10-K: Jushi Holdings Secures $160M Loan, Refinances Debt, Eyes VA Adult-Use Market

Jushi Holdings Inc. has secured a new $160 million senior secured term loan to refinance existing debt and fund operations, while also anticipating the launch of adult-use cannabis sales in Virginia by early 2027.

Summary

• Jushi Holdings Inc. (the Borrower) entered into a Loan Agreement dated March 27, 2026, for a $160 million senior secured term loan (the 2026 Term Loan) with FG Agency Lending LLC as Agent and other Lenders.
• The 2026 Term Loan was issued with a 4% original issue discount and bears an interest rate of 12.50% per annum, payable monthly in arrears, maturing on March 27, 2029.
• Proceeds from the 2026 Term Loan were used to repay in full the outstanding principal, accrued interest, exit fees, and make-whole on the 2024 Term Loan ($46.075 million principal) and the Second Lien Notes ($86.194 million principal), which were previously scheduled to mature within twelve months of December 31, 2025.
• Remaining excess proceeds from the 2026 Term Loan were retained on the balance sheet for general corporate purposes and to pay associated fees and expenses.
• The 2026 Term Loan is secured by a first lien security interest on substantially all material assets and owned equity of the Company and its current and future subsidiaries (Guarantors), with certain exclusions for cannabis licenses, inventory, and assets legally unpledgeable.
• Legislation permitting the sale of cannabis for adult-use in Virginia was passed in March 2026, pending Governor's action, with retail adult-use sales expected to commence on January 1, 2027.
• For the year ended December 31, 2025, net revenue increased by 2% to $262.909 million, up from $257.525 million in 2024.
• Retail cannabis revenue increased by $7.542 million (3%), primarily driven by new dispensary openings and adult-use transition in Ohio (+$14.271 million) and increased customer demand in Virginia (+$5.661 million).
• Wholesale cannabis revenue decreased by $2.158 million (7%), mainly due to lower demand in Virginia (-$4.034 million) and Massachusetts (-$403k), partially offset by increased production capacity in Ohio (+$1.756 million).
• Gross profit decreased by 4% to $113.977 million in 2025 from $118.303 million in 2024, with gross profit margin declining from 46% to 43% due to competitive pricing pressure and higher production costs.
• Net loss for 2025 was $(68.591) million, compared to $(48.777) million in 2024, an increase in loss of $19.814 million.
• Adjusted EBITDA (Non-GAAP) increased by 9% to $50.262 million in 2025 from $46.177 million in 2024, primarily due to employee retention credit claims payments.
• Cash flows provided by operating activities decreased by 18% to $17.725 million in 2025 from $21.569 million in 2024, driven by a decline in cash flow from working capital.
• The Company received $10.617 million related to employee retention credit claims, including interest, from the IRS in 2025.
• As of December 31, 2025, the Company operated 42 dispensaries across eight states (California, Illinois, Massachusetts, Nevada, New Jersey, Ohio, Pennsylvania, and Virginia).
• The Company's business licenses, with a gross value of $82.401 million, commenced amortization on June 1, 2024, over a 15-year period, resulting in approximately $5.493 million in annual amortization.
• The Company's Insider Trading and Blackout Period Policy was last revised on June 10, 2025.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this filing with a neutral-to-slightly-negative sentiment. While the successful debt refinancing and strategic positioning in emerging adult-use markets are positive, the significant increase in net loss, declining gross margins, and reduced operating cash flow indicate underlying profitability challenges that temper optimism.

Positives

• Successfully refinanced $132.269 million of existing debt (2024 Term Loan and Second Lien Notes) with a new $160 million senior secured term loan, extending maturity to March 2029.
• Anticipated commencement of adult-use cannabis sales in Virginia by January 1, 2027, following recent legislation, is expected to expand the customer base and increase product demand.
• Net revenue increased by 2% year-over-year to $262.909 million in 2025, demonstrating continued top-line growth.
• Retail cannabis sales increased by 3%, driven by strong performance in Ohio (+$14.271 million from new dispensaries and adult-use transition) and Virginia (+$5.661 million from increased units sold).
• Adjusted EBITDA (Non-GAAP) grew by 9% to $50.262 million in 2025, indicating improved operational profitability before certain non-cash and non-recurring items.
• Received $10.617 million in employee retention credit claims, including interest, from the IRS, enhancing liquidity.
• Opened five new dispensaries in Ohio since Q3 2024 and one new dispensary in Pennsylvania in February 2025, expanding retail footprint.
• Operating efficiencies in Nevada contributed to an increase in wholesale revenue in that state.

