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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2026
OR
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 333-249081
CURALEAF HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
British Columbia, Canada
98-1461045
(Province or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification Number)
250 Harbor Drive, Third Floor, Stamford, Connecticut 06902
(Address of Principal Executive Offices)
(917) 717-5875
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: Subordinate Voting Shares
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

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x
Large accelerated filer
o
Accelerated filer
o
Non-accelerated filer
o
Smaller reporting company
o
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
As of July 27, 2026, the number of shares outstanding of each of the registrant's classes of capital or common stock were (on a post-consolidation basis):
Subordinate Voting Shares
233,484,263
Multiple Voting Shares
31,323,568

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TABLE OF CONTENTS
PART I
PART II
Item 1A. Risk Factors
Item 6. Exhibits
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FORWARD-LOOKING STATEMENTS
This quarterly report on Form 10-Q (the "Quarterly Report") contains "forward-looking statements" within the meaning of United States (the "U.S.") securities laws, including Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based on our current beliefs, expectations or assumptions regarding the future of our business, future plans and strategies, operational results and other future conditions. In addition, we may make or approve certain statements, with the SEC, in press releases or in presentations by our representatives that are not statements of historical fact and which may also constitute forward-looking statements. All statements, other than statements of historical fact, made by us that address activities, events or developments that we expect or anticipate will or may occur in the future are forward-looking statements, including, but not limited to, statements preceded by, “followed by” or that include words such as “may”, “will”, “would”, “could”, “should”, “believes”, “estimates”, “projects”, “potential”, “expects”, “plans”, “intends”, “anticipates”, “targeted”, “continues”, “forecasts”, “designed”, “goal” or the negative of those words or other similar or comparable words and includes, among others, information regarding: expectations of the effects and potential benefits of any transactions; statements relating to our business, future activities and developments after the date of this Quarterly Report, including such things as future business strategy, competitive strengths, goals, expansion and growth; expectations that cannabis licenses applied for will be obtained; the current state of cannabis legalization, including the fact that medical-use cannabis is now legal in 48 U.S. states, the District of Columbia and certain U.S. territories, and potential future legalization of adult-use cannabis and/or federal rescheduling or descheduling of cannabis under U.S. federal law and/or foreign jurisdictions; expectations of market size and growth; the expected benefits, timing and effects of the Company’s redomicile transaction, including any changes to the Company’s regulatory, tax or governance profile as a result thereof; expectations for other economic, business, regulatory and/or competitive factors related to us or the cannabis industry; the ability of U.S. holders of our securities to sell our securities on the Toronto Stock Exchange (the “TSX”); and other events or conditions that may occur in the future. Forward-looking statements may relate to future financial conditions, results of operations, plans, objectives, performance or business developments. These statements speak only as of and at the date they are made and are based on information currently available and current expectations at that time. Holders of our securities are cautioned that forward-looking statements are not based on historical facts, but instead are based on reasonable assumptions and our estimates at the time they were provided or made and involve known and unknown risks, uncertainties and other factors, which may cause our actual results, performance or achievements, as applicable, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements, including, but not limited to, risks and uncertainties relating to: the legality of cannabis in the U.S., including its classification as a controlled substance under the U.S. Federal Controlled Substances Act ("CSA"); compliance with anti-money laundering laws and regulations; the lack of access to U.S. bankruptcy protections; financing constraints, including limited access to banking and risks associated with raising additional capital; general regulatory and legal restrictions, including limitations imposed by the TSX; potential legal, regulatory or political changes; licensing and ownership limitations; regulatory actions and approvals from the U.S. Food and Drug Administration (“FDA”), including the risk of increased FDA oversight; potential heightened scrutiny by regulators; loss of foreign private issuer status; internal control deficiencies; litigation exposure; higher compliance costs as a public company in both Canada and the U.S.; recent and proposed U.S. cannabis and hemp licensing legislation; environmental risks, including compliance with environmental regulations and unforeseen environmental liabilities; expansion into foreign jurisdictions and the legality of cannabis abroad; future acquisitions or dispositions; dependence on key suppliers and service providers; enforceability of contracts; risks associated with our subordinate voting shares (“SVS”), including resale limitations, limited liquidity for U.S. investors, market price volatility as well as significant sales of SVS; reliance on senior management and other key personnel, including challenges in recruiting and retaining such personnel; competitive pressures; risks inherent in agricultural operations; adverse publicity or shifts in consumer perception; product liability and recalls; uncertainty regarding results of future clinical research; reliance on agricultural inputs; limited market data and forecasting uncertainty, including the risk that past performance or financial projections may not be reliable indicators of future results; intellectual property risks; marketing and advertising restrictions; fraudulent or illegal activity by employees, consultants or contractors; labor risks, including potential union activity; information technology failures, cyber-attacks or security breaches; reliance on management services agreements with subsidiaries and affiliates; website accessibility and digital compliance requirements; high bonding and insurance costs; risks associated with leverage and debt management; challenges related to growth and scalability; conflicts of interest; global economic pressures, including tariffs, retaliatory measures and trade disputes; currency exchange fluctuations; risks related to our business structure and securities, including our status as a holding company, lack of dividend history, indebtedness and concentrated voting control; limited shareholder rights in corporate affairs; enforcement challenges against directors and officers residing outside Canada; tax
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risks; risks associated with the Company’s redomicile transaction, including the risk that anticipated benefits are not realized or that the transaction triggers adverse tax, regulatory or contractual consequences; and those risks described in this Quarterly Report and discussed further in Part I — Item 1A — Risk Factors of our Annual Report on Form 10-K (the "Annual Report") and in Part II — Item 1A — Risk Factors of this Quarterly Report.
The purpose of forward-looking statements is to provide the reader with a description of our expectations, and such forward-looking statements may not be appropriate for any other purpose. In particular, but without limiting the foregoing, disclosure in this Quarterly Report as well as statements regarding our objectives, plans and goals, including future operating results and economic performance, may make reference to or involve forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Certain of the forward-looking statements and other information contained herein concerning the cannabis industry, its medical and adult use, our general expectations concerning the industry and our business and operations are based on our estimates. We prepare these estimates using reasonable data from publicly available governmental sources, market research and industry analysis as well as assumptions that we believe to be reasonable based on our data and knowledge of the cannabis industry. Although generally indicative of relative market positions, market shares and performance characteristics, such data is inherently imprecise. While we are not aware of any misstatements regarding any government or industry data presented herein, the cannabis industry involves risks and uncertainties that are subject to change based on various factors.
A number of factors could cause actual events, performance or results to differ materially from what is projected in the forward-looking statements, and undue reliance should not be placed on forward-looking statements contained in this Quarterly Report. Such forward-looking statements are made as of the date of this Quarterly Report. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. Our forward-looking statements are expressly qualified in their entirety by this cautionary statement.

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Table of Contents Curaleaf Holdings, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands)
PART I
ITEM 1. FINANCIAL STATEMENTS

As of
Note
March 31, 2026
December 31, 2025
(Unaudited)
(Audited)
ASSETS
Current assets:
Cash and cash equivalents
3
$
93,759 
$
89,213 
Restricted cash
3
12,370 
12,360 
Accounts receivable, net of allowance for credit losses of $2,346 and $2,617, respectively
7, 26
71,546 
76,339 
Inventories, net
8
241,284 
225,022 
Assets held for sale and discontinued operations
5, 6
3,054 
3,681 
Prepaid expenses and other current assets
3
33,135 
37,379 
Notes receivable - current
9
6,368 
4,629 
Total current assets
461,516 
448,623 
Deferred tax asset
23
464 
443 
Income tax receivable
23
2,382 
2,382 
Other assets - net of current
14
17,879 
13,396 
Notes receivable - net of current
9
806 
2,980 
Property, plant and equipment, net
10, 12
509,153 
520,386 
Right-of-use assets, finance lease, net
11
91,646 
97,599 
Right-of-use assets, operating lease, net
11
112,147 
113,274 
Intangible assets, net
13
982,061 
1,011,115 
Goodwill
13
633,524 
635,117 
Total assets
$
2,811,578 
$
2,845,315 
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Table of Contents Curaleaf Holdings, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands)
As of
Note
March 31, 2026
December 31, 2025
LIABILITIES, TEMPORARY EQUITY AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable
$
76,100 
$
74,725 
Accrued expenses
15
102,089 
110,493 
Income tax payable
23
21,661 
18,952 
Lease liabilities, finance - current
11
12,709 
11,684 
Lease liabilities, operating - current
11
20,046 
19,837 
Notes payable - current
16
40,014 
35,730 
Deferred consideration liability - current
4
2,171 
2,966 
Financial obligations - current
12
10,421 
7,238 
Liabilities associated with assets held for sale and discontinued operations
5, 6
6,839 
7,073 
Other current liabilities
4,292 
5,616 
Total current liabilities
296,342 
294,314 
Deferred tax liability
23
204,160 
212,002 
Notes payable - net of current
16
525,077 
512,922 
Lease liabilities, finance - net of current
11
137,755 
144,446 
Lease liabilities, operating - net of current
11
97,513 
102,346 
Uncertain tax position
23
439,228 
531,508 
Contingent consideration liability - net of current
4, 26
3,047 
3,358 
Deferred consideration liability - net of current
4
125 
— 
Financial obligations - net of current
12
197,743 
202,901 
Other long-term liabilities
1,479 
1,237 
Total liabilities
$
1,902,469 
$
2,005,034 
Commitments and contingencies
25
Temporary equity:
Redeemable non-controlling interest contingency
2, 18
87,997 
83,931 
Shareholders' equity:
Common stock, no par value; unlimited shares authorized; 260,491,464 and 257,491,582 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively.
$
— 
$
— 
Additional paid-in capital
17
2,348,719 
2,345,402 
Accumulated other comprehensive loss
(10,162)
(1,808)
Accumulated deficit
(1,517,445)
(1,587,244)
Total shareholders' equity
821,112 
756,350 
Total liabilities, temporary equity and shareholders' equity
$
2,811,578 
$
2,845,315 
The accompanying notes are an integral part of the Condensed Consolidated Balance Sheets (Unaudited) (as defined herein).
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Condensed Consolidated Statements of Operations (Unaudited)
(in thousands, except share and per share amounts)
Three Months Ended March 31,
Note
2026
2025
Revenues, net:
Retail and wholesale revenues
$
320,910 
$
304,983 
Management fee income
3,321 
1,641 
Total revenues, net
24
324,231 
306,624 
Cost of goods sold
166,941 
151,058 
Gross profit
157,290 
155,566 
Operating expenses:
Selling, general and administrative
20, 19
122,870 
110,818 
Depreciation and amortization
10, 11, 12, 13
33,667 
35,382 
Total operating expenses
156,537 
146,200 
Income from operations
753 
9,366 
Other income (expense):
Interest income
212 
171 
Interest expense
16
(15,024)
(14,161)
Interest expense related to lease liabilities and financial obligations
11, 12
(10,503)
(11,084)
Impairment loss
10, 11
— 
(3,695)
Other (expense) income, net
22
(4,067)
3,003 
Total other expense, net
(29,382)
(25,766)
Loss before benefit (provision) for income taxes
(28,629)
(16,400)
Benefit (provision) for income taxes
98,705 
(33,653)
Net income (loss) from continuing operations
70,076 
(50,053)
Net loss from discontinued operations
6
(293)
(10,193)
Net income (loss)
69,783 
(60,246)
Less: Net (loss) income attributable to non-controlling interest
2, 18
(16)
817 
Net income (loss) attributable to Curaleaf Holdings, Inc.
$
69,799 
$
(61,063)
Per share - basic
Net income (loss) per share from continuing operations(1)
$
0.27 
$
(0.26)
Net loss per share from discontinued operations
— 
(0.04)
Net income (loss) per share attributable to Curaleaf Holdings, Inc.(1)
23
$
0.27 
$
(0.30)
Basic weighted-average common shares outstanding(3)
23
258,476,410
248,299,646
Per share - dilutive
Net income (loss) per share from continuing operations(1)
$
0.26 
$
(0.26)
Net loss per share from discontinued operations
— 
(0.04)
Net income (loss) per share attributable to Curaleaf Holdings, Inc.(1)
23
$
0.26 
$
(0.30)
Dilutive weighted-average common shares outstanding(2)(3)
23
263,888,023
248,299,646
(1) Certain non-controlling interests are redeemable at the option of the holders. When the estimated redemption value exceeds the recorded amount, the excess is charged directly to Shareholders' equity on the Condensed Consolidated Balance Sheets (Unaudited). This adjustment does not affect the Company's reported net loss; however, under ASC 480-10, Distinguishing Liabilities from Equity, the excess redemption value must be included in the calculation of earnings per share - basic and diluted. See Note 2 — Basis of presentation and consolidation and Note 24 — Earnings per share for additional information.
(2) As a result of the Company’s net losses from its continuing and discontinued operations for the three months ended March 31, 2025, all potentially dilutive securities were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive. Accordingly, basic and diluted net loss per share are the same for each period presented.
(3) All basic and diluted income (loss) per share calculations presented for the periods shown have been retrospectively adjusted to reflect the 1-for-3 reverse stock split effected on June 5, 2026. See Note 2 — Basis of presentation and consolidation for further details.
The accompanying notes are an integral part of the Condensed Consolidated Statements of Operations (Unaudited) (as defined herein).
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Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)
(in thousands)

Three Months Ended March 31,
2026
2025
Net income (loss) from continuing operations
$
70,076 
$
(50,053)
Foreign currency translation (loss) gain
(4,653)
8,819 
Net comprehensive income (loss) from continuing operations
65,423 
(41,234)
Net comprehensive loss from discontinued operations
(293)
(10,193)
Net comprehensive income (loss)
65,130 
(51,427)
Less: Net comprehensive income attributable to non-controlling interest
3,685 
3,573 
Net comprehensive income (loss) attributable to Curaleaf Holdings, Inc.
$
61,445 
$
(55,000)
The accompanying notes are an integral part of the Condensed Consolidated Statements of Comprehensive Loss (Unaudited) (as defined herein)
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Condensed Consolidated Statements of Temporary Equity and Shareholders’ Equity (Unaudited)
(in thousands, except for share amounts)
Note
Redeemable non-controlling interest contingency
Common shares
Additional paid-in capital
Accumulated other comprehensive loss
Accumulated deficit
Total shareholders’ equity
Number of shares
SVS*
MVS***
Balances as of December 31, 2024
$
132,179 
218,696,071
31,323,568
$
2,237,468 
$
(20,080)
$
(1,356,174)
$
861,214 
Extinguishment of convertible notes by issuance of SVS*
16
— 
1,427,532
—
16,500 
— 
— 
16,500 
Foreign currency translation gain
2,756 
—
—
— 
6,063 
— 
6,063 
Exercise of stock options
19
— 
33,333
—
10 
— 
— 
10 
Issuance of SVS* for settlement of RSUs**
19
— 
556,208
—
— 
— 
— 
— 
Issuance of SVS* for settlement of PSUs**
19
— 
119,983
—
— 
— 
— 
— 
Excess redemption value above carrying value
18
13,327 
—
—
(13,327)
— 
— 
(13,327)
Share-based compensation
19
— 
—
—
4,624 
— 
— 
4,624 
Net income (loss)
817 
—
—
— 
— 
(61,063)
(61,063)
Balances as of March 31, 2025
$
149,079 
220,833,127
31,323,568
$
2,245,275 
$
(14,017)
$
(1,417,237)
$
814,021 
Balances as of December 31, 2025
$
83,931 
226,168,014
31,323,568
$
2,345,402 
$
(1,808)
$
(1,587,244)
$
756,350 
Foreign currency translation gain (loss)
3,701 
—
—
— 
(8,354)
— 
(8,354)
Exercise of stock options
19
— 
996,576
—
478 
— 
— 
478 
Issuance of SVS* for settlement of RSUs**
19
— 
1,995,496
—
— 
— 
— 
— 
Issuance of SVS* for settlement of PSUs**
19
— 
928,214
—
— 
— 
— 
— 
SVS* withheld to satisfy statutory tax withholding obligations(1)
19
— 
(920,404)
—
(6,444)
— 
— 
(6,444)
Excess redemption value above carrying value
18
381 
—
—
(381)
— 
— 
(381)
Share-based compensation
19
— 
—
—
9,664 
— 
— 
9,664 
Net (loss) income
(16)
—
—
— 
— 
69,799 
69,799 
Balances as of March 31, 2026
$
87,997 
229,167,896
31,323,568
$
2,348,719 
$
(10,162)
$
(1,517,445)
$
821,112 
(1) In connection with the Company’s net share settlement (withhold-to-cover) of PSUs** and RSUs** that vested during three months ended March 31, 2026.
*as defined in Note 1 — Operations of the Company
**as defined in Note 3 — Significant accounting policies
***as defined in Note 17 - Shareholders' equity
The accompanying notes are an integral part of the Condensed Consolidated Statements of Temporary Equity and Shareholders' Equity (Unaudited) (as defined herein).
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Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
Three Months Ended March 31,
Note
2026
2025
Cash flows from operating activities:
Net income (loss) from continuing operations
$
70,076 
$
(50,053)
Adjustments to reconcile net income (loss) from continuing operations to net cash provided by operating activities from continuing operations:
Depreciation and amortization
10, 11, 12, 13
47,855 
48,829 
Share-based compensation
19
9,664 
4,624 
Non-cash interest expense
5,766 
1,772 
Amortization of operating lease right-of-use assets
11
4,851 
4,237 
Loss on impairment
10, 11, 12
— 
3,695 
Loss (gain) on extinguishment of debt
16, 22
4,289 
(1,487)
Deferred taxes
(6,982)
(4,278)
Other adjustments, net
(1,466)
498 
Foreign exchange loss (gain)
22
1,547 
(1,475)
Changes in assets and liabilities:
Accounts receivable, net
7, 26
4,186 
1,705 
Inventories
8
(16,281)
(2,680)
Prepaid expenses and other assets, current
3
6,186 
(2,560)
Income tax receivable
— 
4,621 
Net assets held for sale and discontinued operations
5, 6
375 
— 
Prepaid expenses and other assets - net of current
14, 26
(939)
636 
Accounts payable
1,659 
(5,017)
Accrued expenses and other liabilities
15
(15,046)
(2,096)
Income tax payable
(89,478)
48,396 
Lease liabilities, operating
11
(4,991)
(4,333)
Net cash provided by operating activities from continuing operations
21,271 
45,034 
Net cash used in operating activities from discontinued operations
(283)
(6,605)
Net cash provided by operating activities
20,988 
38,429 
Cash flows from investing activities:
Purchases of property, plant and equipment
10, 12
(16,985)
(16,077)
Disposals of property, plant and equipment
10, 12
— 
200 
Purchases of intangibles
13
(61)
(226)
Purchase of investments
14
— 
(277)
Issuance of notes receivable
9
(126)
(1,206)
Payments received on notes receivable
9
586 
267 
Net cash used in investing activities from continuing operations
(16,586)
(17,319)
Net cash used in investing activities from discontinued operations
— 
(178)
Net cash used in investing activities
(16,586)
(17,497)
Cash flows from financing activities:
Proceeds from notes payable(1)
16
362,978 
19,681 
Principal payments on notes payable
16
(344,280)
(18,214)
Payments of debt issuance costs
16
(7,009)
(950)
Principal payments on finance lease liabilities
11
(2,832)
(2,474)
Principal payments on financial obligations
12
(1,975)
(1,774)
Exercise of stock options
19
477 
10 
Payments to repurchase SVS*(2)
19
(6,444)
— 
Payments of deferred consideration
4
(618)
(3,000)
Net cash provided by (used in) financing activities from continuing operations
297 
(6,721)
Net cash used in financing activities from discontinued operations
— 
— 
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Table of Contents Curaleaf Holdings, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
Net cash provided by (used in) financing activities
297 
(6,721)
Net increase in cash and cash equivalents (including restricted cash)
4,699 
14,211 
Cash and cash equivalents (including restricted cash), beginning of period
101,573 
107,226 
Effect of exchange rate changes on cash and cash equivalents (including restricted cash)
(143)
430 
Cash and cash equivalents (including restricted cash), end of period
$
106,129 
$
121,867 
Non-cash investing & financing activities:
Purchases of property, plant and equipment within accounts payable and accrued expenses
10
$
770 
$
2,417 
Exchanged portion of Senior Secured Notes - 2026* for Senior Secured
Notes - 2029*(1)
16
142,202 
— 
Non-cash proceeds from Note Exchange*
16
— 
7,000 
Extinguishment of convertible notes by issuance of SVS*
16
— 
16,500 
Non-cash activity related to obtaining finance right-of-use assets
11
23 
1,994 
Non-cash activity related to obtaining operating right-of-use assets
11
1,442 
4,941 
Other non-cash activity related to finance right-of-use assets
11
(2,857)
1,133 
Other non-cash activity related to operating right-of-use assets
11
(921)
(1,262)
Excess redemption value attributable to non-controlling interest
18
(381)
13,327 
Supplemental disclosure of cash flow information:
Cash paid for income taxes
$
1,511 
$
1,610 
Cash paid for interest
22,204 
16,530 
*as defined herein
(1) The remaining outstanding balance of the Senior Secured Notes – 2026* of $142.2 million was exchanged on a non-cash basis for Senior Secured Notes – 2029*.
(2) In connection with the Company’s net share settlement (withhold-to-cover) of PSUs* and RSUs* that vested during three months ended March 31, 2026.
The accompanying notes are an integral part of the Condensed Consolidated Statements of Cash Flows (Unaudited) (as defined herein).
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)

Explanatory Note
Unless otherwise noted or the context otherwise requires, all information provided in the Condensed Consolidated Financial Statements (Unaudited) as of March 31, 2026 and December 31, 2025 and for the three months ended March 31, 2026 and 2025 and the accompanying notes (together, the “Consolidated Financial Statements (Unaudited)”) is given as of March 31, 2026, and references to the “Company” or “Curaleaf” refer to Curaleaf Holdings, Inc. (the “Company”), its wholly-owned subsidiaries, majority-owned subsidiaries and legal entities in which it holds a controlling financial interest.
Note 1 — Operations of the Company
The Company is a global cannabis company dedicated to developing, manufacturing and distributing a portfolio of cannabis brands for consumers and patients worldwide. The Company's product portfolio includes flower, pre-rolls, vaporizer cartridges, concentrates, topicals, tinctures, edibles and beverages.
The Company's global brand portfolio consists of Select, Grassroots, Find, Dark Heart, Reef, Anthem, Curaleaf, JAMS, Four20 Pharma, and Huala.
Domestic Operations:
In the United States (“U.S.”), the Company serves the medical and adult-use cannabis markets through retail and wholesale channels. As of March 31, 2026, the Company’s U.S. operations, conducted by the Company and/or its affiliates, spanned 14 states and included 173 dispensaries, 15 cultivation sites and 18 manufacturing facilities.
International Operations:
The Company's international operations extend to cultivation, processing, manufacturing and distribution in several key markets:
•Cultivation: The Company operates licensed cultivation facilities in Portugal and Canada.
•Processing and Manufacturing: Pharma-grade cannabis processing and manufacturing facilities are maintained in Germany, Spain, Canada, Portugal and the United Kingdom (“U.K.”).
•Wholesale Distribution: The Company supplies cannabis on a wholesale basis to Australia, New Zealand, the U.K. and various European countries, including Germany, Italy, Poland, the Czech Republic, Switzerland, Sweden and Norway.
•Retail Sales: In the U.K., the Company operates a medical cannabis clinic and holds a pharmacy license, which enables the direct retail supply of medical cannabis to patients.
The Company’s subordinate voting shares ("SVS") are listed on the Toronto Stock Exchange (the "TSX") under the symbol “CURA” and quoted on the OTCQX® Best Market ("OTCQX") under the symbol “CURLF”.
The principal business address of the Company is located at 250 Harbor Drive, Third Floor, Stamford, Connecticut 06902. The Company’s registered and records office address is located at Suite 1700-666 Burrard Street, Vancouver, British Columbia, Canada.
Note 2 — Basis of presentation and consolidation
The Condensed Consolidated Financial Statements (Unaudited) have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”) as issued by the Financial Accounting Standards Board (the “FASB”). The significant accounting policies described in Note 3 — Significant accounting policies have been applied consistently to all periods presented.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Amounts reported in the Condensed Consolidated Financial Statements (Unaudited) include estimates and assumptions of management. Actual results could differ from these estimates. In the opinion of management, the financial data presented includes all adjustments necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods presented.
Certain previously reported amounts have been reclassified between line items to conform to the current period presentation with no impact on previously reported results of operations, cash flows or shareholders’ equity.
The Condensed Consolidated Financial Statements (Unaudited) do not include all of the information and footnotes required by U.S. GAAP for complete annual financial statements and should be read in conjunction with the audited consolidated financial statements for the Company as of and for the years ended December 31, 2025 and 2024 and the accompanying notes thereto (collectively, the “Audited Consolidated Financial Statements”).
Functional and presentation currency
The Condensed Consolidated Financial Statements (Unaudited) are presented in U.S. dollars (“USD”), which is the reporting currency of the Company, unless otherwise noted. The functional currency of the Company and the domestic entities reflected in the Condensed Consolidated Financial Statements (Unaudited) is the USD, and the functional currency of each of the Company’s international entities is the currency of the economic environment in which primary operations are conducted. The financial accounts of the Company’s international subsidiaries are translated to USD using exchange rates at specific reporting dates or average rates over the reporting period, as applicable. Unrealized gains and losses resulting from foreign currency translation adjustments are recognized within Accumulated other comprehensive loss, which is a component of Shareholders’ equity on the Condensed Consolidated Balance Sheets (Unaudited). Realized transactional exchange gains and losses are included in Other (expense) income, net on the Condensed Consolidated Statements of Operations (Unaudited).
Basis of measurement
The Condensed Consolidated Financial Statements (Unaudited) have been prepared on a going concern basis, under the historical cost convention, except for certain financial instruments that are measured at fair value, as described herein.
Basis of consolidation
The Condensed Consolidated Financial Statements (Unaudited) include all the accounts of the Company, its wholly-owned subsidiaries, majority-owned subsidiaries and legal entities in which it holds a controlling financial interest. Historically, the Company has obtained controlling financial interests in entities through management service agreements (“MSAs”) or financing arrangements.
All intercompany balances and transactions have been eliminated in consolidation. See Note 3 — Significant accounting policies.
Non-controlling interests (“NCI”)
NCI in consolidated subsidiaries represent the component of equity in consolidated subsidiaries held by third parties. Any change in ownership of a subsidiary while the controlling financial interest is retained is accounted for as an equity transaction between the controlling and non-controlling interests. However, when a subsidiary is deconsolidated, any retained non-controlling equity investment in the former subsidiary is initially measured at fair value, and the gain or loss triggered by any difference between the carrying value and fair value of the retained interest would be included in Other (expense) income, net on the Condensed Consolidated Statements of Operations (Unaudited).
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(Amounts in thousands, except share and per share amounts or where otherwise indicated)
NCI with redemption features, such as put and call options, that are not solely within the Company’s control are considered redeemable non-controlling interests (“Redeemable NCI”). Redeemable NCI is considered to be temporary equity and is reported in the mezzanine section between Commitments and contingencies and Shareholders’ equity on the Condensed Consolidated Balance Sheets (Unaudited). Redeemable NCI is recorded at the greater of the carrying value, which is adjusted for the NCI’s share of net income or loss generated over the reporting period, and the estimated redemption value at the end of the reporting period. In instances where the redemption value of Redeemable NCI is greater than the carrying value (“excess redemption value”) and redemption is at least probable, the Company has elected to immediately recognize the entire excess redemption value as an adjustment to Additional paid-in capital on the Condensed Consolidated Balance Sheets (Unaudited). This election provides for a more immediate and transparent reflection of the economic impact associated with changes in redemption value, as opposed to accreting the difference over time.
Change in ownership
Changes in the Company’s ownership interest of a subsidiary with a Redeemable NCI that do not also result in a change in control are accounted for as equity transactions in accordance with Accounting Standards Codification (“ASC”) 810, Consolidation (“ASC 810”). No gain or loss is recognized in earnings within the Condensed Consolidated Statements of Operations (Unaudited). The carrying amount of the Redeemable NCI is adjusted to reflect the revised ownership percentage, and any difference between the consideration paid and the adjustment to the Redeemable NCI is recognized within Additional paid-in capital in the Condensed Consolidated Balance Sheets (Unaudited). Adjustments to Accumulated other comprehensive loss attributable to the Redeemable NCI are also reclassified to Additional paid-in capital to reflect the Company’s revised ownership interest.
See Note 18 — Redeemable non-controlling interest for additional information.
Reverse stock split
On June 5, 2026, the Company effected a 1-for-3 reverse stock split of its SVS. In connection with the reverse stock split, the Company's multiple voting shares ("MVS") were also consolidated on a 1-for-3 basis to preserve the relative rights among the Company's share classes. As a result, every three issued and outstanding SVS and MVS were automatically combined into one issued and outstanding share of the applicable class. All share amounts, per share amounts, voting rights and equity award information presented in the accompanying Condensed Consolidated Financial Statements (Unaudited) and notes thereto have been retrospectively adjusted to reflect the reverse stock split for all periods presented.
Note 3 — Significant accounting policies
Variable interest entities
The Company consolidates legal entities in which it holds a controlling financial interest. Pursuant to ASC 810, the Company is deemed to have a controlling financial interest, when (i) it has the power to direct the activities of a variable interest entity ("VIE") that most significantly impact the VIE's economic performance and (ii) the obligation to absorb losses of, or the right to receive benefits from, the VIE that could be potentially significant to the VIE. See Note 2 — Basis of presentation and consolidation and Note 28 — Variable interest entities for additional information about the entities consolidated by the Company under the VIE consolidation model.
This evaluation considers voting rights, MSAs, the entity’s design and the existence of financial guarantees.
Cash and cash equivalents (including restricted cash)
Cash and cash equivalents include cash deposits in financial institutions, other deposits that are readily convertible into cash, with original maturities of three months or less, and cash held at retail locations. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (the "FDIC") up to $250,000. The Company maintains its cash in bank deposit accounts, the balances of which, at times, may exceed federally insured limits.
