Planet 13 Holdings reported second-quarter 2026 revenue of $22.9 million, down 14.9% from a year earlier, as the multi-state operator worked through a California exit and continued price compression in its core Nevada and Florida markets. The results, disclosed August 12, arrive as the company moves toward closing its previously announced merger with Vireo Growth Inc. - a deal that reframes almost everything else in the release.
A Smaller Top Line, But a Cleaner Operation
Revenue fell, but the story underneath it is more interesting than the headline number. Gross margin improved to 53.9% from 43.4% a year prior, helped by the California retreat, company-wide procurement changes, and a $1.0 million reduction in an inventory reserve tied to Florida distillate. Strip out that one-time reserve adjustment and margin still lands at 49.5% - a meaningful gain regardless of how you slice it. Total expenses dropped 17.7% to $15.2 million, and the net loss narrowed to $5.6 million from $13.3 million. Adjusted EBITDA loss shrank to $0.5 million from $2.4 million. None of this makes Planet 13 profitable. It does suggest a company that trimmed cost structure faster than revenue eroded, which is the harder trick to pull off in a compressing wholesale environment.
Florida's Rebound and What It Signals for Distillate Inventory
Florida revenue rose 17.1% sequentially, a detail Co-CEO Larry Scheffler flagged directly. That growth mattered enough to justify releasing part of the distillate inventory reserve - in plain English, the company had built up excess vape and extract inventory in Florida, marked it down as a precaution, and then reversed some of that markdown once sales absorbed the surplus. For operators watching Florida's crowded medical market, this is a useful data point: inventory reserves tied to slow-moving SKUs are not permanent write-offs. They can reverse when demand catches up, and that reversal flows straight into gross margin. The company also secured OMMU approval in May for a Florida BHO extraction facility and confirmed a new Sarasota store opening in July, both signals of continued investment in the state even as broader retail pricing stays under pressure.
The Merger Overshadows the Quarter
Co-CEO Bob Groesbeck was candid about the underlying pressure driving the Vireo transaction: scale, purchasing power, distribution reach, and balance-sheet depth increasingly determine who survives price compression in mature adult-use and medical markets. That's not a controversial read of the multi-state operator sector right now. Smaller vertically integrated companies are finding it harder to compete on wholesale pricing against operators with larger cultivation footprints and broader retail networks. Planet 13's decision to skip its usual investor conference call this quarter - citing the pending merger - underscores how much the company's near-term narrative has shifted from quarterly operating performance to deal execution. Total assets stood at $144.3 million versus $152.3 million at year-end 2025, while total liabilities rose slightly to $105.5 million from $101.2 million, a balance sheet picture that will matter to Vireo shareholders evaluating the combined entity's leverage.
What Operators and Investors Should Watch
- Whether Florida's sequential revenue gain persists or reflects a temporary inventory correction
- How the Vireo merger timeline affects store-level operations, vendor contracts, and employee retention during the transition
- Continued margin trends as cost-cutting initiatives mature and price compression in Nevada persists
- Balance sheet changes as the combined company assumes Planet 13's liabilities alongside Vireo's own capital structure
For dispensary operators and wholesale suppliers elsewhere, Planet 13's quarter is a reminder that margin discipline - procurement terms, inventory reserve management, and cost control - can matter more than top-line growth when a market is compressing. Consolidation pressure of this kind rarely resolves quickly, and shareholders, employees, and patients connected to Planet 13's Nevada, Illinois, and Florida operations will be watching execution details as closing approaches, not just the merger announcement itself.
