Charlotte’s Internet reported one other decline in gross sales within the second quarter because the U.S. CBD firm continued slicing prices and restructuring its enterprise following a significant funding by British American Tobacco, in accordance with its Q2 2026 report.
The restructuring comes because the struggle over intoxicating hemp – and a looming ban – has develop into central to the way forward for the U.S. CBD enterprise, pushing Charlotte’s Internet towards a extra healthcare-oriented technique.
CW’s income fell 15% to $10.9 million within the quarter ended June 30, from $12.8 million a yr earlier. The corporate reported a internet lack of $4.1 million, in contrast with a lack of $6.3 million within the second quarter of 2025.
Europe additionally squeezed
CEO Invoice Morachnick put the stakes over CBD guidelines bluntly in March: “If the trade is capped at 0.4 mg of THC per container, it mainly demolishes the CBD trade as we all know it.” The federal restrictions are scheduled to take impact earlier than the top of the yr.
The corporate stated it helps guidelines that “clearly distinguish non-intoxicating, full-spectrum hemp wellness merchandise, from intoxicating drinks and leisure merchandise.”
The potential squeeze in america comes after European regulators successfully pushed a lot of the ingestible CBD market out of existence, most not too long ago by setting a provisional secure consumption stage of simply 2 mg per day.
Gross sales slide
Charlotte’s Internet stated the quarterly income decline primarily displays a restructuring begun in September 2025 that lowered distribution via conventional retail channels. The corporate is placing extra emphasis on direct on-line gross sales, healthcare practitioners and different botanical wellness merchandise, .
The newest outcomes proceed a long-running decline on the firm, as soon as the dominant model within the U.S. CBD market. CW generated $49.9 million in income in 2025 and posted a internet lack of $29.7 million.
BAT deal
Charlotte’s Internet considerably lowered its debt in the course of the quarter after BAT exchanged debt it was owed for shares within the firm and invested a further $10 million.
The BAT transactions considerably strengthened Charlotte’s Internet’s stability sheet. Complete liabilities fell to $20.3 million on the finish of June from $77.3 million on the finish of 2025, whereas money elevated to $14 million from $8 million, presumably giving the corporate extra monetary respiratory room.
For the primary six months of 2026, income fell 12% to $22 million from $25.1 million a yr earlier. The web loss widened to $17.2 million from $12.5 million. The bigger first-half loss was primarily affected by a non-cash accounting cost associated to the BAT debt earlier than its conversion.
Healthcare push
Charlotte’s Internet continues to pursue a method more and more tied to regulated healthcare purposes for CBD.
The corporate owns roughly one-third of DeFloria, a enterprise with AJNA BioSciences and a BAT subsidiary that’s creating a full-spectrum botanical drug candidate. Charlotte’s Internet additionally holds business manufacturing rights to the drug if it in the end receives U.S. Meals and Drug Administration approval.
The corporate has moreover been positioning its full-spectrum CBD merchandise for potential use in federal healthcare initiatives whereas lobbying for U.S. guidelines that distinguish standard non-intoxicating CBD merchandise from artificial and intoxicating hemp-derived cannabinoids.
