Planet 13 Holdings reported second-quarter revenue of $22.9 million, down 14.9% from a year earlier, but gross margin climbed to 53.9% and the net loss shrank to $5.6 million from $13.3 million. The results, announced for the period ended June 30, 2026, arrive as the Las Vegas-based multi-state operator works toward closing its previously disclosed merger with Vireo Growth Inc., a deal that will reshape how the company reports - and how long it keeps reporting on its own.
A Smaller Top Line, a Healthier Margin
The revenue decline traces directly to Planet 13's exit from California retail and wholesale, plus continuing price compression in Nevada and Florida. That's not a new story in this industry - California's wholesale market has been brutal on margin for years, and operators without scale there have been peeling off one by one. What's notable is that Planet 13 turned a smaller revenue base into a better gross margin. Cutting the California drag, tightening procurement, and a $1.0 million reduction in the inventory reserve for Florida distillate all fed into the 53.9% gross margin figure, up from 43.4% a year prior. Strip out that reserve adjustment and margin still lands at 49.5%, which is the more honest number for anyone modeling forward quarters.
Total expenses fell 17.7% to $15.2 million, reflecting company-wide cost-cutting rather than a one-time item. Adjusted EBITDA loss narrowed to $0.5 million from $2.4 million. None of this is spectacular in absolute terms, but the direction matters more than the level here - a company trimming losses while shedding a costly market is doing the unglamorous work that precedes any credible turnaround, or any credible merger integration.
Florida's Slow Build and the Extraction Approval
Florida revenue rose 17.1% quarter over quarter, which the company points to as evidence the state business is stabilizing after a rocky stretch. Florida remains a medical-only market with tight regulatory oversight through the Office of Medical Marijuana Use, and vertically integrated operators there carry the full weight of cultivation, extraction, and dispensing compliance under one roof. The May 9 OMMU approval for a BHO extraction facility gives Planet 13 more control over its own concentrate supply rather than relying on third-party processing, which matters for both cost and consistency of finished product batches. The planned Sarasota store, announced July 22, extends the state footprint further, though new-store economics in a medical market depend heavily on patient registration growth and local competition - factors outside any single operator's control.
The Merger Overhang
Everything in this release sits under the shadow of the July 27 merger announcement with Vireo Growth. Co-CEO Bob Groesbeck's comment about the market rewarding "scale, greater purchasing power, broader distribution and the balance sheet to absorb continued price compression" is worth sitting with. That's a candid admission that standalone operators of Planet 13's size are increasingly squeezed between larger multi-state operators with deeper capital access and regional players with lower overhead. Combining with Vireo is a bet that a larger balance sheet buys negotiating leverage on wholesale pricing and procurement that neither company can get alone.
Notably, Planet 13 will not hold a quarterly conference call this cycle, citing the pending transaction - a common practice once a merger agreement is signed, since forward guidance gets complicated when two companies are being folded into one. For shareholders, employees, and the dispensary customers who show up at the counter, the practical question is whether the combined entity keeps store operations, product testing standards, and compliant packaging protocols consistent through the transition. Mergers in this sector often stall on regulatory approval timelines across multiple state cannabis boards, so a signed agreement is a milestone, not a finish line.
What Operators Should Watch
- Whether gross margin gains hold once the one-time inventory reserve benefit rolls off in future quarters
- How Florida's OMMU-regulated extraction approval affects concentrate supply costs and product availability
- Timing and state-by-state regulatory clearance needed before the Vireo merger can close
- Whether Nevada and Florida price compression continues to pressure wholesale menus industry-wide
