-
The graph shows the actual or expected sequential revenue growth from the 4th quarter of 2022 to the first quarter of 2023 for sixteen of the top MSOs. Eight of the sixteen companies have already announced Q1:23 results; these companies have an “A” after their ticker symbol. The sequential revenue growths for the eight companies that have not yet reported are calculated based on consensus estimates of Q1:23 revenues compared to actual Q4: 22 revenues.
-
A significant part of Q1’s revenue declines are attributable to seasonality. The 4th quarter tends to be stronger than the first in most markets except Florida. The group is projected to have an aggregate sequential revenue decline of 3.1% in Q1:23, but this is not much worse than the 2.1% decline in Q1:22.
-
Still, there IS an underlying deceleration of revenue growth projected for 2023. The companies on the chart had a 15.7% revenue growth in 2022 but are projected to have only 4.9% growth in 2023.
-
Why the slowdown in growth?
-
2022’s growth stemmed from large capital spending programs funded from record capital raises in 2021. Similarly, 2021 saw many of the largest M&A deals ever completed in the cannabis space, and the companies on the chart were the beneficiaries of that activity.
-
Capital spending and M&A activity were sharply curtailed in 2022 through Q1:23 due to the contraction in the cannabis capital markets, and this lack …
-