$cbdMD, Inc. (NYSE American: YCBD) posted third-quarter fiscal 2026 net sales of $5.6 million, a 20.0% increase from $4.6 million in the year-ago period, as its Oasis hemp-derived THC beverage brand expanded distribution and the recently acquired Bluebird Botanicals delivered its first complete quarter of contribution. For the nine months ended June 30, 2026, net sales rose 12.0% to $16.2 million from $14.5 million in the prior-year period.
Revenue Mix & Margins
Wholesale net sales surged 61.0% year-over-year to $1.7 million, representing 30.0% of total net sales, reflecting Oasis shelf gains and core cbdMD initiative progress. Direct-to-consumer e-commerce accounted for the remaining $3.9 million, or 70.0% of net sales, a 9.0% increase aided by the Bluebird addition and partially offset by tightening state-level restrictions. Gross margin contracted to 54.7% from 61.5% in the prior-year quarter, pressured by a shift toward lower-margin wholesale, incremental warehouse and repacking costs tied to evolving state compliance requirements, and elevated inventory reserves set aside in anticipation of pending federal regulatory changes under Section 781 of H.R. 5371.
Loss from operations widened to approximately $1.13 million from approximately $900,000 in the year-ago quarter. Management attributed the deterioration to deliberate one-time expenditures: more than $100,000 in M&A due-diligence and legal costs, continued clinical and product-development investment — including a self-GRAS designation at 200 milligrams per day — and incremental supply-chain compliance spending. On an adjusted basis, the non-GAAP Adjusted EBITDA loss narrowed to approximately $508,000 from approximately $624,000 in the third quarter of fiscal 2025, a sequential improvement management frames as evidence of underlying operational progress. Net loss attributable to common shareholders held roughly flat at approximately $1.2 million, or $0.11 per share, versus approximately $1.2 million, or $0.21 per share, a year earlier; the per-share improvement reflects a larger share count. Working capital stood at approximately $4.7 million at June 30, 2026, up from approximately $3.4 million at September 30, 2025, while cash on hand eased slightly to approximately $2.1 million from approximately $2.3 million.
Beverage & Brand Buildout
Oasis continues to be the primary growth engine within the hemp-derived beverage segment, a category drawing increasing attention from retailers and distributors navigating evolving cannabis-adjacent regulations. The brand added South Carolina distribution and more than quadrupled Texas store access through a new distribution partner. Distributor depletions grew 25.0% in the third fiscal quarter; management reported record depletions in July, up more than 34.0% from the Q3 average, with August tracking to potentially double that figure. The company also launched an Oasis Kava zero-proof beverage — positioned as a non-intoxicating, THC-free functional alternative — marking the first in a pipeline of natural-compound extensions slated for release before calendar year-end.
Bluebird Botanicals, acquired in an all-stock transaction, contributed more than $500,000 in revenue during the quarter after creating an earnings drag during its initial integration period. Management expects Bluebird to contribute positively to both revenue and earnings in the fourth fiscal quarter.
Regulatory Runway & Cost Actions
The broader hemp-beverage industry, including operators tracked by Food & Beverage Magazine, is watching the legislative calendar closely as Section 781 of H.R. 5371 — signed into law in November 2025 and setting a 0.4-milligram per-container THC limit — carries a November 12, 2026 effective date. A Senate stopgap proposal, H.R. 6500, would temporarily exempt naturally occurring cannabinoids through December 11, 2026, buying procedural time for a permanent fix. The bipartisan Beverage Regulatory Parity Act, introduced August 10, 2026, would establish an alcohol-style regulatory framework for hemp-derived beverages — a structure that would directly benefit Oasis if enacted. The White House-supported Lawful Hemp Protection Act (H.R. 9830) adds further legislative momentum.
Separately, management implemented cost-reduction initiatives in July targeting $100,000 to $150,000 in monthly savings, equivalent to approximately $1.2 million to $1.8 million annualized, aimed at positioning the company for a post-regulation operating environment. "We are running the business to be leaner, more flexible, and well positioned to succeed in the market following the effectiveness of pending federal regulation," said Ronan Kennedy, Chief Executive Officer and Chief Financial Officer of cbdMD, noting that compliance-focused operators with clinical credibility are best placed to benefit as regulatory clarity emerges. The company also disclosed it continues to evaluate additional M&A opportunities in the functional-beverage and hemp wellness space, having expensed more than $100,000 in due-diligence costs during the quarter.
Written by Michael Politz, Author of Guide to Restaurant Success: The Proven Process for Starting Any Restaurant Business From Scratch to Success (ISBN: 978-1-119-66896-1), Founder of Food & Beverage Magazine, the leading online magazine and resource in the industry. Designer of the Bluetooth logo and recognized in Entrepreneur Magazine's "Top 40 Under 40" for founding American Wholesale Floral, Politz is also the Co-founder of the Proof Awards and the CPG Awards and a partner in numerous consumer brands across the food and beverage sector.
