Aurora Cannabis entered fiscal 2027 as a company that had made a sharp strategic bet and watched it pay off. Through fiscal 2026 it shed two businesses - the plant-propagation unit Bevo and its low-margin Canadian consumer cannabis channel - to become, in its own framing, a business focused exclusively on global medical cannabis. The result was a record year: net revenue up 11% to about US$230 million and adjusted EBITDA up a third to a record near US$39 million. Then fiscal 2027 opened into a wall. On April 1, 2026, Canada's federal medical reimbursement program cut its reimbursement rates by roughly 30%, a policy lever no cultivation strategy can offset. The first quarter of fiscal 2027 is the story of that cut - and of the company's answer to it.
The numbers tell the tension plainly. Total net revenue fell about 9% year over year to US$48.5 million. Canadian medical net revenue dropped about a quarter as the reimbursement change hit pricing, and adjusted EBITDA collapsed from US$7.8 million to US$2.5 million. But the intended engine held up: international medical net revenue grew about 17% to US$31.1 million, on higher German patient demand, and now accounts for the majority of sales. Management closed the acquisition of Safari, an EU-good-manufacturing-practice certified cultivator, precisely to feed that international machine, and expects second-quarter revenue and adjusted EBITDA to be sequentially higher than the first.
The investment question is whether the quarter represents a reset worth owning or a structural erosion of Canada's most valuable medical program. The answer turns on whether the international push - the Safari capacity, the German-led demand, and a pending US$33 million unlock of restricted cash - can rebuild revenue and margin faster than the Canadian reimbursement reform depletes them. The stock trades near US$3.49, roughly 60% of book value, with analysts converging on a target more than 70% above the market. The first quarter is the cost of the pivot; the second quarter is the test of it.