Planet 13 Holdings reported second-quarter 2026 revenue of $22.9 million, down 14.9% from a year earlier, but the multi-state operator's real story is margin recovery, not top-line growth. Gross margin climbed to 53.9% from 43.4%, and the adjusted EBITDA loss narrowed to $0.5 million from $2.4 million a year ago. The results, covering the three months ended June 30, 2026, arrive as the company works toward closing its previously announced merger with Vireo Growth Inc.
Exiting California, Chasing Efficiency
The revenue decline traces directly to Planet 13's exit from California retail and wholesale operations, a market where price compression had already squeezed margins for years. Pulling out of a saturated, high-tax adult-use market to protect the balance sheet elsewhere is not a new playbook among multi-state operators; several have made similar retreats as California's illicit market and local licensing patchwork kept undercutting compliant retailers. What's striking here is how quickly the exit showed up in gross margin. Excluding a one-time $1.0 million reduction in the company's Florida distillate inventory reserve, margin still landed at 49.5% - a meaningful improvement that reflects company-wide procurement and cost-cutting initiatives rather than a one-quarter accounting quirk.
Florida Momentum, Nevada Headwinds
Florida revenue grew 17.1% quarter over quarter, a notable turn for a state where Planet 13 has been working to stabilize operations after earlier stumbles. The company also received OMMU approval in May for a Florida BHO extraction facility and announced a new Sarasota store in July, signals that it intends to keep building out vertical integration in that market even as it manages the broader corporate transition. Nevada, by contrast, continues to face price compression - a familiar pattern in mature adult-use markets where dispensary density and wholesale oversupply push retail prices down faster than operators can cut costs. For dispensary operators watching from other states, the lesson is straightforward: even award-winning retail concepts and flagship locations, like Planet 13's large-format Las Vegas store, are not immune to wholesale pricing pressure once a market matures.
What the Merger Signals for Operators
Co-CEO Bob Groesbeck's comments frame the Vireo merger as a response to a market that increasingly rewards scale - greater purchasing power, broader distribution, and a balance sheet that can absorb continued price compression. That's a candid admission, and it applies well beyond Planet 13. Smaller and mid-sized multi-state operators are under similar pressure: 280E tax burdens limit deductions available to ordinary businesses, capital remains expensive without access to federal banking, and consolidation is becoming a more common exit path than organic growth. Because the merger is pending, Planet 13 did not hold its usual quarterly conference call, a procedural detail but one worth noting for investors tracking disclosure practices during M&A transitions.
Balance Sheet and Compliance Context
Cash and restricted cash stood at $16.5 million versus $15.6 million at year-end 2025, while total liabilities rose slightly to $105.5 million. Net loss narrowed to $5.6 million from $13.3 million. None of these figures suggest a company in crisis, but they do describe an operator managing a leaner footprint while betting that scale, through consolidation, offers a more durable path than continuing to compete store by store in markets with falling wholesale prices.
- Revenue: $22.9 million, down 14.9% year over year
- Gross margin: 53.9% reported, 49.5% excluding inventory reserve adjustment
- Adjusted EBITDA loss: $0.5 million, improved from $2.4 million
- Florida revenue up 17.1% sequentially
- Merger with Vireo Growth Inc. announced July 27, 2026
