Dive Brief:
- Shock Top and Redhook owner Tilray Brands is aiming to cut $20 million in costs during the next two years after reorganizing its beverage business and significantly reducing its craft brewing footprint in the U.S.
- The craft beer and cannabis company consolidated its U.S. brewing footprint from 10 facilities to six and reduced its distributor network by 9%. Tilray said in a statement that “additional initiatives to reduce complexity are underway.”
- The cost-cutting effort is part of a larger move by Tilray to prioritize established regional brands, national offerings and “higher-potential growth categories,” including nonalcoholic beverages and functional energy drinks, the company said.
Dive Insight:
Tilray is streamlining its business as the craft beer market evolves and the company looks to capitalize on more profitable opportunities in premium and imported brews and non-beer options.
Since the beginning of 2025, Tilray has reduced its SKU count by about 28%. This included removing duplicative, lower-margin and “slower-moving” products, the company said in the release. Moving forward, CEO Irwin Simon said the company is looking to further reduce its operational capacity through additional consolidation of its distributor network.
“With a more efficient cost structure and additional volume opportunities ahead, we expect these actions to drive margin expansion and stronger earnings across our U.S. beverage operations, while creating greater flexibility to reinvest in our brands,” Simon said in a statement.
Tilray shuttered breweries for Hop Valley, Redhook and Revolver, and transitioned Terrapin brewing production from the brand's Georgia brewery to other facilities. It also sold the Atwater brand, which it acquired from Molson Coors in 2024.
The changes come as Tilray prepares for its partnership with Carlsberg in January, which will require the company to rapidly scale operations to sell the Danish brewing giant's beers in the U.S.
“Bringing on Carlsberg is going to be a big feat for us,” Simon said in an earnings call. “There's going to be a lot of product and a lot of opportunities with that.”
Tilray’s most recent earnings show it benefited from the $44 million acquisition of craft brewer BrewDog earlier this year. Tilray netted revenue of $257 million during its first quarter, a 23% year-over-year increase. The company’s beverage business grew 82%, due to the BrewDog acquisition.
