STOCK TITAN

Planet 13 (OTCQX: PLNH) posts lower Q1 2026 revenue and higher net loss

Filing Impact
(Moderate)
Filing Sentiment
(Neutral)
Form Type
10-Q

Rhea-AI Filing Summary

Planet 13 Holdings Inc. reported lower revenue and a larger loss for the quarter ended March 31, 2026 as it exited California and faced intense price pressure in key markets. Net revenue fell to $21.1 million from $28.0 million, a 24.8% decline, mainly from shutting down California operations and weaker flower pricing in Nevada and Florida. Gross profit decreased to $9.4 million, though gross margin improved to 44.6% as the company reduced flower production and optimized third‑party sourcing.

Operating expenses dropped 19% to $15.1 million due to cost-cutting, but the company still posted an operating loss of $5.7 million. A sharp increase in income tax expense, largely tied to uncertain positions under Section 280E, drove net loss to $8.1 million, versus $2.0 million a year earlier. Cash and restricted cash totaled $16.3 million and working capital was $16.5 million, which management believes is sufficient for the next 12 months while it scales its Florida footprint, focuses on its Las Vegas superstore, and continues to exit less profitable operations.

Positive

  • None.

Negative

  • Net revenue declined 24.8% and net loss nearly quadrupled, to $21.1 million and $8.1 million respectively, driven by California exit, price compression and sharply higher tax expense tied to uncertain 280E positions.

Insights

Revenue fell sharply and tax-driven losses widened despite cost cuts.

Planet 13’s quarterly net revenue declined to $21.1M, down 24.8% year over year, as it exited California and faced price compression in flower, concentrates and edibles. Gross margin improved to 44.6%, reflecting product mix shifts and reduced cultivation.

Operating expenses dropped 19.0% to $15.1M, showing early payoff from 2025 cost reductions. However, income tax expense surged to $4.18M, driven by uncertain tax positions under IRC 280E, pushing net loss to $8.10M. The balance of uncertain tax positions rose to $37.05M.

Cash and restricted cash of $16.26M and working capital of $16.51M as of March 31, 2026 support near-term operations, but future performance hinges on stabilizing Nevada demand and successfully scaling Florida’s MMTC network, including new stores expected after Q2 2026.

Net revenue $21,092,230 Three months ended March 31, 2026; down 24.8% year over year
Net loss $8,095,802 Three months ended March 31, 2026; versus $2,047,167 in 2025
Gross profit margin 44.6% Three months ended March 31, 2026; up from 42.8% in 2025
Income tax expense $4,183,999 Three months ended March 31, 2026; includes uncertain 280E positions
Cash and restricted cash $16,257,037 Balance as of March 31, 2026
Working capital $16,514,812 As of March 31, 2026
Uncertain tax positions $37,053,990 Long-term liability as of March 31, 2026
Total assets $146,914,891 As of March 31, 2026 balance sheet
Section 280E financial
"We are subject to Section 280E of the Internal Revenue Code (the “Code”), which prohibits businesses from taking deductions or credits..."
A U.S. federal tax rule that prevents businesses involved in trafficking federally controlled substances from deducting most ordinary business expenses on their federal income tax returns, while still permitting them to count the cost of goods sold. For investors it matters because it increases a company’s effective tax rate and reduces reported profits and cash flow—similar to a store allowed to subtract only the cost of its inventory but not rent or wages—affecting valuations and reinvestment capacity.
Emerging Growth Company regulatory
"The Company is an “Emerging Growth Company”, as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act..."
An emerging growth company is a recently public or smaller public firm that qualifies for temporary, lighter regulatory and disclosure rules to reduce the cost and effort of being public. For investors, it means the company may provide less historical financial detail and face fewer reporting requirements than larger firms, so it can grow more quickly but also carries higher uncertainty—like buying a promising early-stage product with fewer user reviews.
Medical Marijuana Treatment Center regulatory
"VidaCann LLC. (“VidaCann”) which holds our Florida Medical Marijuana Treatment Center (“MMTC”) license..."
uncertain tax positions financial
"Uncertain Tax Positions | 37,053,990 | 33,041,402"
vertically integrated cannabis operations technical
"Nevada license holding company; vertically integrated cannabis operations"
revolving line of credit financial
"The Company entered into a cash secured line of credit up to $9,750,000, effective June 13, 2024..."
A revolving line of credit is a flexible borrowing arrangement that allows a person or business to access funds up to a set limit whenever needed, much like a prepaid card. As money is repaid, it becomes available to borrow again, making it a convenient way to manage cash flow or cover ongoing expenses. Investors pay attention to it because it reflects a company’s ability to access quick funds and manage financial flexibility.
Net revenue $21,092,230 -24.8% YoY
Gross profit $9,413,613 -21.6% YoY
Gross margin 44.6% +1.8 pts YoY
Net loss $8,095,802 +295.5% YoY
General and administrative expenses $11,207,427 -20.0% YoY
0001813452 Planet 13 Holdings Inc. false --12-31 Q1 2026 0 0 1,500,000,000 1,500,000,000 328,270,798 328,270,798 325,670,800 325,670,800 0 0 50,000,000 50,000,000 0 0 0 0 6 3 3 6 3 3 3 1 2 2 1 1 1 1 1 2 May 6, 2029 June 30, 2026 0 0 1 1 1 0 0 0 100,000 100,000 0 0 0 0 0 2.1 5.5 5.0 false false false false The Company entered into a cash secured line of credit up to $9,750,000, effective June 13, 2024, with no other collateral securing the credit line (the "revolving line of credit"). The revolving line of credit contains no financial, or other incurrence-based covenants or no material maintenance covenants. The revolving line of credit balance at December 31, 2025 equaled $9,750,000 (2024 - $0). Total interest expense for the year ended December 31, 2025 equaled $434,442 (2024 - $0). The Promisory note to VidaCann former managers had a face value of $1,500,000. The Company determined a fair value of $1,148,423 at the May 9, 2024 acquisition date using a 15% estimated borrowing rate. 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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 


 

FORM 10-Q

 


(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

  

For the quarterly period ended March 31, 2026

  
 

OR

  

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ________ to ________

 

Commission File Number: 000-56374

 

 

 

PLANET 13 HOLDINGS INC.

 
 

(Exact name of Registrant as Specified in its Charter) 

 

 

Nevada

 

83-2787199

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

   

2548 West Desert Inn Road, Suite 100

Las Vegas, Nevada

 

89109

(Address of principal executive offices)

 

(Zip Code)

 

Registrants telephone number, including area code: (702) 815-1313 

 

Securities registered pursuant to Section 12(b) of the Act: None

 

Securities registered pursuant to Section 12(g) of the Act: Common Stock

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒     No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒     No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

Non-accelerated Filer

Smaller reporting company

Emerging growth company

  

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes      No ☒

 

As of May 13, 2026, there were 328,604,131 shares of common stock outstanding.

 



 

 

 

Planet 13 Holdings Inc.

Quarterly Report on Form 10-Q

For Quarterly Period Ended March 31, 2026

 

Table of Contents

 

   

Page

PART I

FINANCIAL INFORMATION

 

Item 1.

Financial Statements.

5

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

25

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

32

Item 4.

Controls and Procedures.

32

     
     

PART II

OTHER INFORMATION

 

Item 1.

Legal Proceedings.

33

Item 1A.

Risk Factors.

33

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

33

Item 3.

Defaults Upon Senior Securities.

33

Item 4.

Mine Safety Disclosures.

33

Item 5.

Other Information.

33

Item 6.

Exhibits.

34

SIGNATURES

35

 

 

2

 

 

 

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q includes “forward-looking information” and “forward-looking statements” within the meaning of applicable United States securities laws and Canadian securities laws. All information, other than statements of historical facts, included in this Quarterly Report on Form 10-Q that addresses activities, events or developments that we expect or anticipate will or may occur in the future is forward-looking information. Forward-looking information is often identified by the words “may,” “would,” “could,” “should,” “will,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “expect” or similar expressions and includes, among others, information regarding: our strategic plans and expansion and expectations regarding the growth of the California, Florida and Illinois cannabis markets; statements relating to the business and future activities of, and developments related to, us after the date of this Quarterly Report on Form 10-Q, including such things as future business strategy, competitive strengths, goals, expansion and growth of our business, operations and plans, new revenue streams, the completion by us of contemplated acquisitions of additional real estate, cultivation and licensing assets, the roll out of new dispensaries, the application for additional licenses and the grant of licenses or renewals of existing licenses that have been applied for, the expansion of existing cultivation and production facilities, the completion of cultivation and production facilities that are under construction, the construction of additional cultivation and production facilities, the expansion into additional U.S. markets, any potential future legalization of adult-use and/or medical cannabis under U.S. federal law; expectations of market size and growth in the United States and the states in which we operate or contemplate future operations; expectations for other economic, business, regulatory and/or competitive factors related to us or the cannabis industry generally; and other events or conditions that may occur in the future.

 

3

 

Readers are cautioned that forward-looking information and statements are not based on historical facts but instead are based on reasonable assumptions and estimates of our management at the time they were provided or made and involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, as applicable, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information and statements. Such factors include, among others, our actual financial position and results of operations differing from management’s expectations; our business model; a lack of business diversification; increasing competition in the industry; public opinion and perception of the cannabis industry; expected significant costs and obligations; current reliance on limited jurisdictions; development of our business; access to capital; risks relating to the management of growth; risks inherent in an agricultural business; risks relating to energy costs; risks related to research and market development; risks related to breaches of security at our facilities; reliance on suppliers; risks relating to the concentrated voting control of the Company; risks related to our being a holding company; risks related to service providers withdrawing or suspending services under threat of prosecution; risks related to proprietary intellectual property and potential infringement by third parties; risks of litigation relating to intellectual property; negative clinical trial results; insurance related risks; risk of litigation generally; risks associated with cannabis products manufactured for human consumption, including potential product recalls; risks relating to being unable to attract and retain key personnel; risks relating to obtaining and retaining relevant licenses; risks relating to integration of acquired businesses; risks related to quantifying our target market; risks related to industry growth and consolidation; fraudulent activity by employees, contractors and consultants; cyber-security risks; conflicts of interest; risks related to reputational damage in certain circumstances; leased premises risks; risks related to epidemics and pandemics; U.S. regulatory landscape and enforcement related to cannabis, including political risks; heightened scrutiny by Canadian regulatory authorities; risks related to capital raising due to heightened regulatory scrutiny; risks related to tax liabilities; risks related to U.S. state and local law and regulations; risks related to access to banks and credit card payment processors; risks related to potential violation of laws by banks and other financial institutions; ability and constraints on marketing products; risks related to lack of U.S. federal trademark and patent protection; risks related to the enforceability of contracts; the limited market for our securities; difficulty for U.S. holders of our common stock to resell over the Canadian Securities Exchange; price volatility of our common stock; future sales by shareholders; no guarantee regarding use of available funds; currency fluctuations; risks related to entry into the U.S; and other factors beyond our control, as more particularly described under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 and subsequent reports.

