Hydrofarm Holdings Group, Inc. reported a net loss of $14.4 million for the three months ended March 31, 2025, compared to a net loss of $12.6 million during the same period in 2024. The company's revenue for the first quarter of 2025 was $40.5 million, reflecting a decrease of 25.2% from $54.2 million in the prior year. This decline was attributed to a 22.6% reduction in the volume and mix of products sold, alongside a 1.8% decrease in pricing, primarily driven by oversupply conditions in the cannabis market.
The company's gross profit also fell to $6.9 million, down 37.1% from $10.9 million in the previous year, resulting in a gross profit margin of 17.0%, down from 20.2%. Operating expenses decreased to $17.9 million, a reduction of 9.0% from $19.6 million, largely due to cost-saving measures implemented as part of a restructuring plan initiated in 2022. Despite these efforts, the loss from operations increased to $11.0 million from $8.7 million year-over-year.
In terms of operational developments, Hydrofarm has been actively restructuring its operations to improve efficiency and reduce costs. The second phase of its restructuring plan was completed by March 31, 2025, which included consolidating U.S. manufacturing facilities and reducing headcount. The company also executed an asset sale in May 2024, selling certain inventories and property related to its Innovative Growers Equipment brand for approximately $8.7 million, while retaining brand ownership and customer relationships.
As of March 31, 2025, Hydrofarm had approximately 4.6 million shares outstanding, with a weighted average of 4.6 million shares used to calculate net loss per share, which was $(3.12) for both basic and diluted shares. The company reported cash and cash equivalents of $13.7 million, down from $26.1 million at the end of 2024, and net cash used in operating activities was $11.8 million for the quarter. Looking ahead, Hydrofarm's management remains cautious about market conditions, particularly regarding the cannabis industry, and is focused on evaluating its product portfolio and supply chain to enhance operational efficiency and financial performance.
About HYDROFARM HOLDINGS GROUP, INC.
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