As of March 31, 2026 and December 31, 2025, restricted cash totaled $12.4 million, comprising $12.0 million of cash pledged as collateral for the Company's ABL Facility (as defined in Note 16 — Notes payable) and the related interest earned.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The reconciliation of cash and cash equivalents and restricted cash reported within the applicable balance sheet that sum to the total of the same such amounts shown in the statements of cash flows is as follows:
Three months ended March 31,
2026
2025
Cash and cash equivalents
$
93,759 
$
107,553 
Restricted cash
12,370 
14,314 
Total cash and cash equivalents and restricted cash
$
106,129 
$
121,867 
Prepaid expenses and other assets
Prepaid expenses primarily result from advance cash payments made by the Company to its vendors in exchange for goods and services. Upon recognition, the advance payments, measured at cost, are capitalized on the Condensed Consolidated Balance Sheets (Unaudited) until the related goods are received and/or services performed. Amortization of the Company's Prepaid expenses, which is based on the passage of time or as the related assets and/or services are expected to be consumed, is recognized within Selling, general and administrative on the Condensed Consolidated Statements of Operations (Unaudited).
Prepaid expenses also include capitalized implementation costs associated with software-as-a-service ("SaaS") and other hosting arrangements. SaaS and other hosting arrangements are evaluated under ASC 350-40, Internal Use Software ("ASC 350-40") and accounted for as service contracts when the Company lacks the contractual right to take possession of the software or the ability to run it independently. Implementation costs associated with these SaaS and hosting arrangements, specifically configuration and customization activities, are capitalized once the project is probable of being completed; all other costs are expensed as incurred. Capitalized implementation costs are amortized on a straight-line basis over the term of the arrangement, including renewal periods that are reasonably certain to be exercised. Amortization expense is recognized within Selling, general and administrative on the Condensed Consolidated Statements of Operations (Unaudited), consistent with the presentation of the associated SaaS and hosting subscription fees.
Other current assets, which represent assets expected to be realized within 12 months of the balance sheet date, consist primarily of non-income tax receivables, prepaid marketing materials and deferred financing fees related to the Company's lines of credit. As of March 31, 2026 and December 31, 2025, the Company had $27.6 million and $31.5 million, respectively, of Prepaid expenses and $5.5 million and $5.9 million, respectively, of other current assets.
Notes receivable
Notes receivable are recognized and measured at amortized cost, which is inclusive of the initial carrying amount adjusted for any subsequent principal payments, accretion of paid-in-kind interest and any expected credit losses. Interest income on notes receivable is recognized using the effective interest rate method and recognized within Interest income on the Condensed Consolidated Statements of Operations (Unaudited).
See Note 9 — Notes receivable for further detail.
Allowance for credit losses on financing receivables
Pursuant to ASC 310, Receivables, the Company recognizes financing receivables, such as accounts receivable and notes receivable, net of an allowance for credit losses on the Condensed Consolidated Balance Sheets (Unaudited), in order to present the financing receivables at the expected realizable value. The Company determines its allowance for expected credit losses in accordance with ASC 326, Financial Instruments — Credit Losses. Accordingly, the Company's allowances for expected credit losses reflect the potential uncollectability of its financing receivables, based on historical credit loss information as adjusted for current conditions, reasonable and supportable forecasts and the risk characteristics of specific receivables. If current or expected future economic trends, events or changes in circumstances indicate that specific accounts receivable may not be collectible, further consideration is given to the collectability of those balances, and the allowance for expected credit losses is adjusted accordingly. Changes in circumstances that could result in the establishment of an allowance for expected credit losses include, but are not limited to, (i) a borrower experiencing significant financial difficulty; (ii) a significant delinquency in contractual payments; (iii) a determination that foreclosure
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(Amounts in thousands, except share and per share amounts or where otherwise indicated)
on the underlying collateral is probable or (iv) an assessment that repayment will be sourced primarily from the sale of the underlying collateral.
Financing receivables are written off after exhaustive collection efforts occur, and the receivables are deemed uncollectible. The credit loss expense associated with the allowance for expected credit losses is recognized within Selling, general and administrative on the Condensed Consolidated Statements of Operations (Unaudited).
For further detail on the Company's allowance for credit losses related to its accounts receivable as of March 31, 2026 and December 31, 2025, see Note 7 — Accounts receivable, net. The Company did not recognize an allowance for credit losses on its notes receivable as of March 31, 2026 and December 31, 2025.
Inventories
Inventories, including packaging and supplies, are stated at the lower of cost or net realizable value ("NRV") within Inventories on the Condensed Consolidated Balance Sheets (Unaudited). NRV is the estimated selling price in the ordinary course of business less estimated costs to sell.
The Company utilizes a standard costing methodology to value its inventories. Standard costs, which are inclusive of, but not limited to, materials, labor and depreciation expense, are reviewed periodically and adjusted to approximate weighted average cost. Inventoried costs are recognized within Cost of goods sold on the Condensed Consolidated Statements of Operations (Unaudited) upon sale of the associated product. General and administrative costs are not included in inventory balances.
The Company reviews and recognizes inventory write-downs for inventories that are aged, obsolete, unsellable, not compliant with the Company's quality standards or that have experienced a decline in carrying value in excess of the respective estimated NRV. Inventory write-downs are presented within Cost of goods sold on the Condensed Consolidated Statements of Operations (Unaudited) and are not reversed in subsequent periods. See Note 8 — Inventories for further detail.
Property, plant and equipment, net
Property, plant and equipment is stated at cost less accumulated depreciation and any impairment losses. The Company capitalizes significant expenditures that extend the useful life of its property, plant and equipment, including those associated with failed sale and leaseback arrangements, and expenses the costs of repairs and maintenance as incurred. Construction in progress is measured at cost and, upon completion and placement in service, is reclassified to the appropriate asset class described in the table below.
The Company's property, plant and equipment is segregated into the following asset classes:
Asset class
Estimated useful lives(2)
Land
Indefinite life
Building and improvements(1)
10-39 years
Furniture and fixtures
3-5 years
Machinery and equipment
3-7 years
Information technology
3-7 years
(1) Leasehold improvements are depreciated over the shorter of the asset’s useful life or the remaining lease term.
(2) At each fiscal year-end, the Company reviews the estimated useful lives, residual values and depreciation methods of its Property, plant and equipment and applies any resulting adjustments prospectively.
Depreciation is calculated using the straight-line method to allocate the cost of property, plant and equipment—net of any estimated residual value—over the estimated useful lives. The Company recognizes depreciation expense within Cost of goods sold and Depreciation and amortization on the Condensed Consolidated Statements of Operations (Unaudited).
Property, plant and equipment that is held for sale is recorded at its estimated fair value less costs to sell and depreciation ceases. Property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected from its use. The resulting gain or loss—calculated as the difference between net disposal proceeds and the carrying value
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(Amounts in thousands, except share and per share amounts or where otherwise indicated)
of the property, plant and equipment—is recognized within Other income (expense), net on the Condensed Consolidated Statements of Operations (Unaudited).
See Note 10 — Property, plant and equipment, net for further detail.
Intangible assets, net
The Company recognizes intangible assets that arise from contractual or other legal rights or are otherwise separable. Intangible assets acquired in a business combination are measured at their acquisition-date fair value. For intangible assets acquired in a group constituting an asset acquisition, the total cost is allocated to the individual assets based on their relative fair values.
Upon initial recognition, an intangible asset is assigned an estimated useful life, representing the period over which the asset is expected to generate future economic benefits. Subsequently, intangible assets are amortized on a straight-line basis over their estimated useful lives. The resulting amortization expense is recognized within Depreciation and amortization on the Condensed Consolidated Statements of Operations (Unaudited).
The Company's intangible assets are segregated into asset classes with the following estimated useful lives:
Asset class
Estimated useful lives(1)(2)
Non-compete agreements
1-15 years
Trade names
1-20 years
Intellectual property and know-how
5-15 years
Licenses and service agreements
5-30 years
Customer relationships
3 years
Internal-use software
3-7 years
(1) At each fiscal year-end, the Company reviews the estimated useful lives of its intangible assets and applies any resulting adjustments prospectively.
(2) The Company holds no intangible assets with indefinite useful lives.
See Note 13 — Intangible assets, net and Goodwill for further detail.
Leases
The Company evaluates contracts at inception to determine whether the contract constitutes or contains a lease. A contract is determined to be a lease if it conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company’s determination of the lease term and classification of a lease as a finance lease or an operating lease occurs as of the lease commencement date. The Company's lease agreements typically contain various extension and termination options. In determining the lease term, the Company includes any option periods for which it is reasonably certain that it will exercise an option to extend the lease or not exercise an option to terminate the lease. For leases with an initial term exceeding 12 months, the Company recognizes a lease liability and a corresponding right-of-use (“ROU”) asset. The lease liability is measured at the present value of future lease payments over the lease term. The ROU asset is measured as the initial lease liability, adjusted for any lease payments made at or before commencement, initial direct costs incurred and lease incentives received. The Company uses its collateralized incremental borrowing rate to determine the present value of future lease payments, unless the rate implicit in the lease is readily determinable.
Lease payments included in the measurement of the lease liability primarily consist of in-substance fixed payments. Certain real estate leases contain provisions for future rent escalations tied to an index or a contractual rate. Variable lease payments not dependent on an index or rate are excluded from the lease liability measurement and are expensed as incurred. In addition, the Company's real estate leases may require additional payments for taxes, insurance and common area maintenance, which are considered non-lease components. Where these non-lease components are fixed, they are included in the measurement of the lease liability and ROU asset. Where these non-lease components are variable, the variable payments are excluded from the Company’s measurements of its ROU assets and lease liabilities and are expensed as incurred through Cost of goods sold or Selling, general and administrative on the Condensed Consolidated Statements of Operations (Unaudited).
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(Amounts in thousands, except share and per share amounts or where otherwise indicated)
ROU assets are amortized on a straight-line basis over the shorter of the useful life of the asset or the lease term:
•Operating Leases: Lease expense, comprised of the amortization of the ROU asset and the reduction of the lease liability, is recognized as a single amount and allocated between Cost of goods sold and Selling, general and administrative on the Condensed Consolidated Statements of Operations (Unaudited).
•Finance Leases: The amortization of the ROU asset is recognized in and allocated between Cost of goods sold and/or Depreciation and amortization, while the effective interest portion of the lease payment is recognized within Interest expense related to lease liabilities and financial obligations on the Condensed Consolidated Statements of Operations (Unaudited).
The Company has elected the following practical expedients permitted under ASC 842, Leases ("ASC 842"):
•For leases with an initial term of 12 months or less, the Company does not recognize an ROU asset or lease liability. Lease expense for these short-term leases is recognized on a straight-line basis over the lease term and recognized within Selling, general and administrative on the Condensed Consolidated Statements of Operations (Unaudited).
•For all classes of leased assets, the Company has elected to combine lease and non-lease components into a single lease component.
The Company occasionally subleases an underlying asset to a third party while the original head lease remains in effect. The Company accounts for the head lease and the sublease as separate transactions. If a sublease arrangement relieves the Company of its primary obligation under the head lease, the associated ROU asset and lease liability are derecognized, and any gain or loss is recognized in the period within Other (expense) income, net in the Condensed Consolidated Statements of Operations (Unaudited). If the Company is not relieved of its primary obligation, the original lease accounting remains unchanged, and the Company accounts for the sublease as a lessor. If the Company remains secondarily liable, a guarantee obligation would also be recognized. Rent payments received from subleases of operating leases and finance leases are recognized within Selling, general and administrative, as a reduction of the related lease expense recorded as the primary lessee, and Other (expense) income, net, respectively, on the Condensed Consolidated Statements of Operations (Unaudited).
See Note 11 — Leases for further detail.
Failed sale and leaseback arrangements
The Company periodically enters into arrangements where the Company sells an asset and simultaneously leases back all, or a portion of, the same asset for all, or part of, the asset's remaining useful life. Each such transaction is evaluated under ASC 606 to determine if the transfer of the asset qualifies as a sale. When a sale and leaseback transaction does not qualify for sale accounting, the transaction is accounted for as a financing arrangement, and the Company:
•does not derecognize the underlying asset and continues to recognize the asset within Property, plant and equipment, net on the Condensed Consolidated Balance Sheets (Unaudited), depreciating the asset over its remaining useful life;
•recognizes a liability for the sale proceeds, within Financial obligations — current and Financial obligations — net of current on the Condensed Consolidated Balance Sheets (Unaudited); and
•allocates the cash payments made to the buyer-lessor between principal reduction of the financial liability and interest expense, using the effective interest method. The interest expense is recognized within Interest expense related to lease liabilities and financial obligations on the Condensed Consolidated Statements of Operations (Unaudited).
If a sale and leaseback transaction that previously failed to qualify for sale accounting subsequently meets the criteria for a sale, the Company accounts for the transaction as a sale and leaseback on that date. The date on which the transaction qualifies as a sale (the “Qualifying Event”) is considered the commencement date of the leaseback. Upon meeting the sale criteria, the Company performs the following:
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(Amounts in thousands, except share and per share amounts or where otherwise indicated)
•Derecognition: The Company derecognizes the carrying amount of the underlying asset and associated financial obligation on the Condensed Consolidated Balance Sheets (Unaudited). The difference between the carrying amounts of the derecognized asset and associated financial obligation is recognized as a gain or loss within Other (expense) income, net on the Condensed Consolidated Statements of Operations (Unaudited).
•Leaseback recognition: Simultaneously, the Company recognizes a lease liability and a corresponding ROU asset. The lease liability is measured as the present value of the remaining lease payments, determined using the IBR assessed on the original sale date or on the date of the Qualifying Event. The IBR utilized is determined based on whether the Qualification Event results from the passage of time (e.g., the expiration of a repurchase option) or as a result of a substantive modification to the economic terms of the underlying contract.
See Note 12 — Failed sale and leaseback arrangements for further detail.
Impairment of long-lived assets
The Company evaluates its long-lived assets, including property, plant and equipment, ROU assets and definite-lived intangible assets, for impairment whenever events or changes in circumstances suggest the carrying amount of the asset group(s) to which the long-lived asset(s) are classified may not be recoverable. If a triggering event occurs, the Company tests its long-lived asset group(s) for recoverability by comparing the carrying amount to the estimated future undiscounted cash flows expected to result from the Company's use and eventual disposition of the long-lived asset group(s). If the long-lived asset group(s) fail the recoverability test, the Company recognizes an impairment loss for the amount by which the carrying amount exceeds the fair value of the long-lived asset group(s). Impairment losses are recognized as incurred within Impairment loss on the Condensed Consolidated Statements of Operations (Unaudited).
Goodwill
Goodwill represents the excess of the consideration transferred in a business combination over the fair value of the net tangible and intangible assets acquired. Goodwill is not amortized but is tested for impairment at the reporting unit level. Upon acquisition, goodwill is allocated to the reporting unit or units expected to benefit from the business combination. A reporting unit is an operating segment or one level below an operating segment that represents a component, or group of components, for which discrete financial information is available and reviewed regularly by segment management.
Impairment of goodwill
The Company tests goodwill for impairment annually, as of October 1, and more frequently if events or changes in circumstances indicate that an impairment loss may have been incurred. The Company conducts its impairment testing process as follows:
•Qualitative Assessment: The Company may first perform a qualitative assessment to determine if it is more likely than not that the fair value of a reporting unit, inclusive of any allocated goodwill, is less than its carrying value. This assessment considers factors such as significant underperformance relative to historical or projected future operating results, significant negative industry or economic trends and significant changes in the Company's use of the acquired assets or its overall business strategy.
•Quantitative Test: If the qualitative assessment indicates that an impairment is more likely than not, the Company proceeds to a quantitative impairment test. The fair value of the reporting unit is compared to its carrying value, including goodwill. The fair value of a reporting unit is determined using a combination of income and market-based valuation approaches.
If the carrying value of a reporting unit exceeds its fair value, the Company recognizes an impairment loss equal to the excess. The loss recognized is limited to the total amount of goodwill allocated to that reporting unit. Impairment losses are recognized within Impairment loss on the Condensed Consolidated Statements of Operations (Unaudited), during the period in which the impairment is identified. Impairment losses recognized in prior reporting periods are irreversible.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Historically, goodwill recognized in connection with the Company’s acquisitions has not been deductible for income tax purposes.
See Note 13 — Intangible assets, net and Goodwill for further detail.
Investments
The Company’s investments are accounted for based on the nature of the investment and the level of influence the Company can exercise over the investee.
Equity method investments: Investments in entities over which the Company has significant influence but not control are accounted for using the equity method of accounting:
•The investment is initially recorded at cost; and
•The carrying amount is subsequently adjusted each reporting period to recognize the Company’s proportionate share of the investee’s net income or loss in the current fiscal period.
Equity securities: Investments in entities over which the Company does not have significant influence or control are accounted for as follows:
•With readily determinable fair value: measured at fair value, with all unrealized gains and losses recognized within the Condensed Consolidated Statements of Operations (Unaudited) in the period they occur;
•Without readily determinable fair value: measured at cost, less any impairment, and adjusted for any observable price changes from identical or similar investments of the same issuer.
The Company evaluates its investment portfolio quarterly for indicators of impairment. If the Company has reason to believe that an investment’s fair value is below its carrying value, the Company recognizes an impairment loss for the difference.
On the Condensed Consolidated Statements of Operations (Unaudited), recognized gains and losses are reflected within Other (expense) income, net and impairment losses are recognized within Impairment loss, during the period in which they occur.
Deferred charges: debt financing
Costs incurred to obtain new debt financing or modify existing debt are deferred. The accounting treatment for these costs depends on the nature of the financing arrangement.
Debt discounts and debt issuance costs related to term loans are presented on the Condensed Consolidated Balance Sheets (Unaudited) as a direct deduction from or addition to the carrying amount of the related debt and are amortized to Interest expense related to notes payable and deferred consideration liabilities over the term of the debt using the effective interest method.
Debt issuance costs related to revolving lines of credit are capitalized and recognized within Prepaid expenses and other assets – current or Prepaid expenses and other assets – net of current, based on the remaining term of the underlying credit facility, on the Condensed Consolidated Balance Sheets (Unaudited). These costs are amortized to Interest expense related to notes payable and deferred consideration liabilities on a straight-line basis over the term of the credit facility on Condensed Consolidated Statements of Operations (Unaudited).
Commitments and contingencies
The Company recognizes loss contingencies on litigation matters within Accrued expenses on the Condensed Consolidated Balance Sheets (Unaudited). Losses on contingent liabilities are recognized when both of the following conditions are met: (i) it is probable that a loss has been incurred and (ii) the amount of the loss can be reasonably estimated. Gains from contingent liabilities are recognized only when realized or realizable. Losses (gains) related to contingent liabilities are
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(Amounts in thousands, except share and per share amounts or where otherwise indicated)
recognized within Other income, net, on the Condensed Consolidated Statements of Operations. The Company does not recognize gain contingencies until realized or realizable; however, if realization of a gain contingency appears probable and disclosure would not be misleading, the Company discloses the nature of the contingency and, if estimable, the amount of the potential gain. Losses (gains) related to contingent liabilities are recognized within Other (expense) income, net, on the Condensed Consolidated Statements of Operations (Unaudited).
The Company recognizes legal costs, as incurred, within Selling, general and administrative on the Condensed Consolidated Statements of Operations (Unaudited).
See Note 26 — Commitments and contingencies for further detail.
Income taxes
The Company’s Benefit (provision) for income taxes on the Condensed Consolidated Statements of Operations (Unaudited) is comprised of current and deferred income taxes, except to the extent that the income tax expense is related to a business combination or items that are recognized directly within Shareholders’ equity on the Condensed Consolidated Balance Sheets (Unaudited).
Current income taxes are recognized for the estimated taxes payable or refundable for the current fiscal period and are based on the taxable income (loss) for the current fiscal period (as adjusted for unrecognized tax benefits, changes in tax receivables (payables) that arose in a prior period and recovery of taxes paid in a prior period). Current taxes are measured using tax rates and laws enacted as of the reporting date within which the taxable income (loss) arose. Current tax assets and liabilities are offset only if the right of offset exists.
Deferred income taxes are recognized for the future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax basis. Deferred taxes are measured using enacted tax rates expected to apply in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in Benefit (provision) for income taxes on the Condensed Consolidated Statements of Operations (Unaudited) in the period that includes the enactment date.
Valuation allowances
Deferred tax assets are reduced by a valuation allowance, if based on available evidence, it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The Company assesses the realizability of its deferred income tax assets quarterly, considering all available positive and negative evidence, including the nature, frequency and severity of cumulative losses, forecasts of future profitability and the duration of statutory carryforward periods.
Uncertain tax positions
The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates and, in the normal course of business, is subject to examination and audit by federal, state and foreign jurisdictions. The Company records liabilities for uncertain tax positions under ASC 740, recognizing a tax benefit only when a position is more likely than not to be sustained upon examination. A liability is recorded for any benefit claimed in excess of the amount recognized and measured under this standard.
Section 280E of the U.S. Internal Revenue Code has historically been applied to the Company’s U.S. plant-touching cannabis operations. The Company has adopted a tax position, supported by legal interpretations, asserting that the restrictions of Section 280E do not apply to its cannabis operations (the “Section 280E Position”).
While the Company believes the Section 280E Position is supported by sound legal interpretations, the cannabis industry operates in a complex and evolving regulatory environment. In the event the Section 280E Position is not sustained, the Company has established reserves for this contingency, which are presented within Uncertain tax positions on the Condensed Consolidated Balance Sheets (Unaudited).
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The Company believes it is reasonably possible that its liability for uncertain tax positions will continue to change over the next 12 months as the Section 280E Position is examined by the Internal Revenue Service ("IRS") and certain state tax authorities.
See Note 23 — Income taxes for further detail.
Revenues
The Company recognizes revenue when the control of a promised good or service is transferred to the customer in an amount that reflects the consideration to which the Company expects to be entitled in exchange for the transferred good or service.
Retail and wholesale revenues
The Company derives revenue from the sale of cannabis products. Domestically, revenue is generated from direct-to-consumer retail sales at Company-operated dispensaries and from wholesale sales to third-party dispensaries, distributors and processors. Internationally, revenue is generated from direct-to-patient retail sales through the Company’s online cannabis pharmacy in the U.K. and from wholesale sales to distributors in Australia, Canada, Europe and New Zealand. In addition, the Company generates non-cannabis revenues from wholesale operations in Germany and Spain.
Revenues from the sale of retail and wholesale cannabis products are recognized at the point in time when control is transferred to the customers. Typically, for retail customers, control is transferred at point of sale and for wholesale customers control is transferred upon delivery and acceptance. Retail and wholesale revenues are recorded net of any sales discounts.
Management fee income
Management fee income is derived from various arrangements with cannabis licensees and other third parties. These arrangements include MSAs through which the Company provides professional services, such as cultivation, processing and retail know-how; back-office administration; brand licensing and real estate leasing/lending services. Domestically, management fee income is inclusive of royalty fees earned on the use of the Company’s licenses by third parties; while, internationally, the Company earns fees for providing manufacturing, logistics and consultation services. Management fee income is recognized on a straight-line basis over the term of the associated arrangements as services are provided.
Customer loyalty program and Promotional discounts
For most of its locations, the Company offers a loyalty reward program where retail customers can earn points on purchases for redemption on future purchases. Loyalty reward points are considered a material right and a separate performance obligation, and a portion of the initial transaction price is allocated to the loyalty points earned on the transaction and deferred. The deferred revenue is recognized within Accrued expenses on the Condensed Consolidated Balance Sheets (Unaudited), until the earned loyalty reward points are redeemed, expired or forfeited. As of March 31, 2026 and December 31, 2025, the Company's accrued loyalty payable totaled $5.2 million and $5.0 million, respectively.
Promotional discounts and loyalty rewards that are not tied to a customer purchase are expensed as incurred and recognized within Sales and marketing, which is a component of Selling, general and administrative expense on the Condensed Consolidated Statements of Operations (Unaudited).
Share-based compensation
The Company accounts for all share-based payments to employees, directors and consultants, including stock options, performance stock units (“PSUs”), restricted stock units (“RSUs”) and virtual share options (“VSOs”), by measuring the awards at their grant-date fair value and recognizing the corresponding compensation expense over the requisite service period, which typically equates to the vesting period. The Company recognizes share-based compensation expense within Selling, General and Administrative costs on the Condensed Consolidated Statements of Operations (Unaudited), with a corresponding increase to Shareholders’ equity or Accrued expenses on the Condensed Consolidated Balance Sheets (Unaudited), based on the award’s classification.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Valuation
The fair value of share-based awards is determined using appropriate valuation models depending on the nature of the award:
•RSUs and PSUs: The fair value of RSUs and PSUs subject to service or non-market performance conditions is determined based on the closing market price of the Company’s SVS on the date of grant.
•Stock options: The Company uses the Black-Scholes option-pricing model to determine the grant-date fair value of stock options.
•Awards with market conditions: For awards that contain market conditions (e.g., achieving a specific stock price), the Company utilizes a Monte Carlo simulation model to determine the grant-date fair value.
•VSOs: VSOs are awards that do not convey actual equity interests and are settled solely in cash. Such awards are classified as liability awards, and the grant-date fair value is determined in accordance with the underlying plan agreement. VSOs are remeasured to fair value at the end of each reporting period.
The key assumptions used in the Black-Scholes model include the award’s expected term, expected volatility, risk-free interest rate and expected dividend yield. Expected volatility is estimated based on the historical stock price volatility of the Company’s SVS over a period commensurate with the award's expected term. The risk-free interest rate is based on the U.S. Treasury yield curve for a term consistent with the expected life of the award (i.e. the period of time that granted stock options are expected to be outstanding). The Company uses an expected dividend yield of zero as it does not currently anticipate paying dividends.
Forfeitures
The Company has elected to recognize forfeitures of unvested awards as they occur. Accordingly, previously recognized compensation expense is reversed in the period in which the forfeiture occurs.
See Note 19 — Share-based compensation for further detail.
Advertising costs
Advertising costs are expensed as incurred and recorded as a component of Sales and marketing on the Condensed Consolidated Statements of Operations (Unaudited).
See Note 20 — Selling, general and administrative expense for further detail.
Earnings per share, basic and diluted
The Company presents basic and diluted earnings per share (“EPS”) on its Condensed Consolidated Statements of Operations (Unaudited). Basic EPS is calculated by dividing the net income (loss) attributable to the Company’s shareholders by the weighted average number of shares outstanding during the reporting period.
Diluted EPS reflects the potential dilution that could occur if contracts to issue SVS were exercised or converted into SVS during the reporting period. Potentially dilutive instruments include share-based awards, contingent equity consideration obligations and convertible debt instruments. To compute diluted EPS, the Company applies the treasury stock method to share-based awards and the if-converted method to contingent equity consideration obligations and convertible debt instruments.
Instruments that are anti-dilutive are excluded from the calculation of diluted EPS. Accordingly, in periods of net loss, diluted EPS generally equals basic EPS, as the inclusion of potentially dilutive instruments would be anti-dilutive, unless instruments subject to the if-converted method are dilutive after considering the related numerator adjustments.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
For redeemable non-controlling interests classified as mezzanine equity, adjustments to reflect changes in the estimated redemption value in excess of the carrying amount are treated as equity adjustments and reduce (or increase) net income (loss) attributable to common shareholders in the calculation of basic and diluted EPS.
See Note 24 — Earnings per share for further detail.
Related party transactions
Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control. Related parties may be individuals or entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties.
Of the $500.0 million in Senior Secured Notes – 2029 (defined herein), issued on February 18, 2026, $1.0 million is held indirectly by the Company’s Chief Executive Officer and Chairman (“CEO and Chairman”). The CEO and Chairman participated in the issuance alongside other holders, and this portion of the issuance has been characterized as a related party transaction. For additional information on the Company’s Senior Secured Notes – 2029, see Note 16 — Notes payable for further detail.
Business combinations and asset acquisitions
The Company accounts for business combinations using the acquisition method in accordance with ASC 805, Business Combinations (“ASC 805”), which requires recognition of assets acquired and liabilities assumed, including contingent assets and liabilities, at their respective fair values on the date of acquisition or assumption of control.
Business combinations
Under the acquisition method, the assets acquired and liabilities assumed in a business combination are recognized at their respective fair values on the date of acquisition, and the operating results of the acquired business are included in the Company’s Condensed Consolidated Financial Statements (Unaudited) from the date of acquisition. The excess of consideration transferred over the net assets acquired and liabilities assumed is recognized as goodwill as of the acquisition date.
Non-controlling interests in the acquiree are measured at fair value on acquisition date, and acquisition-related transaction costs are recognized as expenses in the period in which the costs are incurred.
Contingent consideration arising from a business combination is included in the purchase consideration at its fair value on the acquisition date:
•Liability-classified: Contingent consideration classified as a liability is remeasured to fair value at each reporting period, with changes in fair value recognized within Other (expense) income, net on the Condensed Consolidated Statements of Operations (Unaudited); and
•Equity-classified: Contingent consideration classified as equity is not remeasured. Contingent consideration classified as equity is assessed quarterly to determine whether equity classification remains appropriate.
Deferred consideration arising from a business combination is included in the purchase price at its fair value, discounted to present value. The subsequent accretion of the discount and any changes in the fair value of the deferred consideration as a result of post-acquisition-date events are recognized in earnings within Interest expense related to notes payable and deferred consideration liabilities and Other income, net, respectively, on the Condensed Consolidated Statements of Operations (Unaudited).
Purchase price allocations may be preliminary and during the measurement period (not to exceed one year from the date of acquisition), changes in assumptions and estimates that result in adjustments to the fair value of assets acquired and liabilities assumed are recorded in the period the adjustments are determined.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Asset acquisitions
The Company applies a screen test to determine if an acquisition should be accounted for as a business combination or an asset acquisition. When substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar assets (generally 90% or more), the transaction is accounted for as an asset acquisition. In addition, assets acquired that do not constitute a business are accounted for as asset acquisitions. The Company allocates the cost of an asset acquisition, including acquisition-related transaction costs, to the individual assets acquired and liabilities assumed based on their relative fair values.
See Note 4 — Acquisitions for further detail.
Fair value of financial instruments
ASC 820, Fair Value Measurement (“ASC 820”) defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 also establishes a fair value hierarchy to prioritize the inputs used to measure fair value into three categories based upon the lowest level of input that is available and significant to the fair value measurement.