 

Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which may have been used. Although we have attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such forward-looking information and statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such information and statements. Accordingly, readers should not place undue reliance on forward-looking information and statements. The forward-looking information and statements contained herein are presented for the purposes of assisting readers in understanding our expected financial and operating performance and our plans and objectives and may not be appropriate for other purposes.

 

The forward-looking information and statements contained in this Quarterly Report on Form 10-Q represent our views and expectations as of the date of this Quarterly Report on Form 10-Q. We anticipate that subsequent events and developments may cause our views to change. However, while we may elect to update such forward-looking information and statements at a future time, we have no current intention of doing so except to the extent required by applicable law.

 

ADDITIONAL INFORMATION

 

In this Quarterly Report on Form 10-Q, unless the context otherwise requires, the terms “we,” “us,” “our,” “Company,” or “Planet 13” refer to Planet 13 Holdings Inc. together with its wholly-owned subsidiaries.

 

Unless otherwise indicated, all references to “$,” “US$” or “USD” in this Quarterly Report on Form 10-Q refer to United States dollars, and all references to “C$,” “CAD$,” or “CAD” refer to Canadian dollars.

 

4

 

PART IFINANCIAL INFORMATION

Item 1. Financial Statements.

 

PLANET 13 HOLDINGS INC.

Interim Condensed Consolidated Balance Sheets

(Unaudited, In United States Dollars)

 

  

March 31,

  

December 31,

 
  

2026

  

2025

 

ASSETS

        

Current Assets:

        

Cash

 $6,007,037  $5,325,031 

Restricted Cash

  10,250,000   10,250,000 

Accounts Receivable

  712,846   1,007,891 

Inventory

  17,187,957   18,138,394 

Other Receivables

  1,578,192   3,754,563 

Prepaid Expenses and Other Current Assets

  2,096,804   2,659,056 

Total Current Assets

  37,832,836   41,134,935 
         

Property, Plant and Equipment

  32,527,756   34,121,678 

Intangible Assets and Goodwill

  42,903,931   42,903,931 

Right of Use Assets - Operating

  30,967,920   31,489,308 

Long-term Deposits and Other Assets

  898,725   829,164 

Deferred Tax Asset

  1,783,723   1,798,654 
         

TOTAL ASSETS

 $146,914,891  $152,277,670 
         

LIABILITIES AND SHAREHOLDERS' EQUITY

        

LIABILITIES

        

Current:

        

Accounts Payable

 $6,692,826  $7,212,187 

Accrued Expenses

  3,260,040   4,632,011 

Income Taxes Payable

  159,080   159,080 

Notes Payable - Current Portion

  9,750,000   9,750,000 

Operating Lease Liabilities

  1,456,078   1,385,566 

Total Current Liabilities

  21,318,024   23,138,844 
         

Long-Term Liabilities:

        

Operating Lease Liabilities

  42,888,732   43,213,442 

Other Long-term Liabilities

  1,265,654   1,250,433 

Uncertain Tax Positions

  37,053,990   33,041,402 

Deferred Tax Liability

  663,317   506,836 

Total Liabilities

  103,189,717   101,150,957 
         

SHAREHOLDERS' EQUITY

        

Common Stock, no par value, 1,500,000,000 shares authorized, 328,270,798 issued and outstanding at March 31, 2026 and 325,670,800 issued and outstanding at December 31, 2025

  -   - 

Preferred Stock, no par value, 50,000,000 shares authorized, 0 issued and outstanding at March 31, 2026 and 0 at December 31, 2025

  -   - 

Additional Paid-In Capital

  371,852,089   371,157,826 

Deficit

  (328,126,915)  (320,031,113)

Total Shareholders' Equity

  43,725,174   51,126,713 
         

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

 $146,914,891  $152,277,670 

 

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

5

 

PLANET 13 HOLDINGS INC.

Interim Condensed Consolidated Statements of Operations and Comprehensive Loss

(Unaudited, in United States Dollars, except Share Amounts)

 

   

Three Months Ended

 
   

March 31,

   

March 31,

 
   

2026

   

2025

 
                 

Revenues, net of discounts

  $ 21,092,230     $ 28,031,807  

Cost of Goods Sold

    (11,678,617 )     (16,024,302 )

Gross Profit

    9,413,613       12,007,505  
                 

Expenses:

               

General and Administrative

    11,207,427       14,016,688  

Sales and Marketing

    1,201,175       1,547,018  

Lease Expense

    1,212,146       1,304,893  

Depreciation

    1,469,219       1,751,430  

Total Expenses

    15,089,967       18,620,029  
                 

Loss From Operations

    (5,676,354 )     (6,612,524 )
                 

Other Income (Expense):

               

Interest income (expense), net

    (79,068 )     (176,411 )

Foreign exchange (loss)

    -       (2,889 )

Other income, net

    1,843,619       4,978,523  

Total Other Income (Expense)

    1,764,551       4,799,223  
                 

Loss Before Provision for Income Taxes

    (3,911,803 )     (1,813,301 )
                 

Provision For Income Taxes

               

Current Tax Expense

    (4,012,587 )     (1,071,602 )

Deferred Tax Recovery

    (171,412 )     837,736  
      (4,183,999 )     (233,866 )
                 

Net Loss and Comprehensive Loss

  $ (8,095,802 )   $ (2,047,167 )
                 

Loss per Share

               

Basic and diluted loss per share

  $ (0.02 )   $ (0.01 )
                 

Weighted Average Number of Shares of Common Stock

               

Basic and diluted

    327,921,909       325,261,578  

 

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

6

 

PLANET 13 HOLDINGS INC.

Interim Condensed Consolidated Statements of Changes in Shareholders Equity

(Unaudited, in United States Dollars, except Share Amounts)

 

   

Number of

                         
   

Shares of Common Stock

   

Warrants

   

Additional Paid-in Capital

   

Accumulated Deficit

   

Total Shareholders' Equity

 
                                         

Balance, December 31, 2024

    325,163,800       18,750,000     $ 368,821,339     $ (256,107,418 )   $ 112,713,921  
                                         

Share based Compensation - RSUs

    -       -       60,331       -       60,331  

Shares Issued on Settlement of RSUs

    100,000       -       -       -       -  

Net Loss for the Period

    -       -       -       (2,047,167 )     (2,047,167 )
                                         

Balance, March 31, 2025

    325,263,800       18,750,000     $ 368,881,670     $ (258,154,585 )   $ 110,727,085  
                                         

Balance, December 31, 2025

    325,670,800       18,750,000     $ 371,157,826     $ (320,031,113 )   $ 51,126,713  
                                         

Share based Compensation - RSUs

    -       -       694,263       -       694,263  

Shares Issued on Settlement of RSUs

    2,599,998       -       -       -       -  

Net Loss for the Period

    -       -       -       (8,095,802 )     (8,095,802 )
                                         

Balance, March 31, 2026

    328,270,798       18,750,000     $ 371,852,089     $ (328,126,915 )   $ 43,725,174  

 

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

7

 

PLANET 13 HOLDINGS INC.

Interim Condensed Consolidated Statements of Cash Flows

(Unaudited, In United States Dollars)

 

   

Three Months Ended

 
   

March 31,

   

March 31,

 
    2026     2025  

CASH USED IN OPERATING ACTIVITIES

               

Net loss

  $ (8,095,802 )   $ (2,047,167 )

Adjustments for items not involving cash:

               

Shared based compensation

    694,263       60,331  

Non-cash lease expense

    437,101       506,530  

Depreciation

    2,223,690       3,081,283  

Gain on disposal of fixed assets

    (1,520,000 )     -  

Recovery of property in legal settlement

    -       (4,570,227 )

Amortization of note payable discount

    15,221       126,725  

Lease incentive amortization

    (15,714 )     2,381  
      (6,261,241 )     (2,840,144 )
                 

Net Changes in Non-cash Working Capital Items

    6,292,616       (1,986,054 )

Proceeds from lease incentives

    50,000       -  

Repayment of lease liabilities

    (254,198 )     (362,842 )

Total Operating

    (172,823 )     (5,189,040 )
                 

FINANCING ACTIVITIES

               

Repayment of Lafayette State Bank Note

    -       (2,947,632 )

Bank of Nevada Revolving Line of Credit

    -       3,000,000  

Total Financing

    -       52,368  
                 

INVESTING ACTIVITIES

               

Purchase of property and equipment

    (665,171 )     (2,691,268 )

Proceeds from sales of fixed assets

    1,520,000       -  

Total Investing

    854,829       (2,691,268 )
                 

NET CHANGE IN CASH DURING THE PERIOD

    682,006       (7,827,940 )
                 

CASH AND RESTRICTED CASH

               

Beginning of Period

    15,575,031       25,435,077  
                 

End of Period

  $ 16,257,037     $ 17,607,137  

 

Supplemental cash flow information (Note 14)

 

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

8

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

1. Nature of Operations

 

Planet 13 Holdings Inc. (“P13” or the “Company”) was incorporated under the Canada Business Corporations Act on  April 26, 2002 and continued under the British Columbia Business Corporations Act on  September 24, 2019, and on  September 15, 2023 completed its domestication to Nevada.

