--- title: "While Cannabis Giants Continue To Tread Water, This Small WeedCo Just Posted a 115% Quarter" url: "https://www.readplaza.com/articles/while-cannabis-giants-continue-to-tread-water-this-small-weedco-just-posted-a-115-quarter" type: "article" publisher: "GoingToADollar" category: "Stock Picks" published: "2026-05-07T09:13:00+00:00" updated: "2026-05-08T06:56:45.553552+00:00" reading_time_minutes: 7 tags: ["Technology"] --- # While Cannabis Giants Continue To Tread Water, This Small WeedCo Just Posted a 115% Quarter _Growth was happening. Just not where you were looking._ Cannabis is back on everyone's radar. The DOJ moved marijuana from Schedule I to Schedule III last month and the sector went nuts for a few days. Tilray ripped. Curaleaf popped. $MSOS lit up. Then most of it faded back down, and now people are left trying to figure out what the rescheduling news actually means in practice. Here is the short version. Rescheduling eliminates a nasty IRS provision called 280E that has been preventing cannabis companies from writing off normal business expenses. For large, profitable U.S. operators it is meaningful tax relief. Green Thumb's CEO put a number on it, around $60M a year in extra free cash flow for them. But here is the problem. Lower taxes only help you if the underlying business is working. And when you actually go pull the 2025 revenue numbers across the sector, a lot of these companies need more than Washington to turn things around. The Giants By the NumbersCuraleaf, 159 locations across 15 states, did $1.27 billion in revenue last year. Down 5%. Trulieve, 230+ stores and the dominant player in Florida, came in around $1.2 billion. Flat. Green Thumb was the best of the group at $1.2 billion, up about 3%. Those are the three names that dominate cannabis coverage. The ones that get mentioned every time a policy headline drops. And collectively they went basically nowhere in 2025. It is not hard to see why. These are capital-heavy businesses. Building a dispensary in a new state means licensing fees, construction, inventory, staff, compliance, all before a dollar of revenue comes in. When you are operating across 10, 15 states simultaneously, that cost base becomes enormous and nearly impossible to flex when the environment turns against you. And it has been turning against them. Wholesale cannabis prices are in sustained compression across most major U.S. markets. New supply keeps coming online faster than demand can absorb it. Margins keep getting squeezed. And the fixed costs these operators built up during years of aggressive expansion do not shrink when revenue stalls. U.S. operators are sitting on an estimated $3.8 billion in delinquent receivables across the supply chain. That tells you everything about where things stand right now. But flat giants do not mean a flat sector. Growth in cannabis is not dead. It is just not where everyone is looking. So What Has Been Growing?Herbal Dispatch is a Vancouver-based cannabis e-commerce and distribution platform. Trades as $HERB.CN on the CSE, and just recently got DTC eligibility and trades as $LUFFF in the US. Not a grower. Not a dispensary operator. It runs a marketplace, handles direct-to-consumer medical sales, sells recreational product wholesale, does co-packing and white-label manufacturing for third parties, and exports to international markets. Four revenue channels running in parallel. The numbers tell the story better than anything else. 2023: $5.7M in gross revenue. 2024: $12.1M. Up 111%. 2025: $16.5M. Up 37%. Three consecutive years of double digit growth while the giants were going sideways. And then Q4 2025 happened. Gross revenue of $6.2M in a single quarter. Up 115% from $2.9M in Q4 2024. Gross margin expanded from 8.1% to 26.5% in three months. Adjusted EBITDA turned positive for the first time. To understand why those margin numbers are so significant, you have to understand their model. When Curaleaf or Trulieve scale revenue, they need more stores, more staff, more cultivation capacity. The cost base grows with it. When Herbal Dispatch scales revenue, the platform absorbs it. Certain fixed costs like labour barely moved while revenue nearly doubled in Q4. That is the difference between an asset-heavy operator and an asset-light platform, and it is exactly why you saw that kind of margin expansion in a single quarter. Worth flagging on Q4: part of that jump was driven by a BC government employees strike from late September to late October that disrupted provincial liquor distribution and pushed retailers toward alternative suppliers. Some of that volume was situational. The company says new partnerships formed during the strike carry forward into 2026. Q1 results will confirm whether that