Aurora Cannabis Inc Q3 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Bill Kirk - Roth Capital Partners LLC - Analyst : Good morning, everybody. Miguel, I had a question, given the inflection in sales here, are you running into any supply constraints in any way or do you still have some room to continue to meet these opportunities and find more growth from here?

Question: Bill Kirk - Roth Capital Partners LLC - Analyst : And then if I can follow up, was were there any like unique or opportunistic items maybe load in particular country that benefited 3Q that just aren't as repeatable for 4Q going forward? Is there any way maybe you could quantify if things like that impacted 4 -- 3Q in a positive way.

Question: Bill Kirk - Roth Capital Partners LLC - Analyst : Wonderful, I'll pass it along. Thank you.

Question: Frederico Gomes - ATB Capital Markets - Analyst : Congrats on the great quarter. First question, just on competition in the international medical cannabis market. We've seen a lot of other LPs trying to enter those markets and export from Canada. How do you see that competition impacting those markets this year? Could it impact prices and margins or not? These markets are growing really fast. So how do you look at competition at this point?

Question: Frederico Gomes - ATB Capital Markets - Analyst : Perfect. Second question is on capital allocation. Now that you've reached the free cash flow positive, obviously, and generating a substantial amount of free cash flow. How are you looking at the balance sheet here, your capital allocation options in terms of growth internationally or maybe in Canada, capacity expansion, et cetera? Just how do you look at the different options that you have in terms of allocating that capital?

Question: Derek Lessard - TD Cowen - Analyst : Hey, good morning, everybody, and congrats on a great quarter. I just wanted to hit on your -- on the margin side of the business and maybe two parts, starting with the medical. Maybe just add some color around that 74% gross margin performance and then, kind of get a sense of what your thoughts are on the sustainability of that margin. And then secondly, on the plant propagation side, again strong results there. So I just want to get some additional color on the growth.

Question: Derek Lessard - TD Cowen - Analyst : Okay. That's super helpful, guys. And maybe just one more for me before I requeue. In Germany, now that, I guess, we're about nine months into the descheduling. What are you seeing, I guess, in terms of patient and then sales growth there? And maybe as a follow-up as well. You recently launched the first cultivar. Just wondering if you could speak to any of the potential cost savings in terms of transportation or anything else.

Question: Matt Bottomley - Canaccord Genuity - Analyst : Wanted to stick on the sort of the international contribution. Obviously, it's done very well for you guys. And it's something that more LPs and even some of the MSOs are starting to talk about with respect to those opportunities. So I guess, first, and I know you've touched on this a little bit, but maybe sort of two ways to look at it. One is, what's kind of the breakdown on average of sort of innovative products there versus maybe more bulk or flower? I know you guys are more in the higher quality segment of the market. But just trying to get an understanding of the types of products on average that make up your revenues. And then if you could also give any color as to what percentage of your customer patient base there or maybe just your revenues are attributable to patients that have coverage?

Question: Matt Bottomley - Canaccord Genuity - Analyst : Okay. Got it. And then just a quick one on consumer cannabis. Obviously, not core to the strategy so not a lot of color on it. But I'm just curious on how you look at that segment going forward in the more medium term. So we're seeing more decreases in that segment as you put more supply into the GMP manufactured products, as you put in your prepared statements. The 26% gross margin, does that flow down to like breakeven on a cash flow if you look at kind of at a 4-wall? And if it does, is there any sort of indication from a strategic standpoint, if there's any more investment into that segment? Or is this just business as usual, focusing on the higher-margin international and focusing on Canada when maybe the regulations change from an adult use standpoint?

Question: Doug Miehm - RBC Capital Markets - Analyst : You did talk about the potential for M&A given better pricing. But you'd stick with your knitting with respect to the medical side of the business. Is there part of your existing portfolio where you do see a need for a specific type of company? Or are you talking more about incremental supply for the growth of the market in various countries as they come on?

Question: Doug Miehm - RBC Capital Markets - Analyst : Okay. Perfect. And then as a follow-up, it's more a housekeeping on that taking over of all MedReleaf. But would you be able to delineate exactly what the contribution was from full consolidation in terms of absolute growth this latest quarter versus last year?

Question: Doug Miehm - RBC Capital Markets - Analyst : Okay. But you can't be more specific than that in terms of a number?