Why investors were high on Cronos Group today

The market got a nice buzz from the Cronos Group (CHRON 4.50%) on the penultimate day of the trading week. The Canadian pot company revealed its second-quarter results, and investors found them encouraging enough to send Cronos shares nearly 5% higher. By comparison, the benchmark S&P 500 the index increased by 2.3%.

It’s lighting up in Canada

For its second quarter, Cronos — which reports in U.S. dollars — took in nearly $27.8 million in revenue, nearly 50% more than the $19 million it earned in the same period of 2023. On a more somber note, its headline net loss deepened 55% to nearly $8.8 million. Net loss was $0.02 per share.

On average, analysts following Cronos were expecting the marijuana company’s revenue to be slightly higher than $26 million. These experts, however, expected to break even on the bottom line.

In its earnings release, Cronos attributed the sizeable top-line improvement to stronger sales of cannabis flower and extract in its home market of Canada. It also said its international sales, to countries such as Germany and Israel, were higher.

General spending cuts are planned

Cronos provided rather unusual guidance for the full year 2024. It reiterated its goal of reducing annual expenses from $5 million to $10 million, which it hopes will come from reductions in general and administrative, sales/marketing expenses and research and development. It added that “Organizational and cost-saving initiatives are intended to position the company to generate profitable and sustainable growth over time.”

Cronos did not provide any revenue or profitability guidance for the year.