Charlotte's Web, a company specializing in CBD products, this week released its fourth-quarter and full-year financial results along with an outline of its efforts to turn the company around.
The company said it is evolving its wellness offerings beyond CBD to include a broader range of botanical wellness solutions, including minor cannabinoids. That strategy is already taking shape with the recent launch of Charlotte's Web Stay Asleep Cannabinol (CBN) gummies, a 20mg dose that the company called the first CBN sleep product backed by peer-reviewed research.
Charlotte's Web said it believes expanding beyond CBD leverages its brand recognition, intellectual property, and partnerships, including an ongoing collaboration with DeFloria for botanical drug development.
As it looks to expand beyond just CBD, the company also recently unveiled what it called a significant competitive price reduction of its CBD oils, which it credited to improved operational efficiencies. It said it expects the modest gross margin reduction to be offset with additional volume.
Since the beginning of 2024, Charlotte's Web said it has made significant progress in transitioning to in-house manufacturing of topical and gummy products.
"Initial equipment has been installed, and commercial runs are anticipated to begin in Q4 while maintaining co-manufacturing relationships for dual-source capability to mitigate supply chain risks," the company said in a statement. "On-site manufacturing can accelerate the innovation process, leading to quicker introduction of new products to the market, while enhancing profit margins."
While it may be too early to judge how well the company's turnaround strategy is working, fourth-quarter results did show some signs of improvement. Despite a slight decline in revenue, the company was able to shrink its operating loss, from $32 million to $10.3 million, and its net loss, from $35.2 million to $8.5 million.
