CV Sciences (OTCMKTS:CVSI) reported second-quarter 2026 revenue of $3 million, down 7% sequentially from $3.2 million in the first quarter and 17% from the prior-year period, as the company navigated continued pressure in the CBD market.
Chief Executive Officer Joseph Dowling said the company remained focused on maintaining margins, reducing costs and moving toward sustainable profitability despite what he described as a challenging market and regulatory environment.
Margins Hold as Company Cuts Expenses
Gross margin was 48.6% in the second quarter, essentially unchanged from 48.9% in the first quarter, though below 50.9% a year earlier. Chief Financial Officer Joerg Grasser attributed the year-over-year decline primarily to somewhat higher freight costs and changes in product and channel mix.
The company reduced operating expenses by 7.9% sequentially to $1.7 million from $1.9 million in the first quarter. Grasser said selling, general and administrative expenses also declined about 10% compared with the same period a year earlier, driven by lower legal and professional fees, reduced marketing spending and administrative efficiencies.
CV Sciences reported an operating loss of $0.3 million for the quarter, compared with an operating loss of about $0.1 million in the prior-year period. Its GAAP net loss was $0.8 million, versus $0.3 million a year earlier. Adjusted EBITDA loss was $0.1 million, consistent with the first quarter and slightly improved sequentially, according to management.
“While we recognize that we still have work to do to achieve sustainable profitability, we believe the continued reduction in our operating cost structure represents meaningful progress towards a more sustainable operating model,” Grasser said.
Cash Flow and Balance Sheet
The company generated approximately $20,000 in positive operating cash flow during the second quarter, following positive operating cash flow in the first quarter. Grasser said the result reflected cost reductions and working-capital discipline, including improved accounts receivable collections, inventory management and oversight of vendor payables.
CV Sciences ended the quarter with approximately $0.3 million in cash, roughly in line with the balance at the end of the first quarter and at year-end. During the quarter, conversions under its amended note payable and convertible note structure reduced the outstanding convertible note balance by approximately $0.7 million. The fair value of the outstanding convertible note was $1 million as of June 30.
Inventory totaled approximately $4 million at quarter-end, compared with $4.1 million at year-end. The company said it continues to optimize the integration of Cultured Foods and Elevated Softgels, identifying opportunities to improve manufacturing efficiency and reduce costs.
Health and Wellness Expansion
Dowling said CV Sciences maintained its position as the top-selling hemp extract brand in the natural-product retail sales channel. Direct-to-consumer sales represented 46.2% of total second-quarter revenue. Although revenue in that channel was slightly lower than prior periods, Grasser said the company saw improvement in key digital performance metrics and remains focused on increasing the channel’s efficiency and profitability.
The company is also expanding beyond cannabinoid products through its +PlusHLTH supplement portfolio. During the quarter, it added formulations intended to support cellular integrity, metabolism, cognitive health, cardiovascular wellness and mobility.
Earlier in the week, CV Sciences launched PlusHLTH.com, a direct-to-consumer website dedicated to the non-cannabinoid product line. The company said PlusCBDOil.com will remain focused on its hemp-derived CBD offerings.
During the first half of 2026, the company also launched Empowr, a product containing 20 grams of protein, 5 grams of creatine and active probiotics. Dowling said the company plans to introduce multiple additional non-cannabinoid products during 2026, including new formulations and delivery formats.
Management said the expanded wellness portfolio is intended to support organic growth, use the company’s existing infrastructure and offset revenue pressure related to regulatory challenges. CV Sciences also plans to continue launching cannabinoid-focused products under its +PlusCBD brand.
Regulatory Developments and European Strategy
Dowling said federal and state regulations remain a significant challenge for the hemp-derived cannabinoid industry. The company is working with advocacy organizations to support science-based regulations, he said.
He highlighted an August 8 Senate vote approving continuing resolution H.R. 6500, which includes language that would delay most implementation of hemp-derived cannabinoid provisions in the November 2025 Appropriations Act. If enacted in its current form, the effective date would move from Nov. 12, 2026, to Dec. 11, 2026.
The measure still requires approval from the House of Representatives and the president’s signature. Dowling said the proposed extension could give the industry more time to work with Congress on a longer-term regulatory framework.
CV Sciences also plans to pursue selected international opportunities through its European subsidiary, Cultured Foods. Dowling said Cultured Foods provides regional production and distribution capabilities and is expected to play a larger role in new product launches and future revenue growth.
Looking ahead, management said it expects the CBD market to remain fragmented and competitive, while continued industry contraction and consolidation could create opportunities for stronger operators. The company said its growth strategy centers on product innovation, cost efficiency and disciplined strategic acquisitions.
About CV Sciences (OTCMKTS:CVSI)
CV Sciences, Inc is a developer, manufacturer and marketer of hemp-derived products, with a focus on cannabidiol (CBD) formulations for both consumer and industrial applications. The company’s consumer segment offers a range of dietary supplements, topical creams, personal care items and pet products under its flagship PlusCBD™ Oil brand, while its industrial segment provides hemp-derived ingredients for use in wellness, pharmaceutical and cosmetic formulations.
Headquartered in San Diego, California, CV Sciences operates a manufacturing facility in El Cajon that oversees cultivation partnerships, extraction, refinement and product formulation.
