MARIMED INC.
For the period ended Jun 30, 2025. Filed Aug 7, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 7, 2025
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-08.
0001522767-25-000052
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-07.
0001522767-25-000169
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 113 previous paragraphs and 115 current paragraphs.
90 unchanged; 18 reworded; 7 added; 3 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 4 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (7)
Current report
Three and six months ended June 30, 2025 and 2024
Current report
Our total revenue for both the three and six months ended June 30, 2025 decreased by $0.8 million compared to the same prior year periods.
Current report
Our product sales increased by $0.1 million and $0.8 million in the three and six months ended June 30, 2025, respectively, compared to the three and six months ended June 30, 2024, respectively. Decreases in retail sales were more than offset by increases in wholesale sales in each of the three and six month periods ended June 30, 2025, compared to the same prior year periods. The decreases in retail sales in both current periods were primarily attributable to lower sales in certain of our dispensaries in Illinois, Massachusetts and Maryland. These decreases were partially offset by higher sales in our other dispensaries in Maryland, Massachusetts and Ohio, as well as the inclusion of retail revenue from FSC for the period since the FSC Acquisition Date. The increases in our wholesale revenue were primarily attributable to higher wholesale revenue in Maryland, Illinois, Missouri and Delaware, partially offset by a decline in wholesale revenue in Massachusetts. The decreases in total other revenue in the three and six months ended June 30, 2025 compared to the same prior year periods were primarily attributable to lower other revenue due to the cessation of revenue recognition from management fees, rental income and other components of other income, effective as of the FSC Acquisition Date.
Current report
We recorded net other income of approximately $17,000 in each of the three and six months ended June 30, 2025 in connection with gains on the disposal of assets. We recorded net other expense of approximately $30,000 and $50,000 in the three and six months ended June 30, 2024, respectively, primarily related to changes in the fair value of investments.
Current report
We recorded income tax provisions of $0.7 million and $3.5 million in the three and six months ended June 30, 2025, respectively, and $0.9 million and $2.6 million in the three and six months ended June 30, 2024, respectively.
Current report
We are subject to income taxes in the jurisdictions in which we operate, and consequently, income tax expense is a function of the allocation of taxable income by jurisdiction and the various activities that impact the timing of taxable events. As we operate in the federally illegal cannabis industry, we are subject to the limitations of the U.S. Internal Revenue Code of 1986, as amended (“IRC”) Section 280E, under which taxpayers are only allowed to deduct expenses directly related to cost of goods sold of cannabis products. This results in permanent differences between ordinary and necessary business expenses deemed non-allowable under IRC Section 280E and a higher effective tax rate than most industries. As a result, our effective tax rate can be highly variable and may not necessarily correlate to pre-tax income or loss.
Current report
In June 2025, the IRS filed a lien against us in connection with an approximate $6 million 2023 alleged tax liability. We are disputing the assessment through a Collection Due Process (“CDP”) Hearing and pursuing a resolution, including potential reduction or collection alternatives. While the matter is pending, IRS enforcement is generally stayed. Although the liability is fully accrued in the accompanying condensed consolidated financial statements, an unfavorable outcome could materially impact our operations and financial position.
Removed paragraphs (3)
Previous report
Our total revenue for the three months ended March 31, 2025 was virtually unchanged from our total revenue in the three months ended March 31, 2024. The $2.3 million increase in revenue from our wholesale operations was offset by decreases of $1.6 million and $0.7 million in retail sales and other revenue, respectively. The increase in wholesale revenue was primarily attributable to higher wholesale revenue in Illinois and Maryland, coupled with higher revenue in certain of our other wholesale locations. Our retail operations reported higher revenue in certain of our dispensaries in Massachusetts, Illinois and Ohio, along with the impact of FSC since the FSC Acquisition Date; however, these increases were offset by lower retail sales in other locations. The decrease in other revenue was primarily due to lower management fees and real estate rentals arising from our acquisition of the businesses from whom we had previously recognized such revenue.
Previous report
We reported net other expense of approximately $20,000 in the three months ended March 31, 2024, which was related to the change in the fair value of our investments. We did not recognize any other income or expense in the three months ended March 31, 2025.
Previous report
We recorded income tax provisions of $2.8 million and $1.7 million in the three months ended March 31, 2025 and 2024, respectively. Our income tax provisions are impacted by Section 280E of the Internal Revenue Code, which prohibits the deduction of certain ordinary business expenses.
Reworded paragraphs (18)
Previous wording
We completed the acquisition of First State Compassion Center ("FSC"), the leading cannabis operator in Delaware, effective March 1, 2025 (the "FSC Acquisition Date"). Prior to its acquisition by us (the "FSC Acquisition"), FSC had been our managed services client. The financial results of FSC are included in our condensed consolidated financial statements for the period subsequent to the FSC Acquisition Date.
