Charlotte’s Web sales fall 15% as intoxicants crackdown spurs healthcare pivot

Charlotte’s Web reported another decline in sales in the second quarter as the U.S. CBD company continued cutting costs and restructuring its business following a major investment by British American Tobacco, according to its Q2 2026 report.

The restructuring comes as the fight over intoxicating hemp – and a looming ban – has become central to the future of the U.S. CBD business, pushing Charlotte’s Web toward a more healthcare-oriented strategy.

CW’s revenue fell 15% to $10.9 million in the quarter ended June 30, from $12.8 million a year earlier. The company reported a net loss of $4.1 million, compared with a loss of $6.3 million in the second quarter of 2025.

Europe also squeezed

CEO Bill Morachnick put the stakes over CBD rules bluntly in March: “If the industry is capped at 0.4 mg of THC per container, it basically demolishes the CBD industry as we know it.” The federal restrictions are scheduled to take effect before the end of the year.

The company said it supports rules that “clearly distinguish non-intoxicating, full-spectrum hemp wellness products, from intoxicating beverages and recreational products.”

The potential squeeze in the United States comes after European regulators effectively pushed much of the ingestible CBD market out of existence, most recently by setting a provisional safe intake level of just 2 mg per day.

Sales slide

Charlotte’s Web said the quarterly revenue decline mainly reflects a restructuring begun in September 2025 that reduced distribution through traditional retail channels. The company is putting more emphasis on direct online sales, healthcare practitioners and other botanical wellness products, .

The latest results continue a long-running decline at the company, once the dominant brand in the U.S. CBD market. CW generated $49.9 million in revenue in 2025 and posted a net loss of $29.7 million.

BAT deal

Charlotte’s Web significantly reduced its debt during the quarter after BAT exchanged debt it was owed for shares in the company and invested an additional $10 million.

The BAT transactions substantially strengthened Charlotte’s Web’s balance sheet. Total liabilities fell to $20.3 million at the end of June from $77.3 million at the end of 2025, while cash increased to $14 million from $8 million, presumably giving the company more financial breathing room.

For the first six months of 2026, revenue fell 12% to $22 million from $25.1 million a year earlier. The net loss widened to $17.2 million from $12.5 million. The larger first-half loss was primarily affected by a non-cash accounting charge related to the BAT debt before its conversion.

Healthcare push

Charlotte’s Web continues to pursue a strategy increasingly tied to regulated healthcare applications for CBD.

The company owns roughly one-third of DeFloria, a venture with AJNA BioSciences and a BAT subsidiary that is developing a full-spectrum botanical drug candidate. Charlotte’s Web also holds commercial manufacturing rights to the drug if it ultimately receives U.S. Food and Drug Administration approval.

The company has additionally been positioning its full-spectrum CBD products for possible use in federal healthcare initiatives while lobbying for U.S. rules that distinguish conventional non-intoxicating CBD products from synthetic and intoxicating hemp-derived cannabinoids.