Home News Slower-Than-Expected Launch Impacts 22nd Century Group’s Revenue Guidance

Slower-Than-Expected Launch Impacts 22nd Century Group’s Revenue Guidance

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Shares of 22nd Century Group experienced a sharp decline on Monday after the company revised its full-year revenue projection due to a slower rollout of its reduced-nicotine cigarettes.

Revenue Expectations Altered

The Buffalo, N.Y.-based manufacturer of bioengineered nicotine and cannabis products now anticipates full-year revenue ranging from $80 million to $90 million. This is a significant decrease from its previous guidance of $105 million to $110 million.

Stock Plummets

As a result of the revised projection, 22nd Century Group’s stock fell by 19% to $2.22 in morning trading. This puts it dangerously close to its 52-week low of $2.19. Overall, shares have declined by 84% during this year.

Altered Product Launch

To explain the lower-than-expected revenue, the company stated that it had made changes to the launch timeline and scope of its reduced-nicotine cigarette, VLN, at certain retail chains. Despite doubling the number of stores selling VLN in July, the product is currently only available in Texas, California, and Florida.

Q2 Financials

In the second quarter, 22nd Century Group reported a loss of $20.54 million, or $1.40 per share. This is an increase from the loss of $11.5 million, or 95 cents per share, from the previous year. Analysts predicted a per-share loss of $1.07.

Although the company’s revenue saw a growth of 62% to $23.4 million, it fell short of analysts’ forecast of $24 million.

Conclusion

The slower-than-expected rollout of 22nd Century Group’s reduced-nicotine cigarettes has undeniably impacted the company’s full-year revenue projection. With significant changes made to the launch timeline and scope of the product, the company has had to revise their expectations. It remains to be seen how these adjustments will impact their future financial performance.

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