Current wording
We completed the acquisition of First State Compassion Center ("FSC"), the leading cannabis operator in Delaware, effective March 1, 2025 (the "FSC Acquisition Date"). Prior to its acquisition by us (the "FSC Acquisition"), FSC had been our managed services client. The financial results of FSC are included in our condensed consolidated financial statements for the periods subsequent to the FSC Acquisition Date.
Previous wording
We completed two acquisitions in the year ended December 31, 2024, which we accounted for as asset purchase. On April 9, 2024, we acquired 100% of the membership interests of Allgreens Dispensary, LLC ("Allgreens"), which held a conditional adult-use cannabis dispensary license in Illinois. On April 5, 2024, we acquired 100% of the membership interests of Our Community Wellness & Compassionate Care Center, Inc. ("MedLeaf"), which held a retail dispensary license in Maryland. The MedLeaf dispensary had ceased operations since July 1, 2023, but we reopened it on August 19, 2024, upon receiving regulatory approval to commence adult use retail sales.
Current wording
We completed two acquisitions in the year ended December 31, 2024, which we accounted for as asset purchases. On April 9, 2024, we acquired 100% of the membership interests of Allgreens Dispensary, LLC ("Allgreens"), which held a conditional adult-use cannabis dispensary license in Illinois. On April 5, 2024, we acquired 100% of the membership interests of Our Community Wellness & Compassionate Care Center, Inc. ("MedLeaf"), which held a retail dispensary license in Maryland. The MedLeaf dispensary had ceased operations since July 1, 2023, but we reopened it on August 19, 2024, upon receiving regulatory approval to commence adult use retail sales.
Previous wording
Revenue for the three months ended March 31, 2025 and 2024 was comprised of the following (in thousands):
Current wording
Revenue for the three and six months ended June 30, 2025 and 2024 was comprised of the following (in thousands):
Previous wording
Our cost of revenue, gross profit and gross margin for the three months ended March 31, 2025 and 2024 were as follows (in thousands, except percentages):
Current wording
Our cost of revenue, gross profit and gross margin for the three and six months ended June 30, 2025 and 2024 were as follows (in thousands, except percentages):
Previous wording
Our cost of revenue increased $1.4 million while revenue remained virtually unchanged in the three months ended March 31, 2025 compared to the three months ended March 31, 2024. This increase was primarily attributable to higher employee-related and facilities and related costs. Our higher personnel costs were primarily due to our increased headcount in connection with our recent acquisitions and expanded footprint. These increases were partially offset by decreases in certain inventory-related expenses.
Current wording
Our cost of revenue increased nominally in the three months ended June 30, 2025 compared to the three months ended June 30, 2024. Our cost of revenue increased by $1.4 million in the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily due to higher employee-related, facilities and related expenses, partially offset by lower inventory-related expenses. The increases in employee-related, facilities and related expenses were primarily due to our increased headcount in connection with our recent acquisitions and expanded footprint.
Previous wording
Our operating expenses are comprised of personnel, marketing and promotion, general and administrative, acquisition-related and other, and bad debt expenses. Our operating expenses for the three months ended March 31, 2025 and 2024 were as follows (in thousands, except percentages):
Current wording
Our operating expenses are comprised of personnel, marketing and promotion, general and administrative, acquisition-related and other, and bad debt expenses. Our operating expenses for the three and six months ended June 30, 2025 and 2024 were as follows (in thousands, except percentages):
Previous wording
The increase in our personnel expenses in the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was primarily due to the increased headcount to support our acquisitions and resulting additional facilities and presence. Personnel costs increased to approximately 19% of revenue in the three months ended March 31, 2025, compared to approximately 17% of revenue in the three months ended March 31, 2024.
Current wording
The increases in our personnel expenses in both the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024 were primarily due to the increased headcount to support our acquisitions and resulting additional facilities and presence. Personnel costs increased to approximately 19% of revenue in each of the three and six months ended June 30, 2025, compared to approximately 17% of revenue in each of the three and six months ended June 30, 2024.
Previous wording
The decrease in our marketing and promotion expenses in the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was primarily attributable to our planned reductions to these expenses; however, we continue to focus on judicious marketing initiatives that expand the branding and distribution of our licensed products.
Current wording
The decreases in our marketing and promotion expenses in each of the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024 were primarily attributable to our planned reductions to these expenditures; however, we continue to focus on judicious marketing initiatives that expand the branding and distribution of our licensed products.