The three levels of the fair value hierarchy, wherein Level 1 is the highest and Level 3 is the lowest, are as follows:
Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2 — Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; and
Level 3 — Inputs for the asset or liability that are not based on observable market data.
The Company evaluates the classification of its financial instruments within the fair value hierarchy at the end of each reporting period. Transfers between levels are recognized based on changes in the observability of the inputs used to measure fair value. The Company’s policy is to recognize transfers between levels of the fair value hierarchy as of the beginning of the reporting period in which the event or change in circumstances that caused the transfer occurs.
The Company’s financial instruments consist of cash and cash equivalents, restricted cash, accounts receivable, notes receivable, equity investments, accounts payable, accrued expenses, long-term notes payable, contingent and deferred consideration liabilities and redeemable NCI.
The carrying values of cash and cash equivalents, restricted cash, accounts receivable, notes receivable, accounts payable and accrued expenses approximate their fair values due to the relatively short-term to maturity. The Company’s notes payable and deferred consideration liabilities are carried at amortized cost, and redeemable NCI is recognized at the greater of carrying value or estimated redemption value at the end of each reporting period.
The Company's equity investments with readily determinable fair values and contingent consideration liabilities are measured at fair value on a recurring basis.
See Note 27 — Fair value measurements and financial risk management for further detail.
Significant accounting judgments, estimates and assumptions
The preparation of financial statements in accordance with U.S. GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses as well as the disclosure of contingent liabilities. These estimates are developed based on historical experience, observable trends and other information available, and they are reviewed and updated regularly. Although actual results could differ from these estimates, management believes them to be reasonable. Changes in estimates are accounted for prospectively.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The most significant assumptions and estimates underlying the Condensed Consolidated Financial Statements (Unaudited) are described below:
Consolidation and variable interest entities
Significant judgment is applied to determine whether the Company holds a controlling financial interest in an entity, particularly when the Company does not hold a majority voting interest. This evaluation considers voting rights, MSAs, the entity’s design and the existence of financial guarantees. The Company consolidates entities in which it holds a controlling financial interest. See Note 2 — Basis of presentation and consolidation and Note 28 — Variable interest entities for further detail.
Business combinations and asset acquisitions
Significant judgment is applied in determining whether an acquisition is treated as a business combination or an asset acquisition. The Company uses an optional screen test under which a transaction is accounted for as an asset acquisition if substantially all of the fair value of the gross assets acquired (generally 90% or more) is concentrated in a single identifiable asset or group of similar assets.
In a business combination, significant estimates are used to determine the fair value of assets acquired and liabilities assumed. Depending on the complexity of the transaction, an independent valuation expert may be engaged.
•Intangible Assets: The valuation of acquired intangible assets, such as cannabis licenses, requires the development of forward-looking cash flow projections and the selection of appropriate discount and terminal growth rates.
•Contingent Consideration: The fair value of contingent consideration liabilities, such as earn-outs, is estimated based on the probability and timing of achieving specific future outcomes, such as revenue targets.
These valuations are closely linked to the assumptions made by management regarding future performance of the assets acquired and any changes in the discount rate applied. See Note 4 — Acquisitions for further detail.
Goodwill impairment
Goodwill is tested for impairment annually or more frequently if impairment indicators exist. This test requires the estimation of the fair value of its reporting units using income and market-based approaches. This process involves significant judgment in developing business plans and forecasts as well as in selecting appropriate market data. See Note 13 — Intangible assets, net and Goodwill for further detail.
Share-based compensation - Stock options
Estimating the fair value of share-based awards requires significant assumptions for the inputs used in the Black-Scholes or Monte Carlo valuation models, including expected volatility of the Company’s SVS, the expected life of an award and the risk-free interest rate. The Company uses an expected dividend yield of zero, as it does not currently anticipate paying dividends. See Note 19 — Share-based compensation for further detail.
Impairment of long-lived assets
The Company evaluates the recoverability of long-lived assets when events indicate their carrying value may not be recoverable. This requires judgment in interpreting key factors (e.g., adverse changes in market conditions, regulatory environment or business climate and adverse changes in the extent or manner in which the long-lived assets will be used) and in estimating the undiscounted future cash flows of such assets. See Note 10 — Property, plant and equipment, net for further detail.
Inventories
Inventories are measured at the lower of cost or NRV. Determining NRV requires significant judgment regarding future demand, selling prices, shrinkage and inventory aging. See Note 8 — Inventories for further detail.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Leases
The selection of the lease term and IBR significantly impacts the classification and valuation of ROU assets and lease liabilities.
•Lease Term: Assessing options to extend or terminate a lease involves evaluating strategic, operational and economic factors, such as the scale of the Company's investment and the strategic importance of the property location.
•IBR: When the implicit rate in a lease is not readily determinable, an IBR must be assessed based on available information at the commencement date, including the specific lease term.
Evaluating whether a contract contains a lease or an embedded lease requires significant judgment. This assessment involves determining (i) if an arrangement conveys the right to control an identified asset by evaluating whether the asset is explicitly or implicitly specified, (ii) whether the Company obtains substantially all economic benefits from its use and (iii) whether the Company has the right to direct that use.
See Note 11 — Leases for further detail.
The Company’s Benefit (provision) for income taxes on the Condensed Consolidated Statements of Operations (Unaudited) is comprised of current and deferred income taxes, except to the extent that the income tax expense is related to a business combination or items that are recognized directly within Shareholders’ equity on the Condensed Consolidated Balance Sheets (Unaudited).
Current income taxes are recognized for the estimated taxes payable or refundable for the current fiscal period and are based on the taxable income (loss) for the current fiscal period (as adjusted for unrecognized tax benefits, changes in tax receivables (payables) that arose in a prior period and recovery of taxes paid in a prior period). Current taxes are measured using tax rates and laws enacted as of the reporting date within which the taxable income (loss) arose. Current tax assets and liabilities are offset only if the right of offset exists.
Deferred income taxes are recognized for the future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax basis. Deferred taxes are measured using enacted tax rates expected to apply in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in Benefit (provision) for income taxes on the Condensed Consolidated Statements of Operations (Unaudited) in the period that includes the enactment date.
Valuation allowances
Deferred tax assets are reduced by a valuation allowance, if based on available evidence, it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The Company assesses the realizability of its deferred income tax assets quarterly, considering all available positive and negative evidence, including the nature, frequency and severity of cumulative losses, forecasts of future profitability and the duration of statutory carryforward periods.
Uncertain tax positions
The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates and, in the normal course of business, is subject to examination and audit by federal, state and foreign jurisdictions. The Company recognizes a liability for tax positions that are more likely than not to be disallowed upon examination by a tax authority.
The Company’s cannabis operations are subject to Section 280E of the U.S. Internal Revenue Code (“Section 280E”), which disallows deductions for ordinary and necessary business expenses. The Company has adopted a tax position, supported by legal interpretations, asserting that the restrictions of Section 280E do not apply to its cannabis operations (the “Section 280E Position”).
While the Company believes the Section 280E Position is supported by sound legal interpretations, the cannabis industry operates in a complex and evolving regulatory environment. If the Company’s position is not upheld the Company has
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
established reserves for this contingency which are recognized within Uncertain tax position on the Condensed Consolidated Balance Sheets (Unaudited).
The Company believes it is reasonably possible that its liability for uncertain tax positions will continue to change over the next 12 months as the Section 280E Position is reviewed by the Internal Revenue Service ("IRS") and certain state tax authorities.
Change in tax laws
The U.S. enacted H.R.1 – One Big Beautiful Bill Act (the “OBBBA”), which introduced various corporate income tax provisions effective in 2025 and 2026. The provisions that became effective in 2025 did not have a material impact on the Company’s consolidated financial position, results of operations or cash flows. The Company is currently evaluating the potential impact of the OBBBA provisions that became effective in 2026; however, the Company does not anticipate these provisions will have a material impact on its consolidated financial position, results of operations or cash flows.
See Note 23 — Income taxes for further detail.
Held for sale and discontinued operations
Significant judgment is required to determine if a disposal group meets the specific criteria to be classified as “held for sale.” An asset or disposal group must meet all of the following conditions:
•Management is committed to a plan to sell;
•The asset or disposal group is available for immediate sale in its present condition;
•An active program to locate a buyer has been initiated;
•The sale is highly probable within one year;
•The asset or disposal group is being actively marketed for sale at a reasonable price; and
•It is unlikely that the plan will be significantly changed or withdrawn.
A disposal group classified as held for sale is reported as a “discontinued operation” if it represents a strategic shift that has a major effect on the Company’s operations and financial results. Assets held for sale are measured at the lower of their carrying amount or fair value less costs to sell. Pursuant to ASC 205, Presentation of Financial Statements, the financial results of the Company’s discontinued operations are presented separately on the Condensed Consolidated Statements of Operations (Unaudited) as Net loss from discontinued operations.
See Note 5 — Assets and liabilities held for sale and discontinued operations and Note 6 — Discontinued operations for further detail.
Redeemable non-controlling interests
The valuation and classification of redeemable non-controlling interests involve significant judgment, including developing discounted cash flow models with assumptions about future revenue, margins and economic conditions. The Company also has to assess whether the underlying equity instruments are currently redeemable or likely to become redeemable in the future, adding complexity to their classification on the Condensed Consolidated Balance Sheets (Unaudited). See Note 18 — Redeemable non-controlling interest for further detail.
Revenue recognized from contracts with customers
Significant judgment is applied in evaluating the nature of the Company’s wholesale and MSA revenue contracts. This includes assessing whether the Company acts as the principal or agent in contracts with customers, particularly where third-party involvement or shared responsibilities exist. The Company also evaluates whether certain transactions are non-reciprocal in nature, requiring consideration of whether a transfer of assets occurred without commensurate value received.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
In arrangements involving transfers of inventory between the same counter-parties, the Company applies judgment to determine whether such transfers represent distinct revenue-generating events. Additionally, the allocation of transaction price across multiple performance obligations necessitates the estimation of standalone selling prices and the timing of satisfaction of each obligation.
New, amended and future accounting pronouncements
The Company has implemented all applicable accounting standards recently issued by the FASB, as well as applicable pronouncements from certain other standard-setting bodies, within the prescribed effective dates. Pronouncements that are not applicable or where it has been determined do not have a significant impact to the Company have been excluded herein.
Recently adopted accounting standards
Effective January 1, 2026, the Company adopted prospectively ASU 2025-05, Financial Instruments—Credit Losses: Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”). ASU 2025-05 was issued to simplify and improve the measurement of credit losses for accounts receivable and contract assets. The amendments in ASU 2025-05 respond to stakeholder concerns regarding the cost and complexity of applying the current expected credit loss model, particularly for assets collected shortly after the balance sheet date. ASU 2025-05 introduces an optional practical expedient allowing all entities to assume that current conditions as of the balance sheet date remain unchanged for the remaining life of the asset. Upon adoption, ASU 2025-05 did not materially impact the Company’s consolidated financial position, results of operations or cash flows, as the Company’s trade accounts receivable are typically settled shortly after billing with historically low write-offs and minimal sensitivity to macroeconomic fluctuations.
Effective January 1, 2026, the Company adopted prospectively ASU 2025-03, Business Combinations and Consolidation: Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity (“ASU 2025-03”). Under ASU 2025-03, a reporting entity involved in a business combination effected primarily by the exchange of equity interests must consider the factors in ASC 805-10-55-12 through 55-15 to determine which entity is the accounting acquirer regardless of whether the legal acquiree is a VIE. More specifically, when considering those factors, the reporting entity can determine that a transaction in which the legal acquiree is a VIE represents a reverse acquisition (in which the legal acquirer is identified as the acquiree for accounting purposes). As a result, comparability is increased with business combinations in which the legal acquiree is a voting interest equity. Upon adoption, ASU 2025-03 did not impact the Company’s consolidated financial position, results of operations or cash flows, as the Company did not acquire any VIEs on or after January 1, 2026.
Effective January 1, 2026, the Company adopted prospectively ASU 2024-04, Debt with Conversion and Other Options (“ASU 2024-04”). ASU 2024-04 clarifies the requirements for accounting for a settlement of a convertible debt instrument as an induced conversion and applies to convertible debt instruments with cash conversion features as well as debt instruments that are not currently convertible. Upon adoption, ASU 2024-04 did not impact the Company’s consolidated financial position, results of operations or cash flows, as the Company has not settled a convertible debt instrument as an induced conversion on or after January 1, 2026.
Recently issued accounting standards not yet adopted
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements (“ASU 2025-11”). ASU 2025-11 makes targeted, narrow-scope improvements to the interim reporting guidance in ASC 270 to clarify the timing and consistency of recognition and measurement in quarterly financial statements. The amendments address specific areas where existing guidance led to uncertainty about whether certain costs, adjustments or changes in estimates should be recognized in an interim period or allocated over an annual period. The amendments in ASU 2025-11 do not introduce new accounting concepts but improves consistency, reduces diversity in practice and enhances comparability across interim reporting periods. ASU 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim reporting periods within those fiscal years, and can be applied on either a prospective or modified retrospective basis. Early adoption is permitted. The Company does not anticipate ASU 2025-11 will have a material impact on its Condensed Consolidated Financial Statements (Unaudited) upon adoption.
In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Scope Refinements (“ASU 2025-07”). ASU 2025-07 was issued to clarify the application of derivative accounting to certain contracts and refine the guidance for share-based noncash consideration received from
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
customers. The amendments introduce a scope exception for contracts that are not exchange-traded and whose underlying is tied to operations or activities specific to one party. Additionally, ASU 2025-07 clarifies that share-based noncash consideration from a customer should initially be accounted for under Topic 606 until the right to receive or retain such consideration becomes unconditional, at which point financial instruments guidance may apply. ASU 2025-07 is effective for fiscal years beginning after December 15, 2026, including interim reporting periods within those fiscal years, and can be applied on either a prospective or modified retrospective basis. Early adoption is permitted. The Company is currently evaluating the potential impact of ASU 2025-07 to the Company and its Condensed Consolidated Financial Statements (Unaudited) upon adoption.
In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software: Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”). ASU 2025-06 was issued to modernize and clarify the accounting for internal-use software, addressing stakeholder concerns that the existing guidance was outdated and based on traditional waterfall development methods that no longer reflect current software development practices, including agile methodologies. The amendments in ASU 2025-06 eliminate references to prescriptive “project stages” and introduce a clearer capitalization threshold, requiring capitalization of software costs once (i) management has authorized and committed funding to the project and (ii) it is probable the software will be completed and used as intended. Entities must also assess whether significant uncertainty exists in the development process when applying this threshold. ASU 2025-06 is effective for all entities for annual reporting periods beginning after December 15, 2027, and can be applied on a prospective, modified retrospective or retrospective basis. Early adoption is permitted. The Company is currently evaluating the potential impact of ASU 2025-06 to the Company and its Condensed Consolidated Financial Statements (Unaudited) upon adoption.
In May 2025, the FASB issued ASU 2025-04, Compensation—Stock Compensation and Revenue from Contracts with Customers (“ASU 2025-04”). ASU 2025-04 revises FASB’s Master Glossary definition of the term performance condition for share-based consideration payable to a customer. The revised definition incorporates:
•conditions (such as vesting conditions) that are based on the volume or monetary amount of a customer’s purchases (or potential purchases) of goods or services from the grantor and
•performance targets based on purchases made by other parties that purchase the grantor’s goods or services from the grantor’s customers.
In addition, the amendments in ASU 2025-04:
•eliminate the policy election permitting a grantor to account for forfeitures as they occur;
•clarify that share-based consideration encompasses the same instruments as share-based payment arrangements, but the grantee does not need to be a supplier of goods or services to the grantor and
•clarify that a grantor is required to assess the probability that an award will vest using only the guidance in ASC 718, Compensation––Stock Compensation. Revenue recognition will no longer be delayed when an entity grants awards that are not expected to vest.
ASU 2025-04 is effective for all entities for annual reporting periods, including interim reporting periods within those annual reporting periods, beginning after December 15, 2026 and can be applied on a modified retrospective or retrospective basis. Early adoption is permitted. The Company is currently evaluating the potential impact of ASU 2025-04 to the Company and its Condensed Consolidated Financial Statements (Unaudited) upon adoption. As of March 31, 2026, the Company has no customer contracts or transactions within the scope of this amendment.
In November 2024, the FASB issued ASU 2024-03, “Reporting Comprehensive Income—Expense Disaggregation Disclosures,” which was subsequently amended by ASU 2025-01 in January 2025. ASU 2024-03, as amended, requires public business entities to provide disaggregated disclosures of specific income statement expense categories, including purchases of inventory, employee compensation, depreciation, intangible asset amortization, depletion and selling expenses. These amendments aim to enhance transparency by offering investors more detailed insights into an entity’s expense structure. This additional information is intended to improve investors' ability to understand an entity’s cost structure and to forecast future cash flows. ASU 2024-03 is effective for all entities for annual periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Early adoption is permitted on either
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
a prospective or retrospective basis. The Company is currently evaluating the potential impact of ASU 2024-03 to the Company and its Condensed Consolidated Financial Statements (Unaudited) upon adoption.
In October 2023, the FASB issued ASU 2023-06, Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative (“ASU 2023-06”). ASU 2023-06 incorporates certain SEC disclosure requirements into the FASB Codification. The amendments introduced by ASU 2023-06 are expected to clarify or improve disclosure and presentation requirements of a variety of Codification Topics, allow users to more easily compare entities subject to the SEC’s existing disclosures with those entities that were not previously subject to the requirements and align the requirements in FASB’s Codification with the SEC’s regulations. ASU 2023-06 is effective on the date on which the SEC removes the related disclosure from Regulation S-X or Regulation S-K. Any amendments the SEC does not remove by June 30, 2027 will not be effective. Early adoption is prohibited. The Company does not anticipate ASU 2023-06 will impact its Condensed Consolidated Financial Statements (Unaudited) upon adoption.
Note 4 — Acquisitions
During the three months ended March 31, 2026 and 2025, the Company did not consummate any acquisitions that were material, individually or in the aggregate.
Contingent consideration
Contingent consideration recorded relates to the Company's business combinations and asset acquisitions. As discussed in Note 3 — Significant accounting policies, contingent consideration payable is subject to significant judgment and estimates, such as projected future revenue. See Note 27 — Fair value measurements and financial risk management for further discussion surrounding the inputs utilized in the fair value of contingent consideration.
The changes in the Company's contingent consideration liability as of March 31, 2026 and December 31, 2025 were as follows:
EMMAC(1)
NGC(2)
Total
Total contingent consideration liability, December 31, 2024
$
2,837 
$
3,310 
$
6,147 
Cash payments of contingent consideration
— 
(3,236)
(3,236)
Issuance of SVS as settlement of contingent consideration
— 
(497)
(497)
Revaluation of contingent consideration
306 
335 
641 
Effect of exchange rate differences
215 
— 
215 
Gain (loss) on contingent consideration not paid
— 
88 
88 
Total contingent consideration liability, December 31, 2025
3,358 
— 
3,358 
Revaluation of contingent consideration
(254)
— 
(254)
Effect of exchange rate differences
(57)
— 
(57)
Total contingent consideration liability, March 31, 2026
3,047 
— 
3,047 
Contingent consideration liability — net of current
$
3,047 
$
— 
$
3,047 
(1) Contingent on the ability of Curaleaf International Holdings Limited ("Curaleaf International") to obtain a recreational cannabis license in Europe and is payable in both cash and SVS upon achievement. Payouts, if any, are expected in 2027.
(2) Contingent obligation was tied to Northern Green Canada ("NGC") achieving certain margin targets during the fiscal year ending December 31, 2024.
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Deferred consideration
The changes in the Company's deferred consideration liability as of March 31, 2026 and December 31, 2025 were as follows:
Tryke(1)
NRPC(2)
Curaleaf Poland(3)
Other(4)
Total
Total deferred consideration liability, December 31, 2024
$
32,564 
$
2,000 
$
504 
$
— 
$
35,068 
Deferred consideration recognized on acquisition
— 
— 
— 
920 
920 
Accretion of interest on deferred consideration
2,436 
— 
— 
— 
2,436 
Effect of exchange rate differences
— 
— 
17 
46 
63 
Change in fair value on deferred consideration paid
— 
— 
(46)
— 
(46)
Issuance of SVS as settlements of deferred consideration
— 
— 
(77)
— 
(77)
Cash payments of deferred consideration
(35,000)
— 
(398)
— 
(35,398)
Total deferred consideration liability, December 31, 2025
— 
2,000 
— 
966 
2,966 
Accretion of interest on deferred consideration
— 
— 
— 
146 
146 
Effect of exchange rate differences
— 
— 
— 
(16)
(16)
Post-closing purchase price adjustment
— 
(182)
— 
— 
(182)
Cash payments of deferred consideration
— 
(618)
— 
— 
(618)
Total deferred consideration liability, March 31, 2026
— 
1,200 
— 
1,096 
2,296 
Less: Deferred consideration liability — current
— 
(1,075)
— 
(1,096)
(2,171)
Deferred consideration liability — net of current
$
— 
$
125 
$
— 
$
— 
$
125 
(1) Related to the second and third anniversary payment due from the Company to the sellers of Tryke that was settled-in-full by October 2025.
(2) Represents amounts withheld in connection with the acquisition of Natural Remedy Patient Center LLC ("NRPC") as security for indemnification obligations. In January 2026, upon receipt of a final, non-appealable order, the $2.0 million holdback became payable. The Company retained $1.2 million for potential tax exposure (scheduled for release in August 2026 and August 2027, subject to IRS claims) and deducted legal fees incurred during the litigation as permitted under the purchase agreement. The remaining amount, net of the tax holdback and legal fees, was paid in February 2026.
(3) Related to Curaleaf Poland’s achievement of certain earnings metrics during the fiscal year ending December 31, 2024. On April 14, 2025, the Company settled this obligation through a cash payment of $0.4 million and the issuance of 32,017 SVS.
(4) Incurred in connection with an individually immaterial acquisition consummated during the three months ended June 30, 2025 within the Company’s international operations.
Note 5 — Assets and liabilities held for sale and discontinued operations
Total gains (losses) recognized by the Company upon consummation of the disposition of its net assets held for sale for the three months ended March 31, 2026 were as follows:
Three Months Ended March 31, 2026
Disposal Group
Discontinued Operations
Held for Sale Entities
Hemp-derived THC
$
(324)
$
— 
Mokena Crossing
— 
8 
Total (loss) gain on disposal of net assets held for sale
$
(324)
$
8 
The Company did not consummate any dispositions of net assets held for sale during the three months ended March 31, 2025.
31
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The changes in assets and liabilities held for sale as of March 31, 2026 and December 31, 2025 were as follows:
Assets held for sale
Discontinued Operations
Held for Sale
Total
Balance at December 31, 2024
$
15,653 
$
— 
$
15,653 
Transferred (out) in, net
(12,355)
383 
(11,972)
Balance at December 31, 2025
3,298 
383 
3,681 
Transferred out, net
(244)
(383)
(627)
Balance at March 31, 2026
$
3,054 
$
— 
$
3,054 
Liabilities associated with assets held for sale
Discontinued Operations
Held for Sale
Total
Balance at December 31, 2024
$
8,471 
$
434 
$
8,905 
Transferred out, net
(1,398)
(434)
(1,832)
Balance at December 31, 2025
7,073 
— 
7,073 
Transferred out, net
(234)
— 
(234)
Balance at March 31, 2026
$
6,839 
$
— 
$
6,839 
Note 6 — Discontinued operations
On December 30, 2025, the Company approved plans to discontinue operations in two markets — Hemp-derived THC and Missouri — both of which represent strategic shifts having a major effect on the Company's operations and financial results. Accordingly, the financial results for both operating segments were reclassified as discontinued operations as of March 31, 2026 and December 31, 2025, and for the three months ended March 31, 2026 and 2025.
Hemp-derived THC. The decision to exit the hemp-derived THC market was driven by recent federal and state legislative changes that materially restricted the legal definition of hemp and significantly curtailed the sale and distribution of hemp-derived THC products. These regulatory changes eroded demand, and no alternative legal markets for the Company's hemp-derived THC products currently exist.
Missouri. The decision to exit the Missouri market was driven by persistent declines in operating performance and management's determination that projected future cash flows were insufficient to recover the carrying value of the associated asset group as of March 31, 2026.
The following table summarizes the major classes of assets and liabilities of the Company's discontinued operations as of March 31, 2026 and December 31, 2025:
As of
March 31, 2026
December 31, 2025
Assets
Prepaid expenses and other current assets
$
— 
$
278 
Total current assets
— 
278 
Deferred tax asset(1)
3,053 
3,020 
Total non-current assets
3,053 
3,020 
Total assets
$
3,053 
$
3,298 
Liabilities
Accrued expenses(2)
$
6,839 
$
7,060 
Lease liabilities, operating — current
— 
13 
Total current liabilities
6,839 
7,073 
Total liabilities
$
6,839 
$
7,073 
(1) Deferred tax asset is primarily a result of the formal dissolution of certain legal entities classified as discontinued operations.
(2) Consists primarily of accrued litigation contingencies. See Note 26 — Commitments and contingencies for additional information.
32
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The following table presents the Company's Condensed Consolidated Financial Statements (Unaudited) results for its discontinued operations for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31,
2026
2025
Total revenues, net
$
1,411 
$
3,383 
Cost of goods sold
859 
3,775 
Gross profit (loss)
552 
(392)
Total operating expenses
511 
1,768 
Income (loss) from operations
41 
(2,160)
Total other (expense) income, net
(324)
700 
Loss before provision for income taxes
(283)
(1,460)
Provision for income taxes(1)
(10)
(8,733)
Net loss from discontinued operations
$
(293)
$
(10,193)
(1) Provision for income taxes is primarily a result of the formal dissolution of certain legal entities that were classified as discontinued operations.
Note 7 — Accounts receivable, net
Accounts receivable, net consist of the following as of March 31, 2026 and December 31, 2025:
As of
March 31, 2026
December 31, 2025
Trade accounts receivable
$
70,660 
$
73,864 
Other receivables
3,232 
5,092 
Accounts receivable, gross
73,892 
78,956 
Less: Allowance for credit losses
(2,346)
(2,617)
Accounts receivable, net
$
71,546 
$
76,339 
The changes in the Company's allowance for credit losses on its trade accounts receivable as of March 31, 2026 and December 31, 2025 were as follows:
Allowance for credit losses as of December 31, 2024
$
(2,722)
Provision
(977)
Charge-offs and recoveries
1,135 
Effect of exchange rate differences
(53)
Allowance for credit losses as of December 31, 2025
(2,617)
Provision
(96)
Charge-offs and recoveries
359 
Effect of exchange rate differences
8 
Allowance for credit losses as of March 31, 2026
$
(2,346)
Additional information about the Company's exposure to credit and market risks and impairment losses for its accounts receivable is included in Note 27 — Fair value measurements and financial risk management.
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Note 8 — Inventories
Inventories consist of the following as of March 31, 2026 and December 31, 2025:
As of
March 31, 2026
December 31, 2025
Raw materials:
Cannabis
$
33,102 
$
38,885 
Non-cannabis
27,206 
20,029 
Total raw materials
60,308 
58,914 
Work-in-process
67,115 
67,996 
Finished goods
113,861 
98,112 
Inventories
$
241,284 
$
225,022 
As of March 31, 2026 and December 31, 2025, the Company's inventory reserve, which is recognized within Inventories on the Condensed Consolidated Balance Sheets (Unaudited), was as follows:
As of
March 31, 2026
December 31, 2025
Inventory reserve
$
(10,761)
$
(10,223)
For the three months ended March 31, 2026 and 2025, inventory write-downs recognized within Cost of goods sold on the Condensed Consolidated Statements of Operations (Unaudited) totaled:
Three Months Ended March 31,
2026
2025
Inventory write-downs
$
(571)
$
(306)
Note 9 — Notes receivable
Notes receivable consists of the following as of March 31, 2026 and December 31, 2025:
As of
March 31, 2026
December 31, 2025
Notes receivable — current
$
6,368 
$
4,629 
Notes receivable — net of current
806 
2,980 
Total notes receivable
$
7,174 
$
7,609 
Riviera Creek
In 2025, the Company initiated a plan to enter into Option and Purchase Agreements with Riviera Creek Holdings, LLC ("Riviera Creek") for the start-up, licensing, build-out and working capital needs of certain dispensaries in Ohio, including RC Retail 1, RC Retail 2, and RC Retail 3 (together, the "RC Retail Stores"). The Company entered into Option and Purchase Agreements with RC Retail 2, RC Retail 3 and RC Retail 1 on January 2, 2025, September 4, 2025 and October 3, 2025, respectively.
As of March 31, 2026, the Company has advanced $4.0 million under a term loan receivable (the "Term Loan"). Advances under the Term Loan accrue non-compounded interest at the applicable federal mid-term rate, calculated on the basis of the actual number of days elapsed over a 365-day year or 366-day year. The maturity date of the Term Loan is contingent upon the execution, or termination, of the Option and Purchase Agreement. The Term Loan is secured by the assets of the Borrower, subject to certain exclusions.
34
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The RC Retail Stores are consolidated by the Company as VIEs. See Note 28 — Variable interest entities for additional information.
Acres Note
On February 23, 2024, the Company signed a real estate purchase agreement to sell the property and equipment of Acres Cultivation LLC and Acres Dispensary LLC for total consideration of $3.3 million, consisting of cash consideration of $1.1 million and a note receivable of $2.2 million (the "Acres Note") secured by the property and equipment acquired by the borrower. The Acres Note earns interest at 8% per annum and matures in February 2027.
Four20 Notes
On January 1, 2024, Four20 Pharma GmbH (“Four20”) converted €0.8 million of overdue accounts receivable of its customer, Canymed GmbH (the “Borrower”), into a secured note receivable (the “Four20 Note”). The note bore interest of 8% and was settled in full on January 30, 2025.
On September 1, 2025, Four20 converted an additional €0.9 million of overdue account into a secured note receivable (the “2025 Four20 Note”). The note bore interest of 8% and matured on December 31, 2025; however, the obligation was not settled upon maturity due to the Borrower’s financial difficulties. Accordingly, the Company enforced its security interest in the collateral to satisfy the outstanding obligation in full in February 2026.
