Aurora Cannabis shares fell more than five percent today following a report that the company is going to announce plans to dismiss XNUMX percent of its workforce to save costs.
Earlier this week, Tilray Inc. announced also that it will fire ten percent of staff. Automation seems to be the code word in the cannabis sector. The weed producers want to save costs by cutting into the current staff.
“Both companies are currently on a relatively difficult path to profitability, have very large operational footprints, a history of aggressive investment and are likely to need to raise capital in the near future,” wrote analysts Owen Bennett and Ryan Tomkins.
Cannabis companies are the victims of difficult licensing processes, which reduces sales and profitability. The shortage of cannabis stores has allowed the black market to undermine legal businesses. As a result, many cannabis producers are struggling with a lack of investment capital. They seek refuge in job cuts and reviewing deals. How will the market respond and other big names in the cannabis industry such as Canopy Growth Corp. (CGC) follow their example?
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