#Canada #Calgary #Decibel Cannabis #AgMedica #Qwest

Decibel Cannabis Company Reports Third Quarter 2025 Financial Results

Decibel Cannabis Company Inc. (TSXV: DB) (OTCQB: DBCCF) has released its interim financial results for the third quarter of 2025, demonstrating robust performance across various metrics. The results indicate a strong upward trajectory for the company, reflecting strategic initiatives that have fostered growth in domestic and international markets.

Financial Highlights

In Q3 2025, Decibel achieved net revenue of $32.9 million, marking a 37% increase year-over-year. This growth was significantly driven by contributions from AgMedica Bioscience Inc., which alone added $7.8 million in international sales. The domestic recreational cannabis sector also saw progress, with net Canadian recreational sales functioning at $24.5 million, a 3% increase from the previous year. These results underpin the effectiveness of Decibel's marketing strategies and product innovation efforts.

International Sales Surge: The company recorded international sales amounting to $8.4 million, which showcases a remarkable 37% quarter-over-quarter increase. This uptick is primarily attributed to AgMedica's burgeoning influence in global markets, emphasizing Decibel's commitment to expanding its international footprint.

Growth Drivers

Benjamin Sze, CEO of Decibel, expressed confidence in the company’s trajectory, stating, “Our results this quarter build on the continued momentum in 2025, proving that Decibel's strategy is working. International demand continues to outpace supply, our partnerships are expanding, and our domestic business has never been stronger.” The successful launch of ultra-high potency vaping products and infused pre-rolls, along with strategic marketing campaigns, played a crucial role in driving sales and enhancing brand equity in the competitive cannabis market.

Other Financial Metrics

• - Gross Margin: Before fair value adjustments, the gross margin settled at 47%, slightly down from 53% in Q3 2024, attributed to higher testing costs associated with international sales.
• - Adjusted EBITDA: The adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) increased to $7.3 million, representing a 40% improvement year-over-year.
• - Free Cash Flow: Reported at $1.5 million, a decrease of $0.3 million since last year, primarily because of significant growth in net revenue, which was somewhat tempered by changes in working capital as the company prepares for anticipated growth.
• - Adjusted Net Income: This metric rose to $3.8 million, an increase of $1.7 million compared to the same quarter last year, with adjusted earnings per share improving to $0.01.

Market Outlook

Despite the impressive growth, Decibel revised its full-year revenue guidance for 2025 to approximately $115 million, down from the original estimate of $130 million. The adjustment reflects challenges, including the halt of cannabis imports by Germany’s Federal Institute for Drugs and Medical Devices, and disruptions caused by a strike affecting distribution in British Columbia.

Management remains optimistic about these hurdles being temporary and not disruptive to Decibel's long-term objectives. The company expects to navigate these challenges effectively, banking on demand for premium products and an expanding operational capacity to maintain its competitive edge in the market.

Conclusion

With a commitment to quality and innovation, Decibel Cannabis Company is poised for further growth as it continues to solidify its presence in both domestic and international markets. The strategic acquisition of AgMedica and emphasis on product excellence are essential components of Decibel's ongoing journey to becoming a leader in the global cannabis industry. As of now, Decibel operates three cultivation facilities and a processing center, and its brands are gaining increasing recognition both in Canada and abroad.

For more detailed financial information, the full results can be accessed on SEDAR+ under Decibel's profile. The company is scheduled to elaborate on these results in a live conference call, further showcasing its strategic plans and market outlook.