Sapphire Note
On November 1, 2024, the Company and Sapphire Nordics AB entered into a financing arrangement whereby the Company extended a line of credit up to £0.5 million (the "Sapphire Note"), which was later amended on September 1, 2025, increasing the line of credit up to £0.8 million. The Sapphire Note bears interest at a rate equal to the European Central Bank base rate plus 3% per annum, with interest accruing from the date of each drawdown. Each drawdown is repayable in full, including accrued interest, no later than the fifth anniversary of its respective disbursement date. The facility is available for drawdown through November 1, 2030. The Company classified the Sapphire Note as a related party transaction, as Sapphire Nordics AB is a joint venture formed with Nordx Pharma AB in January 2023.
Note 10 — Property, plant and equipment, net
Property, plant and equipment, net consist of the following as of March 31, 2026 and December 31, 2025:
As of
March 31, 2026
December 31, 2025
Land
$
12,937 
$
12,937 
Building and improvements
553,285 
548,388 
Furniture and fixtures
109,485 
108,750 
Machinery and equipment
139,437 
133,648 
Information technology
1,105 
27,668 
Construction in progress
23,788 
22,618 
Property, plant and equipment, gross
840,037 
854,009 
Less: Accumulated depreciation
(330,884)
(333,623)
Property, plant and equipment, net
$
509,153 
$
520,386 
Assets included in construction in progress represent projects related to the Company's dispensary, cultivation, manufacturing and corporate office facilities not yet completed or otherwise not ready for use.
35
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
For the three months ended March 31, 2026 and 2025, depreciation expense was as follows:
Three Months Ended March 31,
2026
2025
Depreciation expense(1):
Cost of goods sold
$
12,503 
$
11,815 
Operating expenses
7,154 
9,362 
Total depreciation expense
$
19,657 
$
21,177 
(1) Includes depreciation expense associated with assets under failed sale and leaseback obligations. See Note 12 — Failed sale and leaseback arrangements for further detail.
Asset specific impairment
2026
The Company did not recognize an impairment loss on Property, plant and equipment, net during the three months ended March 31, 2026.
2025
During the three months ended March 31, 2025, in a continued effort to optimize cultivation operations, additional assets with no future benefits to the Company were identified, and the Company recognized an impairment loss of $3.7 million within Impairment loss on the Condensed Consolidated Statements of Operations (Unaudited), inclusive of $0.4 million of cultivation assets associated with one of the Company's failed sale and leaseback arrangements.
Note 11 — Leases
The Company leases real estate and equipment for its dispensaries, cultivation facilities, production plants and corporate offices.
The Company's lease agreements contain various extension and termination options. Extension options range from one to 20 years, with a typical extension period of five years, while certain termination options are contingent upon the Company securing regulatory permits.
The Company does not have any material percentage-rent, sales-based, or other contingent lease payment arrangements. Lease payments are predominantly fixed and/or based on fixed escalations.
ROU assets and lease liabilities as of March 31, 2026 and December 31, 2025 consisted of the following:
As of
March 31, 2026
December 31, 2025
Finance Leases
Operating Leases
Finance Leases
Operating Leases
ROU assets:
ROU assets, gross
$
184,099 
$
180,944 
$
186,943 
$
178,904 
Accumulated amortization
(92,453)
(68,797)
(89,344)
(65,630)
Total ROU assets, net
$
91,646 
$
112,147 
$
97,599 
$
113,274 
Lease liabilities:
Lease liabilities — current
$
12,709 
$
20,046 
$
11,684 
$
19,837 
Lease liabilities — net of current
137,755 
97,513 
144,446 
102,346 
Total lease liabilities
$
150,464 
$
117,559 
$
156,130 
$
122,183 
36
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The components of the Company's lease expenses for the three months ended March 31, 2026 and 2025 were as follows:
Three Months Ended March 31,
2026
2025
Finance lease expense:
Amortization of ROU assets
Cost of goods sold
$
1,684 
$
1,701 
Operating expenses
1,435 
1,306 
Total amortization of ROU assets
3,119 
3,007 
Interest on finance lease liabilities
4,248 
4,449 
Total finance lease expense
7,367 
7,456 
Operating lease expense(1)
7,999 
7,436 
Short-term lease expense
783 
944 
Total lease expense
$
16,149 
$
15,836 
(1) Includes $0.1 million and nil of sublease income as a net reduction of rent expense for the three months ended March 31, 2026 and 2025, respectively.
Cash flows associated with the Company's leasing arrangements for the three months ended March 31, 2026 and 2025 were as follows:
Three Months Ended March 31,
Financial Statement Line Item:
2026
2025
Cash flows from operating activities:
Operating cash flows from operating leases
$
(8,190)
$
(7,545)
Operating cash flows from finance leases
(4,248)
(4,449)
Cash flows from financing activities:
Financing cash flows from finance leases
(2,832)
(2,474)
Net cash flows from leasing arrangements
$
(15,270)
$
(14,468)
As of March 31, 2026 and December 31, 2025, the weighted average remaining lease terms and weighted average discount rates of the Company's leasing arrangements were as follows:
As of
March 31, 2026
December 31, 2025
Weighted average remaining lease term (in years) — finance leases
8.7
10.0
Weighted average remaining lease term (in years) — operating leases
6.1
6.3
Weighted average discount rate — finance leases
11.1 
%
11.2 
%
Weighted average discount rate — operating leases
10.8 
%
10.9 
%
37
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
As of March 31, 2026, maturities of the Company's lease liabilities under its non-cancelable leases were as follows:
Fiscal Year
Operating Leases
Finance Leases
2026 (nine months remaining)
$
23,751 
$
21,368 
2027
30,429 
28,972 
2028
26,774 
28,314 
2029
22,801 
28,186 
2030
18,773 
27,825 
2031 and thereafter
40,254 
114,488 
Total undiscounted remaining minimum lease payments
162,782 
249,153 
Less: imputed interest
(45,223)
(98,689)
Total discounted remaining minimum lease payments
$
117,559 
$
150,464 
Note 12 — Failed sale and leaseback arrangements
The Company has entered into several sale and leaseback arrangements in connection with building improvements and equipment at various of its cultivation and processing sites. All of these transactions were accounted for as failed sale and leaseback arrangements, as the Company retained control of the assets for the majority of their remaining useful lives.
As of March 31, 2026 and December 31, 2025, the Company's failed sale and leaseback arrangements were recognized in the Condensed Consolidated Balance Sheets (Unaudited) as follows:
As of
March 31, 2026
December 31, 2025
Property, plant and equipment, net:
Financed property and equipment, net of accumulated depreciation of $79.3 million and $76.1 million, respectively
$
121,530 
$
124,708 
Financial obligations:
Financial obligations - current
10,421 
7,238 
Financial obligations - net of current
197,743 
202,901 
Total financial obligations
$
208,164 
$
210,139 
For the three months ended March 31, 2026 and 2025, the expenses incurred by the Company related to its failed sale and leaseback arrangements were recognized on the Condensed Consolidated Statements of Operations (Unaudited) as follows:
Three Months Ended March 31,
2026
2025
Other income (expense):
Interest on financial obligations
$
6,255 
$
6,635 
Operating expenses:
Depreciation on financed property, plant and equipment
3,178 
3,505 
Total expense associated with failed sale and leaseback obligations
$
9,433 
$
10,140 
For the three months ended March 31, 2026 and 2025, cash flows associated with the Company’s failed sale and leaseback arrangements were recognized in the Condensed Consolidated Statements of Cash Flows (Unaudited) as follows:
Three Months Ended March 31,
2026
2025
Cash flows from operating activities
$
(6,255)
$
(6,635)
Cash flows from financing activities
(1,975)
(1,774)
Net cash flows from failed sale and leaseback obligations
$
(8,230)
$
(8,409)
38
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
As of March 31, 2026, maturities of the Company's financial obligations associated with failed sale and leaseback arrangements were as follows:
Fiscal Year
Financial Obligations
2026 (nine months remaining)
$
24,909 
2027
31,006 
2028
31,841 
2029
30,497 
2030
29,459 
2031 and thereafter
204,871 
Total undiscounted remaining minimum payments
352,583 
Less: imputed interest
(144,419)
Total discounted remaining minimum payments
$
208,164 
Asset specific impairment
During the three months ended March 31, 2026 and 2025, the Company recognized an impairment loss of nil and $0.4 million, respectively, to reduce the carrying value of certain cultivation assets assigned to failed sale and leaseback arrangements. See Note 10 — Property, plant and equipment, net for additional information.
Note 13 — Intangible assets, net and Goodwill
Intangible assets, net
Identifiable intangible assets consisted of the following as of March 31, 2026 and December 31, 2025:
As of March 31, 2026
Gross Carrying Amount
Accumulated Amortization
Net Carrying Amount
Licenses and service agreements
$
1,313,575 
$
(442,905)
$
870,670 
Trade names
150,071 
(55,471)
94,600 
Non-compete agreements
21,293 
(11,169)
10,124 
Intellectual property and know-how
9,365 
(4,214)
5,151 
Internal-use software
2,045 
(575)
1,470 
Customer relationships
69 
(23)
46 
Intangible assets, net(1)
$
1,496,418 
$
(514,357)
$
982,061 
(1)Intangible assets held by the Company’s international subsidiaries are subject to foreign currency translation adjustments.
As of December 31, 2025
Gross Carrying Amount
Accumulated Amortization
Net Carrying Amount
Licenses and service agreements
$
1,318,987 
$
(422,887)
$
896,100 
Trade names
162,903 
(65,877)
97,026 
Non-compete agreements
25,244 
(14,591)
10,653 
Intellectual property and know-how
9,577 
(3,790)
5,787 
Internal-use software
1,716 
(220)
1,496 
Customer relationships
71 
(18)
53 
Intangible assets, net(1)
$
1,518,498 
$
(507,383)
$
1,011,115 
(1) Intangible assets held by the Company’s international subsidiaries are subject to foreign currency translation adjustments.
During the three months ended March 31, 2026, the gross carrying amount of intangible assets decreased by $22.1 million, primarily driven by foreign currency translation.
Amortization expense for the Company's intangible assets was $25.1 million and $24.7 million for the three months ended March 31, 2026 and 2025, respectively.
39
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
As of March 31, 2026, the Company's estimated intangible amortization expense over the next five fiscal years was as follows:
Fiscal Year
Estimated Amortization
2026 (full 12 months)
$
105,348 
2027
104,841 
2028
101,136 
2029
95,888 
2030
91,795 
The Company's remaining weighted average amortization period for its outstanding intangibles as of March 31, 2026 was 11.61 years. The remaining weighted average amortization period for each major class as of March 31, 2026 was as follows:
Asset class:
Weighted Average Amortization (in years)
Licenses and service agreements
11.85
Trade names
11.32
Non-compete agreements
5.23
Internal-use software
3.79
Intellectual property and know-how
2.75
Customer relationships
2.00
Goodwill
The changes in the Company's Goodwill as of March 31, 2026 and December 31, 2025 were as follows:
Domestic
International
Total
Balance at December 31, 2024
$
551,181 
$
77,703 
$
628,884 
Acquisitions(1)
— 
1,328 
1,328 
Measurement period adjustment
— 
(3,984)
(3,984)
Effect of exchange rate differences
— 
8,889 
8,889 
Balance at December 31, 2025
551,181 
83,936 
635,117 
Effect of exchange rate differences
— 
(1,593)
(1,593)
Balance at March 31, 2026
$
551,181 
$
82,343 
$
633,524 
(1) Incurred in connection with an individually immaterial acquisition consummated during the three months ended June 30, 2025 within the Company’s international operations.
40
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Note 14 — Other assets – net of current
Other assets — net of current consist of the following as of March 31, 2026 and December 31, 2025:
As of
March 31, 2026
December 31, 2025
Security deposits(1)
$
10,988 
$
11,082 
Prepaid expenses(2)
4,029 
— 
Other assets(3)
2,520 
2,051 
Investments(4)
342 
263 
Total prepaid expenses and other assets — net of current
$
17,879 
$
13,396 
(1)Represents security deposits for certain lease arrangements.
(2) Represents prepaid SaaS and hosting subscription fees, along with capitalized implementation costs. See Note 3 — Significant accounting policies for further detail.
(3) Represents deferred financing fees related to the Amended Needham LOC (as defined herein).
(4)Represents an equity investment in a social equity collective.
Note 15 — Accrued expenses
Accrued expenses consist of the following as of March 31, 2026 and December 31, 2025:
As of
March 31, 2026
December 31, 2025
Accrued payroll expenses
$
31,674 
$
41,861 
Accrued inventory expenses
13,574 
12,196 
Professional services and legal matters(1)
9,853 
12,078 
Sales taxes payable
7,256 
7,754 
Excise taxes payable
3,055 
4,347 
Accrued occupancy and technology expenses
7,967 
5,422 
Accrued loyalty payable
5,176 
4,986 
Accrued marketing expenses
2,751 
2,788 
Interest payable
6,794 
1,704 
Property and other taxes payable
1,742 
1,480 
Deferred revenue
1,117 
634 
Other accrued expenses
11,130 
15,243 
Total accrued expenses
$
102,089 
$
110,493 
(1) Includes amounts recognized for legal contingencies. See Note 26 — Commitments and contingencies for additional information.
41
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Note 16 — Notes payable
Notes payable consist of the following as of March 31, 2026 and December 31, 2025:
As of
March 31, 2026
December 31, 2025
Senior Secured Notes – 2029
$
500,000 
$
— 
Senior Secured Notes – 2027
50,115 
56,597 
Senior Secured Notes – 2026
— 
456,815 
Amended Needham LOC
— 
21,910 
ABL Facility – EWB Note
12,000 
12,000 
Seller note payable
4,022 
4,093 
Other notes payable
7,193 
3,308 
Less: Unamortized debt discount and deferred financing fees
(8,239)
(6,071)
Notes payable, net of unamortized debt discount and deferred financing fees
565,091 
548,652 
Less: Notes payable — current
(40,014)
(35,730)
Notes payable — net of current
$
525,077 
$
512,922 
Below is a summary of the Company's credit facilities outstanding as of March 31, 2026:
Credit facility
Original facility size
Outstanding balance
Stated interest rate (11)
Maturity date
Senior Secured Notes – 2029
$
500,000 
$
500,000 
11.50 
%
February 18, 2029
Senior Secured Notes – 2027
67,000 
50,115 
10.00 
%
(5)
December 17, 2027
Senior Secured Notes – 2026(9)
475,000 
— 
8.00 
%
(4)
December 15, 2026
(9)
Amended Needham LOC(2)(10)
100,000 
— 
8.99 
%
(6)(10)
February 18, 2029
(10)
ABL Facility – EWB Note
12,000 
12,000 
6.00 
%
(7)
August 25, 2026
Seller note payable (Scottsdale)(1)
5,100 
4,022 
5.00 
%
(8)
December 20, 2036
Other notes payable(3)
11,280 
7,193 
Various
Various
$
1,170,380 
$
573,330 
(1) The Company has a seller note payable incurred in connection with the Company’s purchase of a building in Scottsdale, Arizona (the “Scottsdale Note”).
(2) In October 2025, the total borrowing capacity under the Needham LOC was increased from $40.0 million to $100.0 million; see section herein titled "Needham Bank" for additional information.
(3) Comprised of various immaterial loans held by Curaleaf International.
(4) Compounded semi-annually and payable in arrears on June 15th and December 15th of each year.
(5) Compounded monthly and computed daily on the basis of a 360-day year for the actual number of days elapsed for a period of time. Interest and principal payments are payable in arrears and due on the 17th of each month.
(6) Calculated on the basis of a 360-day year. Interest is due on the 6th of each month.
(7) Calculated on the basis of a 360-day year for the actual number of days elapsed for any period of time. Interest is due on the 25th of each month.
(8) Compounded monthly and computed daily on the basis of a 360-day year for the actual number of days elapsed for a period of time. Interest and principal payments are payable in arrears and due on the 23rd of each month.
(9) In February 2026, the Company closed on a private placement of senior secured notes for aggregate gross proceeds of $500.0 million due February 18, 2029. Net proceeds were used to fully repay the Senior Secured Notes – 2026.
(10) In conjunction with the origination of the Senior Secured Notes – 2029, the maturity date of the Amended Needham LOC was extended to February 18, 2029, and the interest rate was amended to 8.99% in accordance with the terms of the Amended and Restated Needham Loan Agreement.
(11) The weighted-average interest rate algins with the stated interest rates of all credit facilities, except for the miscellaneous category, the impact of which is immaterial.
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The Company's interest expense by credit facility for the three months ended March 31, 2026 was as follows:
Three Months Ended March 31, 2026
Credit facility
Effective interest rate
Stated interest expense
Amortization of debt discount/ premium and deferred financing fees
Total interest expense(1)
Senior Secured Notes – 2029
12.13%
$
6,459 
$
247 
$
6,706 
Senior Secured Notes – 2027
10.69%
1,338 
81 
1,419 
Senior Secured Notes – 2026
9.30%
4,906 
717 
5,623 
Amended Needham LOC
8.99%
268 
560 
828 
ABL Facility – EWB Note
6.00%
180 
— 
180 
Seller note payable – Scottsdale
5.00%
51 
— 
51 
Other notes payable
Various
39 
— 
39 
$
13,241 
$
1,605 
$
14,846 
(1) Total interest expense herein does not encompass interest expense recognized on the Company’s deferred consideration obligations. For the three months ended March 31, 2026, the Company recognized interest expense of $0.1 million on its deferred consideration obligations. See Note 4 — Acquisitions for additional information.
The Company's interest expense by credit facility for the three months ended March 31, 2025 was as follows:
Three Months Ended March 31, 2025
Credit facility
Effective interest rate
Stated interest expense
Amortization of debt discount/ premium and deferred financing fees
Total interest expense(1)
Senior Secured Notes – 2026
9.30%
$
9,074 
$
1,240 
$
10,314 
Senior Secured Notes – 2027
10.69%
1,359 
65 
1,424 
Bloom Notes – 2025
10.36%
120 
142 
262 
Bloom Notes – 2024
10.00%
81 
— 
81 
Needham LOC
7.99%
279 
348 
627 
ABL Facility - EWB Note
6.00%
180 
— 
180 
Other notes payable - BHH Note
15.00%
277 
— 
277 
Seller notes payable - Scottsdale Note
5.00%
54 
— 
54 
Other notes payable - VOWL Note
5.90%
28 
— 
28 
Other notes payable - NGC Note
12.00%
47 
— 
47 
Other notes payable - miscellaneous
various
66 
— 
66 
Three months ended March 31, 2025
$
11,565 
$
1,795 
$
13,360 
(1) Total interest expense herein does not encompass interest expense recognized on the Company’s deferred consideration obligations. For the three months ended March 31, 2025, the Company recognized interest expense of $0.8 million on its deferred consideration obligations. See Note 4 — Acquisitions — deferred consideration for additional information.
As of March 31, 2026, maturities of the Company's notes payable were as follows:
Fiscal Year:
Amount
2026 (remaining nine months)
$
35,382 
2027
30,913 
2028
1,334 
2029
501,228 
2030 and thereafter
4,473 
Total future principal maturities
$
573,330 
43
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
As of March 31, 2026 and December 31, 2025, the carrying values and fair values of the Company's notes payable were as follows:
As of
March 31, 2026
December 31, 2025
Carrying value
$
573,330 
$
554,723 
Fair value
584,069 
546,068 
The fair value of the Company's senior secured notes was estimated using Level 2 inputs, based on third-party evaluated pricing derived from observable market yields and spreads for debt of comparable terms and credit profile.
Senior Secured Notes – 2026
In December 2021, the Company closed on a private placement of senior secured notes due 2026 for aggregate gross proceeds of $475.0 million ("Senior Secured Notes – 2026"). The note indenture (the “Original Indenture”), dated as of December 15, 2021, provided for the issuance of the Senior Secured Notes – 2026, as amended pursuant to a first amendment dated as of February 8, 2022 (the “First Amendment”), as supplemented by a first supplemental indenture dated as of December 21, 2021 (the “First Supplemental Indenture”), a second supplemental indenture dated as of December 8, 2023 (the “Second Supplemental Indenture”) and a third supplemental indenture dated as of January 17, 2025 (the “Third Supplemental Indenture” and together with the Original Indenture, the First Amendment, the First Supplemental Indenture, the Second Supplemental Indenture and the Third Supplemental Indenture, the “Base Indenture”).
The Base Indenture enabled the Company to issue additional senior secured notes on an ongoing basis as needed, subject to maintaining leverage ratios and complying with other terms and conditions of the Note Indenture. The principal restrictions on incurring additional indebtedness include the requirement that post-incurrence of the additional debt, a fixed charge coverage ratio of 2.5:1 and consolidated debt to consolidated EBITDA ratio of 4:1 be maintained. The issuance of additional senior secured notes or other debt pari passu to the existing notes is permitted, provided that post-incurrence of the additional debt, the consolidated secured debt to consolidated EBITDA ratio of 3:1 is maintained and provided certain other conditions are met. Under the Note Indenture, the Company and certain of its guarantor entities are required to grant a first lien security interest in their respective assets to the appointed trustee, including assets acquired after the issue of the Senior Secured Notes – 2026, subject to limited exceptions. Despite the first lien granted to the holders of the Senior Secured Notes – 2026, the Note Indenture permits the Company to grant a more senior lien to secure up to $200.0 million of additional financing from commercial banks for revolving credit loans, such as the Needham LOC (as defined herein), provided that the interest rate applicable to such revolving credit loans is lower than the interest rate applicable to the Senior Secured Notes – 2026.
Subject to the consent of Needham Bank, the Senior Secured Notes – 2026, inclusive of accrued and unpaid interest, could be redeemed early without incurring a prepayment premium.
Redemption of Senior Secured Notes - 2026
On April 30, 2024, in an arm’s length transaction, the Company paid $14.3 million to purchase, for cancellation, Senior Secured Notes – 2026 that had a face value of $15.0 million. The Company also reduced accrued interest by $3.2 million that had been accruing from December 15, 2023 through April 30, 2024 specific to the notes purchased for cancellation.
On July 22, 2025, in an arms-length transaction, the Company paid $2.9 million to purchase, for cancellation, Senior Secured Notes – 2026, that had a face value of $3.2 million. The Company also reduced accrued interest by $0.4 million that had been accruing from June 15, 2025 through July 22, 2025 specific to the notes purchased for cancellation.
On February 18, 2026, the Company consummated the 2026 Refinancing (as defined below), the proceeds from which were used to (i) repay approximately $314.6 million of the Senior Secured Notes – 2026 and (ii) to exchange, on a non-cash basis, with certain participating existing lenders, $142.2 million of the Senior Secured Notes – 2026 for Senior Secured Notes – 2029. As of March 31, 2026, the Company had no outstanding obligation under the Senior Secured Notes – 2026.
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Senior Secured Notes – 2027
On January 17, 2025, the Company entered into an agreement (the “Note Exchange Agreement”) with the former owners of Bloom (the “Bloom Lenders”), pursuant to which the Company agreed to accept from the Bloom Lenders, and the Bloom Lenders agreed to transfer to the Company, the Bloom Notes – 2025 in exchange for senior secured notes of the Company with an aggregate principal balance of $67.0 million (the “Senior Secured Notes — 2027”), consisting of the $60.0 million then-outstanding principal of the Bloom Notes – 2025 plus $7.0 million of accrued interest on such notes (the “Note Exchange”). In connection with the Note Exchange, the Company paid in cash (i) $0.6 million, representing the remaining balance of interest accrued on the Bloom Notes – 2025 as of the date of the Note Exchange and (ii) $1.0 million of debt origination fees. The Senior Secured Notes – 2027 mature on January 17, 2027. There are no prepayment penalties on the Senior Secured Notes – 2027.
The Company accounted for the Note Exchange as a debt extinguishment and recognized a loss on extinguishment of debt of $0.3 million, which is recognized within Other (expense) income, net on the Condensed Consolidated Statements of Operations (Unaudited).
Senior Secured Notes – 2029
On February 18, 2026, the Company entered into a fourth supplemental indenture to the Base Indenture (together with the Base Indenture, the “2029 Indenture”) to complete the private placement of senior secured notes due February 18, 2029 (the "Senior Secured Notes – 2029"), for aggregate gross proceeds of $500.0 million (the "2026 Refinancing"). Cash proceeds from the offering were used to extinguish $314.6 million of the Senior Secured Notes – 2026 and settle $6.5 million of accrued interest. The remaining $142.2 million of outstanding Senior Secured Notes – 2026 were exchanged for Senior Secured Notes – 2029.
The 2029 Indenture permits the Company to issue additional senior secured notes on an unlimited basis, subject to compliance with the incurrence covenants and other terms of the 2029 Indenture. The principal restrictions on incurring additional indebtedness require that, on a pro forma basis after giving effect to such incurrence, (i) the consolidated fixed charge coverage ratio is at least 2.5:1, (ii) consolidated indebtedness to consolidated EBITDA does not exceed 4:1 and (iii) no Default or Event of Default exists. In addition, the 2029 Indenture permits the Company to grant a more senior lien to secure up to $100.0 million of additional financing from commercial banks for revolving credit loans, provided that, such credit facilities bear interest at a rate lower than the Senior Secured Notes – 2029 and immediately following such incurrence, consolidated secured indebtedness to consolidated EBITDA does not exceed 3:1 and all other conditions under the 2029 Indenture are satisfied. The Company and certain guarantor entities are required to grant a first‑priority security interest in substantially all of their assets, including after‑acquired property, subject to Excluded Property and Permitted Liens.
Amounts paid to holders of the Senior Secured Notes – 2026 that did not participate in the refinancing were accounted for as debt extinguishments. Based on this assessment, the portions of the 2026 Refinancing involving continuing lenders were accounted for as debt modifications, including the exchange of approximately $142.2 million principal amount of Senior Secured Notes – 2026 for Senior Secured Notes – 2029 and certain cash settlements and issuances involving continuing holders that did not qualify as debt extinguishments under ASC 470-50. Amounts paid to non-participating holders, including approximately $78.8 million principal amount of Senior Secured Notes – 2026, were accounted for as debt extinguishments. The remaining Senior Secured Notes – 2029 were issued to new lenders and accounted for as new debt. The Company had approximately $4.7 million of unamortized deferred financing costs and debt discounts related to the Senior Secured Notes – 2026, of which $1.8 million continues to be amortized over the term of the Senior Secured Notes – 2029, while $2.9 million was written off and recognized as a loss on debt extinguishment within Other (expense) income, net on the Condensed Consolidated Statements of Operations (Unaudited). In connection with the 2026 Refinancing, the Company incurred approximately $8.1 million of deferred financing fees and debt discounts, of which $1.5 million was expensed as incurred and recognized within Other (expense) income, net on the Condensed Consolidated Statements of Operations (Unaudited) and $6.6 million was capitalized as debt issuance costs to be amortized over the term of the Senior Secured Notes – 2029. The Company recognized total expense of $4.5 million from loss on debt extinguishments, consisting primarily of the write-off of unamortized deferred financing costs and third party debt issuance costs related to the refinancing.
The Senior Secured Notes – 2029 issued in transactions accounted for as debt extinguishments were initially recognized at fair value on the issuance date. The Company determined that the fair value of the Senior Secured Notes – 2029 was equal
45
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
to par value, or $500.0 million in the aggregate, based on the observed arm’s-length issuance price in the private placement. The notes were issued at 100% of principal, with no original issue discount, and the terms were determined through arm’s-length negotiations between the Company and the agents. The fair value measurement on the issuance date would be classified within Level 2 of the fair value hierarchy because the measurement was based on observable inputs, principally the contemporaneous arm’s-length issuance price and market-negotiated coupon for debt with the Company’s credit profile and terms, and there was no quoted price in an active market for the identical instrument on the measurement date. The notes will be carried at amortized cost and related debt issuance costs and lender fees will be amortized to interest expense over the term of the notes using the effective interest method.
The Senior Secured Notes – 2029, inclusive of accrued and unpaid interest, may be redeemed early, but are subject to a prepayment premium that is dependent on the loan year as follows:
Loan year
Prepayment redemption prices
August 18, 2027 to February 17, 2028
105.8%
February 17, 2028 and thereafter
100.0%
Related Party Transaction
Holders of the Senior Secured Notes – 2029 include Medtech International Group LLC (“Medtech”), an entity wholly-owned by the CEO and Chairman. Medtech subscribed to $1.0 million of the Senior Secured Notes – 2029. Medtech’s subscription is characterized as a related party transaction.
Needham Bank
On November 6, 2024, the Company entered into a loan agreement (the “Needham Loan Agreement”) with Needham Bank (“Needham”), establishing a revolving line of credit for up to $40.0 million (the “Needham LOC”), with an option to request up to an additional $20.0 million, beginning May 6, 2026, subject to Needham’s discretion and credit approval process.
On October 10, 2025, the Company entered into an amended and restated loan agreement with Needham (the “Amended and Restated Needham Loan Agreement”) to refinance the Needham LOC. As part of the refinancing, the total borrowing capacity under the Needham LOC was increased from $40.0 million to $100.0 million (the “Amended Needham LOC”), and the maturity date was extended to October 10, 2026. The unused capacity at March 31, 2026 was $98.3 million. The Amended Needham LOC remains secured by a first-priority lien on senior mortgages, guarantees of the Company’s U.S. subsidiaries and a parent guaranty limited to the Company’s U.S. assets. Proceeds may be utilized for general corporate purposes, including working capital and operational expenses, as well as to reduce outstanding principal balances of certain Indebtedness (as defined in the Amended Needham LOC). The Amended Needham LOC is subject to certain debt covenants including maintaining a post-incurrence debt service coverage ratio of 1.5:1 as well as covenants related to appraised fair value of mortgaged properties (subject to an 80% LTV constraint), receivables and cash, net of reserves.
The Amended and Restated Needham Loan Agreement contains contractual provisions that are automatically triggered upon the consummation of certain refinancing transactions. In connection with the February 18, 2026 issuance of the Company’s Senior Secured Notes – 2029, the Amended and Restated Needham Loan Agreement was automatically amended, extending the maturity date to February 18, 2029, and increasing the stated interest rate from 7.99% to 8.99%.

Tangela Holdings, LTD
On June 11, 2024, the Company entered into a loan agreement (the “NGC Note”) with Tangela for $1.6 million to fund bulk purchases of cannabis for resale by NGC. The NGC Note, as most recently amended on March 11, 2025, matured as scheduled, and on July 1, 2025, the Company settled the loan in full.