 

The Company is a vertically integrated cultivator and provider of cannabis and cannabis-infused products that is licensed under the laws of the States of Nevada, California, Illinois and Florida. The Company is licensed in these jurisdictions as follows: six Nevada licenses for cultivation (three medical and three adult-use), six Nevada licenses for production (three medical and three adult-use), three Nevada dispensary licenses (one medical and two adult-use), two Nevada licenses for distribution (one active, one conditional), One distribution licenses in California, one medium indoor cultivation license in California, one Medical Marijuana Treatment Center license in Florida (unlimited medical dispensaries, cultivation and processing) and one adult-use dispensary license in Illinois. As of March 31, 2026 all California operations have been sold, with the remaining cannabis license transfers awaiting final regulatory approval, which is expected in the second quarter of 2026. 

 

P13 is a public company which is listed on the Canadian Securities Exchange (“CSE”) under the symbol PLTH and on the OTCQX exchange under the symbol “PLNH”.

 

The Company’s registered and head office address is 2548 W. Desert Inn Road, Suite 100, Las Vegas, NV 89109.

 

While cannabis and CBD-infused products are legal under the laws of several U.S. states (with varying restrictions applicable), the United States Federal Controlled Substances Act classifies all “marijuana” as a Schedule I drug, whether for medical or recreational use. Under U.S. federal law, a Schedule I drug or substance has a high potential for abuse. On April 23, the U.S. Department of Justice issued a Final Order (the “Order”) placing FDA-approved marijuana products and state-regulated medical marijuana from Schedule I to Schedule III of the Controlled Substances Act. The Order does not apply to adult-use cannabis which remains classified as a Schedule I controlled substance. State medical marijuana license holders will no longer be subject to section 280E of the IRC. The Company continues to assess the impact of these developments and evaluate potential implications for its operations, tax position, and regulatory environment.

 

 

The federal government currently is prohibited from prosecuting businesses that operate in compliance with applicable state and local medical cannabis laws and regulations; however, this does not protect adult use cannabis. If the federal government changes this position, it would be financially detrimental to the Company.

 

 

2. Basis of Presentation

 

These unaudited condensed consolidated interim financial statements reflect the accounts of the Company and have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for all periods presented. Certain information and footnote disclosures normally included in the audited annual consolidated financial statements prepared in accordance with GAAP have been omitted or condensed. The information included in these unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes as of and for the year ended  December 31, 2025 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. These unaudited interim condensed consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments), which, in the opinion of management, are necessary for the fair presentation of the results for the interim periods presented. Interim results are not necessarily indicative of results for a full year. 

 

These unaudited interim condensed consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will continue in operation for the foreseeable future and, accordingly, will be able to realize its assets and discharge its liabilities in the normal course of operations as they come due.

 

Failure to arrange adequate financing on acceptable terms and/or achieve profitability may have an adverse effect on the financial position, results of operations, cash flows and prospects of the Company. These unaudited interim condensed consolidated financial statements do not give effect to adjustments to assets or liabilities that would be necessary should the Company be unable to continue as a going concern. Such adjustments could be material. These unaudited interim condensed consolidated financial statements are presented in U.S. dollars, which is also the Company’s and its subsidiaries’ functional currency.

 

These unaudited condensed consolidated interim financial statements were authorized for issuance by the Board of Directors of the Company on May 13, 2026

 

9

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

i)

Basis of consolidation

 

These accompanying unaudited condensed consolidated interim financial statements include the accounts of the Company and all subsidiaries. Subsidiaries are entities in which the Company has a controlling voting interest or is the primary beneficiary of a variable interest entity. Subsidiaries are fully consolidated from the date control is transferred to the Company and are deconsolidated from the date control ceases. All intercompany accounts and transactions have been eliminated upon consolidation. The unaudited condensed consolidated interim financial statements include all the assets, liabilities, revenues, expenses and cash flows of the Company and its subsidiaries after eliminating intercompany balances and transactions.

 

These unaudited condensed consolidated interim financial statements include the accounts of the Company and the following entities which are subsidiaries of the Company:

 

Subsidiaries as at March 31, 2026 

Jurisdiction of Incorporation

 

Ownership Interest 2026

 

Ownership Interest 2025

 

Nature of Business

         

MM Development Company, Inc. ("MMDC")

 

Nevada, USA

 

100%

 

100%

 

Nevada license holding company; vertically integrated cannabis operations

BLC Management Company LLC

 

Nevada, USA

 

100%

 

100%

 

Management/holding company

LBC CBD LLC ("LBC")

 

Nevada, USA

 

100%

 

100%

 

CBD retail sales and marketing

Newtonian Principles Inc.

 

California, USA

 

100%

 

100%

 

California license holding company; cannabis retail sales

Crossgate Capital U.S. Holdings Corp.

 

Nevada, USA

 

100%

 

100%

 

Holding company

Next Green Wave, LLC

 

California, USA

 

100%

 

100%

 

California license holding company; cannabis cultivation and processing

Planet 13 Illinois, LLC

 

Illinois, USA

 

100%

 

100%

 

Illinois license holding company; cannabis retail sales

BLC NV Food, LLC

 

Nevada, USA

 

100%

 

100%

 

Holding company for By The Slice LLC

By The Slice, LLC

 

Nevada, USA

 

100%

 

100%

 

Subsidiary of BLC NV Food, LLC; restaurant and retail operations

Planet 13 Chicago, LLC

 

Illinois, USA

 

100%

 

100%

 

Holding company

Planet 13 Real Prop LLC

 

Florida, USA

 

100%

 

100%

 

Holding company

Planet 13 Lifestyles LLC Nevada, USA 100% 100% Retail sales of apparel and accessories
VidaCann, LLC Florida, USA 100% 100% Florida license holding company
Planet 13 Innovations LLC Nevada, USA 100% 100% Intellectual property holding company
Estate of Las Palmas LLC California, USA 100% 100% Real estate holdings company
Club One Three, LLC Nevada, USA 100% 100% Inactive

 

ii)

Functional currency

 

These unaudited condensed consolidated interim financial statements are presented in U.S. Dollars (“USD”), which is the Company’s and its subsidiaries’ functional currency.

 

Foreign currency transactions are remeasured to the respective financial currencies of the Company’s entities at the exchange rates in effect on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are measured to the functional currency at the foreign exchange rate applicable at the statement of balance sheets date. Non-monetary items are carried at historical rates. Non-monetary items carried at face value denominated in foreign currencies are remeasured to the functional currency at the date when the fair value was determined. Realized and unrealized foreign exchange gains and losses are recognized through profit or loss.

 

10

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

iii)

Emerging growth company

 

The Company is an “Emerging Growth Company”, as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act, and it has taken advantage of certain exemptions that are not applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

 

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not has a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial reporting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable.

 

The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public and private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

 

 

3. Inventory

 

Finished goods inventory consists of dried cannabis, concentrates, edibles, and other products that are complete and available for sale (both internally generated inventory and third-party products purchased in the wholesale market). Work in process inventory consists of cannabis after harvest, in the processing stage. Packaging and miscellaneous consist of consumables for use in the transformation of biological assets and other inventory used in the production of finished goods, non-cannabis merchandise and food and beverage items. The Company’s inventory is comprised of:

 

  

March 31,

  

December 31,

 
  

2026

  

2025

 
         

Raw materials

 $6,358,562  $6,853,816 

Packaging and miscellaneous

  1,568,517   1,536,003 

Work in progress

  4,864,997   3,976,567 

Finished goods

  4,395,881   5,772,008 
  $17,187,957  $18,138,394 

 

Cost of Inventory is recognized as an expense when sold and included in the cost of goods sold. During the three months ended March 31, 2026, the Company recognized $11,678,617 (2025 - $16,024,302) of inventory expensed to cost of goods sold.

 

 

4. Prepaid Expenses and Other Current Assets

 

  

March 31,

  

December 31,

 
  

2026

  

2025

 
         

Security deposits

 $25,000  $27,318 

Advertising and Marketing

  18,748   - 

Prepaid rent

  908,696   963,655 

Insurance

  271,209   433,720 

License fees

  280,580   417,304 

Miscellaneous

  592,571   817,059 
  $2,096,804  $2,659,056

 

 

11

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

 

5. Property, Plant and Equipment

 

  

Land and

          

Leasehold

  

Construction

     
  

Improvements

  

Buildings

  

Equipment

  

Improvements

  

in Progress

  

Total

 

Gross carrying amount

                        
                         

At December 31, 2025

 $287,967  $4,785,413  $14,818,427  $58,938,527  $2,913,703  $81,744,037 

Additions

  -   -   3,985   23,856   601,927   629,768 

Disposals

  -   -   (40,259)  -   -   (40,259)

At March 31, 2026

 $287,967  $4,785,413  $14,782,153  $58,962,383  $3,515,630  $82,333,546 
                         

Depreciation

                        
                         

At December 31, 2025

 $19,704  $910,195  $9,966,259  $36,726,201  $-  $47,622,359 

Additions

  2,107   113,771   495,946   1,611,866   -   2,223,690 

Disposals

  -   -   (40,259)  -   -   (40,259)

At March 31, 2026

 $21,811  $1,023,966  $10,421,946  $38,338,067  $-  $49,805,790 
                         

Carrying amount

                        
                         

At December 31, 2025

 $268,263  $3,875,218  $4,852,168  $22,212,326  $2,913,703  $34,121,678 

At March 31, 2026

 $266,156  $3,761,447  $4,360,207  $20,624,316  $3,515,630  $32,527,756 

 

For the three months ended March 31, 2026, depreciation expense was $2,223,690 (2025 - $3,081,283) of which $754,471 (2025 - $1,329,853) was included in cost of goods sold and inventory.

 

During the three months ended March 31, 2026, $0 was transferred from Construction in Progress to the other fixed accounts (2025 - $2,057,410).

 

During the three months ended March 31, 2026, a gain on the sale of fixed assets in the amount of $1,520,000 was included in other income.  The sale represents all assets of the Planet 13 Orange County dispensary and had a net book value of $0.

 

During the three months ended March 31, 2026, no impairment charges were recognized. (2025 - $0).