Negatives

• Net loss increased significantly to $(68.591) million in 2025 from $(48.777) million in 2024, indicating worsening profitability.
• Gross profit decreased by 4% and gross profit margin declined from 46% to 43%, primarily due to competitive pricing pressure, higher discounting in retail, and increased production costs.
• Cash flows provided by operating activities decreased by 18% year-over-year, driven by a decline in cash flow from working capital.
• Sales declined in Illinois (-$5.482 million), Massachusetts (-$3.892 million), and Nevada (-$2.701 million) due to increased competition, price compression, and a dispensary closure in Nevada.
• Wholesale revenue declined by 7% overall, with a notable $4.034 million decrease in Virginia due to lower demand and limited product availability for third-party customers.
• Interest expense, net, increased by 9% to $40.845 million, primarily due to the 2024 Term Loan.
• Fair value gain on derivatives turned into a loss of $(5.087) million in 2025 from a gain of $6.275 million in 2024, reflecting stock price movement.
• Income tax expense increased by 11% to $34.988 million, mainly due to an increased valuation allowance against Canadian deferred tax assets.
• The Company continues to operate under Section 280E of the U.S. Internal Revenue Code, which prohibits deducting ordinary and necessary business expenses, leading to a materially higher effective federal income tax rate.

Risks

• The cannabis industry is relatively new and subject to inherent immaturity, limited comparable business models, and evolving best practices, which could lead to unanticipated expenses, problems, or technical difficulties.
• The Company's ability to grow may be limited by challenges in managing growth, including capacity constraints, pressure on internal systems, and the need to expand and train its employee base.
• The Company has incurred losses and negative cash flow from operations in the past and expects significant ongoing costs for infrastructure, growth, and regulatory compliance, which may prevent sustained profitability.
• The market for Subordinate Voting Shares may be limited for U.S. resident securityholders due to the heightened risk profile of the cannabis industry, potentially affecting pricing, transparency, and liquidity.
• The Company is subject to taxation in both Canada and the U.S. (due to Section 7874 of the Code), which could materially adversely affect its financial condition and results of operations.
• Increasing competition from larger, better-capitalized companies with longer operating histories and more experience could materially and adversely affect business, financial condition, and results of operations.
• Inaccuracies in forecasting operating results and planning operations due to limited and unreliable market data in the cannabis industry could adversely affect demand for products.
• The business involves growing an agricultural product, subject to risks like infestation, plant diseases, and natural disasters, which could materially adversely affect future production.
• High dependence on key managerial personnel, including the CEO and Chairman, James Cacioppo, and the CFO, Michelle Mosier, with the risk of harm to business if they are lost or not replaced in a timely manner.
• Inherent risks of product liability claims, regulatory action, and litigation if products cause or are alleged to have caused loss or injury, including from product defects, contamination, or inadequate labeling.
• Potential for litigation in the ordinary course of business, which could result in substantial costs and divert management's time and attention.
• Difficulty in obtaining adequate insurance coverage due to the cannabis industry, potentially leading to uninsured losses.
• Changes in consumer preferences could lead to lower demand for products and require significant capital investment in new product lines without guaranteed success.
• Consumer perception of the cannabis industry, influenced by scientific research, regulatory investigations, or media, could adversely affect demand for products.
• Product recalls due to defects, contamination, or labeling issues could result in unexpected expenses, lost sales, and reputational harm.
• Significant risk of theft at facilities and cybersecurity threats (e.g., phishing, ransomware) to data and IT systems, potentially leading to financial losses, liability, and reputational damage.
• Exposure to fraudulent or illegal activity by employees, contractors, consultants, and agents, which could lead to investigations, penalties, and reputational harm.
• A substantial level of indebtedness ($193.076 million as of Dec 31, 2025, subject to scheduled repayments) requires compliance with restrictions and covenants, and there is a risk of insufficient cash flow to service debt.
• Labor risks, including union organizing efforts and potential work stoppages, could increase labor costs and adversely affect operations.
