As multi-state operators kick off 2023 earnings, Green Thumb Industries (GTBIF) reported strong cash flow generation despite a muted top-line result. Q1 revenue for the industry leader was up 2.4% year-over-year. Same-store sales grew 6%, which helped drive total retail growth of 9.4% and offset wholesale declines of 14.7%.
Management attributed the wholesale softness to continued price compression across markets, a narrative we expect to hear from most U.S. operators through the first half of the year before any prospects of stabilization. Despite the sequential price compression, gross margins grew 240 basis points to 50.2% from Q4. (A basis point = 0.01%).