 

12

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

 

6. Intangible Assets and Goodwill

 

  

Retail Dispensary License Clark County

  

Cultivation and Production License Clark County

  

Illinois License

  

Florida MMTC License-VidaCann

  

VidaCann Goodwill

  

Other

  

Total

 

Gross carrying amount

                            
                             

Balance, December 31, 2025

 $690,000  $709,798  $1,812,656  $9,000,000  $30,661,477  $30,000  $42,903,931 

Impairments

  -   -   -   -   -   -   - 

Balance at March 31, 2026

 $690,000  $709,798  $1,812,656  $9,000,000  $30,661,477  $30,000  $42,903,931 

 

 

The company tests and assesses for impairment of intangible asset carrying values annually at a minimum, or when there are indicators of a loss in value, such as a decline in the market or overall business performance.  During the three months ended March 31, 2026, no impairment charges were recognized. (2025 - $0).

 

 

 

13

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

 

14

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

 

 

7. Leases

 

The Company’s lease agreements are for cultivation, manufacturing, retail, and office premises and for vehicles. The property lease terms range between 5 years and 24 years depending on the facility and are subject to an average of 2 renewal periods of equal length as the original lease. Certain leases include escalation clauses or payment of executory costs such as property taxes, utilities, or insurance and maintenance. Rent expense for leases with escalation clauses is accounted for on a straight-line basis over the lease term. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

 

15

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

The following table provides the components of lease costs recognized in the unaudited interim condensed consolidated statement of operations and comprehensive loss for the three month periods ended March 31, 2026 and 2025:

 

  

Three Months Ended

 
  

March 31,

  

March 31,

 
  

2026

  

2025

 
         

Operating lease costs

 $2,074,660  $2,307,071 

Short term lease expense

  153,252   111,293 

Total lease costs

 $2,227,912  $2,418,364 

 

Other information related to operating and finance leases as of and for the three months ended March 31, 2026 and 2025 is as follows:

 

  

March 31, 2026

  

March 31, 2025

 
  

Operating

  

Operating

 
  

Lease

  

Lease

 
         

Weighted average discount rate

  15.00%  15.00%

Weighted average remaining lease term

  7.39   7.66 

 

The maturities of the contractual undiscounted lease liabilities as of March 31, 2026 and  December 31, 2025 are:

 

  March 31,  December 31, 
  

2026

  

2025

 
  

Operating

  

Operating

 
  

Lease

  

Lease

 
         

2026

 $5,855,798  $7,779,306 

2027

  7,973,556   7,973,556 

2028

  8,050,719   8,050,719 

2029

  8,106,646   8,106,646 

2030

  8,067,339   8,067,339 

2031

  7,917,963   7,917,963 

2032

  7,655,113   - 

Thereafter

  53,877,434   61,532,548 
         

Total undiscounted lease liabilities

  107,504,568   109,428,077 

Interest on lease liabilities

  (63,159,758)  (64,829,069)

Total present value of minimum lease payments

  44,344,810   44,599,008 

Lease liability - current portion

  (1,456,078)  (1,385,566)

Lease liability

 $42,888,732  $43,213,442 

 

Principally all leases relate to real estate.

 

For the three months ended March 31, 2026, the Company incurred $2,074,660 of operating lease costs (2025 - $2,307,071), of which $962,217 (2025 - $1,016,521) was allocated to cost of goods sold and inventory.

 

See Note 14 for additional supplemental cash flow information related to leases.

 

16

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

 

8. Notes Payable

 

  

March 31,

  

December 31,

  

Stated Interest

   

Effective

  

Maturity

  

2026

  

2025

  

Rate

   

Interest Rate

  

Date

                    

Promissory Note to VidaCann former managers, unsecured with interest paid monthly at 7.5%, maturity date May 6, 2029

  1,249,574   1,234,353   7.5%

(1)

  15.0% 

5/6/2029

Revolving Line of Credit, cash secured with monthly interest paid at an annual rate of 5.65%

  9,750,000   9,750,000   5.65%

(2)

  5.65% 

6/30/2026

                    
  $10,999,574  $10,984,353            

Less current portion

  (9,750,000)  (9,750,000)           
  $1,249,574  $1,234,353            
                    

Stated maturities of debt obligations are as follows:

                   
                    

2026

 $9,750,000  $9,750,000            

2027

  -   -            

2028

  -   -            

2029

  1,249,574   1,234,353            

2030

  -   -            

2031

  -   -            

Total

 $10,999,574  $10,984,353            

 

(1) The Promissory note to VidaCann former managers had a face value of $1,500,000. The Company determined a fair value of $1,148,423 at the May 9, 2024 acquisition date using a 15% estimated borrowing rate. Total interest expense including paid interest and amortization of the note discount for the three-month period ended March 31, 2026 equaled $42,961 (2025 - $68,715).

 

(2) The Company entered into a cash secured line of credit up to $9,750,000, effective June 13, 2024, with no other collateral securing the credit line (the "revolving line of credit"). The revolving line of credit contains no financial, or other incurrence-based covenants or no material maintenance covenants. The revolving line of credit balance at March 31, 2026 equaled $9,750,000 (2025 - $3,000,000).  Total interest expense for the three months ended March 31, 2026 equaled $137,719 (2025 - $0).

 

 

9. Share Capital

 

The Company is authorized to issue 1,500,000,000 shares of common stock and 50,000,000 shares of preferred stock. 

 

   

Number of Shares of Common Stock

 
          
   

March 31,

  

December 31,

 
   

2026

  

2025

 

Common Stock

         

Balance at January 1

  325,670,800   325,163,800 

Shares issued on settlement of RSUs

i.

  2,599,998   507,000 
          

Total shares of common stock outstanding

  328,270,798   325,670,800 

 

i. Shares issued for Restricted Share Units

 

During the three months ended March 31, 2026, no restricted stock units ("RSU") were awarded under the Planet 13 Holdings Inc 2023 Equity incentive plan (as amended from time to time, the "2023 Equity Plan")2,599,998 vested RSUs were issued and 904,378 unvested RSUs were forfeited and cancelled.  The Company did not receive any cash proceeds on the settlement of the RSUs.

 

During the year ended December 31, 2025, 23,930,635 RSUs were awarded under the Planet 13 Holdings Inc 2023 Equity incentive plan. 507,000 of these RSUs vested and were issued, 1,780,931 RSUs were forfeited and cancelled. The Company did not receive any cash proceeds on the settlement of the RSUs.

 

17

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

 

 

10. Warrants

 

The following table summarizes the number of warrants outstanding at March 31, 2026 and  December 31, 2025.  

 

 

  

March 31, 2026

  

Weighted Average Exercise Price - USD

  December 31, 2025  

Weighted Average Exercise Price - USD

 
                 

Balance - beginning of period

  18,750,000  $0.77   18,750,000  $0.77 

Exercised

  -  $-   -  $- 

Issued

  -  $-   -  $- 

Balance - end of period

  18,750,000  $0.77   18,750,000  $0.77 

 

 

On   March 7, 2024, the Company issued and sold 18,750,000 Units at a public offering price of $0.60 per unit. Each Unit consisted of one share of Common Stock and one Warrant. Each Warrant entitles the holder to purchase one share of Common Stock for a period of 5 years following the closing date of the Offering at an exercise price of $0.77, subject to adjustments in certain events. The warrants expire on March 7, 2029.

 

 

11. Share Based Compensation 

 

At the 2023 Annual General and Special Meeting, the shareholders of Planet 13 voted to approve and adopt the 2023 Equity Plan, which was contingent upon the completion of the Company's domestication, and became effective on September 15, 2023. As of September 15, 2023, the Company may not grant any new awards under the Planet 13 Holdings Inc. 2018 Stock Option Plan and Planet 13 Holdings Inc. 2018 Share Unit Plan (collectively, the “Prior Plans”), and the Prior Plans will continue to govern awards previously granted under them.

 

On July 22, 2025, the Company authorized an additional 10,000,000 reserve shares for a total of 32,000,000 shares of Common Stock are available for grants under the 2023 Equity Plan and all other security based compensation arrangements of the Company, including the Prior Plans (the “Total Share Reserve”).  As of  March 31, 2026, a maximum number of 5,657,319 shares of Common Stock are available for issuance under the 2023 Equity Plan, subject to adjustment pursuant to the terms of the 2023 Equity Plan.

 

(a) Stock Options

 

During the three months ended March 31, 2026 and the year ended December 31, 2025

 

No incentive stock options were granted during the three months ended March 31, 2026 or the year ended December 31, 2025

 

The following table summarizes information about stock options outstanding at March 31, 2026:

 

  

Exercise price

  

March 31, 2026

  

March 31, 2026

  

December 31, 2025

  

December 31, 2025

 

Expiry Date

 

CAD$

  

Outstanding

  

Exercisable

  

Outstanding

  

Exercisable

 
                     

September 30, 2026

 $4.37   97,322   97,322   97,322   97,322 
      97,322   97,322   97,322   97,322 

 

18

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

The following table reflects the continuity of stock options for the period presented:

 

  

March 31, 2026

  

Weighted Average Exercise Price - CAD

  December 31, 2025  

Weighted Average Exercise Price - CAD

 
                 

Balance - beginning of period

  97,322  $4.37   417,922  $3.15 

Expired

  -   -   (320,600)  2.78 

Balance - end of period

  97,322  $4.37   97,322  $4.37 

 

Share based compensation expense attributable to employee options was $0 and $0 for the three months ended March 31, 2026 and 2025, respectively. 

 

The total intrinsic value of stock options exercised, outstanding and exercisable as of March 31, 2026 and December 31, 2025 was $0 and $0, respectively.

 

(a) Restricted Share Units

 

The following table summarizes the RSUs that are outstanding as at March 31, 2026 and  December 31, 2025:

 

  

March 31,

  

December 31,

 
  2026  2025 
         

Balance - beginning of period

  21,942,704   300,000 

Issued

  -   23,930,635 

Exercised

  (2,599,998)  (507,000)

Forfeited

  (904,378)  (1,780,931)

Balance - end of period

  18,438,328   21,942,704 

 

The Company recognized $694,263 in share-based compensation expense attributable to the RSU vesting schedule for the three months ended March 31, 2026 ($60,331 for the three months ended March 31, 2025).

