEC.
Trulieve Cannabis Corp. is a reporting issuer in the United States and Canada.States. The Company’s subordinate voting shares (the "Subordinate Voting Shares (as hereinafter defined") are listed for trading on the CanadianNew SecuritiesYork Stock Exchange (“CSE”"NYSE") under the symbol “TRUL” and are also traded in the United States on the OTCQX Best Market (“OTCQX”) under the symbol “TCNNFTRLV”.
Trulieve is a vertically integrated medical cannabis company and multi-state operator with operations in four states. Headquartered in Tallahassee, Florida, we are the largest medical cannabis retailer in the United States with over 200 dispensaries and 3.5 million square feet of cultivation and production capacity.
Following federal rescheduling of medical marijuana under the Controlled Substances Act (the “CSA”) from Schedule I to Schedule III in April 2026, we applied to register all of our state licensed medical operations with the Drug Enforcement Agency ("DEA") in Florida, Georgia, Pennsylvania, and West Virginia. As outlined in the rescheduling final order by the Department of Justice ("DOJ"), our state licensed operations are deemed federally lawful while application reviews are ongoing. We have been working with the DEA to complete site inspections. The Company operates in highly regulated markets that require expertise in cultivation, manufacturing, and retail. We have developed proficiencies in each of these functional areas and are passionate about expanding access to regulated cannabis products through advocacy, education and expansion of our distribution network. We are committed to delivering exceptional customer experiences through elevated service and high-quality branded products. We aim to be the brand of choice for medical customers in all of the markets that we serve.
Trulieve is a vertically integrated cannabis company and multi-state operator with operations in nine states. Headquartered in Tallahassee, Florida, we are the largest cannabis retailer in the United States. We are committed to delivering exceptional customer experiences through elevated service and high-quality branded products. We aim to be the brand of choice for medical and adult-use customers in all of the markets that we serve. The Company operates in highly regulated markets that require expertise in cultivation, manufacturing, and retail. We have developed proficiencies in each of these functional areas and are passionate about expanding access to regulated cannabis products through advocacy, education and expansion of our distribution network.
All of the states in which we operate have developed programs to permit the use of cannabis products for medicinal purposes to treat specific conditions and diseases, which we refer to as medical cannabis. Recreational cannabis, or adult-use cannabis, is legal cannabis sold in licensed dispensaries to adults ages 21 and older. Thus far, of the states in which we operate, Arizona, Colorado, Connecticut, Maryland, and Ohio, have already launched programs legalizing the sale of adult-use cannabis products. Trulieve operates its business through its owned subsidiaries which hold licenses in the states in which they operate. In Texas, Trulieve was granted conditional approval for a dispensing organization license under the Texas Compassionate Use Program. In recent months we have been working with regulatory authorities as part of the due diligence process required to attain a final license. Our initial investment in production capacity is completed and ready for inspection. Pending regulatory approval, we plan to ramp production and retail capacity to serve all 11 regions in Texas.
As of MarchJune 31,30, 2026, we operated the following:
Trulieve’s production, retail, and distribution areas are organized into regional hubs whereby teams and assets are aggregated in order to effectively pair national structure and support with localized operations tailored to each market. Trulieve has established cannabis operations in three hubs: Southeast, Northeast, and Southwest. Each of our three regional hubs are anchored by cornerstone markets in Arizona, Florida, Ohio and Pennsylvania.
InTrulieve’s production, retail, and distribution areas are organized into regional hubs whereby teams and assets are aggregated in order to effectively pair national structure and support with localized operations tailored to each market. Trulieve has established medical cannabis operations in two hubs: Southeast and Northeast. Our regional hubs are anchored by cornerstone markets in Florida and Georgia,Pennsylvania. In the Southeast, Trulieve cultivates, processes, and manufactures all cannabis products sold in our dispensaries.dispensaries in Florida and Georgia. The Georgia medical marijuana program expanded on July 1, 2026 with the removal of the low-THC cap on products and new qualifying conditions for patients and product form factors allowed. Additionally, Trulieve supplies licensed independent pharmacies in Georgia with approved medical cannabis products to be dispensed to registered patients. In otherthe markets including Arizona, Maryland, Pennsylvania, and West Virginia,Northeast, we have achieved varying percentages of vertical integration with cultivation and processing operations to support our retail and wholesale businesses.businesses in Pennsylvania and West Virginia. Our investments in vertically integrated operations in several of our markets afford us ownership of the entire supply chain, which mitigates third-party risks and allows us to completely control product quality and brand experience. Trulieve employs an in-house quality team as well as testing laboratories in select markets, both of which allow us to more tightly control product quality.
