Tilray Brands, Inc. (TLRY) experienced a significant decline in its stock price, falling over 16% in after-hours trading on Wednesday. This downturn followed the company”s announcement regarding a 1-for-10 reverse stock split, slated to take effect on December 1, 2025.
The impending reverse split will consolidate Tilray”s outstanding shares from approximately 1.16 billion to 116 million. Adjusted trading under the new share structure will commence on December 2, 2025. Following the announcement, TLRY”s stock, which closed regular trading at $1.03—an increase of 4.76%—plummeted to $0.9494 during extended trading hours.
Shareholders of Tilray had previously approved the reverse split at a special meeting held on June 10, 2025, granting the board the authority to implement a ratio ranging from 1-for-10 to 1-for-20. The board opted for the 1-for-10 ratio, and no fractional shares will be issued as part of this process.
This strategic move aims to better align Tilray”s share structure with that of its competitors of similar size and is anticipated to attract institutional investors who typically shy away from lower-priced stocks. Additionally, the company estimates potential annual savings of up to $1 million in shareholder meeting costs as a result of the consolidation.
Notably, brokerage systems will automatically update shareholder positions after the split, and those holding shares through banks or brokers will not need to take any action. Cash compensation will be provided to those entitled to fractional shares, facilitating a smooth transition during this adjustment.
The reverse split could enhance the market perception of Tilray”s stock, as lower-priced stocks often face negative connotations among investors. However, short-term volatility is expected as the market adapts to this significant change.
Currently, Wall Street analysts maintain a Moderate Buy consensus rating on TLRY, with two analysts recommending a Buy and one suggesting a Sell. The average price target for Tilray stands at $1.95 per share, indicating a potential upside of 89.32% from its current valuation.
In the lead-up to this announcement, TLRY had seen positive momentum, influenced in part by reports that the Centers for Medicare & Medicaid Services was considering expanding eligibility for CBD coverage among Medicare patients. Tilray operates across multiple regions, including North America, Europe, Australia, and Latin America, and offers a diverse portfolio that encompasses cannabis, beverages, hemp-based food, and wellness products, supporting over 40 brands in more than 20 countries.