 

During the three months ended March 31, 2026

 

No RSU's were granted, 2,599,998 RSUs vested and were exercised, 904,378 RSUs were forfeited and cancelled.  The Company did not receive any cash proceeds from the settlement of the RSUs.

 

During the three months ended  March 31, 2025

 

100,000 RSU's were granted, vested and were exercised.  The Company did not receive any cash proceeds from the settlement of the RSUs.

 
19

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

 

12. Loss Per Share

 

  

Three Months Ended

 
  

March 31,

  

March 31,

 
  

2026

  

2025

 
         

Loss available to common stockholders

 $(8,095,802) $(2,047,167)
         

Weighted average number of shares outstanding, basic and diluted

  327,921,909   325,261,578 
         

Basic and diluted loss per share

 $(0.02) $(0.01)

 

37,285,650 and 19,416,397 potentially dilutive securities for the three months ended March 31, 2026 and 2025, respectively, were excluded in the calculation of diluted EPS as their impact would have been anti-dilutive due to the net losses for such periods.

 

 

13. General and Administrative

 

 

  

Three Months Ended

 
  

March 31,

  

March 31,

 
  

2026

  

2025

 
         

Salaries and wages

 $4,402,412  $5,878,604 

Share based compensation

  694,263   60,331 

Executive compensation

  724,870   1,099,940 

Licenses and permits

  551,435   702,036 

Payroll taxes and benefits

  1,026,757   1,387,489 

Supplies and office expenses

  150,651   329,597 

Subcontractors

  493,561   635,060 

Professional fees (legal, audit and other)

  981,456   1,263,506 

Miscellaneous general and administrative expenses

  2,182,022   2,660,125 
  $11,207,427  $14,016,688 

  

20

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

 

14. Supplemental Cash Flow Information

 

    Three Months Ended  
    March 31,     March 31,  

Change in Working Capital

 

2026

   

2025

 
                 

Accounts Receivable

  $ 2,521,417     $ (160,964 )

Inventory

    950,437       (1,377,625 )

Prepaid Expenses and Other Assets

    562,252       854,068  

Long-term Deposits and Other Current Assets

    (69,561 )     (34,719 )

Deferred Tax Assets

    14,930       (387,381 )

Deferred Tax Liabilities

    156,481       (450,355 )

Accounts Payable

    (483,957 )     (1,583,433 )

Accrued Expenses

    (1,371,970 )     86,673  

Other Liabilities (LT)

    -       (3,920 )

Uncertain Tax Positions

    4,012,587       -  

Income Taxes Payable

    -       1,071,602  
    $ 6,292,616     $ (1,986,054 )
                 

Cash Paid

               
                 

Interest Paid on Leases

  $ 1,653,273     $ 1,798,160  

Income Taxes

  $ -     $ -  
                 

Non-cash Financing and Investing Activities

               
                 

Fixed Asset Amounts in Accounts Payable

  $ 238,146     $ 420,470  

Reclassification of long term lease liabilities to current

  $ 70,512     $ 78,938  

 

 

15. Related Party Transactions and Balances

 

Related party transactions are summarized as follows:

 

(a) Building Lease

 

As part of the VidaCann acquisition on May 9, 2024, the Company entered into a long-term lease agreement with Loop's Nursery for a property in St John's Florida that is used as the Company's primary cultivation facility in Florida. Loop's Nursery is primarily owned by David Loop, one of the Company's board members. Payments for rent and associated costs related to the use of this property for the three months ended March 31, 2026 equaled $1,087,708 (three months ended March 31,2025 - $922,111).

 

(b) Other

 

As part of the VidaCann acquisition on May 9, 2024, the Company acquired related party notes payable to David Loop, one of the Company's board members and Mark Ascik, in the amounts of $750,000 each (see Note 8). Payments for interest on the related party notes for the three months ended March 31, 2026 totaled $27,740 combined (three months ended March 31, 2025 - $27,740).

 

Effective September 19, 2025, the Company entered into a three month consulting agreement with Off the House, LLC, an entity owned and operated by the stepson of Robert Groesbeck, the Company's Co-CEO. After the initial three month period, the contract continues on a month to month basis.  Total contract payments for the three months ended March 31, 2026 equaled $84,285 (three months ended March 31, 2025 - $nil).

 

For the three-month period ended  March 31, 2026, no amounts were due to related parties ( December 31, 2025 - $5,935).

 

 

16. Commitments and Contingencies

 

(a) Construction Commitments

 

The Company had $194,700 of outstanding construction commitments as of March 31, 2026 ( December 31, 2025 - $383,494).

 

21

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

(b) Contingencies

 

The Company’s operations are subject to a variety of local and state regulations. Failure to comply with one or more of those regulations could result in fines, restrictions on its operations, or losses of permits that could result in the Company ceasing operations. While management of the Company believes that the Company is in compliance with applicable local and state regulations at March 31, 2026, medical and adult use cannabis regulations continue to evolve and are subject to differing interpretations. As a result, the Company may be subject to regulatory fines, penalties, or restrictions in the future.

 

(c) Claims and Litigation

 

From time to time, we may become involved in legal or regulatory proceedings, lawsuits and other claims arising in the ordinary course of our business. In view of the inherent difficulty of predicting the outcome of such matters, we cannot state what the eventual outcome of such matters will be. However, based on our knowledge, as of March 31, 2026, we are not presently a party to any legal proceedings that, in the opinion of our management, would individually or taken together have a material adverse effect on our business, operating results, financial condition, or cash flows. Regardless of outcome, litigation can have an adverse impact on us due to defense and settlement costs, diversion of management resources, negative publicity and reputational harm, and other factors.

 

(d) Operating Licenses

 

Although the possession, cultivation, and distribution of marijuana for medical and adult use is permitted in Nevada and California, and for medical use these activities are permitted in Florida, marijuana is a Schedule I controlled substance, and its use remains a violation of federal law. Since federal law criminalizing the use of marijuana pre-empts state laws that legalize its use, strict enforcement of federal law regarding marijuana would likely result in the Company’s inability to proceed with our business plans. In addition, the Company’s assets, including real property, cash, equipment, and other goods, could be subject to asset forfeiture because marijuana is still federally illegal.

 

 

17. Risks

 

Credit risk

 

Credit risk is the risk that a third party might fail to discharge its obligations under the terms of a financial instrument. Credit risk arises from cash with banks and financial institutions. It is management's opinion that the Company is not exposed to significant credit risk arising from these financial instruments. The Company limits credit risk by entering into business arrangements with high credit-quality counterparties. The Company further limits credit risk to a maximum of $250,000 to any individual counterparty at a given time. Total maximum credit risk for all counterparties combined is estimated at $500,000.

 

The Company evaluates the collectability of its accounts receivable and maintains an allowance for credit losses at an amount sufficient to absorb losses inherent in the existing accounts receivable portfolio as of the reporting dates based on the estimate of expected net credit losses.

 

Interest Rate Risk

 

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company currently has some notes payable that are interest bearing, as well as funds held in an interest-bearing money market account.  Based on the balances involved, it is management’s opinion that the Company is not exposed to significant interest rate risk.

 

Price risk

 

Price risk is the risk that the trading price of the Company’s shares will fluctuate and adversely impact the Company, primarily due to the inability to raise additional funds through future stock offerings. The Company is not exposed to significant price risk.

 
22

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

Liquidity risk

 

The Company’s approach to managing risk is to ensure that it will have sufficient liquidity to meet liabilities when due. As of March 31, 2026, the Company’s financial liabilities consist of accounts payable, accrued liabilities, obligations under operating leases, notes payable and taxes. The Company manages liquidity risk by reviewing its capital requirements on an ongoing basis. Historically, the Company’s main source of funding has been the public issuance of common equity. The Company’s access to financing is always uncertain. There can be no assurance of continued access to significant equity financing.

 

Concentration risk

 

The Company operates exclusively in Southern Nevada and Florida, and has a small presence in Illinois. Should economic conditions deteriorate within any of these regions, its results of operations and financial position would be negatively impacted.

 

Banking risk


Notwithstanding that a majority of states have legalized medical marijuana, there has been no change in US federal banking laws related to the deposit and holding of funds derived from activities related to the cannabis industry. Given that US federal law provides that the production and possession of cannabis is illegal, there is a strong argument that banks cannot accept or deposit funds from businesses involved with the marijuana industry. Consequently, businesses involved in the cannabis industry often have difficulty accessing the US banking system and traditional financing sources. The inability to open bank accounts with certain institutions may make it difficult to operate the business of the Company and leave the Company’s cash holdings vulnerable.

 

Asset forfeiture risk

 

Because the cannabis industry remains illegal under US federal law, any property owned by participants in the cannabis industry which are either used in the course of conducting such business, or are the proceeds of such business, could be subject to seizure by law enforcement and subsequent civil asset forfeiture. Even if the owner of the property was never charged with a crime, the property in question could still be seized and subject to an administrative proceeding by which with minimal due process, it could be subject to forfeiture.

 

Currency rate risk

 

As of March 31 2026, none of the Company’s financial assets and liabilities were held in Canadian dollars. The same was true as of December 31, 2025. The Company’s objective in managing its foreign currency risk is to minimize its net exposure to foreign currency cash flows by transacting, to the greatest extent possible, with third parties in the functional currency. The Company does not currently use foreign exchange contracts to hedge its exposure of its foreign currency cash flows as management has determined that this risk is not significant at this point in time. The Company’s exposure to a 10% change in the foreign exchange conversion rate at March 31 2026 equals $nil.

 

 

18. Disaggregated Revenue

 

The following table presents the Company’s disaggregated revenue by sales channel:

 

  

Three Months Ended

 
  

March 31,

  

March 31,

 
  

2026

  

2025

 
         

Retail

 $20,172,154  $24,629,801 

Wholesale

  920,076   3,402,006 
         

Net revenues

 $21,092,230  $28,031,807 

 

23

 

PLANET 13 HOLDINGS INC.