Asset-based revolving credit facility
On August 25, 2023, the Company entered into an asset-based revolving credit facility (the “ABL Facility”) with EWB that provided for borrowings up to $6.5 million and immediately drew down $6.5 million (the “EWB Note”). The EWB Note had a maturity date of August 25, 2024. On March 26, 2024, the Company signed an agreement (the “1st Change in Terms
46
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Agreement”), increasing the ABL Facility to $10.0 million and extending the maturity date of the EWB Note to August 25, 2025. On June 14, 2024, the Company executed an amendment to the 1st Change in Terms Agreement, increasing the ABL Facility by an additional $2.0 million to $12.0 million. On September 2, 2025, the Company executed Amendment No. 3 to its Loan Agreement with East West Bank, extending the maturity date to August 25, 2026. No other changes were made to the ABL Facility.
The ABL Facility is secured by the Company’s deposit accounts at EWB, and as such, the Company’s balance in the EWB deposit accounts is classified as restricted cash on the Company’s Condensed Consolidated Balance Sheets (Unaudited) as of March 31, 2026 and December 31, 2025.
Covenant compliance
As of March 31, 2026, the Company was in compliance with all financial covenants within each credit facility, and the Company did not observe evidence of any cross-defaults.
Note 17 — Shareholders’ equity
Authorized
As of March 31, 2026, the Company's authorized share capital consists of (i) an unlimited number of MVS, (ii) an unlimited number of SVS and (iii) an unlimited number of non-voting and non-participating shares that are exchangeable at the shareholder's option into SVS (the "Exchangeable Shares"). All three classes of authorized share capital are without par value. The MVS are held directly or indirectly by the CEO and Chairman.
Issued
Holders of the SVS are entitled to one vote per share. Holders of the MVS are entitled to 15 votes per share and are entitled to notice of and to attend any meeting of the Company’s shareholders, except for shareholder meetings in which only holders of a particular class or series of shares will have the right to vote.
The MVS are convertible into SVS on a one-for-one basis at any time at the option of the holder or upon termination of the MVS structure. The MVS shall automatically convert into SVS upon the earlier to occur of: (i) the transfer or disposition of the MVS by the CEO and Chairman to one or more third parties who are not permitted holders; and (ii) the CEO and Chairman or his permitted holders no longer beneficially owning, directly or indirectly and in the aggregate, at least 5% of the issued and outstanding SVS and MVS on a non-diluted basis.
As of March 31, 2026, the Company's MVS represented approximately 12.0% of the total issued and outstanding shares and controlled approximately 67.2% of the total voting power. As of December 31, 2025, the MVS represented approximately 12.2% of the total issued and outstanding shares and controlled approximately 67.5% of the total voting power.
As of March 31, 2026, no Exchangeable Shares have been issued.
As of March 31, 2026 and December 31, 2025, the number of SVS available for issuance under the Company's 2018 Long Term Incentive Plan ("LTIP") was 26,049,147 and 25,749,158, respectively. See Note 19 — Share-based compensation for further detail.
On June 5, 2026, the Company effected a 1-for-3 reverse stock split of its SVS and MVS. Share amounts, per share amounts, voting rights and equity award information included herein has been retrospectively adjusted to reflect the reverse stock split for all periods presented. See Note 2 — Basis of presentation and consolidation for further detail.
Treasury shares
There were no SVS repurchased into treasury during the three months ended March 31, 2026 or 2025.
Note 18 — Redeemable non-controlling interest
47
Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
In connection with the acquisition of Four20 Pharma GmbH ("Four20") in September 2022, the selling shareholders and Curaleaf International entered into separate put/call options, which permit either party to trigger the roll-up of the remaining equity of Four20 two years after the launch of adult-use cannabis sales in Germany, but no later than the end of 2025 if adult-use launch had not occurred by such date. As adult-use cannabis sales in Germany had not commenced by the end of 2025, the options became exercisable.
On February 23, 2026, the selling shareholders of Four20 exercised their put option by delivering an irrevocable notice to the Company to redeem their remaining 45% equity interest in Four20. On April 30, 2026, the Company settled the put option and acquired the remaining equity interest in Four20. The transaction resulted in a change in the Company's ownership interest in Four20 without a loss of control; therefore, it was accounted for as an equity transaction in accordance with ASC 810, as further described in Note 2 — Basis of presentation and consolidation. Consideration paid to settle the put option of €76.5 million consisted of cash, deferred consideration and equity consideration of €43.0 million, €12.2 million and €21.3 million, respectively. The deferred consideration is payable in two installments due on August 31, 2026 and November 30, 2026, respectively, and bears interest at a rate of 6% per annum from the closing date through the respective payment dates.
Note 19 — Share-based compensation
The Company maintains a LTIP, which provides for the grant of incentive stock options, non-statutory stock options, restricted stock units, performance stock units and other share-based awards to eligible participants. The number of SVS reserved for issuance under the LTIP is calculated as 10% of the aggregate number of SVS and MVS outstanding on an "as-converted" basis.
On June 5, 2026, the Company effected a 1-for-3 reverse stock split of its SVS and MVS. All share amounts, per share amounts, voting rights and equity award information included herein has been retrospectively adjusted to reflect the reverse stock split for all periods presented. See Note 2 — Basis of presentation and consolidation for further detail.
Share-based compensation consisted of the following for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31,
2026
2025
Equity-classified awards:
Stock options
$
1,659 
$
1,850 
Performance stock units
3,789 
510 
Restricted stock units
4,216 
2,264 
Total share-based compensation expense
$
9,664 
$
4,624 
Stock options
As of March 31, 2026 and 2025, total unamortized compensation cost related to unvested stock options was $10.1 million and $16.4 million, respectively, which the Company expects to recognize over a weighted-average period of 1.82 and 2.21 years, respectively.
The total intrinsic value of stock options exercised and the total fair value of stock options vested during the three months ended March 31, 2026 and 2025 were as follows:
Three Months Ended March 31,
2026
2025
Total intrinsic value of options exercised
$
6,712 
$
125 
Total fair value of options vested
3,524 
3,277 
Significant assumptions used to estimate the fair value of the Company's stock options granted during the three months ended March 31, 2026 and 2025 were as follows:
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Three Months Ended March 31,
2026
2025
Expected volatility
82 
%
72% – 74%
Expected life (years)
6.05
6.24
Expected dividends(1)
— 
%
— 
%
Risk-free interest rate
3.89 
%
4.14% – 4.15%
(1) The Company has never paid cash dividends and does not expect to pay cash dividends in the foreseeable future.
The Company's stock option activity and related information during the three months ended March 31, 2026 and 2025 were as follows:
Number of Options
Weighted Average Exercise Price
Weighted Average Remaining Contractual Life (years)
Aggregate Intrinsic Value
Outstanding at January 1, 2026
10,618,602
$
8.658 
Forfeited
(283,439)
4.257 
Expired
(169,736)
28.560 
Exercised
(996,576)
0.480 
Granted
87,477
6.915 
Outstanding at March 31, 2026
9,256,328
$
9.291 
7.07
$
15,444 
Options exercisable at March 31, 2026
3,275,631
$
10.947 
5.42
$
5,965 
Performance stock units
As of March 31, 2026 and 2025, total unamortized compensation cost related to unvested performance stock units was $20.9 million and $10.1 million, respectively, which the Company expects to recognize over a weighted-average period of 1.79 years and 1.89 years, respectively.
The Company's PSU activity during the three months ended March 31, 2026 and 2025 were as follows:
Number of PSUs
Weighted Average Grant Date Fair Value
Unvested at January 1, 2026
3,263,478
$
3.180 
Forfeited
(622,681)
2.820 
Vested(1)
(928,214)
3.630 
Granted
2,003,765
6.750 
Unvested at March 31, 2026
3,716,348
$
5.070 
Inception-to-date PSUs vested at March 31, 2026
1,180,376
$
4.860 
(1) Includes 320,867 SVS, at a weighted-average fair value of $6.855, withheld by the Company to satisfy applicable statutory tax withholding obligations upon the vesting of PSUs during the reporting period. The SVS withheld were returned to the pool of SVS available for future issuance under the LTIP.
Restricted stock units
As of March 31, 2026 and 2025, total unamortized compensation cost related to unvested restricted stock units was $37.0 million and $26.2 million, respectively, which the Company expects to recognize over a weighted-average period of 2.36 years and 2.42 years, respectively.
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The Company's RSU activity during the three months ended March 31, 2026 and 2025 were as follows:
Number of RSUs
Weighted-Average Grant Date Fair Value
Unvested at January 1, 2026
8,848,666
$
4.830 
Forfeited
(250,267)
5.040 
Vested(1)
(1,995,496)
4.530 
Granted
1,251,755
6.750 
Unvested at March 31, 2026
7,854,658
$
5.220 
Inception-to-date RSUs vested at March 31, 2026
5,888,702
$
13.290 
(1) Includes 599,537 SVS, at a weighted-average fair value of $7.080, withheld by the Company to satisfy applicable statutory tax withholding obligations upon the vesting of RSUs during the reporting period. The SVS withheld were returned to the pool of SVS available for future issuance under the LTIP.
Note 20 — Selling, general and administrative expense
Selling, general and administrative expenses consisted of the following for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31,
2026
2025
Salaries and benefits
$
63,740 
$
59,423 
Rent and occupancy
14,559 
14,214 
Sales and marketing
11,392 
11,130 
Office supplies and services
11,841 
10,881 
Share-based compensation
9,664 
4,624 
Professional fees
6,501 
5,399 
Insurance and compliance
2,395 
2,414 
Travel
1,981 
1,846 
Research and development
296 
335 
Other operating expense
501 
552 
Total selling, general and administrative expense
$
122,870 
$
110,818 
Note 21 — Defined contribution plans
The Company established the Curaleaf, Inc. 401(k) Plan (the "Plan") effective January 1, 2022. The Company's U.S. employees are generally eligible to participate in the Plan. The Plan allows eligible employees to make contributions, up to limits set by the IRS, through payroll deductions and invest their contributions in one or more of the investment funds offered by the Plan. For employees who have completed one or more years of eligible service, the Company matches 25% of the first 4% of eligible contribution on a pretax and/or Roth 401(k) basis for each annual period. Under the Plan, employees become eligible for contributions on the first day of the calendar month, coincident with or next, following the date the employee performs an hour of service as an eligible employee. Matched contributions are always fully vested.
Employees outside the U.S. who are not covered by the Plan may be covered by defined contribution plans that are subject to applicable laws and rules of the country in which they are administered.
Employer contributions, which are expensed as incurred, totaled $0.1 million and $0.3 million for the three months ended March 31, 2026 and 2025, respectively.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Note 22 — Other (expense) income, net
Other (expense) income, net consists of the following for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31,
2026
2025
(Loss) gain on extinguishment of debt
$
(4,289)
$
1,487 
Foreign exchange (loss) gain
(1,547)
1,475 
Gain (loss) on disposal of assets
194 
(1,076)
Gain on investment
342 
277 
Miscellaneous other income
1,233 
840 
Other (expense) income, net
$
(4,067)
$
3,003 
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Note 23 - Income taxes

The Company computes its interim provisions for income taxes for the three months ended March 31, 2026 and 2025 using the actual effective tax rate for each interim period. Therefore, the Company’s effective income tax rates for the three months ended March 31, 2026 and 2025 are not indicative of the effective income tax rate for each respective fiscal year of 2026 and 2025.

For the three months ended March 31, 2026, the Company recorded income tax benefit of $98.7 million on pre-tax loss from continuing operations of $28.6 million. The tax rate was impacted by a tax benefit due to the release of uncertain tax positions, partially offset by non-deductible expenses due to Section 280E.

For the three months ended March 31, 2025, the Company recorded income tax expense of $33.7 million on pre-tax loss from continuing operations of $16.4 million. The tax rate was impacted primarily by non-deductible expenses due to Section 280E.
The Company’s Uncertain tax position liability decreased by $94.6 million during the three months ended March 31, 2026, of which $97.2 million reflects the portion associated with the Section 280E Position. The remaining movement relates to other immaterial uncertain tax positions.
The Company files its income tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by federal, state and foreign taxing authorities, where applicable. As of March 31, 2026, the Company is under audit for years ranging from 2020 to 2023 by the IRS, a few U.S. states and in Canada. The statute of limitations for federal, state and foreign taxing jurisdictions are open from tax year 2020.

Global Minimum Tax Rules - Pillar Two

Numerous foreign jurisdictions have enacted or are in the process of enacting legislation to adopt a minimum effective tax rate, as described in the Global Anti-Base Erosion Model Rules (otherwise known as Pillar Two) issued by the Organization for Economic Co-operation and Development. Under Pillar Two, a minimum effective tax rate of 15% would apply to multinational companies with consolidated revenues above €750 million. Pillar Two became effective for fiscal years beginning on or after January 1, 2024, in several jurisdictions in which the Company operates. Upon enactment, Pillar Two did not have a material impact on the Company’s Consolidated Financial Statements, and there was no material impact to the Company’s consolidated financial position, results of operations or cash flows.
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Note 24 — Earnings per share
Basic and diluted income (loss) per share attributable to Curaleaf Holdings, Inc. for the three months ended March 31, 2026 and 2025 were calculated as follows:
Three Months Ended March 31,
2026
2025
Numerator:
Net income (loss) from continuing operations
$
70,076 
$
(50,053)
Less: excess redemption value above carrying value(3)
(381)
(13,327)
Net income (loss) from continuing operations, net of excess redemption value
69,695 
(63,380)
Net loss from discontinued operations
(293)
(10,193)
Net income (loss), net of excess redemption value
69,402 
(73,573)
Less: Net (loss) income attributable to non-controlling interest
(16)
817 
Net income (loss) attributable to Curaleaf Holdings, Inc., net of excess redemption value
$
69,418 
$
(74,390)
Denominator:
Basic weighted-average common shares outstanding
258,476,410
248,299,646
Dilutive effect of stock options to purchase SVS
1,829,573
—
Dilutive effect of restricted and performance-based stock awards(2)
3,322,707
—
Dilutive effect of contingent shares
259,333
—
Dilutive weighted-average common shares outstanding(1)
263,888,023
248,299,646
Per share – basic:
Net income (loss) per share from continuing operations(3)
$
0.27 
$
(0.26)
Net loss per share from discontinued operations
— 
(0.04)
Net income (loss) per share attributable to Curaleaf Holdings, Inc.(3)
$
0.27 
$
(0.30)
Per share – diluted:(1)(4)
Net income (loss) per share from continuing operations(3)
$
0.26 
$
(0.26)
Net loss per share from discontinued operations
— 
(0.04)
Net income (loss) per share attributable to Curaleaf Holdings, Inc.(3)
$
0.26 
$
(0.30)
(1) As a result of the Company’s net loss from its continuing and discontinued operations for the three months ended March 31, 2025, all potentially dilutive securities were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive. Accordingly, basic and diluted net loss per share are the same for each period presented.
(2) Excludes PSU awards that did not meet performance criteria at March 31, 2026 and 2025.
(3) Certain non-controlling interests are redeemable at the option of the holders. When the estimated redemption value exceeds the recorded amount, the excess is charged directly to Shareholders' equity on the Condensed Consolidated Balance Sheets (Unaudited). Pursuant to ASC 480-10, Distinguishing Liabilities from Equity, the excess redemption value must be included in the calculation of earnings per share - basic and diluted. See Note 2 — Basis of presentation and consolidation for additional information.
(4) Excludes 985,199 of outstanding SVS awards from the computation of diluted net income per share for March 31, 2026, as including them would have an anti-dilutive effect.
Note 25 — Segment reporting
The Company operates through two distinct reportable segments: (i) Domestic Operations and (ii) International Operations. This segmentation reflects the point at which the Company's business units no longer share similar economic characteristics and differ significantly in key areas, including:
(a) the nature of cultivation and manufacturing processes;
(b) the class of customer for products and services;
(c) distribution methods and
(d) the regulatory environments in which they operate.
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
In addition, this segmentation reflects the manner in which the Company’s chief operating decision maker (the “CODM”), its CEO, allocates resources and evaluates performance as well as the manner in which the Company’s internal financial reporting is structured.
The Company’s reportable segments generate revenues from the cultivation, production and distribution of cannabis products. The Company’s Domestic Operations are vertically integrated in the majority of the states in which the Company operates and derives the majority of its revenues from retail sales. In contrast, the Company’s International Operations is organized on a country-level basis, has centralized cultivation facilities in Portugal and Canada and derives the majority of its revenue from wholesale sales.
The Company’s CODM assesses the performance of and allocates resources to each reportable segment using Adjusted EBITDA1 as the primary measure of profitability. The CODM also reviews significant segment expenses within this measure, which consist primarily of Cost of goods sold and Total operating expenses.
The accounting policies for each reportable segment are consistent with those described in Note 3 — Significant accounting policies. There are no intersegment sales or transfers between the Company’s reportable segments. Corporate overhead costs are primarily incurred within the Domestic Operations segment and are not allocated to the International Operations segment, consistent with how the CODM evaluates segment performance.
The following table presents Adjusted EBITDA by reportable segment for the three months ended March 31, 2026 and 2025, and the reconciliation of such non-GAAP financial measure to the most directly comparable GAAP measure, being income (loss) from continuing operations for the applicable periods:
Three Months Ended March 31,
Domestic
International(1)
Total
2026
2025
2026
2025
2026
2025
Loss before Benefit (provision) for income taxes
$
(22,968)
$
(17,085)
$
(5,661)
$
685 
$
(28,629)
$
(16,400)
Total other expense (income), net
26,343 
27,535 
3,039 
(1,769)
29,382 
25,766 
Depreciation and amortization(2)
41,444 
42,883 
6,411 
5,946 
47,855 
48,829 
Other adjustments(3)
14,150 
7,339 
655 
560 
14,805 
7,899 
Adjusted EBITDA
$
58,969 
$
60,671 
$
4,444 
$
5,423 
$
63,413 
$
66,094 
(1) The Company is exposed to foreign currency exchange risk due to fluctuations between the functional currencies of its international subsidiaries and the USD. Additionally, the translation of these subsidiaries’ operating results into USD for reporting purposes introduces further exposure. While these fluctuations are not material to the Company’s consolidated operating results, they may impact the comparability of the Company’s segmented results across quarters and year-over-year.
(2) Depreciation and amortization includes depreciation and amortization from cost of goods sold and operating expenses.
(3) Other adjustments for the three months ended March 31, 2026 primarily include costs related to share-based compensation expense of $9.7 million, restructuring costs $1.9 million, adult use campaign and political initiatives $0.6 million as well as acquisition, transaction, and other non-recurring costs $2.6 million. Other adjustments for the three months ended March 31, 2025 primarily include costs related to share-based compensation expense $4.6 million, restructuring costs $0.6 million, as well as acquisition, transaction, and other non-recurring costs $2.7 million.
1 Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization, adjusted for share-based compensation expense and other adjustments related to restructuring costs, adult use campaign and political initiatives, as well as acquisition, transaction and other non-recurring costs.
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The following table presents selected financial information by reportable segment for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31,
Domestic
International(1)
Total
2026
2025
2026
2025
2026
2025
Retail revenues
$
215,223 
$
219,644 
$
15,886 
$
11,058 
$
231,109 
$
230,702 
Wholesale revenues
61,516 
51,824 
28,285 
22,457 
89,801 
74,281 
Management fee income
248 
236 
3,073 
1,405 
3,321 
1,641 
Total revenues, net
276,987 
271,704 
47,244 
34,920 
324,231 
306,624 
Cost of goods sold
139,732 
133,231 
27,209 
17,827 
166,941 
151,058 
Selling, general and administrative(2)
105,819 
98,015 
17,051 
12,803 
122,870 
110,818 
Depreciation and amortization
28,061 
30,009 
5,606 
5,373 
33,667 
35,382 
Adjusted EBITDA
$
58,969 
$
60,671 
$
4,444 
$
5,423 
$
63,413 
$
66,094 
Capital expenditures
$
14,297 
$
14,935 
$
2,688 
$
1,142 
$
16,985 
$
16,077 
(1) The Company is exposed to foreign currency exchange risk due to fluctuations between the functional currencies of its international subsidiaries and the USD. Additionally, the translation of these subsidiaries’ operating results into USD for reporting purposes introduces further exposure. While these fluctuations are not material to the Company’s consolidated operating results, they may impact the comparability of the Company’s segmented results across quarters and year-over-year.
(2) See Note 20 — Selling, general and administrative expenses for additional detail regarding the composition of consolidated selling, general and administrative expenses. No individual selling, general and administrative expense category within the International segment exceeded 10% of total consolidated selling, general and administrative expenses.
The CODM reviews total assets as the primary balance sheet metric to assess each segment. The following table presents total assets by reportable segment as of March 31, 2026 and December 31, 2025:
Total assets:
Domestic
International
Total
March 31, 2026
$
2,393,748 
$
417,830 
$
2,811,578 
December 31, 2025
2,415,707 
429,608 
2,845,315 
No single customer or country other than the United States accounted for 10% or more of consolidated revenue during the the three months ended March 31, 2026, and 2025. In addition, no individual country other than the United States represented a material portion of long-lived assets during those periods.
Note 26 — Commitments and contingencies
Indemnification agreements
In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties.
In addition, the Company has entered into indemnification agreements with certain members of its board of directors and senior executive team that may require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or senior officers of the Company. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. To date, the Company has not incurred any material costs as a result of such indemnification agreements. The Company does not believe that the outcome of any claims under indemnification arrangements will have a material effect on its financial position, results of operations or cash flows, and it has not accrued any liabilities related to such obligations in its Condensed Consolidated Financial Statements (Unaudited).
Dividend restriction
The Company has not historically paid dividends on its outstanding SVS. Any future determination to pay dividends will depend upon the Company's financial condition and results of operations. Furthermore, the Company’s ability to pay
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
dividends is subject to applicable laws, regulatory capital requirements and compliance with covenants contained in the Company's outstanding debt arrangements.
Its ability to pay dividends would be dependent on the Company’s results of operation, subject to applicable laws and regulations, and would require maintenance of certain solvency and capital standards as well as applicable covenants within the Company’s outstanding debt arrangements.
Income tax returns
The Company files its income tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by federal, state and foreign taxing authorities, where applicable. The Company records tax benefits for all years subject to examination, based upon management’s evaluation of the facts, circumstances and information available at the end of the reporting period. The Company has not recognized any tax benefits associated with those income tax positions where it is not more-likely-than-not that a tax benefit will result.
Litigation
The Company is involved in claims or lawsuits that arise in the ordinary course of business. Although the ultimate outcome of these claims or lawsuits cannot be ascertained by the Company, on the basis of present information and advice received from the Company’s legal counsel, it is management’s opinion that the disposition or ultimate determination of such claims or lawsuits, except as noted below, will not have a material effect on the Company’s operations and financial results. As of March 31, 2026 and December 31, 2025, the Company recognized legal contingencies of $5.3 million and $7.6 million, respectively, which is presented in Accrued expenses on the Condensed Consolidated Financial Statements (Unaudited).
Hello Farms
In 2020, GR Vending MI, LLC (“GR Vending MI”), prior to its acquisition by the Company, entered into a supply contract with Hello Farms Licensing MI, LLC (“Hello Farms”) (the “Hello Farms Supply Contract”) to acquire the expected output of Hello Farms’ Michigan cultivation facility from the 2020 and 2021 harvests, subject to certain conditions. Additionally, Cura MI, LLC (“Cura MI” and together with GR Vending MI, the “Michigan Entities”) entered into a guaranty agreement (the “Cura MI Guaranty”) with Hello Farms, under which Cura MI guaranteed the performance of GR Vending MI’s payment obligations under the Hello Farms Supply Contract. The Hello Farms Supply Contract was amended and restated in November 2020. Subsequently, GR Vending MI indicated that Hello Farms had failed to perform its obligations under the Hello Farms Supply Contract; and therefore, deemed the contract breached and therefore terminated. In February 2021, Hello Farms sued the Michigan Entities in a state court in Michigan. In March 2021, the case was moved to the U.S. District Court for the Eastern District of Michigan (the “Michigan Eastern District Court”).
A trial was held in January 2025, after which a jury awarded Hello Farms approximately $31.8 million in damages against the Michigan Entities for breach of contract. In May 2025, a judgment was issued awarding a post-filing prejudgment interest of $5.4 million, increasing the total amount to $37.2 million. The Michigan Entities have appealed the ruling to the Sixth Circuit Court of Appeals. Interest will continue to accrue on the total judgment amount until the matter is fully resolved.
Based on the Company's assessment of the likelihood of success on appeal, the estimated accrual as of March 31, 2026 is substantially less than the total potential loss associated with the judgment. If the Company's appeal is unsuccessful, it is reasonably possible the resulting loss could materially exceed the Company's current accrual.
The Michigan Entities, which are consolidated by the Company as VIEs, ceased operations in 2023, do not have any substantial assets and are classified by the Company as discontinued operations. See Note 6 — Discontinued operations for additional information.
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Note 27 — Fair value measurements and financial risk management
Non-recurring fair value measurements
The Company's assets measured at fair value on a nonrecurring basis include its long-lived assets and goodwill. The Company reviews the carrying amounts of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable or, at minimum, annually for goodwill. Any resulting asset impairment would require that the asset be written down to fair value. Fair value measurements of these assets are derived using inputs classified within Level 3 of the fair value hierarchy.
Recurring fair value measurements
The Company's financial instruments measured at fair value on a recurring basis include certain equity investments and contingent consideration liabilities. The lowest level of inputs that are significant to the fair value measurements of these financial instruments are not based on observable market data; and therefore, these financial instruments are classified within Level 3 of the fair value hierarchy.
As of March 31, 2026 and December 31, 2025, the Company's financial instruments measured at fair value on a recurring basis were classified in the fair value hierarchy as follows:
As of March 31, 2026
Level 1
Level 2
Level 3
Total
Contingent consideration liabilities
$
— 
$
— 
$
3,047 
$
3,047 
$
— 
$
— 
$
3,047 
$
3,047 
As of December 31, 2025
Level 1
Level 2
Level 3
Total
Contingent consideration liabilities
$
— 
$
— 
$
3,358 
$
3,358 
$
— 
$
— 
$
3,358 
$
3,358 
Level 3
As of March 31, 2026 and December 31, 2025, the following valuation methodologies and significant unobservable inputs were used to derive the fair value measurements of the Company's financial instruments measured at fair value on a recurring basis:
As of
Financial Instrument
Valuation Methodology
Level 3 Input
March 31, 2026
December 31, 2025
Contingent consideration – EMMAC
Monte Carlo simulation
Timing of achievement
2 years
2 years
Probability of achievement
99.0 
%
99.0 
%
There were no transfers between fair value levels during the three months ended March 31, 2026 or December 31, 2025.
Financial risk management
The Company is exposed to financial risks, including credit risk, liquidity risk and market risk. The following discussion summarizes the Company's approach to managing these risks:
Credit risk
Credit risk is the risk that the Company incurs a loss on a financial instrument as a result of a customer or third party failing to meet contractual obligations. Credit risk arises principally from the Company's financing receivables, including its accounts receivable and notes receivable. The Company's maximum credit exposure as of March 31, 2026 and December 31, 2025 equates to the aggregate carrying amount of its cash and cash equivalents, restricted cash, accounts receivable and notes receivable.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The majority of the Company's revenues are derived from its retail dispensaries, where customers are required to transfer payment immediately upon purchase. For the three months ended March 31, 2026 and 2025, the Company's retail revenues represented 71% and 75%, respectively, of total revenues, net.
In the normal course of business, the Company provides financing to its non-retail customers as trade accounts receivables. The Company may also extend financing, as notes receivable, in connection with an acquisition or divestiture. While the Company has not adopted standardized credit policies, the Company has established processes to mitigate credit risk on such financing receivables, which include assessing creditworthiness on an individual basis.
Given the increasing financial pressure across the cannabis industry, the Company has heightened its monitoring of credit exposure to other cannabis operators and continues to prioritize timely collections of outstanding trade accounts receivables.
The following table presents the aging of the Company's trade accounts receivable as of March 31, 2026 and December 31, 2025:
As of
March 31, 2026
December 31, 2025
0 to 90 days
$
63,693 
$
66,649 
91 to 180 days
3,334 
3,572 
181 days +
3,633 
3,643 
Trade accounts receivable
$
70,660 
$
73,864 
Liquidity risk
Liquidity risk is the risk that the Company will not have sufficient liquidity to settle its financial obligations and liabilities when due. The Company mitigates its liquidity risk through management of its capital structure.
The Company has material debt obligations requiring scheduled principal and interest payments, which are subject to various financial covenants. Non-compliance with these financial covenants or failure to make timely debt service payments could result in the outstanding principal and accrued interest on the Company's debt obligations becoming due immediately or on demand, which would have a material adverse impact on the Company's financial position and cash flows. See Note 16 — Notes payable for additional information.
Future payment obligations associated with the Company's long-term acquisition-related financial instruments and lease obligations are further discussed in Note 4 — Acquisitions and Note 11 — Leases, respectively.
Currency risk
The financial position, results of operations and cash flows of the Company are presented in USD, which requires the Company to translate the financial accounts for its international subsidiaries into USD, using exchange rates at specific reporting dates or average rates over the reporting period, as applicable. Transactions which are denominated in currencies other than the USD are subject to both transaction risk and translation risk.
As of March 31, 2026 and December 31, 2025, the Company had no hedging agreements in place with respect to foreign exchange rates.
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Cash and cash equivalents (including those that are restricted) bear interest at market rates. The Company's notes receivable and notes payable have fixed rates of interest and are carried at amortized cost. The Company does not account for any fixed-rate financial assets or fixed-rate financial liabilities at fair value. Accordingly, the Company has limited exposure to interest rate sensitivity risk with respect to these financial instruments.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
Geography risk
The geographic concentration of the Company's domestic and international operations exposes the Company to heightened risk if the U.S. or international cannabis markets experience significant adverse developments or if macroeconomic conditions deteriorate.
