Unrivaled Brands, Inc.

For Q3 2021, Unrivaled reported revenue of $23.4 million versus $3.1 million in Q3 2020, up 668% year over year. Gross profit was $2.3 million versus about $1.4 million a year ago, and operating loss was $11.2 million versus $13.9 million in Q3 2020. Net loss was $5.35 million, or $0.01 per share, compared with a net loss of $18.2 million, or $0.09 per share, in the prior-year quarter; non-GAAP loss was $0.9 million versus $12.7 million a year ago. Management said a $4 million inventory reserve hit cost of sales and gross margins. For the next period, management reaffirmed 2022 revenue guidance above $130 million and said it expects EBITDA positive in Q1 2022.

Frank Knuettel framed the quarter as the company’s first after the UMBRLA merger and a step toward becoming a dominant West Coast MSO. He emphasized that the long-term value drivers are branded products and dispensary brands, supported by owned retail and delivery channels, and said the company is using integration to improve cross-selling and control more of the margin pool. His tone was constructive but measured, highlighting meaningful operational progress while noting that margin improvement and capital discipline remain priorities.

Jeff Batliner focused on the scale-up in the income statement and the effects of integration. He broke Q3 revenue into $7.2 million of retail, $14.6 million of distribution, and $1.6 million of cultivation revenue, and said gross profit was reduced by the $4 million inventory reserve. He also pointed out SG&A of $13.5 million, up 142% year over year, though down to 57% of revenue from 183% in Q3 2020, and noted the company had 286 employees versus 60 last year. He reiterated management’s aim to keep investing in growth and marketing while letting fixed and quasi-fixed costs decline as a percentage of revenue.

Questions centered on cannabis banking reform, the stock price, gross margin, edible gardens, and possible Nevada expansion. On SAFE Banking, management said momentum appears to be building for a SAFE-like bill in the next 4 to 6 months, though more expansive legislation may take longer. On the share price, Knuettel said he cannot control timing and believes the stock should follow as the company builds a better business and communicates more clearly; on Nevada, he said the company sees bigger opportunities in California and Oregon and is not planning immediate expansion there because Nevada’s market has softened and tourism-linked demand proved vulnerable during COVID.