:max_bytes(150000):strip_icc()/GettyImages-2188541130-d98be71a2a5e4aa8ae0c8475bcbc992d.jpg "Tilray Plunges Ahead of a 1-for-10 Reverse Stock Split. Here’s What You Need to Know")
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Key Takeaways
- Tilray Brands shares tumbled Friday ahead of a 1-for-10 reverse stock split set set to take effect after markets close next Monday, Dec. 1.
- In a reverse stock split, a company cuts the number of its outstanding shares and increases the per-share price proportionally.
Nearly six months ago, Tilray Brands (TLRY) stockholders approved a 1-for-10 reverse stock split. Now the cannabis firm has given a date it will take effect, and shares are tanking.
The stock lost over a fifth of its value in Friday’s shortened trading session, bringing its losses in 2025 to nearly 40%. (Read our daily markets coverage here.)
Tilray Brands, which describes itself as “a global lifestyle and consumer packaged goods company at the forefront of the global cannabis, beverage, and wellness industries,” announced late Wednesday that the reverse split will take effect after markets close next Monday, Dec. 1. When markets open Tuesday, its shares will begin trading on a split-adjusted basis under the same ticker symbol, but with a new CUSIP number, 88688T209.
Starting Tuesday, every 10 shares of common stock will be automatically combined and converted into one, reducing the number of outstanding from about 1.16 billion shares to 116 million. Fractional shares will not be issued, Tilray said.
Why This Is Significant
In a reverse stock split, a company cuts the number of its outstanding shares and increases the per-share price proportionally. While the move won’t change the overall value of Tilray investors’ holdings, it will boost the price of each individual share.
Tilray said it expects the change, which Tilray’s stockholders had approved at a special meeting back in June, could make its stock “more attractive to institutional shareholders” and reduce expenditures associated with its annual meeting, “resulting in up to $1 million in cost savings on an annual run rate basis.”
However, reverse stocks splits are typically viewed as a bearish signal by investors, as they could suggest a lack of confidence in the stock’s upward trajectory. Shares of Tilray had been up nearly 60% for the year as recently as Oct. 9, two months after President Donald Trump said the White House would be “looking at reclassification” of marijuana, but have fallen since amid regulatory uncertainty as no final rule has been adopted.
