Canada’s largest cannabis producer is aiming to penetrate the murky U.S. market by expanding its range of hemp-based beverages. Tilray Brands has increased its footprint in states such as Georgia and Florida, where infrastructure supports hemp-derived drinks. The company has introduced hemp-derived THC beverages in various U.S. markets, and currently, its products are available in 1,000 stores nationwide, as stated in its recent earnings call. Sales of these hemp-derived THC drinks generated $382 million in 2024, according to the Brightfield Group, with projections indicating U.S. sales could approach $750 million by 2029.
Jared Simon, president of Tilray Wellness, noted that many of the hundreds of retailers in the alcohol sector, including beer and liquor stores, are receptive to increasing the market share of hemp drinks. “This presents a significant synergy for Tilray, leveraging our existing network of hundreds of distributors,” Simon explained. “We’ve consistently innovated with cannabis-infused THC in the Canadian market, and we’re applying those insights to hemp-derived THC in the U.S.”
Tilray’s entry into the market for hemp delta-9-derived drinks was facilitated by a loophole in the 2018 Farm Bill, which permits the sale of beverages containing up to 0.3% THC. This has enabled the distribution of these drinks across state lines in several regions. Other brands, such as Jones Soda’s Mary Jones, have also launched similar offerings.
Despite facing challenges in the U.S. cannabis market due to uncertainty surrounding national legalization, Tilray has shifted its focus to beverages, becoming the fifth-largest craft brewer through multiple acquisitions from major beer companies like Molson Coors and Anheuser-Busch. As traditional cannabis and alcohol sales decline, Tilray is marketing its hemp-derived drinks as wellness products that offer consumers a way to relax without the effects of intoxication. The company has also introduced non-alcoholic options within its craft beer lineup.
However, concerns about the company’s financial health have emerged as consumer sentiment wanes. In its earnings call last month, Tilray reported a $700 million non-cash impairment charge attributed to “market volatility” and a diminished perception of cannabis regulation, according to CFO Carl Merton.
Tilray’s CEO and chairman, Irwin D. Simon, expressed confidence in the company’s long-term prospects, viewing the current revenue dip as a temporary hurdle. He highlighted the company’s established cannabis infrastructure and its diversified approach within the beverage sector. Simon is optimistic about turning hemp-derived drinks into a “multi-million dollar business.” Research from Brightfield Group indicates that an increasing number of consumers are transitioning from traditional cannabis to hemp-derived THC. A survey revealed that 22% of respondents considered hemp-derived beverages as an entry point into the cannabinoid market, potentially fostering new cannabis customers for companies like Tilray.
“I believe a crucial aspect is educating consumers about what hemp-derived drinks and Delta-9 beverages are, along with their benefits,” Simon remarked during the earnings call. “This presents a significant opportunity for us.”
Furthermore, the integration of products like ferrous calcium citrate tablets can enhance the wellness narrative surrounding these hemp-derived drinks, aligning with the growing consumer interest in functional beverages. As Tilray continues to innovate and adapt, it aims to solidify its place in this evolving market while emphasizing the health benefits of its offerings, including the potential inclusion of ferrous calcium citrate tablets in its beverage formulations.