- Decibel Cannabis Company (TSXV:DB) reported that revenue rose 41 per cent year over year to about C$30 million, driven by a surge in international sales, which jumped 330 per cent
- Profitability improved significantly with adjusted EBITDA doubling, while underlying cash flow remained strong despite a one-time refinancing impact
- The company reaffirmed full-year guidance and expects continued growth supported by expanding global demand and steady domestic market gains
- Decibel Cannabis stock (TSXV:DB) last traded at $0.10
Decibel Cannabis Company (TSXV:DB) reported strong financial results for the first quarter of 2026, highlighted by significant year-over-year growth in revenue, profitability, and international sales. Net revenue rose 41 per cent to approximately C$30 million, up from C$21.2 million in the same period last year, reflecting continued momentum in global markets alongside steady domestic performance. The company’s adjusted EBITDA doubled to C$6.9 million, underscoring improving operating leverage as higher-margin international sales increasingly contribute to overall performance.
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International operations were the primary growth engine during the quarter, with sales climbing 330 per cent year over year to C$9.6 million. The increase was driven by strong demand and expanding distribution, although partially offset by permitting delays in Germany, one of Europe’s largest medical cannabis markets. Decibel indicated that processing times for German permits improved in the second quarter, and management expects to convert existing backlog into revenue through the remainder of the year. The company also highlighted progress within its EU GMP-certified platform, including shipments into Germany, supply agreements with more than 16 international customers, and growing demand for extracts used in vape and oil products.
Domestic performance was more modest but remained positive, with sales increasing 7 per cent year over year to C$20.3 million. Growth was supported by the early success of the company’s Standard Issue brand and ongoing strength in its flagship General Admission lineup. Market share rose to 4.4 per cent from 4.1 per cent a year earlier, with notable gains in the vape category and infused pre-roll segment. Decibel maintained leadership positions in several categories, including liquid diamond vape products and infused pre-rolls, and continued to refresh its product offerings to sustain consumer demand.
Profitability metrics also improved during the quarter. Gross margin before fair value adjustments increased slightly to 51 per cent, compared to 50 per cent in the prior year period. Adjusted net income reached C$3.1 million, compared to a loss in the prior year, reflecting both top-line growth and cost discipline. However, free cash flow was negative C$14.6 million, largely due to a one-time C$13.2 million payment tied to a debt refinancing completed in February 2026. Excluding this item, the company indicated that free cash flow would have been positive and aligned with underlying operating performance.
Decibel also made moves to strengthen its balance sheet and streamline operations. During the quarter, the company secured a new C$61 million credit facility extending debt maturities to 2030 and reducing near-term payment obligations. Along with this, it announced the pending sale of its Creston, British Columbia cultivation facility for C$2.5 million, a move expected to generate approximately C$4 million in annual cost savings without impacting revenue.
Looking ahead, Decibel provided second-quarter 2026 revenue guidance in the range of C$33 million to C$35 million, representing expected year-over-year growth of roughly 14 per cent at the midpoint. The company also reaffirmed its full-year 2026 outlook, projecting net revenue of C$130 million to C$135 million and adjusted EBITDA of C$27 million to C$31 million. Management showed some confidence that continued international expansion, combined with steady domestic gains, will support sustained growth through the remainder of the year.
“Q1 was a strong start to the year with revenue up 41 per cent, international sales tripling and Adjusted EBITDA doubling year over year,” Decibel’s CEO, Benjamin Sze said in a news release. “This performance is especially meaningful as we emerge from last quarter’s headwinds with a strengthened balance sheet and real momentum heading into the strongest season for our domestic portfolio. The setup for the rest of 2026 is compelling.”
Decibel is the cannabis company behind the General Admission, Qwest and Vox brands. The company is expanding its primarily Canadian operations into Europe with the acquisition of AgMedica Biosciences, adding a EU-GMP certified facility to its cultivation and manufacturing portfolio.
Decibel Cannabis stock (TSXV:DB/OTC:DBCCF) last traded at $0.10 and has risen 40 per cent since this time last year.
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