Trulieve’s customer engagement activities are designed to foster deep connections with medical patients and adult use customers in person and online. Through educational events, local partnerships and charitable giving, Trulieve supports community activity while raising awareness for the many benefits of cannabis.
Investment in Harvest
On June 3, 2026, the Company completed a transaction pursuant to which the Company ceased to control its former indirect wholly-owned subsidiary, Harvest Enterprises, LLC (“Harvest”), which holds the Company’s former mixed-use cannabis operations (the “Deconsolidation Transaction”), other than businesses the transfer of which is subject to regulatory approval, which businesses will, automatically and without any action on the part of the Company or any other party, transfer to Harvest upon the receipt of regulatory approval, ceased to be a consolidated subsidiary.
As further described below, as a result of the implementation of the Deconsolidation Transaction, an indirect wholly-owned subsidiary of the Company (“Company Subsidiary”) holds non-voting and non-participating units (the “Non-Voting Units”) in the capital of Harvest. The Non-Voting Units do not carry voting rights or rights to receive dividends, do not provide the Company with the ability to direct the business, operations or activities of Harvest, or provide other rights upon dissolution of Harvest, and are only convertible into Class B units of Harvest (the “Common Units”) following the date that the New York Stock Exchange permits the listing of companies that consolidate the financial statements of companies that cultivate, distribute or possess marijuana (as defined in 21 U.S.C. 802) for non-medical uses in the United States (the “Stock Exchange Permissibility Date”).
In connection with the Deconsolidation Transaction, among other things:
1)Harvest and its members (including Company Subsidiary), entered into a limited liability company agreement, dated June 3, 2026 (the “LLC Agreement”), which provides for, among other things, three classes of units (the “Units”): the Class A units (the “Voting Units”), the Common Units and the Non-Voting Units. The Harvest Investor (as defined below) holds all of the Voting Units, which provide for standard voting and dividend rights, including rights upon dissolution of Harvest. The Common Units also provide for standard voting and dividend rights, including rights upon dissolution of Harvest. The LLC Agreement provides that upon conversion of all of the Non-Voting Units into Common Units, the Voting Units will be equal to no less than 10% of the total issued and outstanding Units following such issuance. Accordingly, in no circumstances will Company Subsidiary, at the time of such conversions, own more than 90% of the Units. In addition, pursuant to the terms of the LLC Agreement, Company Subsidiary has the right to appoint one member to the Harvest board of managers (the “Harvest Board”) and the Harvest Investor has the right to appoint two members to the Harvest Board.
2)Harvest and the Company entered into a Class A Unit Purchase Agreement (the “Class A Unit Purchase Agreement”) with an independent third party investor, Whitley Holding 05192026, LLC (the “Harvest Investor”), dated June 3, 2026, pursuant to which, among other things, the Harvest Investor made an investment in Harvest and acquired Voting Units representing a 10% economic ownership interest in Harvest for approximately $14.8 million (the “Harvest Investment”). In connection with the Harvest Investment, the Harvest Investor appointed two managers to the Harvest Board and Company Subsidiary appointed one manager to the Harvest Board.
3)The Company, Company Subsidiary and Harvest entered into a protection agreement, dated June 3, 2026, to provide for certain covenants in order to preserve the value of the Non-Voting Units held by Company Subsidiary until such time as the Non-Voting Units are converted into Common Units in accordance with their terms, provided that, such conversion shall only be permitted following the Stock Exchange Permissibility Date, but does not provide the Company or Company Subsidiary with the ability to direct the business, operations or activities of Harvest.
In connection with the Deconsolidation Transaction, the Company and Harvest entered into a management services agreement (the “MSA”), pursuant to which, among other things, a subsidiary of the Company agreed to provide certain consulting, advisory and administrative support services to Harvest. The MSA provides for reimbursement of the Company’s costs incurred in providing such services plus a 5% margin, together with a fixed quarterly management fee. Each of the parties to the MSA has the ability to terminate the MSA at any time upon 90 days’ notice.
Harvest conducts mixed-use cannabis businesses in Arizona, Connecticut, Maryland, and Ohio. Harvest operates 34 Trulieve branded dispensaries in addition to cultivation and production capacity across these markets. Following the Deconsolidation Transaction , the Company accounts for its investment in Harvest under the equity method of accounting and no longer consolidates Harvest's assets, liabilities, results of operations, or cash flows.
