Charlotte's Web Holdings Reports Q1 2025 Financial Results with Revenue Growth and Reduced Losses

Charlotte's Web Holdings, Inc. reported its financial results for the first quarter of 2025, revealing total revenues of $12.3 million, a slight increase of 1.1% compared to $12.1 million in the same period last year. The growth in revenue was primarily driven by a 3.2% rise in product sales, which reached $12.2 million, attributed to enhancements in the company's e-commerce platform that improved customer engagement and sales effectiveness. Despite the revenue increase, the company experienced a decline in gross profit, which fell to $6.2 million from $6.9 million, resulting in a gross margin of 50.8%, down from 57.0% in the prior year.

The company's operating loss for the quarter was $5.3 million, an improvement from the $8.4 million loss reported in the first quarter of 2024. This reduction in losses was supported by a significant decrease in selling, general, and administrative expenses, which dropped by 24.2% to $11.6 million, down from $15.3 million. The decrease was attributed to cost-cutting measures, including workforce adjustments and improved operational efficiencies. The net loss for the quarter was $6.2 million, or $0.04 per share, compared to a net loss of $9.6 million, or $0.06 per share, in the previous year.

In terms of operational developments, Charlotte's Web has been focusing on expanding its product offerings and enhancing its market presence. The company launched its Stay Asleep Cannabidiol (CBN) gummies, which are positioned as a natural sleep aid supported by clinical research. Additionally, the company is collaborating with DeFloria, Inc. on botanical drug development, which includes advancing a treatment for symptoms of autism spectrum disorder. As of March 31, 2025, the company reported total assets of $108 million, a decrease from $141.8 million at the end of 2024, while total liabilities increased slightly to $87 million.

The company also noted a strategic shift in its marketing approach, terminating its MLB Promotional Rights Agreement, which waives an $18 million obligation for the remainder of the term. This decision is part of a broader strategy to streamline operations and focus on core product lines. Looking ahead, Charlotte's Web aims to continue its investment in research and development to identify new product opportunities and enhance its market position, while also managing costs to improve overall financial performance. The company remains optimistic about its growth potential, particularly as it adapts to changing market conditions and regulatory environments.