The focus on hemp-based drinks marks a new era for the firm under its new GTI leadership.
Agrify Corp. (Nasdaq: AGFY) saw wider third-quarter losses driven primarily by changes in warrant valuations as its new management pivots toward hemp-derived beverages.
The Michigan-based company posted a net loss of $18.7 million, or $17.31 per share, versus a $2.1 million loss in the same period last year, the company said Thursday. The increased loss was mainly attributed to a $15 million change in warrant liabilities.
Revenue dropped 38% to $1.9 million from $3.1 million a year earlier, while gross profit declined to $200,000 from $974,000.
The earnings report comes just days after Green Thumb (CSE: GTII) (OTCQX: GTBIF), one of the largest U.S. cannabis operators, effectively took control of Agrify through a $20 million convertible note financing deal. As part of that transaction, GTI CEO Ben Kovler was appointed chairman and interim CEO, replacing outgoing chief Raymond Chang.
“Today really is Day One at Agrify,” Kovler said in a statement. “The hemp and cannabis industries are evolving fast and Agrify’s fortified balance sheet is ready to move on opportunities.”
Yesterday, the new leadership announced plans to acquire Double or Nothing’s Señorita brand of hemp-derived THC beverages in an all-stock transaction valued at approximately $4.9 million based on current share prices. The deal would give Agrify entry into the growing hemp beverage sector, with Señorita products currently sold in Canada and nine U.S. states.
That acquisition could provide a needed revenue boost for Agrify, which according to regulatory filings had just $263,000 in cash at the end of September. The company has struggled financially, accumulating a $265 million deficit as of December 2023, based on previous disclosures.
The new strategy marks a departure from Agrify’s historical focus on cannabis cultivation and extraction equipment. The company developed proprietary vertical farming units and extraction systems for cannabis producers.
Ditching cannabis growing tech for hemp-based drinks marks a new era for the firm under its new GTI leadership. Read More