• Reliance on third-party suppliers, manufacturers, and contractors, and key inputs (electricity, water), with risks of interruption or negative changes in availability or economics.
• Inflation could increase operational costs (labor, raw materials, utilities), affecting competitive pricing and potentially leading to loss of business and revenue.
• Cannabis remains illegal under U.S. federal law, posing significant risks of fines, penalties, administrative sanctions, criminal charges under the CSA, and asset forfeiture.
• Uncertainty in cannabis regulation in the U.S. at federal, state, and local levels, with potential for new rules or more stringent enforcement.
• Government inquiries and investigations could harm business or reputation, even without fines or business interruptions.
• Constraints by law on marketing products in various jurisdictions may limit effective marketing and competition for market share.
• Anti-Money Laundering Laws in the U.S. may limit access to banking and financial services, potentially forcing cash-based operations.
• Section 280E of the Code prohibits deducting ordinary and necessary business expenses for cannabis operations, resulting in a materially higher effective federal income tax rate.
• Risk of tax audits by various authorities and potential disallowance of tax positions, including on Section 280E, leading to additional taxes, penalties, and expenses.
• Re-classification of cannabis under the CSA (e.g., to Schedule III) could lead to FDA regulation, requiring clinical trials, facility registration, and compliance with new regulations.
• Restrictions under U.S. border entry laws could lead to detention, denial of entry, or lifetime bans for individuals associated with U.S. cannabis businesses.
• Challenging U.S. and global economic conditions (inflation, high interest rates, recession) may negatively impact consumer spending and business operations.
• Heightened scrutiny by regulators and stock exchanges in Canada and the U.S. could materially adversely impact the liquidity of Subordinate Voting Shares.
• Difficulty in locating and obtaining rights to operate at preferred locations due to local regulations, federal illegality, and reluctance of property owners.
• Lack of access to U.S. federal bankruptcy protections for cannabis businesses, making it difficult for lenders to recover investments.
• Doubt regarding the ability to enforce contracts due to federal illegality of cannabis, potentially affecting the realization of contract benefits.
• Limits on the number of cannabis licenses one entity may own in certain states, restricting organic growth and market share expansion.
• Inability to adequately protect intellectual property (e.g., federal trademark and patent protection) as long as cannabis remains federally illegal.
• Property owned by cannabis industry participants could be subject to civil asset forfeiture by law enforcement.
• Potential for criminal prosecution or civil liabilities under the Racketeer Influenced Corrupt Organizations Act (RICO) due to cannabis activities.
• Return on Subordinate Voting Shares is not guaranteed, and investment is speculative with a high degree of risk.
• Raising additional capital through equity, equity derivatives, or convertible debt securities may cause dilution to existing shareholders.
• Sales of substantial amounts of Subordinate Voting Shares by existing shareholders could adversely affect the market price.
• The market price for Subordinate Voting Shares has been and is likely to continue to be volatile due to numerous factors beyond the Company's control.
• If securities or industry analysts do not publish research or publish inaccurate/unfavorable research, share price and trading volume could decline.
• There may not be sufficient liquidity in the markets for Subordinate Voting Shares.
• Increased costs as a U.S. and Canadian reporting company due to regulatory requirements.
• As an emerging growth company and smaller reporting company, the Company may take advantage of reduced disclosure requirements, potentially making shares less attractive to investors.
• Internal controls over financial reporting may not be effective, and the independent registered public accounting firm may not be able to certify their effectiveness, harming business and reputation.

Future Outlook

The Company anticipates expanded customer base and increased demand for its products with the expected commencement of adult-use cannabis sales in Virginia by January 1, 2027, pending gubernatorial action. The DEA's proposed rule to reschedule marijuana from Schedule I to Schedule III, if finalized, could have broad implications for federal policy, potentially impacting state medical and recreational programs, and may lead to new regulatory, tax, and enforcement guidance from various federal agencies. The Company also expects to continue its strategy of opportunistic investments and pursuing application opportunities in attractive limited license jurisdictions.