The vast majority of both manufacturing and retail competitors in our markets are either localized businesses with operations in a single state market or regional players. Other multi-state cannabis operators compete directly in several of our operating markets. Aside from this direct competition, out-of-state operators that are sufficiently capitalized to enter those markets through acquisitions are also part of the competitive landscape. Similarly, as we execute on our regional hub strategy and expand across the U.S., operators in our future state markets will inevitably become direct competitors. Increased competition by larger and better financed competitors could materially affect our business, financial condition and results of operations.
We face additional competition from new entrants. If the number of consumers of medical and adult-use cannabis in our markets increases, the demand for products will increase and we expect that competition will become more intense as current and future competitors offer an increasing number of diversified products and engage in price competition. We expect to continue to invest in several areas, including customer experience, product innovation, scaled production, marketing and branding, and distribution network expansion. Trulieve may not have sufficient resources to maintain investments on a competitive basis, which could have a material adverse effect on our business, financial condition and operational results. The management team monitors developments in the fast-paced cannabis industry and adjacent industries to help us remain competitive.
In April 2026, the DOJ announcement restarted the process for rescheduling adult use marijuana from Schedule I to Schedule III. A hearing to gather testimony from selected interested parties was conducted between June 29 and July 15, 2026. Hearing transcript corrections and post hearing briefs are due on August 17, 2026. After reviewing the hearing record, testimony, and briefs, the Administrative Law Judge ("ALJ") is expected to issue a recommended decision. Typically, the DEA Administrator would review the recommendation by the ALJ and may choose to issue a final rule with the scheduling determination, effective date, and implementation details.
On August 5, 2026, the Company's shareholders approved, and the Board of Directors authorized, the concurrent domestication of the Company to the State of Delaware and continuance out of the Province of British Columbia. The domestication and continuance remain subject to the satisfaction of applicable legal and regulatory requirements and the filing of the requisite governing documents.
On April 23, 2026, the U.S. Department of Justice (the "DOJ") announced the finalization of the rescheduling of medical marijuana under the Controlled Substances Act (the “CSA”) from Schedule I to Schedule III. As a result of the rescheduling, certain federal tax, regulatory, and research restrictions applicable to Schedule I substances no longer apply to medical marijuana. The DOJ announcement also provided state-legal medical marijuana businesses an expedited process for registration with the Drug Enforcement Administration (the "DEA"). The Company has applied for DEA licenses in Florida, Georgia, Pennsylvania and West Virginia, with the expected effect that the Company’s operations in those medical-only states are federally legal. Finally, the DOJ announcement restarted the process for rescheduling adult use marijuana from Schedule I to Schedule III.
The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The Company’s accounting policies that we believe are the most critical to aid in fully understanding and evaluating our reported financial results are described in our 2025 Form 10-K under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Estimates.” During the threesix months ended MarchJune 31,30, 2026, there were no significant changes to our previously disclosed critical accounting policies and estimates.estimates other than the addition of a critical accounting estimate related to the valuation of the Company's retained equity method investment in Harvest following the Deconsolidation Transaction. The fair value measurement required significant management judgment related to the selection of discount rates, projected EBITDA margins and marketability discounts, all of which represent significant unobservable inputs. See Note 5. Equity Method Investment for additional information.
This section of this Form 10-Q generally describes and compares our results of continuing operations for the three and six months ended MarchJune 31,30, 2026 and 2025.
Comparability of Results
As discussed in Note 4. Disposition, the Deconsolidation Transaction impacts the comparability of the Company's results of operations between periods. Accordingly, period-over-period comparisons may not be directly comparable and should be considered in conjunction with the discussion of the Deconsolidation Transaction in Note 4. Disposition and the Equity Method Investment disclosure in Note 5. Equity Method Investment.
Revenue
Revenue for the three months ended MarchJune 31,30, 2026 was $286.8$271.0 million, a decrease of $11.0$31.1 million, from $297.8$302.1 million for the three months ended MarchJune 31,30, 2025. The decrease was primarily driven by the Deconsolidation Transaction, which reduced the period of Harvest activity included in consolidated revenue during the current quarter. Excluding the impact of the Deconsolidation Transaction, revenue was drivenalso affected by acontinued $16.8pricing million decreasepressure in retailcertain revenuemature markets, partially offset by arevenue $5.8 million increasegrowth in wholesaleOhio andthrough otherthe revenue.Deconsolidation Transaction date. Revenue also increased as a result of management services provided under the MSA with Harvest.
The increase in wholesale and other revenue was driven primarily by a continued focus on new and expanded relationships with wholesale partners, resulting in higher wholesale revenue across several core markets.