Factors that may adversely affect U.S. or international cannabis markets include, among others, the following:
•weakened consumer demand as a result of economic headwinds, such as industry slowdowns and changing demographics;
•inability or unwillingness of customers to pay current and/or increased prices;
•rising operating expenses, such as taxes, utilities and routine maintenance;
•local conditions, such as oversupply of or reduced demand for cannabis products;
•regulatory restrictions or local laws, which could result in market saturation, price compression and/or increased operating costs;
•concentration of and competition from other cannabis cultivators, manufacturers and distributors;
•competition from manufacturers of naturally occurring cannabinoids and pharmaceutical and synthetic alternatives;
•competition from participants in adjacent markets, including the alcoholic beverage, tobacco and health and wellness sectors; and
•specific regional acts of nature, such as earthquakes, fires and floods.
Disaggregated financial information for the Company's two reportable segments, Domestic and International, is presented in Note 25 — Segment reporting.
Industry risk
Cannabis-related activities remain illegal under U.S. federal law in most forms, and enforcement of such federal laws could have significant adverse risks to the Company. Certain state-licensed medical cannabis activities have been reclassified to Schedule III under the Controlled Substances Act pursuant to recent federal regulatory actions; however, cannabis otherwise remains federally illegal. The Company's shareholders should carefully evaluate the risk factors discussed in Part I — Item 1A — Risk Factors in our Annual Report for a careful evaluation of these conditions.
Capital management
The Company’s primary objective when managing capital is to continually provide returns to its shareholders and benefits to its other stakeholders. The capital structure of the Company consists of shareholders’ equity and notes payable, net of cash, cash equivalents and restricted cash. In order to safeguard the Company’s ability to continue as a going concern, management manages and adjusts the Company’s capital structure, in response to changes in the economic conditions of the jurisdictions in which the Company operates and on the risk characteristics of the Company’s underlying assets. The Company expects its cash on hand together with anticipated cash flows from its operating and financing activities will be sufficient to meet its capital requirements and operational needs over the next 12 months.
Note 28 — Variable interest entities
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Table of Contents Curaleaf Holdings, Inc.
Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
For additional information on the variable interest entities consolidated within the Condensed Consolidated Financial Statements (Unaudited), see Note 1 — Operations of the Company, Note 2 — Basis of presentation and consolidation and Note 3 — Significant accounting policies. Because cannabis remains federally illegal in most forms under the CSA, subject to recent reclassification of certain state-licensed medical cannabis activities, the assets of the Company’s variable interest entities can typically be used only to settle obligations of the VIEs, except for certain grandfathered obligations, such as the Company’s Senior Secured Notes – 2026. In addition, the creditors of Curaleaf, Inc. do not have recourse to the general credit of the Company.
The following table presents summarized financial information about the Company's variable interest entities as of March 31, 2026 and December 31, 2025:
As Revised(2)(3)
March 31, 2026
December 31, 2025
Included in Condensed Consolidated Balance Sheets (Unaudited):
Cash
$
84,536 
$
77,119 
Accounts receivable
47,305 
47,701 
Inventory
210,972 
195,184 
Other current assets
36,572 
37,369 
Total current assets
379,385 
357,373 
Property, plant, and equipment , net
463,077 
474,338 
Right-of-use assets
194,692 
201,434 
Intangible assets, net and goodwill
1,323,842 
1,343,581 
Other long-term assets
17,253 
15,454 
Total assets
$
2,378,249 
$
2,392,180 
Accounts payable
$
64,594 
$
57,622 
Accrued expenses
55,775 
88,060 
Income tax payable
16,674 
14,218 
Other current liabilities
51,876 
49,178 
Total current liabilities
188,919 
209,078 
Deferred tax liability
157,225 
163,433 
Lease liabilities
228,134 
239,223 
Long-term financial obligation
197,743 
202,901 
Long-term debt(1)
493,986 
449,168 
Uncertain tax position
439,228 
531,508 
Other long-term liabilities
1,240 
1,114 
Total liabilities
$
1,706,475 
$
1,796,425 
Equity attributable to Curaleaf Holdings, Inc.
$
671,774 
$
595,755 
(1) In conjunction with the issuance of the Senior Secured Notes – 2026 in December 2021, the Company entered into an intercompany loan agreement with Curaleaf Inc. On February 18, 2026, the Senior Secured Notes – 2026 were repaid using proceeds from the issuance of the Senior Secured Notes – 2029. The intercompany loan remains outstanding, is reflected herein and has been eliminated in the Consolidated Financial Statements (Unaudited).
(2) The consolidated financial statements as of and for the quarter ended March 31, 2026 accurately reflect the correct accounting treatment of the Company's variable interest entities ("VIEs"). During the preparation of the Company's expanded VIE disclosures, management identified a classification difference in the VIE tabular disclosure above resulting from the incorrect allocation of certain tax-related balances between VIE and non-VIE entities. Management concluded that the difference was not material to the Company's consolidated financial statements. Accordingly, the VIE information as of March 31, 2026 has been revised to reflect the corrected allocation of balances between VIE and non-VIE entities, which (i) decreased income tax payable and total current liabilities by $288.5 million; (ii) increased long-term debt by $19.4 million; (iii) increased uncertain tax positions by $157.1 million; (iv) decreased other long-term liabilities by $3.7 million; (v) resulted in a net decrease in total liabilities of $115.8 million; and (vi) increased equity attributable to Curaleaf Holdings, Inc. by $115.8 million.
(3) The consolidated financial statements as of and for the year ended December 31, 2025 accurately reflect the correct accounting treatment of the Company's variable interest entities ("VIEs"). During the preparation of the Company's expanded VIE disclosures, management identified a classification difference in the VIE tabular disclosure above resulting from the incorrect allocation of certain tax-related balances between VIE and non-VIE entities. Management concluded that the difference was not material to the Company's consolidated financial statements. Accordingly, the VIE information as of December 31, 2025 has been revised to reflect the corrected allocation of balances between VIE and non-VIE entities, which (i) decreased income tax payable and total current liabilities by $287.6 million; (ii) increased deferred tax liabilities by $3.9 million, long-term debt by $1.2 million and uncertain tax positions by $271.9 million; (iii) resulted in a net decrease in total liabilities of $10.6 million; and (iv) increased equity attributable to Curaleaf Holdings, Inc. by $10.6 million.
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Notes to Consolidated Financial Statements (Unaudited)
(Amounts in thousands, except share and per share amounts or where otherwise indicated)
The following table presents summarized financial information about the Company's variable interest entities for the three months ended March 31, 2026 and 2025:
As Revised(1)(2)
Three Months Ended March 31,
2026
2025
Included in Condensed Consolidated Statements of Operations (Unaudited):
Revenues, net
$
276,987 
$
306,624 
Net income (loss) attributable to Curaleaf Holdings, Inc.
79,803 
(51,050)
(1) The consolidated financial statements for the three months ended March 31, 2026 accurately reflect the correct accounting treatment of the Company's VIEs. During the preparation of the Company's expanded VIE disclosures, management identified a classification difference in the VIE tabular disclosure above resulting from the incorrect allocation of certain tax-related balances between VIE and non-VIE entities. Management concluded that the difference was not material to the Company's consolidated financial statements. Accordingly, the VIE information for the three months ended March 31, 2026 has been revised to reflect the corrected allocation of balances between VIE and non-VIE entities, which increased net income attributable to Curaleaf Holdings, Inc. included in the VIE disclosure by $115.5 million.
(2) The consolidated financial statements for the three months ended March 31, 2025 accurately reflect the correct accounting treatment of the Company's VIEs. During the preparation of the Company's expanded VIE disclosures, management identified a classification difference in the VIE tabular disclosure above resulting from the incorrect allocation of certain tax-related balances between VIE and non-VIE entities. Management concluded that the difference was not material to the Company's consolidated financial statements. Accordingly, the VIE information for the three months ended March 31, 2025 has been revised to reflect the corrected allocation of balances between VIE and non-VIE entities, which decreased net loss attributable to Curaleaf Holdings, Inc. included in the VIE disclosure by $10.0 million.
Note 29 — Subsequent events
The Company has evaluated subsequent events through May 5, 2026, which represents the date these Condensed Consolidated Financial Statements (Unaudited) were originally made available to investors, and June 5, 2026, for the reverse stock split described below.
Settlement of redeemable non-controlling interest put option — Four20
On February 23, 2026, the selling shareholders of Four20 exercised their put option by delivering an irrevocable notice to the Company to redeem their remaining 45% equity interest. On April 30, 2026, the Company settled the put option, at which time Four20 became a wholly-owned subsidiary of the Company. For additional information, see Note 18 — Redeemable non-controlling interest.
Reverse Stock Split
On June 5, 2026, the Company effected a 1-for-3 reverse stock split of its issued and SVS and MVS. The reverse stock split reduced the number of issued and outstanding shares of the Company’s SVS and MVS on a proportionate basis and did not affect any shareholder’s percentage ownership interest in the Company, except for adjustments resulting from the treatment of fractional shares. Share amounts, per share amounts, voting rights and equity award information presented in these Condensed Consolidated Financial Statements (Unaudited) and accompanying notes have been retroactively adjusted to reflect the reverse stock split for all periods presented. For further details, see Note 2 — Basis of presentation and consolidation.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Condensed Consolidated Financial Statements (Unaudited) and related notes included in Item 1 of this Quarterly Report.
This management's discussion and analysis (“MD&A”) of the financial condition and results of operations of Curaleaf Holdings, Inc.. (For the purposes of this MD&A, the terms “Company”, “Curaleaf", “we”, “our” or “us” mean Curaleaf Holdings, Inc. and, unless the context otherwise requires, includes its wholly-owned subsidiaries, majority-owned subsidiaries and legal entities in which it holds a controlling financial interest.) is as of March 31, 2026 and December 31, 2025 and for the three months ended March 31, 2026 and 2025. It is supplemental to, and should be read in conjunction with, the Company’s Condensed Consolidated Financial Statements (Unaudited) as of March 31, 2026 and December 31, 2025 and for the three months ended March 31, 2026 and 2025 and the accompanying notes for each respective period. The Company’s financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Financial information presented in this MD&A is presented in thousands of United States dollars (“$” or “US$”), unless otherwise indicated.
This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those discussed in Part I — Item 1A — Risk Factors in our Annual Report.
We caution readers not to place undue reliance on any forward-looking statements made by us, which speak only as of the date they are made. We disclaim any obligation, except as specifically required by law and the rules of the U.S. Securities and Exchange Commission (the “SEC”), to publicly update or revise any such statements to reflect any change in our expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Condensed Consolidated Financial Statements (Unaudited) and related notes included in Item 1 of this Quarterly Report.
Overview
The Company is a leading global cannabis company dedicated to developing, manufacturing, and distributing a portfolio of highly sought after cannabis brands for consumers and patients worldwide. As of March 31, 2026, our cannabis portfolio included ten national and international brands across four primary categories, consisting of flower, pre-rolls, vaporizer cartridges, and edibles.
Our broad multichannel distribution footprint enables us to serve consumers and patients across the United States, Canada, Europe and Australasia. As of March 31, 2026, through our U.S. operations, we make, market, and distribute our brands to consumers and patients in 14 states, through 173 owned and managed retail locations and over 1,300 wholesale partner accounts. Internationally, our brand portfolio is available to medical cannabis patients in 15 countries, headlined by our positions in Germany, the United Kingdom, Poland, and Australasia. Subsequent to March 31, 2026, we expanded our U.S. retail footprint to 176 owned and managed locations as of August 5, 2026.
Our brands are supported by a vertically integrated platform that allows us to manage the end-to-end supply chain and distribution network in our core markets. Our owned cultivation and manufacturing infrastructure, consisting of 18 cultivation sites with approximately 1.5 million square feet of cultivation capacity, ensures the quality, consistency and reliable supply of our branded products. In the U.S., we own and operate a fleet of Curaleaf-branded retail stores that sell our cannabis brands as well as third-party products. In our international markets, we distribute through clinics, pharmacies, and telemedicine platforms. We also complement our distribution model with wholesale partnerships and "asset-light" brand-licensing deals, allowing our brands to reach a wider set of consumers and patients, optimizing market exposure, and strategically managing capital allocation.
We are incorporated under the laws of the Province of British Columbia, Canada, pursuant to the British Columbia Business Corporations Act. Our SVS are listed on the TSX under the symbol "CURA" and quoted on the OTCQX® Best
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Market (the "OTCQX") under the symbol "CURLF." The principal business address of the Company is located at 250 Harbor Drive, Third Floor, Stamford, Connecticut 06902.
Products and Brands
We offer a wide range of cannabis products including flower, pre-rolls, vaporizer cartridges, edibles, concentrates, topicals, tinctures, and beverages. Domestically, these products are marketed under our national brands, including Select, Grassroots, Find, Dark Heart, Reef, Anthem, Curaleaf, and JAMS. Our prominent international brands include Curaleaf, Four20 Pharma, and Huala. Our product portfolio architecture is designed to appeal to consumers and patients of all income demographics by offering a good, better, best assortment with corresponding price points. Our total brand portfolio has consistently earned a leading market share position in the U.S. according to Hoodie Analytics.
Competitive Landscape
The cannabis industry is highly competitive, and we compete with a diverse range of legal and illicit operators on factors such as quality, price, brand recognition and distribution strength. In the U.S., our competitors range from small, family-owned businesses and single-state operators to multi-state operators ("MSOs"). We also face competition from manufacturers of naturally occurring and synthetic cannabinoids and from participants in adjacent markets, including the alcoholic beverage, tobacco and health and wellness sectors. Internationally, we primarily face competition from other licensed cultivators and wholesale distributors of medical cannabis.
We also face persistent competition from the illicit market, which operates without the significant regulatory, compliance and tax burdens we bear, allowing illicit operators to offer lower prices and attract a meaningful portion of the cannabis consumer base. As the industry matures, we anticipate escalating competition from companies with longer operating histories and/or greater financial resources.
Strategy
Our vision is to be the world's leading cannabis company, driven by a mission to democratize cannabis to improve and celebrate life, every day, everywhere. Our primary strategic priority is to grow our brands' share of the global cannabis market, supported by operational excellence across our vertically integrated platform. Our commitment to deliver profitable and sustainable growth is grounded in market leadership in the U.S. and continuous expansion internationally.
•Domestic Market Leadership: Growing U.S. market share for our brands is at the core of our strategic pillars. Those pillars include customer centricity, brand building and innovation, and executional and operational excellence. The Company’s focus on customer centricity means we are committed to making quality products, delivering exceptional service, offering an attractive portfolio assortment, and supplying customers with value – wherever those customers are buying our brands. We will continue to build our brand portfolio through new product innovation and developing brand worlds that serve consumers and patients. Our research and development efforts have resulted in 77 peer-reviewed research papers and partnerships with institutions including University of Pennsylvania, Imperial College London, the Institute of Cancer Research London and the University of Insubria. Given the current regulatory framework, our owned and managed retail stores are valuable assets in our vertical platform and allow us to actively support our brands and speak directly to consumers and patients at the point of purchase. Our U.S. retail and wholesale distribution footprint prioritizes highly populated states with large, well-structured state-licensed cannabis programs, such as Florida, Illinois, New Jersey and Pennsylvania. We will continue to target growth opportunities as existing state programs stabilize or as new state programs launch.
•International Expansion: Although we consider the U.S. to be the marquee market for our business and the global cannabis industry, the population in Europe is roughly twice that of the U.S., with a population of approximately 742 million people, offering a large potential addressable market of medical cannabis patients. We believe we are currently the largest cannabis operator globally and that we are all positioned to capitalize on the growing international opportunity as countries launch new medical cannabis programs. We continue to invest in supply chain capacity and distribution partnerships to broaden our market presence across the globe, including accelerating patient adoption in Germany, the U.K., and Poland, and expanding into Turkey, where we received an operating license in 2025.
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Production and Distribution
Across our global operations, we manage the entire cannabis product lifecycle from seed to sale. This vertically integrated business model provides us with significant control over our supply chain, ensuring high standards for product safety, quality and consistency, and control over our distribution network, allowing our brands to reach a wider audience of consumers and patients.
Cultivation and Genetics
We have developed a diverse global portfolio of unique cannabis cultivars, systematically tested and characterized for yield and cannabinoid content. We cultivate cannabis using a variety of methods — including indoor, two-tier indoor and greenhouse environments — across our global footprint. We regularly evaluate our cultivar portfolio to identify the most attractive varieties, replace underperforming varieties and promote operational standardization.
Extraction, Formulation and Quality Control
Our facilities utilize traditional extraction processes as well as proprietary processes for cannabis extraction and terpene purification. Our processing facilities produce a wide spectrum of solid, liquid and inhaled products for both medical and adult-use markets. For our international operations, our manufacturing and processing facilities in Canada, Germany, Portugal, Spain and the U.K. adhere to stringent European Union Good Manufacturing Practice (“EU-GMP”) standards.
Domestic Sales and Distribution
We offer multichannel distribution to consumers and patients both in-store and online. Our primary method of cannabis sales in the U.S. is direct-to-consumer retail through our owned and managed state-licensed dispensaries. Our dispensaries also offer online ordering via our e-commerce website and our web app for in-store pickup, and we provide drive-thru service in Nevada, Utah and Florida, and home delivery, where permitted by state regulations. Our U.S. wholesale business generates revenue through sales to third-party dispensaries, distributors, and processors.
International Sales and Distribution
In Europe, our sales occur primarily through licensed wholesale distribution to pharmacies across Germany, Poland, Switzerland and the U.K. Our U.K. model also includes a medical cannabis clinic and a licensed online pharmacy, enabling direct-to-patient sales. We also supply cannabis to our Australasian partners on a wholesale basis. During 2025, we received the only foreign issued license to operate in Turkey upon commencement of its medical cannabis market, expected in 2027.
Results of Operations
The following table sets forth the Company’s selected consolidated financial results for the periods, and as of the dates, indicated. The (i) Condensed Consolidated Statements of Operations for the three months ended March 31, 2026 and 2025 and (ii) Condensed Consolidated Balance Sheet as of March 31, 2026 and December 31, 2025 have been derived from, and should be read in conjunction with the consolidated financial statements and accompanying notes presented in Item 1 of this Quarterly Report on Form 10-Q.
 (in thousands, except shares and per share amounts)
Three Months Ended March 31,
2026 vs. 2025
2026
2025
$
%
Revenues, net:
Retail revenues
$
231,109 
$
230,702
407 
— 
%
Wholesale revenues
89,801 
74,281
15,520 
21 
%
Management fee income
3,321 
1,641
1,680 
102 
%
Total revenues, net
324,231 
306,624
17,607 
6 
%
Cost of goods sold
166,941 
151,058
15,883 
11 
%
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Gross profit
157,290 
155,566
1,724 
1 
%
Gross profit margin
49 
%
51%
-2pp
Total operating expenses
156,537 
146,200
10,337 
7 
%
Income from continuing operations
753 
9,366
(8,613)
(92)
%
Total other expense, net
(29,382)
(25,766)
(3,616)
14 
%
Loss before income taxes
(28,629)
(16,400)
(12,229)
75 
%
Benefit (provision) for income taxes
98,705 
(33,653)
132,358 
(393)
%
Net income (loss) from continuing operations
70,076 
(50,053)
120,129 
(240)
%
Net loss from discontinued operations
(293)
(10,193)
9,900 
(97)
%
Net income (loss)
69,783 
(60,246)
130,029 
(216)
%
Less: Net (loss) income attributable to non-controlling interest
(16)
817
$
(833)
(102)
%
Net loss attributable to Curaleaf
$
69,799 
$
(61,063)
$
130,862 
(214)
%
Net income (loss) per share (basic)(1)
$
0.27 
$
(0.30)
$
0.57 
(190)
%
Weighted avg. shares outstanding (basic)
258,476,410
248,299,646
Net income (loss) per share (dilutive)(1)
$
0.26 
$
(0.30)
$
0.56 
(187)
%
Weighted avg. shares outstanding (dilutive)(2)
263,888,023 
248,299,646 
(1) Certain non-controlling interests are redeemable at the option of the holders. When the estimated redemption value exceeds the recorded amount, the excess is charged directly to Shareholders' equity on the Condensed Consolidated Balance Sheets (Unaudited). Pursuant to ASC 480-10, Distinguishing Liabilities from Equity, the excess redemption value must be included in the calculation of earnings per share - basic and diluted. See Note 2 — Basis of presentation and consolidation for additional information.
(2) As a result of the Company’s net loss from its continuing and discontinued operations for the three months ended March 31, 2025, all potentially dilutive securities were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive. Accordingly, basic and diluted net loss per share are the same for each period presented.
Revenues, Net
Total revenues, net for the three months ended March 31, 2026 were $324.2 million, an increase of $17.6 million, or 6%, compared to $306.6 million for the three months ended March 31, 2025. Wholesale revenues increased 21% to $89.8 million, reflecting continued growth in our B2B distribution strategy. For more details, please see Segment Results.
Cost of Goods Sold and Gross Profit
Cost of goods sold ("COGS") for the three months ended March 31, 2026 was $166.9 million, or 51% of Total revenues, net, compared to $151.1 million, or 49% of Total revenues, net, for the three months ended March 31, 2025, an increase of $15.9 million, or 11%. The increase in COGS was primarily driven by the the increase in wholesale revenues, which are typically lower margin than retail revenues, as a percent of total revenues.
Gross profit was $157.3 million, or 49% of Total revenues, net, compared to $155.6 million, or 51%, for the three months ended March 31, 2025. The 200 basis points margin decrease reflects the increase in COGS, described above.
Total Operating Expenses
Total operating expenses increased $10.3 million, or 7%, to $156.5 million. The primary drivers were $4.3 million of increased salaries and benefits due primarily to increased headcount, and a $5.1 million increase in share-based compensation driven by higher award volumes and grant-date fair values.
Total Other Expense, Net
Total other expense, net increased $3.6 million, or 14%, to $29.4 million. The primary drivers were $4.3 million of deferred financing fees related to the Senior Secured Notes - 2026 and $3.5 million increase in international expenses due to a change in foreign exchange rates between the U.S. dollar and British pound. These increases were partially offset by a $3.5 million decrease in Total other expense, net driven by one time impairment charges taken in the first quarter of 2025, as well as favorable swing on retirement of assets mostly in the west $0.9 million.
Benefit (Provision) for Income Taxes
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We recorded a benefit for income taxes of $98.7 million for the three months ended March 31, 2026, a change of $132.4 million, or 393%, compared to the provision for income taxes of $33.7 million for the three months ended March 31, 2025. During the period ended March 31, 2026, the decrease in income tax expense was primarily driven by the net release of $96.5 million million of previously recorded tax reserves related to the treatment of certain costs in our U.S. consolidated tax return and a decrease of $8.9 million in non-deductible Section 280E expenses.
Net Income (Loss) from Continuing Operations
Net income from continuing operations for the three months ended March 31, 2026 was $70.1 million compared to a net loss from continuing operations of $50.1 million for the three months ended March 31, 2025, an increase of 240%. The drivers of the change in Net loss from continuing operations are correlated with the aggregate net impact of the aforementioned factors discussed in the “Results of Operations” section of this MD&A.
Net Loss from Discontinued Operations
Net loss from discontinued operations was $0.3 million and $10.2 million for the three months ended March 31, 2026 and 2025, respectively, a decrease of $9.9 million primarily driven by net losses in the company's Hemp-derived THC and Missouri operating segments. See Item 1, Note 6 — Discontinued Operations.
Segment Results
We have two reportable operating segments: (i) Domestic operations and (ii) International operations. The following tables present revenues, net by segment for the three months ended March 31, 2026 and 2025.
Domestic Operations
 (in thousands, except shares and per share amounts)
Three Months Ended March 31,
2026 vs. 2025
2026
2025
$
%
Retail revenues
$
215,223 
$
219,644 
$
(4,421)
(2)
%
Wholesale revenues
61,516 
51,824 
9,692 
19 
%
Management fee income
248 
236 
12 
5 
%
Total revenues, net — Domestic
$
276,987 
$
271,704 
$
5,283 
2 
%
International Operations
 (in thousands, except shares and per share amounts)
Three Months Ended March 31,
2026 vs. 2025
2026
2025
$
%
Retail revenues
$
15,886 
$
11,058 
$
4,828 
44 
%
Wholesale revenues
28,285 
22,457 
5,828 
26 
%
Management fee income
3,073 
1,405 
1,668 
119 
%
Total revenues, net — International
$
47,244 
$
34,920 
$
12,324 
35 
%
Domestic revenues increased $5.3 million, or 2%, to $277.0 million, driven primarily by increased finished goods sales in New York, New Jersey and Massachusetts due to better market penetration and flower quality. This was partially offset by a decrease in retail revenues driven by heightened retail competition and price compression.
International revenues increased $12.3 million, or 35%, to $47.2 million. International wholesale revenues grew 26% to $28.3 million, driven by sales of cannabis flower and vapes in Germany. International retail (pharmacy) revenues grew 44% to $15.9 million, supported by increased patient counts and pharmacy demand in the United Kingdom. Management fee income grew 119% to $3.1 million.
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Non-GAAP Measures
Adjusted EBITDA is a non-GAAP financial measure, and Adjusted EBITDA Margin is a non-GAAP financial ratio, and such measure and ratio do not have standardized definitions under GAAP. A reconciliation of the supplemental non-GAAP financial measure to the most directly comparable financial measure calculated and presented in accordance with GAAP is presented in Item 1, Note 25 — Segment reporting. The Company has provided the non-GAAP financial measure and ratio, which are not calculated or presented in accordance with GAAP, as supplemental information and in addition to the financial measures that are calculated and presented in accordance with GAAP. These supplemental non-GAAP financial measure and ratio are presented because management has evaluated the financial results both including and excluding the adjusted items and believes that the supplemental non-GAAP financial measure and ratio presented provide additional perspective and insights when analyzing the core operating performance of the business. These supplemental non-GAAP financial measure and ratio should not be considered superior to, as a substitute for or as an alternative to, and should be considered in conjunction with, the GAAP financial measures presented. The Company defines such non-GAAP financial measure and ratio as follows:
“Adjusted EBITDA” is defined as earnings before interest, taxes, depreciation and amortization, adjusted for share-based compensation expense and other adjustments related to restructuring costs, adult use campaign and political initiatives, as well as acquisition, transaction and other non-recurring costs.
“Adjusted EBITDA Margin” is defined as Adjusted EBITDA divided by total revenue.
Three Months Ended
March 31, 2026
March 31, 2025
Net income (loss)
$
69,783
$
(60,246)
Less: Net loss from discontinued operations
(293)
(10,193)
Net income (loss) from continuing operations
70,076
(50,053)
Interest expense, net
25,315
25,074
(Benefit) provision for income taxes
(98,705)
33,653
Depreciation and amortization
47,855
48,897
Share-based compensation
9,664
4,624
Loss on impairment
—
3,695
Total other income, net
4,067
(3,003)
Other adjustments(1)
5,141
3,275
Adjusted EBITDA
$
63,413
$
66,163
Adjusted EBITDA Margin
20 
%
22 
%
(1) Other adjustments for the three months ended March 31, 2026 primarily include restructuring costs $1.9 million, adult use campaign and political initiatives $0.6 million as well as acquisition, transaction, and other non-recurring costs $2.6 million. Other adjustments for the three months ended March 31, 2025 primarily include restructuring costs $0.6 million, as well as acquisition, transaction, and other non-recurring costs $2.7 million.
Liquidity and Capital Resources
The Company's primary sources of liquidity are cash flows from operations and, to a lesser extent, proceeds from asset sales and borrowings under our credit facilities. Our primary uses of cash are working capital requirements, capital expenditures, debt service and lease obligations. We expect that cash on hand together with anticipated cash flows from operations and financing activities will be sufficient to meet our capital requirements and operational needs over the next 12 months.
Working Capital
Working capital is defined as current assets minus current liabilities. As of March 31, 2026, we had positive working capital of $165.2 million compared to positive working capital of $154.3 million as of December 31, 2025. Cash and cash equivalents (including restricted cash) were $106.1 million and $101.5 million as of March 31, 2026 and December 31, 2025, respectively. The $10.9 million increase in working capital was driven primarily by increased inventory for new product launches and decreases in accrued payroll due to bonus payout and changes in the payment cycle. These increases
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to working capital were partially offset by an increase in accrued interest driven by higher interest rates on the Senior Secured Notes - 2026.
Outstanding Debt Obligations
As of March 31, 2026, our material outstanding debt obligations were as follows:
Credit Facility
Outstanding Balance
Maturity Date
Senior Secured Notes – 2029
$
500,000 
February 18, 2029
Senior Secured Notes – 2027
50,115 
December 17, 2027
Amended Needham LOC(1)
— 
February 18, 2029
ABL Facility - EWB Note
12,000 
August 25, 2026
Seller note payable
4,022 
December 1, 2036
Other notes payable
7,193 
Various
Total notes payable
$
573,330 
(1) In connection with the completion of the private placement of $500 million of Senior Secured Notes due February 18, 2029 (the "Senior Secured Notes – 2029"), the maturity date of the Amended Needham LOC was extended to February 18, 2029. See Note 16 - Notes payable
Cash Flows
The following table summarizes our sources and uses of cash for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31,
2026
2025
Operating activities:
Continuing operations
$
21,271 
$
45,034 
Discontinued operations
(283)
(6,605)
Net cash provided by operating activities
$
20,988 
$
38,429 
Investing activities:
Continuing operations
$
(16,586)
$
(17,319)
Discontinued operations
— 
(178)
Net cash used in investing activities
$
(16,586)
$
(17,497)
Financing activities:
Continuing operations
$
297 
$
(6,721)
Discontinued operations
— 
— 
Net cash provided by (used in) financing activities
297 
(6,721)
Net increase in cash
$
4,699 
$
14,211 
Net cash provided by operating activities decreased $17.1 million to $21.0 million. Cash from continuing operations of $21.3 million was driven by income from operations and partially offset by cash interest payments on debt and lease obligations, as well as working capital fluctuations. The $0.3 million cash outflow from discontinued operations, reflects the wind-down of the Hemp-derived THC and Missouri discontinued operations.
Net cash used in investing activities decreased $0.9 million to $16.6 million. Investing cash outflows in both periods were primarily driven by strategic capital expenditures supporting our global expansion and operational efficiency initiatives. During the three months ended March 31, 2025, cash outflows were partially offset by proceeds received from asset sales and payments received on outstanding notes receivable.
