Tilray Brands chairman and CEO Irwin Simon doesn’t believe the narrative that drinkers – including the youngest legal-drinking-age consumers – are giving up alcohol.
Simon shared several anecdotes informing his thinking during TD Cowen’s Future of the Consumer Conference earlier this week.
“I got four kids, and they’re all over 21, and I had 100 kids at my house for a party last week, and I didn’t see one of them walking around not with a drink in their hand,” Simon shared, adding that “to my dismay, they weren’t drinking non-alc.”
Simon also recalled going to dinner the night before with CFO Carl Merton.
“When I go to restaurants, I walk [by] every table to see who has a drink,” he said. “It was a Monday night, and everybody had a drink on their table. So it’s not dry Monday yet.”
Simon offered another anecdote that he smelled “a lot of cannabis” as he walked to the conference, “and I tell you what, people are drinking a lot of beer and alcohol.”
“So whoever says beer and alcohol are going away, it’s absolutely not,” he said.
A lot of topics were covered during the 30-minute discussion, including Tilray’s stock price, brewery closures, SKU rationalization, distributor consolidation and more.
Here are the highlights:
On Tilray’s stock, which is under threat of being delisted by Nasdaq …
“The reflection of our stock price is no reflection of what the company is today,” Simon said.
Tilray has grown into a $400 million market cap company with $800 million in sales, as the company has added several craft breweries through acquisitions.
Simon pegged the value of its assets in the U.S. at around $350 million. Tilray doesn’t sell cannabis in the U.S., but does offer intoxicating hemp beverages in around 13 states, with half that business running through beer distributors and the other half going direct to retailers such as Total Wine and ABC.
“Today, Tilray is a $200 million U.S. cannabis business in Canada,” he said, adding that the company pays more than $125 million in excise taxes north of the border.
On the potential of intoxicating hemp in the U.S. …
For 2026, Simon estimated that Tilray’s intoxicating hemp beverage business could be “in the millions of size,” which would be incremental to the company.
“[If] we could sell cannabis drinks in the U.S., it’s a billion-dollar-plus business,” Simon added. “In Canada today, we have about a 45% share of the Canadian market to about $25 to $30 million in Canada, and only can sell them in cannabis stores. Again, if we could sell them to restaurants, if we could sell the beer stores, it’s [a] $100-plus-million-dollar business.”
On the potential for federally legalized cannabis in the U.S. …
Tilray is lobbying for more states to allow intoxicating hemp beverages, Simon said.
“With regulatory, I hate making predictions, because I’ve been wrong all the time,” he added. “I thought today cannabis would be legal in the U.S. If I can keep these 13 states right now, I’ll be happy. And if I get any more, I’ll be real happy.”
On distributor consolidation …
Simon revealed that Tilray was required to stick with the Anheuser-Busch InBev (A-B) distributor network for two years following the 2023 craft acquisitions, but now the company is exploring consolidating its network of upwards of 800 distributors.
Tilray has a team dedicated to working through that consolidation process, exploring the costs to move and brand trades.
On Tilray ceasing brewing operations at Revolver in Texas and Hop Valley in Oregon …
Simon estimated the closure of the facilities, which he didn’t name, “took about $25 million of costs out so far.”
“We look to take more,” he added. “So there’s some work to do on our beverage business.”
Simon explained that the company doesn’t “want to be running capacity today at 50%.”
“[A-B or Molson] can produce beer at $30, $40 a barrel, where it’s much more expensive for us,” he said. “So we got to get the efficiencies of our breweries, and that’s some of the stuff that we’re in the midst of doing today.”
On investing in its acquired brands …
“When you buy something at a good price, you can let them die or you got to invest in them,” Simon said.
“There’s capital that we’ve had to put into these businesses to really the right size and get the right spend on the brand,” he continued, adding that Tilray has invested in sports marketing and licensing deals.
“We’ve had to invest probably more money than I thought we would back into the brands. And ultimately we’ll see the benefits.”
Simon described the acquisition prices paid for the 12 former A-B and Molson Coors craft brands as “very cheap.”
Some of the acquired brands were in such decline that investment was necessary.
“HiBall was dead, no sales,” Simon said of the energy drink brand that A-B discontinued in 2023 and Tilray resurrected, now available nationwide in Whole Foods. “Shock Top, basically no money, no attention to it, no innovation.”
He added: “We’re going to give them love and attention where they got lost within the ABI system, that got lost within the Molson system.”
On Tilray’s craft strategy moving forward …
Simon said the goal is to “regionalize” the brands, focusing “on three or four states,” while keeping Shock Top a national brand. The brands will be marketed through social media and events.
On Tilray’s SKU rationalization program …
One brand that met the chopping block was SweetWater’s Gummies line of high ABV IPAs, which Simon described as “not the greatest tasting beer.” He acknowledged that consumers want products that “taste good,” are “lighter,” provide some benefits and are unique.
Nevertheless, Tilray will continue to innovate.
“Craft beer is not going away,” Simon said. “The winner is going to be those that come out with innovation and those who come out with new products.”
Year-to-date through May 18, Tilray’s off-premise dollar sales have declined 17.4%, to $68.89 million at multi-outlet grocery, mass retail and convenience stores, according to market research firm Circana. Volume, measured in case sales, has declined 18%. Those trends have accelerated in the four-week period ending May 18, with declines of 20.6% and 23.8%, respectively.
In 2024, Tilray ranked as the fourth largest Brewers Association-defined craft brewery. Beer production across its portfolio declined 13%, to 783,495 barrels, last year.