The decrease in retail revenue reflects continued price compression, partially offset by contributions from new retail dispensary openings; the Company operated 236 dispensaries as of March 31, 2026, compared to 229 dispensaries as of March 31, 2025.
Cost of goods sold for the three months ended MarchJune 31,30, 2026 was $116.7$108.7 million, ana increasedecrease of $2.1$10.5 million from $114.5$119.2 million for the three months ended MarchJune 31,30, 2025. Cost of goods sold as a percentage of revenue was 40.7%40.1% for the three months ended MarchJune 31,30, 2026 as compared to 38.5%39.4% for the three months ended MarchJune 31,30, 2025. Gross profit for the three months ended MarchJune 31,30, 2026 was $170.1$162.3 million, a decrease of $13.1$20.6 million from $183.2$182.9 million for the three months ended MarchJune 31,30, 2025. Gross profit as a percentage of revenue was 59.3%59.9% for the three months ended MarchJune 31,30, 2026 as compared to 61.5%60.6% for the three months ended MarchJune 31,30, 2025. Cost of goods sold and gross profit decreased primarily as a result of the Deconsolidation Transaction; however, both remained generally consistent as a percentage of revenue compared to the prior-year period. Gross margin will continue to fluctuate quarter to quarter depending on product and market mix, inventory sell through, promotional activity and idle capacity costs.
Selling, general, and administrative expense for the three months ended MarchJune 31,30, 2026 was $104.9$101.8 million, aan decreaseincrease of $13.9$0.7 million from $118.8$101.1 million for the three months ended MarchJune 31,30, 2025. Selling, general, and administrative expense as a percentage of revenues was 36.6%37.6% for the three months ended MarchJune 31,30, 2026, compared to 39.9%33.5% for the three months ended MarchJune 31,30, 2025. The decreaseincrease in the current period expenditures as a percentage of revenue compared to the prior year comparable period reflects lowercosts campaignassociated and political contributions, totaling $9.5 million inwith the currentDeconsolidation period compared to $23.0 million in the prior year period.Transaction.
Depreciation and amortization expense for the three months ended MarchJune 31,30, 2026 was $29.7$25.7 million, ana increasedecrease of $0.4$3.7 million from $29.3$29.4 million for the three months ended MarchJune 31,30, 2025. The decrease is primarily attributable to the Deconsolidation Transaction.
Loss (Gaingain) loss on disposal or impairment of assets
Loss (gain) on disposal or impairment of assets was a gain of $2.0 million for the three months ended June 30, 2026 compared to a loss of $0.3 million for the three months ended June 30, 2025.
Loss on Deconsolidation Transaction
Loss on deconsolidation transaction expense for the three months ended June 30, 2026 was $403.3 million and was attributable to the Deconsolidation Transaction completed during the quarter. The loss resulted primarily from the application of ASC 810, which required the Company to derecognize Harvest's net assets and measure its retained investment at fair value upon deconsolidation. As a result, the loss is primarily a non-cash accounting charge and is not indicative of the ongoing operating performance or cash-generating capacity of the underlying business. Further information regarding the transaction and the related loss is included in Note 4. Disposition.
Impairment and other charges, net of recoveries was a gain of $0.3 million for the three months ended March 31, 2026 compared to a loss of $1.8 million for the three months ended March 31, 2025.
Interest expense, net for the three months ended MarchJune 31,30, 2026 was $13.3$12.8 million, a decrease of $3.0$3.6 million from $16.3$16.4 million for the three months ended MarchJune 31,30, 2025. The decrease was primarily driven by a reduction in overall debt in the current period as compared to the prior period.
Interest income for the three months ended MarchJune 31,30, 2026 was $2.7$3.1 million, a decrease of $0.4$0.6 million from $3.1$3.6 million for the three months ended MarchJune 31,30, 2025.
Equity in net loss of Harvest
Equity in net loss of Harvest for the three months ended June 30, 2026 was $3.3 million and represents the Company's proportionate share of Harvest's net results following the June 3, 2026 Deconsolidation Transaction. Due to Harvest being accounted for under the equity method of accounting, the Company recognizes only its share of Harvest's net income or loss and no longer consolidates Harvest's revenue, operating expenses, assets, or liabilities.
Other Income,Income (Expense), Net
Other income, net for the three months ended MarchJune 31,30, 2026 was $0.1 million, a decreasechange of $0.1$1.1 million from $0.2other expense of $1.0 million for the three months ended MarchJune 31,30, 2025.