Previous wording
Our general and administrative expenses increased slightly in the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The increase was primarily attributable to higher facilities, stock-based compensation and insurance expenses, which were largely offset by decreases in certain other general and administrative expenses, such as professional fees and depreciation.
Current wording
The increases in our general and administrative expenses in each of the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024 were primarily attributable to higher facilities, stock-based compensation and insurance expenses. These increases were largely offset by decreases in certain other general and administrative expenses, such as professional fees, travel and entertainment, and depreciation.
Previous wording
Acquisition-related and other expenses include those expenses related to acquisitions and other significant transactions that we would otherwise not have incurred, and include professional and services fees, such as legal, audit, consulting, paying agent and other fees. Our acquisition-related and other expense in the three months ended March 31, 2025 primarily related to the FSC Acquisition. Our acquisition-related and other expense in the three months ended March 31, 2024 primarily related to the acquisitions of MedLeaf and Allgreens, which were both consummated in April 2024.
Current wording
Acquisition-related and other expenses include those expenses related to acquisitive activities and other significant transactions that we would otherwise not have incurred, and include professional and services fees, such as legal, audit, consulting, paying agent and other fees. Our acquisition-related and other expense in each of the three and six months ended June 30, 2025 primarily related to the FSC Acquisition and other acquisitive activities. Our acquisition-related and other expense in the three and six months ended June 30, 2024 primarily related to the acquisitions of MedLeaf and Allgreens, which were both consummated in April 2024, and non-cash expense for warrants to purchase our common stock issued to an entity in consideration for introductory and other services rendered in connection with certain funding and acquisitive transactions.
Previous wording
We recorded $1.4 million of bad debt expense in the three months ended March 31, 2025, comprised of $1.3 million of expense to fully reserve an amount due from a credit card service provider (the "Service Provider Receivable") and $0.1 million of expense to reserve for certain trade accounts receivable accounts. The Service Provider Receivable was reported in our condensed consolidated balance sheets as a component of Other assets at March 31, 2025 and as a component of Cash at December 31, 2024. The reserve was reported as a component of Other assets in our condensed consolidated balance sheet at March 31, 2025.
Current wording
We recorded $0.2 million and $1.6 million of bad debt expense in the three and six months ended June 30, 2025, respectively. The six-month amount included $1.5 million of expense to fully reserve amounts due from two credit card service providers (the "Service Provider Receivables") and $0.1 million of expense to reserve for certain trade receivable accounts. Of the $1.5 million of Service Provider Receivables, $1.3 million and the related reserve were included as components of Other assets and $0.2 million and the related reserve were included as components of Accounts Receivable in the condensed consolidated balance sheet at June 30, 2025. At December 31, 2024, the Service Provider Receivables were included as components of Cash. We recorded a nominal credit to bad debt expense in each of the three and six months ended June 30, 2024.
Previous wording
Our net interest expense increased $0.1 million in the three months ended March 31, 2025 compared to the three months ended March 31, 2024, primarily due to the interest on the notes issued in connection with the MedLeaf and Allgreens acquisitions and our entry into additional finance leases.
Current wording
Our net interest expense increased nominally in the three months ended June 30, 2025 compared to the three months ended June 30, 2024, and increased $0.2 million in the six months ended June 30, 2025 compared to the six months ended June 30, 2024. These increases were primarily due to the interest on additional finance leases and the refinancing of one of our mortgages.
Previous wording
We had cash and cash equivalents of $7.2 million and $7.3 million at March 31, 2025 and December 31, 2024, respectively. In addition to the discussions below of our cash flows from operating, investing, and financing activities, please also see our discussion of non-GAAP Adjusted EBITDA in the section “Non-GAAP Measurement” below, which discusses an additional financial measure not defined by GAAP which our management also uses to measure our liquidity.
Current wording
We had cash and cash equivalents of $6.1 million and $7.3 million at June 30, 2025 and December 31, 2024, respectively. In addition to the discussions below of our cash flows from operating, investing, and financing activities, please also see our discussion of non-GAAP Adjusted EBITDA in the section “Non-GAAP Measurement” below, which discusses an additional financial measure not defined by GAAP which our management also uses to measure our liquidity.
Previous wording
Our operating activities provided $1.3 million and $3.2 million of cash in the three months ended March 31, 2025 and 2024, respectively. The change in cash from operating activities in the current year period compared to the prior year was primarily attributable to higher personnel costs and operating expenses arising from expanding our geographic presence. These higher costs primarily relate to personnel, cultivation/manufacturing and facility expenses.