Net cash provided by financing activities increased $7.0 million. Cash inflows were driven primarily by $257.8 million of cash proceeds from the 2026 Refinancing (exclusive of $142.2 million of Senior Secured Notes – 2026 exchanged for Senior Secured Notes – 2029) and $5.2 million of cash proceeds from loans within our International segment.
Contractual Obligations
The following table summarizes our contractual obligations as of March 31, 2026:
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Notes
Total
Less than 1 Year
1–3 Years
3–5 Years
More than 5 Years
Notes payable (principal) (1)
16
$
573,330 
$
42,703 
$
525,235 
$
2,242 
$
3,150 
Notes payable (interest)(1)
16
172,723 
61,864 
110,113 
364 
382 
Operating lease obligations
11
162,781 
23,751 
57,202 
41,574 
40,254 
Finance lease obligations
11
249,153 
21,368 
57,288 
56,011 
114,486 
Financial obligations — sale-leasebacks
12
352,582 
24,909 
62,847 
59,956 
204,870 
Contingent consideration
4, 27
3,047 
— 
3,047 
— 
— 
Deferred consideration
4
2,296 
2,296 
— 
— 
— 
Redeemable NCI contingency
2, 18
87,997 
87,997 
— 
— 
— 
Litigation settlements(2)
26
7,636 
— 
— 
— 
— 
Uncertain tax positions(2)
23
439,228 
— 
— 
— 
— 
Total contractual obligations
$
2,050,773 
$
264,888 
$
815,732 
$
160,147 
$
363,142 
(1) Does not reflect the impact of the Senior Secured Notes – 2029 origination in February 2026 on the maturity date and stated interest rate of the Amended Needham LOC.
(2) Excluded from aging columns due to uncertainty regarding timing of settlement.
Off-Balance Sheet Arrangements
As of March 31, 2026 and December 31, 2025, the Company does not have any off-balance-sheet arrangements that have, or are reasonably likely to have, a current or future effect on the results of operations or financial condition of the Company, including, and without limitation, such considerations as liquidity and capital resources.
Changes in or Adoption of Accounting Practices
We have implemented all applicable accounting standards recently issued by the Financial Accounting Standards Board, as well as applicable pronouncements from certain other standard-setting bodies, within the prescribed effective dates. Pronouncements that are not applicable or where it has been determined do not have a significant impact to the accompanying Condensed Consolidated Financial Statements have been excluded. See discussion under Item 8, Note 3 – Significant Accounting Policies.
Future Capital Offerings
On February 3, 2025, we filed a final short-form base shelf prospectus in Canada (the "Base Shelf Prospectus") and, on February 5, 2025, we filed the Base Shelf Prospectus on a Form F-10 registration statement (File No. 333-284710) (the "Registration Statement") with the SEC under the U.S./Canada Multijurisdictional Disclosure System ("MJDS"), allowing us to offer up to $1 billion of securities (including SVS, debt securities, subscription receipts, warrants and units) from time to time during the 25-month period of effectiveness (subject to MJDS eligibility). The specific terms of any future offering of securities, including the use of proceeds from any offering, will be established in a supplement to the Base Shelf Prospectus and/or the Registration Statement. Upon our transition from complying with MJDS requirements as a foreign private issuer to complying with U.S. domestic issuer requirements, we expect to file future shelf registration statements on applicable domestic filer forms.
Reverse Stock Split
On June 5, 2026, the Company effected a 1-for-3 reverse stock split of its issued and outstanding SVS and MVS. The reverse stock split reduced the number of issued and outstanding shares of the Company’s SVS and MVS on a proportionate basis and did not affect any shareholder’s percentage ownership interest in the Company, except for adjustments resulting from the treatment of fractional shares. All share amounts, per share amounts, voting rights and equity award information presented in these Condensed Consolidated Financial Statements and accompanying notes have been retroactively adjusted to reflect the reverse stock split for all periods presented.
Critical accounting policies, judgments and estimates
The preparation of financial statements in accordance with U.S. GAAP requires us to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses as well as the disclosure of
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contingent liabilities. These estimates are developed based on historical experience, observable trends and other information available, and they are reviewed and updated regularly. Although actual results could differ from these estimates, we believe them to be reasonable.
The most significant assumptions and estimates underlying the accompanying Condensed Consolidated Financial Statements are described below:
Consolidation and variable interest entities
Significant judgment is applied to determine whether we hold a controlling financial interest in an entity, particularly when we do not hold a majority voting interest. This evaluation considers voting rights, management and service agreements, the entity's design and the existence of financial guarantees. Entities in which we hold a controlling financial interest are consolidated.
Business combinations and asset acquisitions
Significant judgment is applied in determining whether an acquisition is treated as a business combination or an asset acquisition. We use an optional screen test under which a transaction is accounted for as an asset acquisition if substantially all of the fair value of the gross assets acquired (generally 90% or more) is concentrated in a single identifiable asset or group of similar assets.
In a business combination, significant estimates are used to determine the fair value of assets acquired and liabilities assumed.
•Intangible Assets: The valuation of acquired intangible assets, such as cannabis licenses, requires the development of forward-looking cash flow projections and the selection of appropriate discount and terminal growth rates.
•Contingent Consideration: The fair value of contingent consideration liabilities, such as earn-outs, is estimated based on the probability and timing of achieving specific future outcomes, such as revenue targets.
These valuations are closely linked to the assumptions made by us regarding future performance of the assets acquired and any changes in the discount rate applied.
Goodwill impairment
Goodwill is tested for impairment annually or more frequently if impairment indicators exist. This test requires the estimation of the fair value of our reporting units using income and market-based approaches. This process involves significant judgment in developing business plans and forecasts as well as in selecting appropriate market data.
Share-based compensation - Stock options
Estimating the fair value of share-based awards requires significant assumptions for the inputs used in the Black-Scholes or Monte Carlo valuation models, including expected volatility of our SVS, the expected life of an award and the risk-free interest rate. We use an expected dividend yield of zero as we do not currently anticipate paying dividends.
Impairment of long-lived assets
We evaluate the recoverability of our long-lived assets when events indicate their carrying value may not be recoverable. This requires judgment in interpreting key factors (e.g., adverse changes in market conditions, regulatory environment or business climate and adverse changes in the extent or manner in which the long-lived assets will be used) and in estimating the undiscounted future cash flows of such assets.
Inventories
Inventories are measured at the lower of cost or NRV. Determining NRV requires significant judgment regarding future demand, selling prices, shrinkage and inventory aging.
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Leases
We apply significant judgment in deriving the lease term and discount rate applicable in a leasing arrangement.
•Lease Term: Determining whether options to extend or terminate a lease are reasonably certain to be exercised involves considering strategic, operational and economic factors, including the size of our investment in the property and the strategic importance of the property location.
•Discount Rate: Determining the incremental borrowing rate for leases where the implicit rate is not readily determinable.
Income taxes
There is inherent uncertainty in quantifying income tax positions. We must exercise significant judgment in evaluating whether our tax positions are more likely than not to be sustained upon examination or audit by tax authorities in the complex federal, state and foreign jurisdictions in which we operate.
Held for sale and discontinued
Significant judgment is required to determine if a disposal group meets the specific criteria to be classified as “held for sale.” An asset or disposal group must meet all of the following conditions:
•Management is committed to a plan to sell;
•The asset or disposal group is available for immediate sale in its present condition;
•An active program to locate a buyer has been initiated;
•The sale is highly probable within one year;
•The asset or disposal group is being actively marketed for sale at a reasonable price; and
•It is unlikely that the plan will be significantly changed or withdrawn.
A disposal group classified as held for sale is reported as a “discontinued operation” if it represents a strategic shift that has a major effect on our operations and financial results. Assets held for sale are measured at the lower of their carrying amount or fair value less costs to sell. For further details, see Item 1, Note 5 — Assets and liabilities held for sale and Note 6 — Discontinued Operations.
Redeemable non-controlling interests
The valuation and classification of redeemable non-controlling interests involve significant judgment, including developing discounted cash flow models with assumptions about future revenue, margins and economic conditions. We also have to assess whether the underlying equity instruments are currently redeemable or likely to become redeemable in the future, adding complexity to their classification on our Condensed Consolidated Balance Sheets.
Revenue recognized from contracts with customers
Significant judgment is applied in evaluating the nature of our wholesale and MSA revenue contracts. This includes assessing whether we act as the principal or agent in contracts with customers, particularly where third-party involvement or shared responsibilities exist. We also evaluate whether certain transactions are non-reciprocal in nature, requiring consideration of whether a transfer of assets occurred without commensurate value received. In arrangements involving transfers of inventory between the same counter-parties, we apply judgment to determine whether such transfers represent distinct revenue-generating events. Additionally, the allocation of transaction price across multiple performance obligations necessitates the estimation of standalone selling prices and the timing of satisfaction of each obligation.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There have been no material changes to our market risk disclosures as set forth in Part II Item 7A of our 2025 Form 10-K.
ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), as appropriate, to allow timely decisions regarding required disclosure.
As of March 31, 2026, our management, with the participation of our CEO and CFO, carried out an evaluation of the effectiveness of our disclosure controls and procedures. In making this evaluation, our management considered the framework set forth in the Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO Framework"). Based on that evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of March 31, 2026.
Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting ("ICFR"), as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act. Our ICFR is designed to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of our Condensed Consolidated Financial Statements (Unaudited) for external purposes in accordance with U.S. GAAP. Our ICFR is based on the criteria established in the COSO Framework.
Changes in Internal Control Over Financial Reporting
During the three months ended March 31, 2026, management implemented enhancements to certain disclosure controls and procedures in connection with the Company’s transition from complying with MJDS requirements as a foreign private issuer to complying with U.S. domestic issuer requirements. Specifically, we formalized and enhanced procedures related to: (i) the preparation, review and management sign-off of our Condensed Consolidated Financial Statements (Unaudited) Condensed Consolidated Financial Statements (Unaudited) in the domestic filer format; (ii) evaluation and disclosure of uncertain tax positions, including procedures related to the April 2026 Rescheduling Order; and (iii) the preparation of Non-GAAP financial measure disclosures in conformance with SEC guidance under Item 10(e) of Regulation S-K. These enhancements were implemented as a direct result of the transition to domestic filer reporting and do not reflect the remediation of any identified material weakness or significant deficiency.
Except as described above, there were no changes in our ICFR during the three months ended March 31, 2026 that have materially affected, or are reasonably likely to materially affect, our ICFR.
Limitations on the Effectiveness of Controls
Our management, including our CEO and CFO, does not expect that our disclosure controls and procedures or ICFR will prevent or detect all errors and fraud. A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system will be met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected.
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PART II –– OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The information required by this Item is incorporated herein by reference to Note 26 — Commitments and contingencies to the Condensed Consolidated Financial Statements (Unaudited) included in Part I, Item 1 of this Quarterly Report.
ITEM 1A. RISK FACTORS
In addition to the other information set forth in this Quarterly Report, you should carefully consider the risk factors discussed in Part I — Item 1A — Risk Factors of our Annual Report, which could materially and adversely affect our business, financial condition or results of operations. The risks described in our annual filings are not the only risks facing us. Additional risks and uncertainties not currently known to us, or that we currently deem immaterial, may also adversely affect our business, financial condition or results of operations.
The following risk factors supplement or update the risk factors included in our annual filings with material developments arising during the three months ended March 31, 2026:
Risks Related to the April 2026 Rescheduling Order
The Rescheduling Order is of limited scope, and significant uncertainty remains regarding its application and impact on Section 280E tax treatment for our operations.
On April 23, 2026, the DOJ and the DEA issued the Rescheduling Order, reclassifying certain state-licensed medical cannabis from Schedule I to Schedule III under the CSA. While we expect a substantial portion of our U.S. state-licensed medical cannabis operations will qualify under the Rescheduling Order, significant risks and uncertainties remain, including:
• Scope limitations: The Rescheduling Order applies only to FDA-approved drug products containing marijuana and marijuana products produced in compliance with state-issued medical marijuana licenses. Adult-use cannabis operations remain Schedule I controlled substances, and Section 280E may be found to continue to apply to those operations.
• DEA registration: We have filed applications for DEA registration, but there is no assurance that such registrations will be granted, maintained or not subsequently revoked. Failure to obtain or maintain DEA registration for qualifying operations would prevent us from realizing Section 280E relief on those operations.
• Pending rulemaking: The Rescheduling Order does not represent a final rule broadly rescheduling cannabis to Schedule III. A separate rulemaking process (the "Proposed Rule") is proceeding toward a formal administrative hearing scheduled for June 29 – July 15, 2026. The timing and outcome of the Proposed Rule are uncertain, and any final rule could be subject to judicial challenge.
• Mixed-use operations: Many of our dispensaries serve both medical and adult-use patients. The application of the Rescheduling Order to mixed-use operations is not fully resolved, and pending DEA and Treasury guidance may limit the scope of Section 280E relief available for such operations.
• Retroactive relief uncertainty: The Rescheduling Order encourages the Secretary of the Treasury to consider granting Section 280E relief retroactively to prior tax years. However, no assurance can be given that retroactive relief will be granted, and absent such relief, our prior year uncertain tax positions may be subject to adjustment.
• Litigation risk: The Rescheduling Order or any broader rescheduling may face legal challenges from various stakeholders, which could delay, modify or reverse the regulatory changes on which we have relied in assessing our tax positions.
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Risks Related to Our Tax Obligations and Section 280E
The uncertain tax position liability we carry for our Section 280E Position remains material, and our ultimate tax liability could materially exceed our current accruals.
As of March 31, 2026, we carry an uncertain tax position liability of $439.2 million on our Condensed Consolidated Balance Sheets (Unaudited), representing management’s estimate of probable tax liabilities associated with our Section 280E Position and other uncertain tax positions. In connection with the Rescheduling Order, we released $96.5 million of this liability during the three months ended March 31, 2026. However, the remaining $439.2 million balance is subject to significant uncertainty, including:
• IRS examination: The IRS is currently examining our tax returns for fiscal years 2020 through 2023. If our Section 280E Position is not upheld, additional taxes, interest and penalties may be assessed against us, which could substantially exceed our current accruals.
• State tax authorities: Several state tax authorities are also reviewing our state-level income tax returns. State income tax laws may apply Section 280E-equivalent disallowances independently of the federal treatment.
• Valuation allowance: We maintain a full valuation allowance against certain of our deferred tax assets. If the valuation allowance proves incorrect, our deferred tax expense could increase materially.
• Cash payment obligations: Taxes paid in cash for Section 280E-impacted operations have historically been substantial. Even as Section 280E relief becomes available for qualifying operations, cash tax obligations on adult-use operations and prior years will continue to represent a significant cash outflow.
Risks Related to Our Transition to Compliance with U.S. Domestic Issuer Reporting Requirements
Our transition from complying with MJDS reporting requirements to U.S. domestic issuer reporting requirements creates new compliance obligations and risks.
Beginning with this Quarterly Report, we will voluntarily comply with the registration and ongoing reporting requirements applicable to a U.S. domestic issuer, which subjects us to reporting requirements and liability standards that are different from, and in certain respects more extensive than, those applicable to foreign private issuers relying on the MJDS. These new requirements include:
• SOX Section 404: We will be required to include management’s assessment of ICFR in our first annual report on Form 10-K. Depending on our accelerated filer determination in a given year, we may also be required to include an auditor attestation on ICFR effectiveness, which would require substantial additional audit work and cost.
• Disclosure controls: We have enhanced our disclosure controls and procedures in connection with the transition, but there is no assurance that our processes and controls will be sufficient to comply with all reporting requirements applicable to U.S. domestic issuers in every filing period, particularly during the transition period.
Risks Related to Access to Banking and Financial Services
Cannabis remains classified as a Schedule I controlled substance for adult-use operations under U.S. federal law, limiting our access to banking and financial services.
Notwithstanding the Rescheduling Order, adult-use cannabis remains a Schedule I controlled substance, and proceeds from adult-use operations continue to present federal anti-money laundering compliance risks for financial institutions. As a result, many U.S. financial institutions continue to decline to provide banking and financial services to cannabis businesses, which:
• Limits our ability to open and maintain bank accounts, obtain credit facilities and access capital markets on terms available to businesses in other industries;
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• Requires us to maintain significant amounts of cash in certain jurisdictions and engage in cash-intensive operations, creating operational and security risks;
• May increase the cost of capital and reduce the availability of financing for capital expenditures, acquisitions and working capital requirements; and
• May create complications for our service providers, suppliers and landlords who are concerned about associating with a cannabis business.
The SAFER Banking Act, which would provide safe harbor protections for financial institutions serving cannabis businesses operating in compliance with state law, has advanced in the legislative process but has not been enacted into law. There is no assurance that comprehensive cannabis banking legislation will be enacted, or that the Rescheduling Order will materially improve our access to banking services for adult-use operations.
Regulatory Environment: Issuers With U.S. Cannabis-Related Operations
In response to the on-going conflict between U.S. federal and U.S. state regulatory frameworks governing cannabis-related activities, the Canadian Securities Administrators issued Staff Notice 51-352, Issuers with U.S. Marijuana-Related Activities, which outlines industry-specific disclosure requirements for Canadian reporting issuers with operations or investments in the U.S. cannabis industry.
Pursuant to Staff Notice 51-352, the following disclosure is aimed at providing additional information regarding:
•our involvement in the U.S. cannabis industry and quantifying our balance sheet and operating statement exposure to U.S. cannabis-related activities;
•statements and other available guidance made by U.S. federal authorities or U.S. federal prosecutors regarding the risk of enforcement action as a result of our involvement with cannabis-related activities;
•risks related to our involvement in cannabis-related activities, including, among others, (i) the risk that third party service providers could suspend or withdraw services and (ii) the risk that regulatory bodies could impose certain restrictions on our ability to operate in the U.S.;
•our ability and our affiliates’ ability to access both public and private capital as well as the financing options that are and are not available to us and our affiliates to support continuing operations;
•cannabis-related regulations and applicable licensing requirements of each U.S. state in which we and/or our affiliates operate as well as our program for monitoring compliance with these regulations and licensing requirements; and
•the status of our compliance with the cannabis-related regulatory framework and applicable licensing requirements of each U.S. state in which we and our affiliates operate.
Our Involvement in the U.S. Cannabis Industry
In the U.S., cannabis remains classified as a Schedule I controlled substance under U.S. federal law, except for certain state-licensed medical cannabis products that have been reclassified to Schedule III under the CSA pursuant to recent federal regulatory actions, as further discussed herein.
In the U.S., we and our affiliates are directly involved in the cannabis industry in certain U.S. states that have legalized the medical and/or adult-use of cannabis. Currently, we and our affiliates hold the requisite licenses to engage in the cultivation, manufacture, processing, distribution and sale of cannabis, as permitted, in the states of Arizona, Connecticut, Florida, Illinois, Maine, Maryland, Massachusetts, Missouri, Nevada, New Jersey, New York, North Dakota, Ohio, Pennsylvania and Utah. In addition, we have partnered with an accredited medical school and obtained a “clinical registrant” license in Pennsylvania.
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For the three months ended March 31, 2026, 85% of our Total revenues, net were directly derived from U.S. cannabis-related activities. We do not differentiate our net assets between those directly derived from cannabis-related activities and those that are unrelated; therefore, such information is not presented.
Regulatory Frameworks Governing Cannabis-Related Activities in the U.S.
Overview of U.S. Federal Regulatory Framework
The Controlled Substances Act
The U.S. federal government regulates drugs, including cannabis, under the CSA, which classifies controlled substances into one of five schedules. Historically, cannabis, other than hemp containing less than 0.3% tetrahydrocannabinol (“THC”) on a dry weight basis, was classified as a Schedule I controlled substance. However, pursuant to recent federal regulatory actions, as further discussed herein, certain state-licensed medical cannabis products have been reclassified to Schedule III. Notwithstanding these developments, cannabis remains federally illegal in most forms, and the possession, use, cultivation and distribution of cannabis continue to be subject to significant restrictions under U.S. federal law.
While most jurisdictions have a uniform national framework for regulation of cannabis-related activities, in the U.S., cannabis is separately regulated at the U.S. state and local jurisdictional levels. As a result, U.S. states that have legalized the medical and/or adult-use of cannabis have regulatory frameworks that are in direct conflict with that of the U.S. federal government.
The Supremacy Clause of the U.S. Constitution establishes that the U.S. Constitution and U.S. federal laws made pursuant to it are paramount and, in case of conflict between U.S. federal and U.S. state law, U.S federal law shall apply. Consequently, although our activities are compliant with applicable cannabis-related U.S. state and local regulations, strict compliance with these U.S. state and local regulations may neither absolve the Company of liability under U.S. federal law nor provide a defense to federal criminal charges that may be brought against the Company.
To address the conflicting treatment of cannabis under U.S. federal and state law, the DOJ has, from time to time, issued guidance regarding federal enforcement priorities. On August 29, 2013, then Deputy Attorney General James Cole issued a memorandum (the “Cole Memorandum”) outlining a framework for prioritizing enforcement of the Controlled Substances Act in jurisdictions that had legalized cannabis in some form. The Cole Memorandum indicated that cannabis-related activities conducted in compliance with robust state regulatory systems were less likely to be prioritized for federal enforcement, provided certain federal priorities—such as preventing distribution to minors, diversion across state lines and involvement of criminal enterprises—were not implicated.
On January 4, 2018, the Cole Memorandum was rescinded by then Attorney General Jeff Sessions, resulting in the restoration of prosecutorial discretion at the individual U.S. Attorney level. Since that time, federal enforcement of cannabis laws has generally been guided by broader DOJ priorities. During his confirmation hearing in 2021, Attorney General Merrick Garland indicated that the DOJ would focus its resources on violent crime and organized criminal activity and would not prioritize enforcement against individuals and businesses operating in compliance with state cannabis laws.
More recently, U.S. federal regulatory actions relating to the potential and partial rescheduling of cannabis under the CSA may further influence federal enforcement priorities. However, the extent to which such developments will affect DOJ enforcement practices remains uncertain, and there can be no assurance that U.S. federal authorities will not enforce applicable U.S. federal laws against U.S. state-licensed cannabis businesses.
•On December 18, 2025, President Trump issued the “Executive Order on Expedited Cannabis Rescheduling” directing the Attorney General and the DEA to evaluate the classification of cannabis under the CSA and to advance the U.S. federal rulemaking process with respect to potential rescheduling. The executive order reflects evolving U.S. federal policy priorities; however, subsequent regulatory actions taken by the DOJ and the DEA in April 2026 are more directly relevant to the current regulatory framework.
The executive order does not itself change the legal status of cannabis under U.S. federal law, nor does it legalize the cultivation, manufacture, distribution or sale of cannabis or authorize interstate commerce. As of the date of this Quarterly Report, the timing, scope and ultimate outcome of the federal rulemaking process remain uncertain.
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•On April 23, 2026, the DOJ and the DEA issued the following orders2 related to the rescheduling of cannabis as a controlled substance under the CSA:
(i)Rescheduling Order: an order reclassifying certain marijuana-related products from Schedule I to Schedule III, specifically FDA-approved drug products containing marijuana and marijuana products produced in compliance with state-issued medical marijuana licenses;
(ii)Proposed Rule: an order cancelling the previously scheduled administrative law hearing related to the proposed rule issued in May 2024 to broadly reschedule marijuana and
(iii)Hearing Order: an order initiating a new administrative hearing on the Proposed Rule, which occurred from June 29, 2026 through July 15, 2026. The hearing concluded on July 15, 2026, and the ALJ set a tight schedule for any post-hearing briefs, which will be due on August 17, 2026.
Rescheduling Order
While the Rescheduling Order clearly reclassifies state-licensed medical cannabis to Schedule III under the CSA, additional guidance from the DEA and the U.S. Department of the Treasury (the “Treasury”) is expected regarding its interpretation and application. Key areas requiring further clarification include:
•Mixed medical and adult-use operations: For businesses that operate both medical and adult-use cannabis under state licenses, it remains unclear how “medical cannabis” will be defined and whether operational or structural separation will be required. Accordingly, the extent to which we may benefit from relief under Section 280E is uncertain.
•Registration with the DEA: The Rescheduling Order permits state-licensed cannabis operators to apply for registration with the DEA for the manufacture, distribution and dispensing of medical cannabis. If obtained, such registration would permit our U.S. state-licensed medical cannabis activities to be conducted in compliance with applicable provisions of the CSA; however, such products would not be approved by the FDA. The Company intends to pursue applicable registrations. If obtained, revenues generated from such operations would be expected to reduce or eliminate characterization as proceeds from trafficking in a controlled substance and the associated federal money laundering risk. While this development may have a favorable impact on our operations, the extent to which it may improve access to capital markets, financial services or commercial counterparties remains uncertain.
•Interstate and International Commerce: DEA registration may enable participation in the lawful transfer and sale of medical cannabis, including across state lines and potentially internationally. However, the DEA is expected to retain significant discretion over the scope of permitted activities, and it is not currently possible to determine the extent to which our medical cannabis operations may be able to engage in interstate or international commerce.
•Retroactive Application of Section 280E Relief: The Rescheduling Order acknowledges that the reclassification of state-licensed medical cannabis may affect the application of Section 280E and encourages the Secretary of the Treasury to consider retroactive relief. While such relief could potentially apply to prior tax years as well as to the tax year ending December 31, 2026, there can be no assurance that any retroactive application will be permitted.
It is important to note that the Rescheduling Order does not affect the classification of adult-use cannabis under the CSA, which remains a Schedule I controlled substance. In addition, the Rescheduling Order may be subject to legal challenges, which could delay, limit or eliminate its anticipated benefits. The Company has applied for DEA registration at each applicable site prior to the end of June 2026.
Proposed Rule and the Hearing Order
2 Full text of the orders is available in the U.S. Federal Register, “Schedules of Controlled Substances: Rescheduling of Food and Drug Administration Approved Products,” published April 28, 2026.
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While the Rescheduling Order applies only to state-licensed medical cannabis, the Proposed Rule, if finalized, would result in the reclassification of cannabis to Schedule III more broadly, without regard to whether such cannabis is produced for medical or adult-use or under a state license.
We expect the Hearing Order to advance the rulemaking process, consistent with recent policy direction expressed by the Trump administration; however, the timing and outcome of the Proposed Rule remain uncertain. If adopted, the Proposed Rule would clarify that Section 280E does not apply to our operations more broadly, which could result in a material reduction in our uncertain tax positions. The magnitude and timing of such impact will depend on the scope of any related guidance issued by the Secretary of the Treasury, including with respect to retroactivity.
The Proposed Rule and the associated rulemaking process are expected to face legal challenges. If such challenges are successful, the anticipated benefits of broader rescheduling may be delayed or may not be realized.
Rohrabacher-Farr Amendment
Companies operating in the U.S. medical cannabis industry have historically benefited from a measure of protection from U.S. federal enforcement through a rider provision to federal appropriations legislation, commonly referred to as the “Rohrabacher-Farr Amendment”. This provision restricts the DOJ from using congressionally appropriated funds to interfere with the implementation of U.S. state laws authorizing the use, distribution, possession or cultivation of medical cannabis. The Rohrabacher-Farr Amendment must be renewed annually as part of the U.S. federal appropriations process and does not provide immunity from prosecution or alter the underlying illegality of cannabis under U.S. federal law. While the Congress of the United States (“Congress”) has consistently renewed the provision since fiscal year 2015, there can be no assurance that it will be extended in future appropriations legislation.
In recent years, numerous bills have been introduced in Congress to address various aspects of U.S. federal cannabis policy, including the decriminalization of cannabis, the imposition of U.S. federal taxes, the establishment of national public health and safety standards and the promotion of social equity and economic opportunities in communities disproportionately impacted by the War on Drugs. Notable examples include the Cannabis Administration and Opportunity Act (the “CAOA”) and the Marijuana Opportunity Reinvestment and Expungement Act (the “MORE Act”). While neither the CAOA nor the MORE Act has been enacted, the continued introduction of cannabis-related legislation reflects ongoing legislative interest in reforming the federal regulatory framework.
There can be no assurance that U.S. state laws legalizing and regulating cannabis-related activities will not be repealed, amended or otherwise restricted, including by local governmental authorities. In addition, there can be no assurance that comprehensive U.S. federal legislation to de-schedule or decriminalize cannabis will be enacted in the near term or at all, or that any such legislation would preserve existing state-based regulatory programs or otherwise be favorable to our U.S. state-licensed operations. Unless and until Congress amends the CSA and notwithstanding ongoing federal regulatory developments, including the potential broad rescheduling of cannabis, U.S. federal authorities may continue to enforce applicable U.S. federal law against U.S. state-licensed cannabis businesses.
Although the Cole Memorandum has been rescinded, we continue to adhere to operating policies and procedures that reflect industry best practices developed during the period in which such guidance was in effect. These policies and procedures are designed to ensure that:
(i)operations are conducted in compliance with applicable licensing requirements at the U.S. state and local levels;
(ii)cannabis-related activities remain within the scope of the licenses held, including limiting sales to authorized patients or eligible adult consumers, as applicable;
(iii)controls are designed to restrict the distribution of cannabis products to minors;
(iv)controls are designed to prevent the diversion of funds to criminal enterprises, gangs or cartels;
(v)U.S. state-mandated seed-to-sale inventory tracking systems and related procedures are effective in monitoring cannabis and cannabis-derived inventory and preventing diversion across state lines or into jurisdictions where such activities remain prohibited;
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(vi)our operations are not used to facilitate the trafficking of other illegal substances or other unlawful activities, including violations of applicable anti-money laundering laws; and
(vii)cannabis and cannabis-derived products comply with applicable regulatory requirements, including labeling and disclosure requirements intended to mitigate public health risks.
In addition, we conduct background checks on principal officers and members of management and perform ongoing reviews of our cannabis-related operations, including the premises on which such operations occur and the policies and procedures governing the possession of cannabis and cannabis-derived products outside licensed premises. See “Compliance and Monitoring” section herein for additional information.