The provision for income taxes for the three months ended MarchJune 31,30, 2026 was $21.9$22.0 million, a decrease of $30.6$32.8 million from $52.5$54.7 million for the three months ended MarchJune 31,30, 2025. The provision for income taxes as a percentage of gross profit was 12.9%13.5% for the three months ended MarchJune 31,30, 2026, compared to 28.6%29.9% for the three months ended MarchJune 31,30, 2025. The decrease was primarily driven by the Company not applying IRC Section 280E for the 2026 taxable year, where the prior period provision included the impact of IRC Section 280E.
The following table and discussion compares condensed consolidated statements of operations data for the year-to-date periods presented:
Revenue for the six months ended June 30, 2026 was $557.7 million, a decrease of $42.1 million from $599.8 million for the six months ended June 30, 2025. The decrease was primarily driven by the Deconsolidation Transaction, which reduced the period of Harvest activity included in consolidated revenue during the current year. Excluding the impact of the Deconsolidation Transaction, revenue was also affected by continued pricing pressure in certain mature markets, partially offset by revenue growth in Ohio through the Deconsolidation Transaction date and revenue associated with the MSA.
Cost of Goods Sold and Gross Profit
Cost of goods sold for the six months ended June 30, 2026 was $225.3 million, a decrease of $8.4 million from $233.7 million for the six months ended June 30, 2025. Cost of goods as a percentage of revenues was 40.4% for the six months ended June 30, 2026 compared to 39.0% for the six months ended June 30, 2025. Gross profit for the six months ended June 30, 2026 was $332.4 million, a decrease of $33.8 million from $366.1 million for the six months ended June 30, 2025. Gross profit as a percentage of revenue was 59.6% for the six months ended June 30, 2026 as compared to 61.0% for the six months ended June 30, 2025. Cost of goods sold and gross profit decreased primarily as a result of the Deconsolidation Transaction; however, both remained generally consistent as a percentage of revenue compared to the prior-year period. Gross margin will continue to fluctuate quarter to quarter depending on product and market mix, inventory sell through, promotional activity and idle capacity costs.
Selling, General and Administrative Expense
Selling, general, and administrative expense for the six months ended June 30, 2026 was $206.7 million, a decrease of $13.2 million from $219.9 million for the six months ended June 30, 2025. Selling, general, and administrative expense as a percentage of revenue was 37.1% for the six months ended June 30, 2026, compared to 36.7% for the six months ended June 30, 2025. The decrease in the current period expenditures compared to the prior year period was primarily driven by the Deconsolidation Transaction and remained relatively flat as a percentage of revenue.
Depreciation and Amortization Expense
Depreciation and amortization expense for the six months ended June 30, 2026 was $55.5 million, a decrease of $3.3 million from $58.8 million for the six months ended June 30, 2025. The decrease is primarily attributable to the Deconsolidation Transaction.
Loss on disposal or impairment of assets
Loss on disposal or impairment of assets for the six months ended June 30, 2026 was $1.7 million compared to $1.5 million for the six months ended June 30, 2025.
Loss on Deconsolidation Transaction
Loss on deconsolidation transaction expense for the six months ended June 30, 2026 was $403.3 million and was attributable to the Deconsolidation Transaction completed during the quarter. The loss resulted primarily from the application of ASC 810, which required the Company to derecognize Harvest's net assets and measure its retained investment at fair value upon deconsolidation. As a result, the loss is primarily a non-cash accounting charge and is not indicative of the ongoing operating performance or cash-generating capacity of the underlying business. Further information regarding the transaction and the related loss is included in Note 4. Disposition.
TRLV insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 3 filings (1 insider, 7 trade dates, 1,699,007 shares, about $14.7M; 3 of these filings say the sales were made under a Rule 10b5-1 trading plan). Net open-market shares: -1,699,007 (purchases minus sales); net value about -$14.7M.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-06-26 | Rivers Kim A. |
Open-market sale |
136,811 | $8.76 | $1.2M |
| 2026-06-25 | Rivers Kim A. |
Open-market sale |
300,000 | $8.17 | $2.5M |
| 2026-06-24 | Rivers Kim A. |
Open-market sale |
400,000 | $8.17 | $3.3M |
| 2026-06-23 | Rivers Kim A. |
Open-market sale |
380,000 | $8.47 | $3.2M |
| 2026-06-22 | Rivers Kim A. |
Open-market sale |
204,815 | $9.35 | $1.9M |
| 2026-06-18 | Rivers Kim A. |
Open-market sale |
139,846 | $9.46 | $1.3M |
| 2026-06-17 | Rivers Kim A. |
Open-market sale |
137,535 | $9.36 | $1.3M |
Well-known investors holding TRLV (13F)
None of the 59 investors we track reported a position in their latest 13F.