Current wording
Our operating activities provided $1.6 million and $6.4 million of cash in the six months ended June 30, 2025 and 2024, respectively. The change in cash from operating activities in the current year period compared to the prior year was primarily attributable to higher personnel costs and operating expenses arising from expanding our geographic presence. These higher costs primarily relate to personnel, cultivation/manufacturing and facility expenses.
Previous wording
Our investing activities used $0.1 million and $4.3 million of cash in the three months ended March 31, 2025 and 2024, respectively. During the three months ended March 31, 2025, we used $0.3 million of cash for capital expenditures and $0.1 million in the aggregate for advances toward future business acquisitions and purchases of cannabis licenses. These amounts were partially offset by $0.2 million of cash acquired in connection with the FSC Acquisition and approximately $26,000 of proceeds from notes receivable. During the three months ended March 31, 2024, we used $3.4 million of cash for capital expenditures, $0.5 million for advances toward future business acquisitions, $0.3 million for purchases of cannabis licenses an $0.1 million for the purchase of certain investments.
Current wording
Our investing activities used $0.7 million and $13.8 million of cash in the six months ended June 30, 2025 and 2024, respectively. During the six months ended June 30, 2025, we used $0.6 million of cash for capital expenditures and $0.4 million in the aggregate for advances toward future business acquisitions and purchases and renewals of cannabis licenses. These amounts were partially offset by $0.2 million of cash acquired in connection with the FSC Acquisition and approximately $26,000 of proceeds from notes receivable. During the six months ended June 30, 2024, we used $8.3 million of cash for capital expenditures, $4.3 million in the aggregate for purchase consideration in connection with the MedLeaf Acquisition and Allgreens Acquisition, $0.6 million for purchases and renewals of cannabis licenses and $0.5 million for advances toward future business acquisitions.
Previous wording
Our financing activities used $1.3 million of cash in the three months ended March 31, 2025 and provided $1.6 million of cash in the three months ended March 1, 2024. During the three months ended March 31, 2025, we made $1.2 million of aggregate principal payments on our outstanding mortgages, promissory notes and finance leases, and approximately $58,000 of distribution payments. During the three months ended March 31, 2024, we received $1.0 million of proceeds from the CREM Loan (described above) and $1.2 million of proceeds from the refinancing of our retail facility in Mt. Vernon, Illinois. We made $0.5 million of aggregate principal payments on our outstanding mortgages, promissory notes and finance leases and approximately $45,000 of distribution payments.
Current wording
Our financing activities used $2.1 million of cash in the six months ended June 30, 2025 and provided $3.0 million of cash in the six months ended June 30, 2024. During the six months ended June 30, 2025, we made $4.0 million of aggregate principal payments on our outstanding mortgages, promissory notes and finance leases and made approximately $81,000 of distribution payments. We received $2.0 million from the refinancing of the mortgage on one of our facilities in Illinois, of which we used $0.7 million of proceeds to retire the previous mortgage on this facility, which amount is included in the aggregate principal payments discussed above. During the six months ended June 30, 2024, we received $2.9 million of additional proceeds from the CREM Loan (described above) and $1.2 million of proceeds from the refinancing of our retail facility in Mt. Vernon, Illinois. We made $1.1 million of aggregate principal payments on our outstanding mortgages, promissory notes and finance leases, and approximately $83,000 of distribution payments.
Previous wording
Based on our current expectations, we believe our current cash and future funding opportunities will be sufficient to meet our anticipated cash needs for working capital and capital expenditures for at least the next twelve months. The rate at which we consume cash is dependent on the cash needs of our future operations, including our contractual obligations at March 31, 2025, and our ability to raise additional cash through financing activities. Our contractual obligations at
Current wording
Based on our current expectations, we believe our current cash and future funding opportunities will be sufficient to meet our anticipated cash needs for working capital and capital expenditures for at least the next twelve months. The rate at which we consume cash is dependent on the cash needs of our future operations, including our contractual obligations at June 30, 2025, and our ability to raise additional cash through financing activities. Our contractual obligations at June 30, 2025 were primarily comprised of our outstanding CREM Loan, mortgages, promissory notes, and operating and finance leases. Our CREM Loan, mortgage and promissory note obligations totaled approximately $74 million at June 30, 2025.
Previous wording
The table below reconciles income from operations to Adjusted EBITDA for the three months ended March 31, 2025 and 2024 (in thousands):
Current wording
The table below reconciles income from operations to Adjusted EBITDA for the three and six months ended June 30, 2025 and 2024 (in thousands):
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Three months ended March 31, 2025 and 2024
Previous report — wording carried elsewhere
March 31, 2025 were primarily comprised of our outstanding CREM Loan, mortgages and promissory notes, and operating leases. Our CREM Loan, mortgage and promissory note obligations totaled approximately $74 million at March 31, 2025.