Management Comments

• Management believes that the products and services offered are generally competitive with those offered by other cannabis companies.
• Management acknowledges that the cannabis industry is undergoing rapid growth and substantial change, resulting in increased competitors, consolidation, and strategic relationships.
• Management relies largely on its own market research to forecast sales due to limited and unreliable third-party market data in the cannabis industry.
• Management believes that the medical marijuana industry is highly dependent upon consumer perception regarding the safety, efficacy, and quality of medical marijuana.
• Management believes that the Company's business activities are compliant with applicable state and local laws in the U.S., but acknowledges that compliance with state and local cannabis laws would not provide a defense to any federal proceeding.
• Management believes that its existing cash and cash equivalents and cash from operations will be sufficient to meet working capital and capital expenditure needs for at least the next twelve months, after giving effect to the debt refinancing.

Industry Context

StockSavvy.ai notes that Jushi Holdings Inc.'s debt refinancing and strategic focus on limited license jurisdictions, particularly in states transitioning to adult-use like Virginia and Ohio, align with broader industry trends of consolidation and market expansion in the U.S. cannabis sector. The industry continues to grapple with the dichotomy of state-level legalization and federal illegality, as evidenced by the ongoing DEA rescheduling process and the impact of Section 280E on profitability. The recent 2025 Legislation addressing the 'hemp loophole' indicates a tightening regulatory environment for hemp-derived intoxicating products, which could reduce indirect competition for state-licensed cannabis operators. The participation of related parties in the new loan facility highlights the continued reliance on internal and affiliated capital sources in an industry still facing limited access to traditional banking and capital markets due to federal restrictions.

Comparison to Industry Standards

• Jushi's gross profit margin of 43% in 2025 is lower than the 46% in 2024, indicating a potential struggle with competitive pricing pressure and higher production costs, which is a common challenge for multi-state operators (MSOs) in maturing cannabis markets facing oversupply.
• The 9% increase in Adjusted EBITDA to $50.262 million, despite a net loss, suggests operational improvements or one-time gains (like ERC claims) that are not fully translating to GAAP profitability, a pattern observed in other cannabis companies heavily impacted by Section 280E.
• The successful refinancing of $132.269 million in debt with a new $160 million term loan, extending maturity to March 2029, is a positive development in an industry where access to capital can be challenging and debt often carries high interest rates (Jushi's new loan is 12.5%). This compares favorably to companies that may face more punitive terms or inability to refinance.
• The expansion into adult-use markets in Ohio and anticipated launch in Virginia positions Jushi similarly to other MSOs that prioritize growth in high-potential, limited-license states, aiming for first-mover advantage and increased market share.
• The decline in cash flows from operating activities by 18% in 2025, primarily due to working capital, indicates potential operational inefficiencies or increased investment in inventory/receivables, which is a metric closely watched by investors in growth-oriented industries.

Management Changes

Corporate Governance

Legal Proceedings

• MJs Market Matter: A complaint filed on March 31, 2023, in federal district court in Massachusetts, alleging violations of antitrust acts, interference with contractual relations, and abuse of process related to a dispensary transaction and zoning appeal. MJs Market is seeking compensatory and other damages.
• Sammartino Matter: On February 28, 2023, the Company alleged breaches of a Merger and Membership Interest Purchase Agreement (MIPA) and fraudulent inducement by Sammartino, electing to offset damages against promissory notes and shares. Sammartino disputed the claims and alleged the Company was in default of the MIPA and promissory notes for failing to issue shares and pay interest.
• Pacific Collective Matter: A complaint filed on October 24, 2022, in California state court, alleging breach of a commercial property lease and lease guaranty, seeking over $20 million in damages. The Referee ruled in favor of the Company's subsidiaries, but Pacific Collective filed an appeal on July 3, 2024.

