Leafly Holdings, Inc. Reports Third Quarter 2022 Financial Results

Published: November 14, 2022

Leafly Holdings, Inc. Reports Third Quarter 2022 Financial Results

Leafly Holdings, Inc., a leading online cannabis discovery marketplace and resource for cannabis consumers, today announced financial results for its third quarter ended September 30, 2022.

“Leafly is helping brands and retailers reach more consumers at a time when driving business is critically important. Retailers are offering deals on Leafly at record numbers as consumers are looking for the best value. We are encouraged by our recent partnerships that allow us to drive new customer acquisition and online orders across the platform,” said Yoko Miyashita, CEO of Leafly. “The cost reductions we implemented were aimed at setting us on a clear path to greater efficiency and monetization as growth in advertising spend returns and the market accelerates. The team is squarely focused on our highest priority initiatives and on optimizing the products we have already developed to maintain our position as a leader in cannabis and build the business for the long term.”

Third Quarter 2022 Financial Results

  • Total revenue was $11.8 million, up 8.1% over Q3 2021
  • Gross margin was 87.1%, compared to 88.4% in Q3 2021
  • Total operating expense was $16.3 million, up 21.0% over $13.5 million in Q3 2021, and down 16.3% from Q2 2022
  • Net income was $15.5 million, and included $22.3 million of gains on derivative liabilities, due to fair value accounting, compared to net loss of $4.5 million in Q3 2021
  • Adjusted EBITDA loss was $5.2 million, compared to Adjusted EBITDA loss of $3.6 million in Q3 2021
  • Ended the quarter with $27.8 million of cash, after repurchasing over 3 million shares of our common stock using $31.3 million of restricted cash

Reconciliations of GAAP to non-GAAP financial measures have been provided in the tables included in this release.

“In October, we right-sized the business through headcount reductions and additional cuts in spending to accelerate our path to profitability,” said Suresh Krishnaswamy, CFO of Leafly. “We are focused on managing our cash while preserving our ability to respond to opportunities in the market.”

Key Performance Metrics

September 30, 2022

June 30, 2022

September 30, 2021

QoQ Change (%)

YoY Change (%)

Average Monthly Active Users (“MAUs”) (in millions)







) %

Ending retail accounts








Retailer average revenue per account (“ARPA”)








) %


) %

  • Year over year, ending retail accounts grew 18.2%, reflecting 7.4% sequential growth in Q3 2022 that was driven by retailers in California, Oregon, and New Mexico.
  • ARPA declined 10.5%, primarily as a result of Leafly’s strategy to use promotional pricing to expand retailer accounts in lower penetrated markets.
  • MAUs increased quarter over quarter highlighting the strength of news and learn content, technical improvements to SEO and the Company’s expertise in the cannabis category. In Q3 2021, higher than usual levels of MAUs were driven by an increase in user traffic primarily as a result of the pandemic.

Business Highlights

  • Q3 2022 revenue from retail accounts was $9.0 million, up 5.1% over Q3 2021.
  • Q3 2022 revenue from brands was $2.7 million, up 19.6% over Q3 2021.
  • Recently partnered with Uber Eats to bring third-party delivery platform to cannabis retailers and consumers in the local Toronto market.
  • Integrated with Onfleet delivery software to make it easier for cannabis retailers to manage delivery fulfillment of online orders placed directly on the Leafly platform all the way to the customer’s doorstep.
  • Expanded partnership with BLAZE, offering cannabis retailers even greater operational efficiency while enhancing the consumer online shopping experience. Improvements in inventory management, menu capability and fulfillment tools allow cannabis retailers to accept online orders directly from Leafly without additional POS order inputs.
  • Launched new marquee ad products in October across Leafly, including on our high-traffic Strain Page. These new features ads provide prominent ways for retailers to reach millions of consumers visiting Leafly each year.
  • On October 18, 2022, announced realignment of cost structure for expected annual cash operating cost reductions of approximately $16.0 million beginning in 2023. These reductions are intended to allow Leafly to prioritize the highest growth opportunities and preserve capital.

Financial Outlook
Leafly is refining its annual guidance The Company does not provide quarterly guidance as a practice. Based on current business trends and conditions, the financial outlook is expected to be as follows:

  • For the full year 2022, Leafly expects revenue to be between $47.0 million and $48.0 million and Adjusted EBITDA loss to be approximately $26.0 million.

Leafly has not provided a quantitative reconciliation of forecasted GAAP net income (loss) to forecasted total Adjusted EBITDA within this communication because the Company is unable, without making unreasonable efforts, to calculate certain reconciling items with confidence. These items include, but are not limited to: depreciation and amortization expense from new assets; impairments of assets; changes in the valuation of any derivatives; the valuation of, and changes in, grants of equity-based compensation; gains or losses on modification or extinguishment of debt. These items, which could materially affect the computation of forward-looking GAAP net income (loss), are inherently uncertain and depend on various factors, many of which are outside of Leafly’s control. For more information regarding the non-GAAP financial measures discussed in this communication, please see “Non-GAAP Financial Measures” below.

About Leafly
Leafly helps millions of people discover cannabis each year. Our powerful tools help shoppers make informed purchasing decisions and empower cannabis businesses to attract and retain loyal customers through advertising and technology services. Learn more at Leafly.com or download the Leafly mobile app through Apple’s App Store or Google Play.

Definitions of Key Performance Metrics

Monthly active users

Monthly active users (“MAUs”) represents the total unique visitors to Leafly websites and native apps each month, which in turn represents the maximum potential unique visitors that could become a customer of a dispensary or brand listed on Leafly’s platform, within a given month.

Users (visitors) are considered active by initiating a session on at least one webpage or app. Each month’s MAUs is the total of unique visitors to Leafly during the specified month and includes both new visitors as well as those returning from the previous month. We count a unique user the first time an individual accesses one of our websites or native apps during a calendar month. If an individual accesses our websites using different web browsers within a given month, the first access by each such web browser is counted as a separate unique user. If an individual accesses more than one of our websites or native apps in a single month, the first access to each website or app is counted as a separate unique user since unique users are tracked separately for each domain and native app. The unique visitors are measured using Google Analytics for our web applications and Firebase for our native applications.

Ending retail accounts
Ending retail accounts is the number of paying retailer accounts with Leafly as of the last month of the respective period. Retail accounts can include more than one retailer.

Retailer average revenue per account
Retailer ARPA is calculated as monthly retail revenue, on an account basis, divided by the number of retail accounts that were active during that same month. An active account is one that had an active paying subscription with Leafly in the month. Leafly does not provide retailers with an ongoing free subscription offering but may offer a free introductory period with certain subscriptions.

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