Canopy Growth Corporation‘s CGC strategy for capturing the U.S. cannabis market was the focal point of a recent fireside chat hosted by Zuanic & Associates. CEO David Klein and CFO Judy Hong provided insights into Canopy USA’s (CUSA) growth strategy, financial projections and its significance for investors navigating the evolving cannabis industry.

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Unique Structure For U.S. Expansion

CUSA’s innovative structure is designed to comply with NASDAQ and SEC regulations while preparing for potential federal cannabis reform. “The structure allows us to keep Canopy Growth compliant while positioning CUSA to grow independently in the U.S.,” Klein said.

This arrangement prevents Canopy Growth from directly financing CUSA but allows for co-investments alongside third-party investors when necessary. Additionally, Canopy Growth holds a beneficial interest in CUSA through exchangeable shares, which can be converted into voting shares once regulatory conditions permit.

Hong revealed CUSA’s long-term potential, noting it could generate up to $300 million in revenue annually with EBITDA margins of approximately 20%. She emphasized the importance of maintaining operational independence until a “federal permissibility event” allows for broader integration.

TerrAscend And Acreage: Growth Potential In Key States

Canopy Growth’s U.S. footprint includes significant stakes in key cannabis brands:

• 100% ownership of Wana and Acreage Holdings upon Acreage’s acquisition closure in 2025.
• 77% stake in Jetty.
• 21% beneficial interest in TerrAscend, subject to the full exercise of warrants and exchangeable shares.

TerrAscend TSNDF supports Wana’s operations in Maryland and New Jersey, generating mutual benefits for both companies. Meanwhile, Acreage is actively expanding in Ohio, where it operates five dispensaries and holds licenses for three more.

“Acreage’s transition to a wholly owned subsidiary will improve efficiency and enable cost savings,” Hong said, adding that these changes position Acreage to better compete in states like New Jersey, Illinois, and Ohio, where adult-use markets are booming.

Read Also: TerrAscend Expands Footprint Despite Q3 Losses, Can A Move To Ohio Turn The Tide?

Global Success And Local Challenges

Canopy Growth’s influence extends beyond the U.S., with strong performance in international markets. Germany, for instance, imported 20 tons of cannabis in Q3, up from 7 tons in Q1, driven by Canadian exporters like Canopy.

Domestically, CUSA is addressing challenges in mature markets such as Colorado, where price compression and competition have intensified. Wana has proactively adjusted its supply chain to lower costs, while Jetty’s focus on solventless extraction has solidified its reputation in California and Colorado.

Brand Synergies And Market Penetration

Collaboration between CUSA’s brands is a cornerstone of its strategy. Wana and Jetty have begun joint marketing efforts in New York and Colorado, leveraging a consumer packaged goods (CPG) approach to cannabis sales.

“Collaboration between Wana and Jetty is already yielding results,” Klein noted, with plans to further integrate operations once Acreage Holdings is acquired. Wana’s expansion into non-dispensary channels such as liquor stores has also helped broaden its consumer base, particularly with its hemp-derived product line.

Read Also: Canopy Growth Acquisition Target Acreage Reports 30% YoY Decline In Q3, Record Cannabis Wholesale Revenue In NY

Investor Perception And Market Positioning

Despite its strategic advancements, Canopy Growth faces challenges in convincing the market of CUSA’s value. “It’s a real business generating revenue daily, but the complexity of our structure sometimes overshadows its value,” Klein acknowledged.

Hong added that audited financial statements for CUSA expected in 2025 will provide much-needed transparency. “This should make it easier for investors to understand CUSA’s role within the broader Canopy Growth story,” she explained.

Investor Takeaways

CUSA offers investors exposure to the U.S. cannabis market without direct regulatory risk. Its portfolio, including brands like Wana and Jetty and its strategic collaborations with TerrAscend, position Canopy Growth to capitalize on evolving market opportunities.

Read Next: Canopy Growth: Q2 Net Revenue Drops 9% YoY, Projects Positive Earnings Ahead