Notes to the Interim Condensed Consolidated Financial Statements

(Unaudited, in United States Dollars, except share amounts)

 

 

 

20. Property Recovered in Settlement

 

On March 3, 2025 the Company announced significant recovery of funds related to El Capitan, including a settlement and recovery of $2.1 million of funds which were held at Bridge Bank, a division of Western Alliance Bank (collectively "WAB"), bringing the total recovery of funds held at WAB to $5.5 million. Additionally, the Company, through a wholly-owned subsidiary, obtained real estate (the "Real Property") valued at approximately $5.0 million based on comparable sales, and carried on
the balance sheet at a net (after estimated costs to sell) value of $4.6 million. On July 15, 2025, the Real Property was sold at a net value (after estimated costs to sell) of $4.1 million, resulting in a loss on sale of assets of $502,154. The recovery amount is also included in the Interim Condensed Consolidated Statements of Operations and Comprehensive Loss for the period ended March 31, 2025 in Other income, net and also in the Interim Condensed Consolidated Statements of Cash Flows for the period ended March 31, 2025 in adjustments for items not involving cash, recovery of property in legal settlement.

 

 

21. Subsequent Events

 

 

None  

 

 

24

 
 

Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.

 

This management’s discussion and analysis (“MD&A”) of the financial condition and results of operations of Planet 13 is for the three months ended March 31, 2026. It is supplemental to, and should be read in conjunction with, our unaudited condensed interim consolidated financial statements for the three months ended March 31, 2026 and 2025, and the accompanying notes presented herein. Our financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Financial information presented in this MD&A is presented in United States dollars (“$”, “USD” or “US$”), unless otherwise indicated.

 

In this MD&A, unless the context otherwise requires, the terms “we,” “us,” “our,” “Company,” or “Planet 13” refer to Planet 13 Holdings Inc. together with its wholly owned subsidiaries.

 

This MD&A contains certain “forward-looking statements” and certain “forward-looking information” as defined under applicable United States and Canadian securities laws. Please refer to the discussion of forward-looking statements and information set out under the heading “Cautionary Note Regarding Forward-Looking Statements,” identified in this Quarterly Report on Form 10-Q. As a result of many factors, our actual results may differ materially from those anticipated in these forward-looking statements and information.

 

Overview 

 

We are a multi-state cannabis operator with licenses to operate in Nevada, California, Florida, and Illinois. We are headquartered in Las Vegas, Nevada.

 

As of March 31, 2026, we employed approximately 650 people and remain focused on providing our customers with the best products, best services, and an experiential shopping experience at our superstore-themed dispensary while expanding our products and sales through neighborhood stores. Each of our state operations is held in state-focused subsidiaries: (a) Newtonian Principles, Inc. for California-licensed cannabis dispensing and distribution activities, (b) Next Green Wave, LLC for California-licensed cannabis cultivation and production activities, (c) MM Development Company, Inc. for all licensed Nevada cannabis cultivation, production, distribution, and dispensing, (d) VidaCann LLC. (“VidaCann”) which holds our Florida Medical Marijuana Treatment Center (“MMTC”) license, and (e) Planet 13 Illinois, LLC (“Planet 13 Illinois”) which holds an Illinois social-equity justice impaired dispensing license. We have focused on our large-store dispensing stores as superstores which offer an experiential approach to our customers, including drones, robotics, 3-D mapping projection, cannabis-culture inspired social-media backdrops for customer interaction, customer-facing production, one-on-one sales staffing and customer education, and other interactive marketing elements to differentiate from more traditional dispensing locations, which we refer to herein as “neighborhood stores”. Each of our cannabis facilities is state-licensed as an adult-use cannabis facility, a medical cannabis facility, or a dual-use facility, allowing for both adult-use and medical cannabis licensed activity, as designated below in the state-by-state breakdown.

 

Nevada

 

As of March 31, 2026, we held the following licensed operations in Nevada: (a) one dual-licensed dispensary superstore adjacent to the Las Vegas Strip with 24,000 square feet of licensed dispensary (the “Planet 13 Las Vegas Superstore”), (b) one adult-use “neighborhood store” at 2,300 square feet of licensed dispensary (the “Medizin dispensary”), (c) three dual-licensed production facilities, one of which is co-located and customer-facing at the Las Vegas SuperStore Entertainment complex with 18,500 square feet of licensed production, (d) three dual-licensed cultivation facilities, one with approximately 16,100 square foot indoor cultivation facility under perpetual harvest cycle, a second with 45,000 square feet co-located with our production license at that facility, and a small-indoor rural site in Beatty, Nevada that is expandable up to 2,300,000 square feet of greenhouse located on 80-acres owned by us, also co-located with our production license at that facility, and (e) one cannabis distribution license and (f) one cannabis consumption license operating as DAZED! Consumption lounge, a 3,000 square foot location inside the Planet 13 Las Vegas Superstore Entertainment complex.  Of the three Nevada cultivation facilities, the Company is currently only utilizing one, the 45,000 sq ft shared use cultivation/production facility, while the other two facilities are dark and reserved for future expansion, or potential sale.   

 

At the Planet 13 Las Vegas Superstore Entertainment complex, we also offer ancillary services to our customers, including a restaurant (currently closed and awaiting a new tenant operator) with a liquor license, a retail store, and our online cannabidiol (“CBD”) store which also sells products in our facility.

 

California

 

As of March 31, 2026, we held the following licenses in California: One dual-use and two adult-use cultivation licenses along with a nursery license and distribution license.  The Company has discontinued operations at both its Orange County, California retail store, as well as its Coalinga California cultivation facility, pending transfer of the licenses.  

 

25

 

Florida

 

As of March 31, 2026, we are continuing capital outlays to utilize our Florida MMTC license issued by the Florida Department of Health that was acquired through our acquisition of VidaCann. Licensed MMTCs are vertically integrated and the only businesses in Florida authorized to dispense medical marijuana cannabis to qualified patients and caregivers. MMTCs are authorized to cultivate, process, transport and dispense medical marijuana. As of December 31, 2025 there were 22 companies with MMTC licenses in Florida, many of which are not yet operational. License holders are not subject to restrictions on the number of dispensaries that may be opened or on the number or size of cultivation and processing facilities they may operate. On September 15, 2023, we recorded an impairment charge of $32,750,466 against our previously acquired Florida MMTC License to reflect the value of the Florida MMTC License as of the date we domesticated to Nevada.  We recognized an additional impairment of $7,197,418, that brought the carrying value of our Florida MMTC License to $9,000,000, as of December 31, 2023.  The amount was equal to the sale price negotiated with a third party who acquired the license from us on May 6, 2024, prior to us closing the acquisition of VidaCann  on May 10, 2024.  The VidCann acquisition added a cultivation and processing facility, a production facility and a twenty-six (26) retail store network, to which we have added seven (7) additional locations, bringing the total number of medical dispensaries we operate in Florida to thirty three (33)

 

As part of our Florida expansion, as of the date of this Quarterly Report on Form 10-Q, we have entered into two leases for additional dispensing locations in Florida, which remain subject to completion of tenant improvements and regulatory inspection prior to sales to customers.  The first location in Sarasota, is nearing completion of tenant improvements and is expected to be operational in the second quarter of 2026, followed by the second location in St. Petersburg, which will begin construction upon completion of Sarasota.

 

Illinois

 

On August 5, 2021, Planet 13 Illinois won a Conditional Adult Use Dispensing Organization License in the Chicago-Naperville-Elgin region from the Illinois Department of Financial and Professional Regulation. The conditional license was issued to Planet 13 Illinois on July 22, 2022. At the time the license was awarded, we owned 49% of Planet 13 Illinois and 51% was owned by Frank Cowan. 

 

On August 5, 2022, we entered into an option purchase agreement that gives us the option to purchase 51% of Planet 13 Illinois that it does not already own from Frank Cowan for $866,250 in cash and 1,063,377 common shares of the Company. The option was exercisable at our discretion for a period of two years.

 

On October 14, 2022, the Company, through its wholly owned subsidiary Planet 13 Chicago, LLC, entered into a $2,500,000 real property purchase agreement for a proposed dispensing location in Waukegan, Illinois, for an approximately 8,000 square foot building on 1.9 acres, previously occupied by a financial institution tenant. The Company’s obligation to close on the transaction is conditioned upon obtaining local jurisdiction zoning and land-use approvals, completion of customary due diligence, and that the current non-occupying tenant terminate their lease at the property. On November 1, 2022, the Company provided notice of this site selection to the Illinois cannabis regulator. 

 

On February 7, 2023, we exercised and closed our option to purchase Mr. Cowan’s 51% interest in Planet 13 Illinois. On February 3, 2023, we closed on the purchase of a dispensary location in the town of Waukegan, a suburb of the greater Chicago area, and on December 4, 2023, opened the Planet 13 Illinois dispensary to the public.

 

As of March 31, 2026 we operate one Planet 13 branded dispensary in Waukegan, Illinois. The Company has plans to leverage its resources in Illinois by introducing its exclusive line of products through licensing agreements for sale at its retail store and wholesale throughout the State in 2026. 

 

Competitive Conditions

 

The markets in which we operate are highly competitive, with increasing competition from larger, better financed companies, as well as new entrants. Competition has become more intense as competitors offer an increasing number of diversified products and engage in price competition in all markets.  Planet 13 is committed to enhancing the customer experience through events, exclusive product offerings, improved pricing and enhancements to its loyalty program to help attract and retain customers in light of this competitive environment.    

 

We expect to continue to focus on several areas, including customer experience, product innovation, production efficiencies, marketing and branding, and ongoing cost control and reductions. The management team constantly monitors ongoing developments in the cannabis and related industries to help us remain competitive. We have been closely tracking the illicit market for cannabis and manufacturers and retailers of intoxicating hemp products as the illicit market also has a direct financial impact on our business.

 

Recent Developments

 

On April 23, 2026, the U.S. Department of Justice (DOJ) officially moved marijuana from Schedule I to Schedule III of the Controlled Substances Act. This recognizes the drug has accepted medical uses and a lower potential for abuse, a major departure from its previous treatment as a drug with no medical value. The order immediately applies to FDA-approved products and state-licensed medical marijuana. A new expedited administrative hearing process is expected to begin on June 29, 2026, to consider further, broader rescheduling. This shift is expected to provide significant tax relief to state-licensed cannabis businesses, allowing them to deduct business expenses that were previously prohibited under IRS rule 280E. The reclassification aims to ease federal restrictions, enabling more rigorous scientific research and expanding access for patients.

