Payments company Mastercard (NYSE:MA) is putting a firm end to any US debit card transactions involving cannabis.
Meanwhile, this week in Canada another cannabis producer issued less-than-glowing financial results, adding to the list of losses faced by the domestic industry. Keep reading to find out more cannabis highlights from the past five days.
Mastercard axes US debit card transactions for cannabis
Mastercard’s move to shut down US debit card transactions for cannabis is another hit to the industry’s stability.
“In accordance with our policies, we instructed the financial institutions that offer payment services to cannabis merchants and connect them to Mastercard to terminate the activity,” the financial firm told Bloomberg.
This decision has created turmoil in the industry as dispensaries look to adjust, and as alternative banking solutions providers face an overwhelming number of queries.
As per usual, this challenge stems from cannabis’ ongoing status as an illegal substance in the US at the federal level, even though it is legal in some form or another in 38 states.
“Our rules require our customers to conduct lawful activity where they are licensed to use our brands. The federal government considers cannabis sales illegal, so these purchases are not allowed on our systems,” Mastercard said.
Mastercard’s decision highlights the scrutiny cannabis operations are facing as legalization efforts continue.
A slowdown at the federal level has been recognized by industry advocates and stakeholders, but it remains to be seen when financial relief may come for cannabis businesses.
“Legal cannabis deserves to be treated like every other business in this country. And 10 years later, we have no support from the federal government and Mastercard retrenching,” Morgan Paxhia, co-founder and managing director of Poseidon Investment Management, told MJBizDaily.
Tilray reports C$1.9 billion annual loss
Tilray Brands (NASDAQ:TLRY,TSX:TLRY) issued its Q4 and full-year financial results for the period ended on May 31, reporting heavy losses as it moves forward with the integration of its latest acquisition, fellow cannabis operator HEXO.
The company reported a C$1.9 billion net loss for the full year. However, the quarterly loss for the firm reduced significantly from the same period last year, falling from C$458 million to C$120 million.
“During the 2023 fiscal year, we delivered on our commitment to generate positive adjusted free cash flow across all business segments, and executed against our strategic plan to grow revenue, drive operating efficiencies, and improve margins and profitability, all while investing in our industry-leading brands,” Irwin Simon, chairman and CEO, said.
The company reported a net revenue uptick of 20 percent for the Q4 period, reaching a line of C$184 million.
Tilray’s total cannabis net revenue for this past quarter was C$64 million.
Cannabis company news
- Aurora Cannabis (NASDAQ:ACB,TSX:ACB)confirmed the sale of its Aurora Sun facility in Medicine Hat, Alberta. The ownership has now been passed on to Bevo Farms, which Aurora has a controlling interest in. Based on deliverables, “up to C$15 million could be payable” to Aurora regarding the transaction.
- SNDL (NASDAQ:SNDL)announced a mutual understanding with Nova Cannabis (TSX:NOVC,OTCQV:NVACF) to extend the deadline for the closing of their strategic partnership. The new date is August 25, 2023.
Don’t forget to follow us @INN_Cannabis for real-time news updates!
Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.
Image and article originally from investingnews.com. Read the original article here.