Related Party Transactions

• Serpentine Capital Management III, LLC, an entity controlled by James Cacioppo (CEO, Chairman, and founder), participated in the $160 million 2026 Term Loan with a principal amount of $27.993 million.
• Denis Arsenault (founder and significant equity holder) participated in the $160 million 2026 Term Loan with a principal amount of $21.016 million.
• An entity affiliated with James Cacioppo was a lender in the 2024 Term Loan with a principal amount of $9 million and received 3.6 million 2024 Term Loan Warrants.
• Denis Arsenault was a lender in the 2024 Term Loan with a principal amount of $7 million and received 2.8 million 2024 Term Loan Warrants.
• An entity affiliated with the CEO purchased US$3.719 million principal amount of Second Lien Notes for US$3.347 million and received 5,810,938 warrants in February 2025.
• Denis Arsenault purchased C$2.000 million of Second Lien Notes for C$1.800 million and received 2,199,688 warrants in February 2025.
• The Second Lien Notes and related interest expense include amounts related to certain senior key management and a significant investor.
• The 2024 Term Loan and related interest expense include amounts related to the Company's CEO and a significant investor.

Stakeholder Impact

• **Shareholders**: The debt refinancing provides stability by extending maturities but the increased net loss and declining gross margins could negatively impact shareholder value. Dilution risk exists if future capital raises involve equity. Related party participation in the loan could raise governance questions.
• **Creditors**: The new $160 million senior secured term loan improves the Company's debt structure by refinancing existing obligations, potentially reducing immediate repayment pressure and providing better security for the new lenders.
• **Employees**: The Company's commitment to hiring and career advancement, along with collective bargaining agreements covering 183 employees, indicates a focus on human capital. However, labor disputes or work stoppages could impact operations.
• **Customers**: Expansion into adult-use markets in Virginia and Ohio, along with new dispensary openings, aims to increase product availability and choice. Competitive pricing pressures could lead to more promotions or lower prices for consumers.
• **Suppliers/Partners**: The Company's reliance on third-party suppliers and manufacturers, and its wholesale operations, indicate ongoing relationships. Changes in demand or regulatory environment could affect these partnerships.
• **Regulatory Authorities**: The Company's detailed compliance program and engagement with state and local regulators demonstrate efforts to adhere to complex cannabis laws. Ongoing legal proceedings and the federal illegality of cannabis pose continuous scrutiny.

Next Steps

• Monitor the Governor's action on the Virginia adult-use cannabis legislation and prepare for retail adult-use sales commencement by January 1, 2027.
• Continue to implement and improve operational and financial systems to manage growth effectively.
• Address competitive pricing pressures and production costs to improve gross profit margins.
• Monitor the DEA's rescheduling process for cannabis and prepare for potential changes in federal regulatory, tax, and enforcement guidance.
• Continue to pursue opportunistic investments and application opportunities in attractive limited license jurisdictions.
• Comply with the financial covenant of maintaining a minimum unrestricted cash balance of $15 million under the new 2026 Term Loan.
• Resolve ongoing legal proceedings, including the MJs Market Matter, Sammartino Matter, and Pacific Collective Matter.

Key Dates

Recommendation

The Company's successful debt refinancing provides crucial liquidity and extends maturities, mitigating immediate financial distress. Strategic expansion into adult-use markets in Virginia and Ohio offers significant growth potential. However, the substantial increase in net loss, declining gross margins due to competitive pressures, and reduced operating cash flow indicate underlying profitability challenges. The ongoing federal illegality of cannabis and associated regulatory risks, including Section 280E, continue to weigh on the Company's financial performance. Given the mixed financial results and the high-risk, high-reward nature of the cannabis industry, a 'hold' recommendation is appropriate for investors to observe how the Company executes its growth strategy and addresses profitability issues in a volatile regulatory landscape.

Keywords

Cannabis, Marijuana, Multi-state operator, SEC filing, 10-K, Loan agreement, Debt refinancing, Term loan, Adult-use cannabis, Medical cannabis, Dispensaries, Cultivation, Processing, Virginia, Ohio, Pennsylvania, Illinois, Massachusetts, Nevada, New Jersey, Revenue, Net loss, Adjusted EBITDA, Liquidity, Capital raise, Regulatory risk, Section 280E, Rescheduling, Controlled Substances Act, Financial performance, Corporate finance, Secured debt, Cannabis licenses, Market expansion, Related party transactions