IMCC · IM Cannabis Corp.

IM Cannabis Corp. reported a challenging first quarter for 2026, with revenue declining 30.6% year-over-year to $8.7 million from $12.5 million. The decrease was primarily driven by lower sales volumes in both Israel and Germany, reflecting ongoing market headwinds and the impact of the Iron Swords War on Israeli operations. Gross profit fell to $1.4 million, with gross margin contracting to 16.3% from 27.6% in the prior year period, indicating pricing pressure or higher cost of goods sold. Operating expenses were reduced to $3.1 million from $3.3 million, with general and administrative expenses down 22% year-over-year due to cost optimization initiatives, including headcount reductions and operational efficiencies. However, the operating result swung to a loss of $1.7 million from income of $0.2 million in Q1 2025. Net loss attributable to equity holders was $2.3 million, or $0.38 per share, compared to net income of $0.3 million, or $0.09 per share, in the prior year. The company ended the quarter with $1.0 million in cash, down from $2.7 million at December 31, 2025, and negative working capital of $12.6 million. Management highlighted continued focus on cost optimization, working capital discipline, and evaluation of strategic opportunities, including a potential sale or disposition of its German operations. The company also completed convertible note financings during and after the quarter to support liquidity. The results underscore the ongoing challenges in the medical cannabis sector and the company's efforts to stabilize operations and achieve profitability.