holds. The International StoryAt the end of April, Herbal Dispatch completed its first international gummy export to Australia, generating $350,000 in revenue from a single shipment. The buyer is noted as "a top three global cannabis company" by Herbal Dispatch management. When one of the largest cannabis operators in the world is sourcing product from you, it says something about where you sit in the supply chain. It also answers a question that was hanging over the company after 2025. Export revenue dropped from $2.9M to $1.75M last year due to order timing delays. Management called it temporary. This shipment is the first hard evidence they were right. Active export relationships now span Australia, Portugal, Germany, Brazil, Czech Republic, UK, Switzerland, and Costa Rica. The company is targeting 100% year over year export revenue growth in 2026 and tripling export volumes by 2028, backed by ongoing investment in GMP and EU-GMP compliance. The Veteran ChannelHerbal Dispatch runs a dedicated medical cannabis channel for veterans in Canada. Concierge-style service, insurance-supported through Blue Cross and Veterans Affairs Canada, with orders curated around individual medical needs and coverage parameters. The economics on this channel are significantly better than the rest of the business. Average annual insured spend per client is around $7,000. Gross margins above 50%, more than double the company average of 22.7%. High retention. Recurring, predictable revenue. And it is accelerating fast. Full year 2025 insured veteran sales were $675,000. The first four months of 2026 alone nearly matched that number. Q1 2026 veteran registrations were up 400% compared to all of 2025. The annualized run rate is sitting at roughly $2.23M and tracking toward an estimated $3.5 to $4M by end of year. For context, Veterans Affairs Canada reimbursed $244.6M in medical cannabis claims in 2025. There are currently 31,000 veterans enrolled in the program out of a total Canadian veteran population estimated above 600,000. The company has also mentioned evaluating U.S. market entry through medical cannabis channels as rescheduling develops. Nothing confirmed. But the infrastructure they are building in Canada, the insurance coordination, the concierge model, the prescriber relationships, is exactly what a veteran-focused medical entry into the U.S. would require. Worth watching as the regulatory picture develops. What to Make of It The cannabis sector has been waiting on two things for years. Full federal recreational reform and institutional capital finally being able to flow in freely. Neither has arrived yet. Herbal Dispatch is not waiting on either. Three consecutive years of double digit revenue growth. A 115% quarter. An export channel that just closed a $350K shipment with one of the largest cannabis operators in the world. A veteran medical channel posting 400% registration growth in a single quarter with 50%+ margins. That said, the company is not without risk. Cash at year end was $197K, working capital is negative, and while adjusted EBITDA turned positive in Q4, profitability is not yet sustained. Additional capital will likely be needed at some point. There are also 32.5M warrants outstanding on a 123M share count. Speculative position. Volatile sector. Size it accordingly. We are shareholders. Please do your own research! Sources Herbal Dispatch Q4 and Full Year 2025 Financial Results https://ca.finance.yahoo.com/news/herbal-dispatch-reports-q4-2025-070100422.html Herbal Dispatch First International Gummy Export to Australia https://ca.finance.yahoo.com/news/herbal-dispatch-completes-first-international-120000520.html Herbal Dispatch Veteran Channel Growth Update https://ca.finance.yahoo.com/news/herbal-dispatch-reports-accelerating-veteran-110000332.html Curaleaf Full Year 2025 Results ($1.27B revenue) https://www.prnewswire.com/news-releases/curaleaf-reports-fourth-quarter-and-full-year-2025-results-domestic-and-international-growth-accelerate-with-gross-margin-expansion-302698979.html Green Thumb Industries Full Year 2025 Results ($1.2B revenue, up 3.4%) https://investors.gtigrows.com/news-releases/news-release-details/green-thumb-industries-reports-fourth-quarter-and-full-year-2025 Trulieve Full Year 2025 Results ($1.2B revenue) https://investors.trulieve.com/2026-02-26-Trulieve-Reports-Fourth-Quarter-and-Full-Year-2025-Results-with-60-Gross-Margin-and-Record-Cash-Flow-Generation Veterans Affairs Canada Cannabis Reimbursement Data https://www.veterans.gc.ca/en/about-vac/reports-policies-and-legislation/departmental-reports/cannabis-medical-purposes Statistics Canada Veteran Population https://www12.statcan.gc.ca/census-recensement/2021/ref/98-20-0002/982000022021001-eng.cfm