CGC stock is unmoved at the start of the week after Canopy Growth Corporation (TSX:WEED) (NYSE:CGC) announced it was delaying the launch of its range of cannabis-infused beverages due to scaling issues.
Wait Goes on for Cannabis Beverages
After a frustrating first year of legalization for pot stock investors and cannabis producers alike, which has seen CGC stock fall over 50%, many had pinned their hopes on the launch of the cannabis 2.0 market to be a saving grace in 2020. One of the most eagerly anticipated new products is cannabis-infused beverages, which is expected to be a US$2 billion market by 2026, and Canopy has been one of the biggest backers of this, with one of the most extensive ranges of drinks in the Canadian cannabis space.
However, in a blow to investors and consumers, the world’s largest cannabis company has revealed that we’ll have to wait a little longer for the arrival of products such as Tweed Houndstooth & Soda and Houseplant Grapefruit. Canopy Growth has said that it is extending its to-market date on its beverage line as it continues to take the final steps towards scaling production up to full commercial capacity. CGC stock is currently trading for $24.89 following the announcement.
“Canopy has had seven weeks to work with THC in the brand new beverage facility to scale processes and IP it has developed in the R&D environment,” said David Klein, CEO of Canopy Growth. “In order to deliver products that meet our customer’s high standards we are electing to revise the launch date while we work through the final details.”
Strong Start to 2020 for CGC Stock
The announcement comes less than a week into Klein’s leadership of the company, having replaced interim CEO Mark Zekulin on January 14 after having previously served as CFO of Constellation Brands (NYSE:STZ), Canopy’s biggest shareholder. Klein is tasked with reigning in the escalating expenses at the firm, which posted a loss of US$155.7 million in the most recent quarter. Despite a poor performance in 2019, CGC stock is up nearly 20% since the turn of the year as investor optimism regarding cannabis 2.0 returns.
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