 

26

 

Results of Operations

 

   

Three Months Ended

       
   

March 31,

   

March 31,

   

Percentage

 

Expressed in USD$

 

2026

   

2025

   

Change

 

Revenue

                       

Net revenue

    21,092,230       28,031,807       (24.8 )%

Cost of Goods Sold

    (11,678,617 )     (16,024,302 )     (27.1 )%

Gross Profit

    9,413,613       12,007,505       (21.6 )%

Gross Profit Margin %

    44.6 %     42.8 %        
                         

Expenses

                       

General and Administrative

    11,207,427       14,016,688       (20.0 )%

Sales and Marketing

    1,201,175       1,547,018       (22.4 )%

Lease expense

    1,212,146       1,304,893       (7.1 )%

Depreciation and Amortization

    1,469,219       1,751,430       (16.1 )%

Total Expenses

    15,089,967       18,620,029       (19.0 )%
                         

Income (Loss) From Operations

    (5,676,354 )     (6,612,524 )     (14.2 )%
                         

Other Income (Expense):

                       

Interest expense, net

    (79,068 )     (176,411 )     (55.2 )%

Foreign exchange gain (loss)

          (2,889 )     (100.0 )%

Other income, net

    1,843,619       4,978,523       (63.0 )%

Total Other Income

    1,764,551       4,799,223       (63.2 )%
                         

Loss for the period before tax

    (3,911,803 )     (1,813,301 )     115.7 %

Provision for income tax (current and deferred)

    (4,183,999 )     (233,866 )     1689.1 %

Loss for the period

    (8,095,802 )     (2,047,167 )     295.5 %
                         

Loss per share for the period

                       

Basic and fully diluted income (loss) per share

  $ (0.02 )   $ (0.01 )        
                         

Weighted Average Number of Shares Outstanding

                       

Basic and diluted

    327,921,909       325,261,578          

 

27

 

Three Months Ended March 31, 2026 Compared to the Three Months Ended March 31, 2025

 

Revenue, net of Discounts

 

The Company experienced a decrease in net revenue of $6,939,577, down 24.8% from $28,031,807 in the prior year during the three months ended March 31, 2026. The decrease in net revenue was primarily driven by the Company's exit from the California market with the wholesale portion substantially complete at the end of 2025 and the final day of sales at the dispensary on February 10, 2026. California revenue represented approximately almost half of the revenue decline vs prior year. The Company experienced ongoing price compression in all markets driven by additional competition and the persistent impact of the illicit market.

 

The Company saw a reduction in the number of customers at the Planet 13 Las Vegas Superstore compared to the prior year, and decreases in revenue from both retail operations and wholesale operations in Nevada. In particular, the flower category suffered from intense price compression and oversupply in the market, negatively impacting both retail and wholesale revenue in the period. We believe that a decline in tourism in Las Vegas, combined with an overall reduction in the disposable income of our customers during the three months ended March 31, 2026, had a negative impact on the number of tourists and local customers visiting the Planet 13 Las Vegas Superstore and our other retail locations.  The Company is focused on driving customer traffic to the Las Vegas Superstore location with local marketing efforts, partnerships with taxi cab and rideshare drivers and targeting high impact events such as certain concerts, events at the Sphere, and EDC, among others.

 

Details of net revenue by product category are as follows:

 
    Three Months Ended        
   

March 31,

   

March 31,

   

Percentage

 
   

2026

   

2025

   

Change

 

Flower

  $ 8,246,571     $ 10,241,007       (19.5 )%

Concentrates

    7,261,864       8,712,701       (16.7 )%

Edibles

    3,416,968       4,187,874       (18.4 )%

Topicals and Other Revenue

    1,246,751       1,488,219       (16.2 )%

Wholesale

    920,076       3,402,006       (73.0 )%

Net revenue

  $ 21,092,230     $ 28,031,807       (24.8 )%

 

 

Gross Profit

 

Gross profit margin for the three months ended March 31, 2026 was 44.6% compared to 42.8% for the three months ended March 31, 2025. Overall gross profit was $9,413,613 and $12,007,505 for the three months ended March 31, 2026 and 2025 respectively, a decrease of 21.6%. 

 

The increase in gross profit margin percentage for the three months ended March 31, 2026 was the result of several factors including: the exit from California wholesale, the reduction of flower production in Nevada and improvements in third party procurement in Nevada.  The Company expects margins to continue to improve from this level going forward from continued efforts in Nevada, as Florida begins to scale and BHO products are introduced.

 

 

28

 

General and Administrative Expenses

 

General and Administrative (“G&A”) expenses (which includes non-cash share-based compensation expenses), decreased by 20% during the three months ended March 31, 2026, when compared to the three months ended March 31, 2025. The decrease in G&A expenses across board was the result of the focused cost cutting initiatives undertaken by the Company during 2025 now showing in the results. Overall, excluding non-cash share-based compensation expenses, G&A expenses as a percentage of revenue equaled 49.8% for the three months ended March 31, 2026, compared to 49.8% for the three months ended March 31, 2025. 

 

A detailed breakdown of G&A expenses is as follows:

 

   

Three Months Ended

       
    March 31,     March 31,     Percentage  
   

2026

   

2025

   

Change

 

Salaries and wages

  $ 4,402,412     $ 5,878,604       (25.1 )%

Share-based compensation expense

    694,263       60,331       1050.8 %

Executive compensation

    724,870       1,099,940       (34.1 )%

Licenses and permits

    551,435       702,036       (21.5 )%

Payroll taxes and benefits

    1,026,757       1,387,489       (26.0 )%

Supplies and office expenses

    150,651       329,597       (54.3 )%

Subcontractors

    493,561       635,060       %

Professional fees (legal, audit and other)

    981,456       1,263,506       (22.3 )%

Miscellaneous general and administrative expenses

    2,182,022       2,660,125       (18.0 )%
    $ 11,207,427     $ 14,016,688       (20.0 )%

 

 

Non-cash, share-based compensation of $694,263 was recognized during the three months ended March 31, 2026, increasing from $60,331 that was recognized during the three months ended March 31, 2025. The increase is primarily attributable to the 13,673,635 Restricted Share Units (“RSUs”) that were granted on March 31, 2025.  These amounts are non-cash, and the expense is recognized in accordance with the vesting schedule of the underlying RSUs. See Note 12 to our audited consolidated financial statements filed with our Annual Report on Form 10-K for the year ended December 31, 2025, for additional details on the assumptions used to calculate fair value as well as information regarding the vesting of the various components of the non-cash share-based compensation.

 

Sales and marketing expenses decreased by 22.4% or $345,843 during the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The decrease in marketing expenses was a result of the Company's overall cost reduction efforts, partially offset by the cost of efforts to drive increased customer traffic to the Planet 13 Las Vegas Superstore.

 

29

 

Lease expense decreased by 7.1% during the three months ended March 31, 2026, when compared to the three months ended March 31, 2025. The decrease in Lease expense is primarily due to the exit from the Orange County, California dispensary, which was completed on February 10, 2026, the exit from administrative office space in Nevada and two unprofitable store locations in Miami Florida.

 

Depreciation and amortization decreased by 16.1% during the three months ended March 31, 2026, when compared to the three months ended March 31, 2025. The reduction is primarily due to the elimination of depreciation charges as a result of the asset sales in California. 

 

Interest expense of $79,068 was incurred during the three months ended March 31, 2026, compared to net interest expense of $176,411 during the three months ended March 31, 2025. The reduction in interest expense when compared to prior year is the result of paying off several higher interest notes by utilizing a low interest revolving line of credit and the settlement of a promissory note secured by a property in Beatty Nevada in December 2025. The interest expense is net of interest earned on a corresponding money market account. The balance of long-term debt as of March 31, 2026, was $1,249,574 compared to $1,234,353 as of December 31, 2025. 

 

We conduct our operations primarily in United States dollars and hold all of our currency in US dollars. An insignificant amount of expenses are incurred in Canadian dollars, or Euros. The foreign currency gains/losses reflect fluctuations in the underlying exchange rates on the dates expenses are incurred compared to when they are paid. It is our policy not to hedge our foreign exchange exposure.

 

Other income/expense, consisting of gains on the sale of fixed assets and other miscellaneous transactions, including Automated Teller Machine (“ATM”) fees, and other income, was income of $1,843,619 for the three months ended March 31, 2026, compared to other income consisting of ATM fees, and other miscellaneous income of $4,978,523 for the three months ended March 31, 2025. Other income for the three months ended March 31, 2026 included $1,520,000 gain on the sale of assets. The prior year other income included the recovery of a property in a legal settlement related to the El Capitan matter valued at $4,570,227.

 

Income tax expense for the three months ended March 31, 2026, was $4,183,999 compared to $233,866 for the prior year period. The tax expense increased primarily due to estimated penalties and interest related to uncertain tax positions associated with IRC 280E, when compared to the prior year. We are subject to Section 280E of the Internal Revenue Code (the “Code”), which prohibits businesses from taking deductions or credits in carrying on any trade or business consisting of trafficking in certain controlled substances that are prohibited by federal law. We, to the extent our “trafficking” activities, and/or key contract counterparties directly engaged in trafficking in cannabis, have incurred significant tax liabilities from the application of Section 280E. Our income tax obligations under Section 280E of the Code are typically substantially higher as compared to companies to which Section 280E does not apply. Section 280E essentially requires us to pay federal, and as applicable, state income taxes on gross profit, which presents a significant financial burden that increases our net loss and may make it more difficult for us to generate net profit and cash flow from operations in future periods. In addition, to the extent that the application of Section 280E creates a financial burden on contract counterparties, such burdens may impact the ability of such counterparties to make full or timely payment to us, which would also have a material adverse effect on our business.

 

The overall net loss for the three months ended March 31, 2026, was $8,095,802 (($0.02) per share) compared to an overall net loss of $2,047,167 (($0.01) per share) for the three months ended March 31, 2025. 

