How are Tilray (TLRY) and Aurora Cannabis (ACB) trading after reporting earnings?

Earnings season is past its peak, but a couple of prominent marijuana stocks reported their latest results, pulling investors’ attention to the cannabis market. Tilray (NASDAQ:TLRY) and Aurora Cannabis (NYSE:ACB) are both big players in marijuana, and their quarterly reports reveal a lot about how the industry looks right now and what you have to do to be successful investing in it…

Tilray heads lower

Shares of Tilray fell 5% after the cannabis company reported its first-quarter financial results. Revenue nearly tripled from the first quarter of 2018, with the company benefiting dramatically from the legalization of recreational cannabis throughout Canada late last year. About a third of Tilray’s sales came from the adult-use market, with another third coming from domestic medical marijuana and the rest coming from cannabis-containing food products and its international medical marijuana business.

Tilray saw production and sales volumes jump. The pot producer sold more than 3,000 kilos of marijuana during the quarter, up from just 1,300 kilos 12 months ago. Acquisitions also played a key role in Tilray’s growth, with the purchase of natural foods and hemp producer Manitoba Harvest opening up new product lines for the company and the purchase of Natura Naturals helping Tilray boost its cultivation capacity.

That said, CEO Brendan Kennedy highlighted a problem that Tilray has faced: finding high-quality cannabis for sale. Kennedy believes that supply constraints will likely persist until late 2020 or early 2021, and even with efforts to build out facilities to ramp up its own production, Tilray won’t be able to meet demand for a while.

For investors, the fact that Tilray lost more money than it did a year ago isn’t surprising, given higher costs for marketing and growth-seeking initiatives. Yet the news does highlight that it’ll take time for promising companies like Tilray to meet their full potential even if things keep going well in the marijuana space.

Aurora goes big

Elsewhere among pot stocks, Aurora’s shares were…

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