Reform of Federal Legislation on Industrial Hemp
On December 20, 2018, the Agriculture Improvement Act of 2018, Pub. L. 115-334 (the “2018 Farm Bill”), was signed into law. The 2018 Farm Bill amended the definition of cannabis under the CSA to exclude hemp, defining hemp as the plant Cannabis sativa L. and any part of that plant—including seeds, derivatives, extracts, cannabinoids, isomers, acids, salts and salts of isomers—provided it contains no more than 0.3 percent delta-9 tetrahydrocannabinol (“Delta-9 THC”) on a dry weight basis. The legislation granted U.S. states the authority to license and regulate the cultivation, production, distribution and sale of hemp and hemp-derived products, such as CBD. In contrast to cannabis, hemp and qualifying hemp-derived products may be distributed and sold across U.S. state lines, provided that the hemp from which such products are derived was cultivated pursuant to a license issued under a U.S. state program approved by the U.S. Department of Agriculture.
Despite the redefinition of hemp under the 2018 Farm Bill, the FDA continues to exercise jurisdiction over hemp-derived products under the Federal Food, Drug, and Cosmetic Act. To date, the FDA (i) has approved only one prescription drug containing CBD, Epidiolex; (ii) prohibits the marketing of CBD as a dietary supplement, as CBD is the active ingredient in Epidiolex; and (iii) prohibits the addition of CBD, THC or other hemp-derived extracts to food or beverages sold in U.S. interstate commerce. The FDA does permit the use of CBD in cosmetic products, provided that such products otherwise comply with the Federal Food, Drug, and Cosmetic Act and do not make therapeutic claims. In January 2023, the FDA announced that existing regulatory frameworks for food and dietary supplements are not appropriate for CBD and indicated its intention to work with Congress to establish a new regulatory pathway for CBD products.
On November 12, 2025, Congress enacted legislation that amended the federal definition of 'hemp' and established a revised federal regulatory framework governing hemp‑derived cannabinoid products (collectively, the “Hemp Amendments”). The Hemp Amendments are scheduled to take effect on November 12, 2026 and represent the most significant federal change affecting hemp‑derived cannabinoid products since the enactment of the 2018 Farm Bill. Among other things, the Hemp Amendments (i) replace the prior delta‑9‑THC threshold with a “total THC” standard that includes delta‑9 THC, THCA and other specified cannabinoids; (ii) establish new federal limits on total THC permitted in consumable hemp‑derived cannabinoid product; (iii) impose expanded compliance obligations on manufacturers, distributors and retailers of hemp‑derived cannabinoid products; and (iv) increase federal oversight of the marketing and distribution of intoxicating hemp‑derived products. These developments may restrict or prohibit categories of hemp‑derived cannabinoid products that previously were marketed as compliant with federal law and may increase regulatory uncertainty and potential enforcement risk with respect to hemp‑derived cannabinoid products. As of the date of this Quarterly Report, it remains unclear how federal agencies will implement and enforce the Hemp Amendments or how these changes will integrate with existing U.S. state regulatory frameworks for hemp and consumable cannabinoid products.
Anti-Money Laundering Laws and Access to Capital
U.S. federal law makes it illegal for financial institutions to provide services to U.S. state-licensed cannabis businesses. Accepting proceeds from the sale of cannabis—historically classified as a Schedule I controlled substance under the CSA—may be considered money laundering under U.S. federal law. Notwithstanding recent federal regulatory actions reclassifying certain state-licensed medical cannabis activities to Schedule III, significant uncertainty remains regarding the application of federal anti-money laundering laws to cannabis-related proceeds. Consequently, financial institutions that depend on the U.S. Federal Reserve’s money transfer system face significant legal, regulatory and compliance risks when servicing cannabis-related businesses, which has limited their willingness to accept cannabis-related deposits.
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In 2014, the Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) issued guidance (the “FinCEN Guidance”) to financial institutions and U.S. prosecutors. The FinCEN Guidance advised U.S. prosecutors not to prioritize enforcement against financial institutions that serve U.S. state-licensed cannabis businesses, provided those businesses comply with U.S. state law and do not violate U.S. federal enforcement priorities under the Cole Memorandum, such as preventing access to cannabis by minors or organized crime. The FinCEN Guidance also outlined how U.S. financial institutions can provide depository services while complying with their obligations under the Bank Secrecy Act, including enhanced customer due diligence and reporting requirements.
The FinCEN Guidance reduced some enforcement risk but did not provide immunity from prosecution. It also increased the cost and burden of compliance, which has discouraged most financial institutions from entering the cannabis sector. Only a limited number of U.S. state-chartered banks and credit unions currently service U.S. state-licensed cannabis businesses. These institutions typically cap cannabis-related deposits at a small portion of their balance sheets, maintain large cash reserves to cover such deposits on demand and charge higher fees to offset compliance costs. In practice, the FinCEN Guidance has not led to a broader willingness among financial institutions to serve U.S. state-licensed cannabis businesses, and most continue to refrain due to the compliance requirements.
Several bills have been introduced in Congress to expand access to banking services, including the Secure and Fair Enforcement Regulation (“SAFER”) Banking Act. In 2023, the Senate Banking Committee approved the SAFER Banking Act by a bipartisan vote of 14-9. The SAFER Banking Act is pending a full Senate vote, but passage remains uncertain. Despite growing support in Congress and among the public, there is no assurance such legislation will be enacted.
Because traditional bank financing is generally unavailable, we rely on equity and debt financing to support our operations, capital expenditures and acquisitions. Until U.S. federal law changes, there can be no assurance that financing will be available to us when needed or on acceptable terms. If additional financing is not available, our ability to fund operations, capital projects, and acquisitions could be limited. Raising funds through equity or convertible debt issuances may also cause significant dilution to our existing shareholders, and new securities may carry rights, preferences or privileges senior to those of our outstanding SVS.
Continued restrictions on financial services available to U.S. cannabis-related businesses may materially and adversely affect our liquidity, growth strategy, and overall financial condition. See the “Risk Factors” section of the Annual Information Form for further risk factors associated with limitations on access to U.S. banking and financing.
Service Providers
Adverse changes in the enforcement of U.S. cannabis laws, regulatory or political shifts, increased scrutiny by regulatory authorities or negative changes in public perception regarding cannabis use could cause our third-party service providers to suspend or withdraw their services, which may have a material adverse effect on our operations.
Heightened Scrutiny by Regulatory Authorities
As outlined above, our existing U.S. operations and any future operations or investments may be subject to heightened scrutiny by regulators, stock exchanges and other authorities. Such scrutiny could restrict our ability to operate or invest in certain jurisdictions and may also affect our listings on the TSX and OTCQX and our reporting obligations in Canada and the U.S.
Adverse changes in government policies or public opinion could significantly influence cannabis regulation in Canada, the U.S. and other jurisdictions. A negative shift in public perception of medical or adult-use cannabis could affect future legislation, regulation or enforcement and may result in the abandonment of initiatives or proposals to legalize medical or adult-use cannabis. Violations of U.S. federal laws and regulations could result in fines, penalties, administrative sanctions, civil settlements or criminal charges.
Following the TSX listing, we became subject to TSX Requirements3, which limit our ability to directly or indirectly own or invest in entities engaged in the cultivation, distribution or possession of cannabis in the United States in a manner that may be considered in violation of U.S. federal law. In connection with these requirements, transfers of funds between
3 Sections 306 (Minimum Listing Requirements) and 325 (Management) and Part VII (Halting of Trading, Suspension and Delisting of Securities) of the TSX Company Manual and TSX Staff Notice 2017-0009 (collectively, the “TSX Requirements”).
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Curaleaf Holdings, Inc. and Curaleaf, Inc. are generally limited while the Company maintains compliance with applicable TSX listing requirements. These requirements are conditions of our TSX listing rather than legal restrictions on the ownership or transferability of the underlying assets. Failure to comply with the TSX Requirements could result in regulatory action by the TSX, including the denial of certain approvals, such as the listing of additional securities, or the suspension or delisting of our securities. However, the Company retains the ability to modify its listing structure and cease being subject to the TSX framework if it determines that doing so is in the best interests of the Company and its shareholders. If the Company determines that compliance with the TSX Requirements could impede its strategic objectives or business operations, it may evaluate alternative listing platforms for its SVS, including the Canadian Securities Exchange, where the Company's shares were previously listed.
The clearing of our outstanding SVS depends on the Clearing and Depository Services Inc. (the “CDS”) for SVS quoted on the TSX and the Depository Trust Company (the “DTC”) for SVS quoted on the OTCQX. If the CDS or the DTC imposed a ban on clearing securities of issuers with cannabis-related activities in the U.S., or if we otherwise became ineligible with the CDS or the DTC, our outstanding SVS could become highly illiquid and shareholders could be prevented from trading their SVS on the TSX or OTCQX.
Compliance and Monitoring
We use reasonable commercial efforts to remain in material compliance with the cannabis regulatory environment in the U.S. In addition, we actively participate in the regulatory and legislative processes at the U.S. federal, state and local levels through our compliance and government relations departments, legal counsel, third-party consultants and engagement with cannabis industry groups. We hold all required licenses to cultivate, manufacture, possess and distribute cannabis in the U.S. states in which we operate and remain in good standing and in material compliance with the applicable cannabis regulatory programs in each such U.S. state.
While we may occasionally be cited or fined by U.S. state regulators for non-compliance with cannabis regulations, including those related to product labeling, testing, potency or the use of banned additives, we are not aware of any circumstances that would likely result in regulatory actions with a material adverse impact on our operations or financial condition.
Our Compliance Department, reporting to the Chief Legal Officer (“CLO”), oversees state-level compliance functions, monitors local regulatory processes, reports developments to the CLO and designs and implements strategies in response to regulatory changes, while also working with third-party legal counsel to ensure compliance with U.S. cannabis laws and regulations. Our Government Relations Department works with management to (i) develop and maintain relationships with U.S. state and local regulators, elected officials and cannabis industry groups and (ii) implement strategies that protect our rights and those of our U.S. affiliates to participate in the U.S. cannabis industry.
See the “Risk Factors” section of the Annual Information Form for further risk factors associated with our U.S. operations and those of our U.S. affiliates.
Overview of U.S. State Regulatory Frameworks
Cannabis laws continue to evolve across numerous U.S. jurisdictions, with a majority of states having legalized cannabis for medical use, adult use, or both, while regulatory structures, licensing requirements, enforcement priorities and market conditions vary significantly by state. Regulatory changes at the state level may impact the Company’s operations, expansion opportunities, compliance obligations and competitive landscape.
Each U.S. state that has legalized medical or adult-use cannabis imposes unique licensing requirements, limits on the number of facilities a license holder may operate, caps on the number of license holders and other regulatory conditions. All of the U.S. states in which we operate permit the use of cannabis for specific qualifying conditions when recommended by a medical doctor, and cannabis is sold in licensed dispensaries to adults aged 21 or older.
We are, in all material respects, compliant with the laws and regulations governing our U.S. cannabis operations, including those of our affiliates.
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The following summary outlines the regulatory frameworks of the U.S. states in which we operate. Dispensary counts may include licensed locations that are temporarily closed or otherwise inactive. For further information on our U.S. operations, see Item 2 of this Quarterly Report.
Arizona
Arizona Licensing Scheme
In Arizona, the Arizona Department of Health Services (“AZ DHS”) licenses and regulates medical and adult-use cannabis. Licenses allow one dispensary, one processing site and one cultivation site per licensee. Vertical integration is not required, and off-site processing and cultivation can be shared by cannabis establishments.
Arizona Medical Patient Requirements
Qualifying medical conditions in Arizona include, but are not limited to, Alzheimer's; ALS; cancer; chronic pain; Crohn's disease; glaucoma; HIV/AIDS; hepatitis C; PTSD; severe nausea and severe or persistent muscle spasms, such as those associated with multiple sclerosis (“MS”) and epilepsy.
For a comprehensive list of qualifying conditions, see the AZ DHS’ Medical Marijuana Program: https://www.azdhs.gov/licensing/medical-marijuana/index.php#qualifying-home.
Connecticut
Connecticut Licensing Scheme
In Connecticut, the Connecticut Department of Consumer Protection (“CT DCP”) licenses and regulates medical and adult-use cannabis. Cannabis licensing is organized across several categories, including retail, cultivation, manufacturing, delivery and individual licenses and registrations, comprising multiple distinct license types. Medical dispensaries are required to have a board-certified pharmacist on-site to dispense cannabis. Connecticut’s dispensary framework has largely transitioned to hybrid retailer licenses, which permit the sale of both medical and adult-use cannabis under licenses approved or issued by the CT DCP.
Connecticut Medical Patient Requirements
Qualifying medical conditions include, but are not limited to,
•For Individuals Aged 18 and Over: cancer; glaucoma; HIV/AIDS; neurological disorders (e.g., Parkinson’s, MS, epilepsy, ALS); chronic pain; PTSD; autoimmune diseases; gastrointestinal conditions (e.g., Crohn’s disease, ulcerative colitis); sickle cell disease and fibromyalgia).
•For Individuals Under 18: cerebral palsy; cystic fibrosis; muscular dystrophy; severe epilepsy; terminal illnesses requiring end of life care and intractable neuropathic pain that is unresponsive to standard medical treatments.
For a comprehensive list of qualifying conditions, see the DCP’s Medical Marijuana Program: https://portal.ct.gov/dcp/medical-marijuana-program/qualification-requirements.
Florida
Florida Licensing Scheme
In Florida, the Florida Department of Health Office of Medical Marijuana Use (“FL OMMU”) licenses and regulates medical cannabis. The FL OMMU oversees 28 Medical Marijuana Treatment Centers, which encompass all vertically integrated operations, including cultivation, processing, fulfillment/storage and dispensing. Licenses are not capped; however, local zoning approval is required for each dispensary.
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Florida Medical Patient Requirements
Qualifying medical conditions include, but are not limited to, cancer; epilepsy; glaucoma; HIV/AIDS; PTSD; ALS; Crohn’s disease; Parkinson’s disease; MS; chronic non-malignant pain and terminal conditions.
For a comprehensive list of qualifying conditions, see the FL OMMU’s Medical Marijuana Use Program: https://knowthefactsmmj.com/patients/cards/.
Illinois
Illinois Licensing Scheme
In Illinois, the cannabis licensing framework is overseen by two departments: the Illinois Department of Financial and Professional Regulation for retail licenses and the Illinois Department of Agriculture for cultivation/processing licenses. License types include (i) retail, (ii) cultivation, (iii) craft growers, (iv) infusers and (v) transporters. Regulations limit each entity to a maximum of three cultivation licenses and 10 retail locations.
Illinois Medical Patient Requirements
Qualifying medical conditions include, but are not limited to, cancer; HIV/AIDS; ALS; Crohn’s disease; glaucoma; MS; PTSD; intractable pain; fibromyalgia; hepatitis C; Tourette’s syndrome and rheumatoid arthritis. Patients with valid opioid prescriptions may also qualify.
For a comprehensive list of qualifying conditions, see the Illinois Department of Public Health’s Medical Cannabis Program: https://www.dph.illinois.gov/topics-services/prevention-wellness/medical-cannabis.
Maine
Maine Licensing Scheme
In Maine, the Maine Department of Administrative and Financial Services Office of Cannabis Policy is responsible for licensing and regulating medical and adult-use cannabis. Licenses are not capped; however, (i) municipalities must opt-in for adult-use and (ii) medical dispensary owners must be residents of Maine. Medical licensees can be vertically integrated, with one license allowed per dispensary and one license per entity, subject to local approval and relevant licensing (e.g., tobacco or food licenses). Adult-use cannabis licensing is divided into three categories: retail, cultivation and manufacturing, with licensees permitted to hold licenses in multiple categories.
Maine Medical Patient Requirements
Qualifying conditions are determined by a practitioner and include any condition where cannabis is deemed therapeutically or palliatively beneficial.
Maryland
Maryland Licensing Scheme
In Maryland, the Maryland Medical Cannabis Commission (“MD MCC”) licenses and regulates medical and adult-use cannabis. Licenses are divided into five license types: (i) dispensary, (ii) grower/cultivator, (iii) processor, (iv) independent testing laboratory and (v) ancillary business. Each license is linked to a single facility. Regulations limit an individual or entity to holding an interest in, or control over, no more than one grower license, one processor license and four dispensary licenses.
Topicals and edible cannabis products are permitted, provided they are shelf-stable.
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Maryland Medical Patient Requirements
Qualifying medical conditions include, but are not limited to, cachexia; chronic pain; severe nausea; severe or persistent muscle spasms; glaucoma; HIV/AIDS; Crohn's disease; PTSD and other severe chronic conditions that are unresponsive to standard medical treatment. Additionally, all dispensaries must have a clinical director available electronically.
For a comprehensive list of qualifying conditions, see the MD MCC’s Medical Cannabis Program: https://cannabis.maryland.gov/Pages/Medical_Cannabis.aspx.
Massachusetts
Massachusetts Licensing Scheme
In Massachusetts, the Massachusetts Cannabis Control Commission (“MA CCC”) licenses and regulates medical and adult-use cannabis. Medical licenses are granted to Medical Treatment Centers (“MTCs”), which are vertically integrated businesses engaged in the cultivating, processing and retailing of their own cannabis and cannabis-derived products for medical use. Adult-use licenses are divided into a range of license types, including (i) retail, (ii) cultivation, (iii) product manufacturing, (iv) testing laboratories, (v) transporters, (vi) couriers, (vii) research facilities, (viii) social consumption establishments, (ix) microbusinesses and (x) delivery services. Licensees are permitted to hold no more than three licenses within a single license type. Additionally, canopy space is capped at 100,000 square feet, which must be distributed across no more than three cultivation licenses and three MTCs.
Massachusetts Medical Patient Requirements
Qualifying conditions include, but are not limited to, cancer; glaucoma; HIV/AIDS; hepatitis C; ALS; Crohn’s disease; Parkinson’s disease and MS, when such diseases are debilitating. Other debilitating conditions require the attestation of a Qualifying Patient’s healthcare provider.
For a comprehensive list of qualifying conditions, see the MA CCC's Medical Use of Marijuana Program: https://www.mass.gov/info-details/massachusetts-law-about-medical-marijuana.
Massachusetts Ballot Initiative
In Massachusetts, recent legislative activity has focused on expanding, rather than repealing, adult‑use cannabis, with the Senate in November 2025 passing a reform bill that would double the adult-use possession limit from one ounce to two ounces and restructure the Cannabis Control Commission to modernize and strengthen the state’s regulatory framework. There is currently a ballot initiative to repeal Adult Use cannabis in Massachusetts. This initiative has qualified for the ballot, however there are significant legal challenges and strong opposition by the cannabis industry against this effort.
Nevada
Nevada Licensing Scheme
In Nevada, the Nevada Cannabis Compliance Board (“NV CCB”) licenses and regulates medical and adult-use cannabis. Cannabis licenses types include (i) cultivation, (ii) product manufacturing, (iii) distribution, (iv) dispensary/retail, (v) testing laboratory and (vi) consumption lounge. Licenses are not capped; however, they are issued only during designated licensing rounds, which are conducted only on an as needed, based on jurisdictional regulations.
Nevada Medical Patient Requirements
Qualifying medical conditions include, but are not limited to, HIV/AIDS; cancer; anorexia nervosa; epilepsy; glaucoma; autism spectrum disorders; opioid addiction; muscle spasms (including, without limitation, spasms caused by MS) and neuropathic conditions, whether or not such condition causes seizures.
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For a comprehensive list of qualifying conditions, see the NV CCB’s Medical Marijuana Program: https://dpbh.nv.gov/Reg/MM-Patient-Cardholder-Registry/.
New Jersey
New Jersey Licensing Scheme
In New Jersey, the New Jersey Cannabis Regulatory Commission (“NJ CRC”) licenses and regulates medical and adult-use cannabis. Medical licenses are granted to Alternative Treatment Centers, which are vertically integrated businesses engaged in the cultivating, manufacturing and dispensing of their own cannabis and cannabis-derived products for medical use. Adult-use licenses are divided into the following types: (i) cultivation, (ii) manufacturing, (iii) wholesale, (iv) distribution, (v) retail and (vi) delivery. Adult-use licensees may vertically integrate by holding any combination of the license types simultaneously or by holding wholesale and distributor licenses simultaneously. Licenses are not capped; however, adult-use licensees are limited to operating one business per license type.
New Jersey Medical Patient Requirements
Qualifying medical conditions include, but are not limited to, ALS; anxiety; cancer; chronic pain; epilepsy; glaucoma; HIV/AIDS; Crohn's disease; PTSD; MS and terminal illnesses with a prognosis of less than 12 months.
For a comprehensive list of qualifying conditions, see the NJ CRC’s Medicinal Cannabis Program: https://www.nj.gov/cannabis/medicinalcannabis/medicinal/.
New Jersey Recent Legislation
New Jersey has authorized cannabis consumption lounges under N.J.S.A 24:6I-21, a provision enacted as part of the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act. The NJ CRC began accepting applications from social equity applicants in January 2025, diversely owned businesses and microbusinesses in April 2025 and all interested Class 5 cannabis retail operators in July 2025. The first four approvals were granted in August 2025.
New York
New York Licensing Scheme
In New York, the New York Cannabis Control Board (“NY CCB”), within the Office of Cannabis Management, licenses and regulates medical and adult-use cannabis. Medical licenses are granted to ‘registered organizations’, which are vertically integrated businesses permitted to manage one medical cultivation/processing facility and up to four medical dispensaries. Adult-use license types include (i) cultivation, (ii) processing, (iii) distribution, (iv) retail and (v) microbusiness operations.
New York Medical Patient Requirements
Under the OCM’s Medical Cannabis Program certification and registration system, practitioners are authorized to certify patients for medical cannabis use for any condition they believe can be effectively treated with medical cannabis.
For a comprehensive list of qualifying conditions, see the NY CCB’s Medical Cannabis Program: https://cannabis.ny.gov/medical-cannabis.
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New York Recent and Proposed Legislation
New York has implemented Metrc, a seed-to-sale tracking system intended to reduce the availability of illegal cannabis and cannabis-derived products in the state. The system went live in December 2025, and integration across cannabis licensees is ongoing.
North Dakota
North Dakota Licensing Scheme
In North Dakota, the North Dakota Department of Health and Human Services (“ND HHS”) licenses and regulates medical cannabis. There are two categories of licenses: manufacturing facilities (which are subdivided into cultivation-only and manufacturing-only) and dispensaries. Each license permits the operation of one dispensary or manufacturing facility per licensee. Currently, the ND HHS is permitted to issue a maximum of two manufacturing facilities licenses and eight dispensary licenses.
Manufacturing facilities are restricted to activities that fall under (i) producing, (ii) processing, (iii) acquiring, (iv) possessing, (v) storing, (vi) transferring and (vii) transporting medical cannabis or medical cannabis-derived products (excluding edibles). Dispensaries are only permitted to purchase cannabis from licensed manufacturing facilities and engage in the storing, delivering, transferring and transporting of medical cannabis.
North Dakota Medical Patient Requirements
Qualifying medical conditions include, but are not limited to, cancer; HIV/AIDS; ALS; PTSD; epilepsy; MS; Crohn's disease; neuropathies; Tourette’s syndrome; Ehlers-Danlos syndrome; autism spectrum disorders; brain injuries and terminal illnesses.
For a comprehensive list of qualifying conditions, please see the ND HHS’ Medical Marijuana Program: https://www.health.nd.gov/mm.
Ohio
Ohio Licensing Scheme
As of January 1, 2024, regulatory oversight of Ohio’s cannabis program is shared between two departments. The Division of Cannabis Control (“OH DCC”), within the Ohio Department of Commerce, oversees the registration of patients and caregivers and licenses medical cultivators, processors, dispensaries and testing laboratories. The OH DCC is also responsible for licensing and regulating the adult-use cannabis. The State Medical Board of Ohio certifies physicians to recommend medical cannabis and approve qualifying conditions.
The medical market is divided into the following license types: (i) cultivator (Level I and Level II), (ii) processor, (iii) dispensary and (iv) testing. Each license is tied to a single facility.
Ohio Medical Patient Requirements
Qualifying medical conditions include, but are not limited to, ALS; epilepsy; severe chronic or intractable pain; PTSD; MS; Parkinson's disease; Crohn's disease; glaucoma; HIV/AIDS; Tourette’s syndrome; traumatic brain injuries; ulcerative colitis and terminal illnesses.
For a comprehensive list of qualifying conditions, see the OH DCC’s Medical Marijuana Control Program Patient & Caregiver Registry: https://com.ohio.gov/divisions-and-programs/cannabis-control/patients-caregivers.
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Pennsylvania
Pennsylvania Licensing Scheme
In Pennsylvania, the Pennsylvania Department of Health (“PA DOH”) licenses and regulates medical cannabis. There are three license types: (i) grower/processor, (ii) dispensary and (iii) clinical registrant. PA DOH also requires each licensed dispensary to have a pharmacist or physician on-site during operating hours.
Pennsylvania Medical Patient Requirements
Qualifying medical conditions include, but are not limited to, ALS; anxiety disorder; cancer; epilepsy; glaucoma; HIV/AIDS; PTSD; MS; severe chronic or intractable pain; neurodegenerative diseases; Huntington’s disease; opioid use disorder (unresponsive to standard medical treatment) and terminal illnesses.
For a comprehensive list of qualifying conditions, see the PA DOH’s Medical Marijuana Program: https://www.pa.gov/agencies/health/programs/medical-marijuana.html.
Pennsylvania Legislative Efforts
Adult Use was not included in the just passed Pennsylvania budget for 2026. No cannabis amendments were adopted, thereby keeping the current regulatory regime and framework in place.
Utah
Utah Licensing Scheme
As of January 1, 2024, regulatory oversight of Utah's medical-only cannabis program is shared between two departments: (i) the Utah Department of Agriculture and Food (“UDAF”), which oversees the licensing of pharmacies, couriers, cultivation and processors of cannabis for medical use; and (ii) the Utah Department of Health and Human Services (“UDHHS”), which oversees regulation of recommending medical providers, pharmacists and patients. The recently established Cannabis Production Establishment Licensing Advisory Board is responsible for final approval of all medical cannabis licenses. As of the 2025 legislative session, pharmacy licenses are capped at 15 (plus one additional rural license in 2026 and one Closed-Door pharmacy). Standalone Tier 1 Processor licenses are capped at 18 (cap limit has already been reached); however, provisions have been made for cultivation licenses to acquire Tier 2 Processor licenses, which will allow for final packaging of flower. Cultivation licenses are capped at 15 (cap limit has not been reached). Licensees are allowed to hold multiple types of licenses, and licenses are non-transferable and non-assignable. Change in ownership of less than 50% are permitted without requiring a new license application.
Utah Medical Patient Requirements
Qualifying medical conditions include, but are not limited to, Alzheimer’s disease; ALS; cancer; epilepsy; chronic pain; autism spectrum disorders; Crohn's disease; ulcerative colitis; MS; HIV/AIDS; terminal illnesses with a life expectancy of less than six months and PTSD. PTSD qualifies if the patient is (i) treated and monitored by a licensed health therapist and either (ii) diagnosed by a Veterans Administration healthcare provider or diagnosed or confirmed by a licensed psychiatrist, psychologist, clinical social worker or psychiatric advanced practice registered nurse.
For a comprehensive list of qualifying conditions, see the UDHHS’ Center for Medical Cannabis: https://medicalcannabis.utah.gov/.
Canada
Our Canadian operations are conducted through Northern Green Canada ("NGC"), which operates a cultivation and manufacturing facility under federal and provincial cannabis regulations, including the Cannabis Act (Canada) and the
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regulations promulgated thereunder. NGC holds EU-GMP2 certification, which is critical to our European supply chain strategy.
Europe and International
Our European operations are subject to the national cannabis regulations of each jurisdiction in which we operate, as well as EU-wide pharmaceutical and GMP standards where applicable. Medical cannabis is legal in the U.K., Germany, Poland, Portugal and certain other jurisdictions in which we operate, subject to strict licensing and distribution controls.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS

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The following exhibits are filed or furnished herewith or incorporated by reference:
Exhibit No.
Exhibit Description
Filed Herewith / Incorporated by Reference
Incorporated by reference from the Company’s Form 6-K filed with the SEC on May 18, 2026 (File No. 333-249081, Exhibit 99.4, Appendix E thereto)
Incorporated by reference from the Company’s Form 6-K filed with the SEC on August 3, 2026 (File No. 333-249081, Exhibit 99.1 thereto)
Incorporated by reference from the Company’s Form 6-K filed with the SEC on August 3, 2026 (File No. 333-249081, Exhibit 99.2 thereto)
Incorporated by reference from the Company’s Form 6-K filed with the SEC on January 13, 2022 (File No. 333-249081, Exhibit 99.3 thereto)
Incorporated by reference from the Company’s Form 6-K filed with the SEC on January 13, 2022 (File No. 333-249081, Exhibit 99.8 thereto)
Incorporated by reference from the Company’s Form 6-K filed with the SEC on August 3, 2026 (File No. 333-249081, Exhibit 99.5 thereto)
Incorporated by reference from the Company’s Form 6-K filed with the SEC on December 19, 2023 (File No. 333-249081, Exhibit 99.5 thereto)
Incorporated by reference from the Company’s Form 6-K filed with the SEC on August 3, 2026 (File No. 333-249081, Exhibit 99.6 thereto)
Incorporated by reference from the Company’s Form 6-K filed with the SEC on February 27, 2026 (File No. 333-249081, Exhibit 99.1 thereto)
Incorporated by reference from the Company’s Form 6-K filed with the SEC on August 3, 2026 (File No. 333-249081, Exhibit 99.3 thereto)
Incorporated by reference from the Company’s Form 6-K filed with the SEC on August 3, 2026 (File No. 333-249081, Exhibit 99.7 thereto)
Filed herewith
Filed herewith
Filed herewith
Filed herewith
101.INS
Inline XBRL Instance Document
Filed herewith
101.SCH
Inline XBRL Taxonomy Extension Schema Document
Filed herewith
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase Document
Filed herewith
101.DEF
Inline XBRL Taxonomy Extension Definition Linkbase Document
Filed herewith
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase Document
Filed herewith
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase Document
Filed herewith
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
Filed herewith
* Management contract or compensatory plan or arrangement.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
CURALEAF HOLDINGS, INC.
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/s/ Boris Jordan
Boris Jordan
Chief Executive Officer and Chairman (Principal Executive Officer)
Date: August 5, 2026
/s/ Ed Kremer
Ed Kremer
Chief Financial Officer (Principal Financial Officer)
Date: August 5, 2026
/s/ Daniel Mickelson
Daniel Mickelson
Chief Accounting Officer
Date: August 5, 2026


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