 

30

 

Segmented Disclosure

 

The Company determined that each of its locations represents an operating segment. These operating segments have been aggregated into a single reportable segment as the Company operates as a vertically integrated cannabis company with dispensary, cultivation, production and distribution operations in the States of Nevada and Florida, dispensary, cultivation and distribution operations in the State of California and dispensary operations in the State of Illinois.

 

Liquidity and Capital Resources

 

As of March 31, 2026, our financial instruments consist of cash, deposits, accounts receivable, accounts payable and accrued liabilities, and notes payable. We have no speculative financial instruments, derivatives, forward contracts, or hedges.

 

As of March 31, 2026, we have working capital of $16,514,812 compared to working capital of $26,457,372 as of March 31, 2025. The Company believes that it has adequate liquidity in the form of cash on hand to continue to fund its operations over the next 12 months.  

 

The following table relates to the three months ended March 31, 2026 and 2025:

 

   

Three Months Ended

 
    March 31,     March 31,  
   

2026

   

2025

 

Cash flows used in operating activities

  $ (172,823 )   $ (5,189,040 )

Cash flows provided by investing activities

    854,829       (2,691,268 )

Cash flows provided by financing activities

   

-

      52,368  

 

Cash Flows from Operating Activities

 

Net cash used in operating activities was $172,823 for the three months ended March 31, 2026, compared to cash used in operating activities of $5,189,040 for the three months ended March 31, 2025. A significant portion of the increase in cash used in operating activities is directly attributable to the net change in certain working capital items during the three months ended March 31, 2026, when compared to the three months ended March 31, 2025.  This was driven primarily by decreases in accounts receivable, inventory and prepaid expense accounts, with an increase to the uncertain tax position account in the three months ended March 31, 2025.

 

Cash Flows from Investing Activities

 

Net cash provided by investing activities was $854,829 for the three months ended March 31, 2026, compared to net cash used in investing activities of $2,691,268 for the three months ended March 31, 2025. Funds received in the current period were related to the sale of dispensary assets in Orange County, California, offset by capital expenditures in Florida. Capital expenditures in the prior year period were primarily related to new store buildouts and upgrades to the cultivation facilities in Florida.  

 

Cash Flows from Financing Activities

 

Net cash provided by financing activities was $0 during the three months ended March 31, 2026, compared to net cash provided by financing activities of $52,368 for the three months ended March 31, 2025. The funds received in the prior period were a $3,000,000 draw from the revolving line of credit, mostly offset by the payoff of debts related to the VidaCann acquisition.

 

Capital Resources

 

We have a recent history of operating losses. It may be necessary for us to arrange for additional financing to meet our ongoing growth initiatives.

 

Management believes it will be able to raise equity capital as required in the long term, but recognizes the risks attached thereto. There can be no assurance that it will be able to obtain adequate financing in the future or that the terms of such financing may be favorable.

 

Should financing not be available, the Company has adequate liquidity in the form of cash on hand and assets for sale to fund all of its planned capital expenditures and expansion plans as well as to continue to fund its operation over the next 12 months, including the planned build-out of its operations in Florida.

 

31

 

Capital Management

 

Our capital consists of shareholders’ equity. Our objective when managing capital is to maintain adequate levels of funding to support the development of our businesses and maintain the necessary corporate and administrative functions to facilitate these activities. This is done primarily through equity financing. Future financings are dependent on market conditions and there can be no assurance we will be able to raise funds in the future. We invest all capital that is surplus to our immediate operational needs in short-term, highly liquid, and high-grade financial instruments. There were no changes to our approach to capital management during the period. We are not subject to externally imposed capital requirements.

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements as of March 31, 2026, or as of the date hereof.

 

Critical Accounting Estimates

 

The preparation of consolidated financial statements in conformity with GAAP requires our management to make judgements, estimates and assumptions about future events that affect the amounts reported in the consolidated financial statements. Although these estimates are based on management’s best knowledge of the amounts, events or actions, actual results may differ from those estimates. Estimates and judgements are continuously evaluated and are based on management’s experience and other factors, including expectations of future events that are believed to be reasonable.

 

Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

 

There have been no material changes to our critical accounting estimates as set forth in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2025.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

 

There have been no material changes to our market risk disclosures as set forth in Part II, Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2025.

 

Item 4. Controls and Procedures

 

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

 

Our management, with the participation of our Co-Chief Executive Officers and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures, as defined in Rule 13a-15(e) under the Exchange Act. Based on that evaluation as of March 31, 2026, our Co-Chief Executive Officers and Chief Financial Officer concluded that our Company’s disclosure controls and procedures were effective.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the period covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

Inherent Limitations on Effectiveness of Controls

 

In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, cannot provide absolute assurance of achieving the desired control objectives. Our management recognizes that any control system, no matter how well designed and operated, is based upon certain judgments and assumptions and cannot provide absolute assurance that its objectives will be met. Similarly, an evaluation of controls cannot provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected.

 

32

 

PART IIOTHER INFORMATION

 

Item 1. Legal Proceedings.

 

From time to time, we may become involved in legal or regulatory proceedings, lawsuits and other claims arising in the ordinary course of our business. In view of the inherent difficulty of predicting the outcome of such matters, we cannot state what the eventual outcome of such matters will be. However, based on our knowledge, we are not presently a party to any legal proceedings that, in the opinion of our management, would individually or taken together have a material adverse effect on our business, operating results, financial condition, or cash flows. Regardless of outcome, litigation can have an adverse impact on us due to defense and settlement costs, diversion of management resources, negative publicity and reputational harm, and other factors.

 

Item 1A. Risk Factors.

 

In addition to other information set forth in this report, you should carefully consider the risk factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, which could materially affect our business, financial condition, financial results, or future performance. Other than as set forth below, there have been no material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

 

The Company made no unregistered sales of securities during the quarter covered by this report that have not previously been disclosed in a Current Report on Form 8-K.

 

Item 3. Defaults Upon Senior Securities.

 

Not applicable.

 

Item 4. Mine Safety Disclosures.

 

Not applicable.

 

Item 5. Other Information.

 

Insider Trading Arrangements and Policies

 

Certain of our officers or directors have made elections to participate in, and are participating in, our equity incentive plans and have made, and may from time to time make, elections to have shares withheld to cover withholding taxes, which may be designed to satisfy the affirmative defense conditions of Rule 10b5-1 under the Exchange Act or may constitute non-Rule 10b5-1 trading arrangements (as defined in Item 408(c) of Regulation S-K). 

 

The Company has adopted an insider trading policy governing the purchase, sale, and other dispositions of the Company’s securities by directors, senior management, and employees. A copy of the insider trading policy is filed as Exhibit 19.1 to our Annual Report on Form 10-K for the year ended December 31, 2025.

 

 

 

 


 

 

 

 

33

 

Item 6. Exhibits.

 

EXHIBIT INDEX

 

        Incorporated by Reference    

Exhibit No.

 

Description

  Form   Exhibit   Filing Date   Filed/Furnished Herewith

31.1

 

Certification of Principal Executive Officer (Robert Groesbeck) pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

               ✓

31.2

 

Certification of Principal Executive Officer (Larry Scheffler) pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

               ✓

31.3

 

Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

               ✓

32.1

 

Certification of Principal Executive Officers and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

               ✓

101.INS

 

Inline XBRL Instance Document

               

101.SCH

 

Inline XBRL Taxonomy Extension Schema Document

               

101.CAL

 

Inline XBRL Taxonomy Extension Calculation Linkbase Document

               

101.DEF

 

Inline XBRL Taxonomy Extension Definition Linkbase Document

               

101.LAB

 

Inline XBRL Taxonomy Extension Label Linkbase Document

               

101.PRE

 

Inline XBRL Taxonomy Extension Presentation Linkbase Document

               

104

  Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101)                ✓

 

 

 

34

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

Date: May 13, 2026

By:

/s/ Robert Groesbeck

 
   

Robert Groesbeck

 
   

Co-Chief Executive Officer

 
    (Principal Executive Officer)  
       
 

By:

/s/ Larry Scheffler

 
   

Larry Scheffler

 
   

Co-Chief Executive Officer

 
    (Principal Executive Officer)  
       
 

By:

/s/ Stephen McLean

 
   

Stephen McLean

 
   

Interim Chief Financial Officer

 
    (Principal Financial and Accounting Officer)  

 

35

FAQ

How did Planet 13 (PLNH) perform financially in Q1 2026?

Planet 13 reported net revenue of $21.1 million, down 24.8% year over year, and a net loss of $8.1 million. Higher tax expense and lower sales from California and Nevada operations were the main drivers of the weaker results.

What happened to Planet 13 (PLNH) revenue by product category in Q1 2026?

All major categories declined: flower revenue fell to $8.25 million, concentrates to $7.26 million, edibles to $3.42 million, and wholesale to $0.92 million. Management cited intense price compression and exiting California operations as key factors.

Why did Planet 13’s (PLNH) net loss increase in Q1 2026?

Net loss rose to $8.1 million from $2.0 million mainly due to higher income tax expense of $4.18 million related to uncertain positions under IRC 280E. Lower revenue also contributed, partly offset by cost reductions and improved gross margin.

What is Planet 13’s (PLNH) liquidity position as of March 31, 2026?

Planet 13 held $16.26 million in cash and restricted cash and reported working capital of $16.51 million. Management believes this liquidity is adequate to fund operations and planned capital spending, including Florida expansion, over the next 12 months.

How is Planet 13 (PLNH) reshaping its operations across states?

Planet 13 exited California retail and cultivation, focusing on its Las Vegas superstore, Nevada production, and expanding its Florida MMTC network to 33 dispensaries. It also operates one Illinois dispensary and is adding new Florida locations after tenant improvements and approvals.

How did rescheduling of marijuana affect Planet 13 (PLNH)?

The DOJ’s move of certain marijuana products to Schedule III removes Section 280E constraints for state-licensed medical marijuana, potentially easing tax burdens. Planet 13 is assessing impacts on its tax position and operations, though adult-use cannabis remains Schedule I.