Tilray Keeps Closing Craft Breweries Because Its Strategy Never Made Sense in the First Place
For years, the comedian Ron White has done a joke about the time he almost got in a plane crash. It’s an all-timer that unravels over the course of a few minutes, and you really owe it to yourself to watch the whole thing. I hate to spoil the punch line, but the joke is about 30 years old, so with respect to Mr. White, here goes:
The guy sitting next to me is losing his mind. Apparently, he had a lot to live for.
He goes, “Hey man … huh-huh-huh … hey man … huh-huh-huh … If one of these engines fails, how far will the other one take us?”
[I said] “All the way to the scene of the crash … which is pretty handy, because that’s where we’re headed. I bet we beat the paramedics there by a half hour.”
Classic stuff. And unfortunately clarifying stuff for the situation at Tilray Brands, whose overstuffed portfolio of craft breweries is well on its way to where it was always headed.
Last week, news broke that the Canadian vice conglomerate planned to close Terrapin Beer Company’s 100,000-square-foot production facility in Athens, Ga. The University of Georgia’s independent student-run paper, The Red & Black, first clocked the shutdown notice, which was buried in Tilray’s most recent 10-K filing. The document also flagged previous consolidations and closures at Hop Valley, Revolver, and Redhook, as well as Atwater, which wasn’t “closed” so much as “hastily sold back to its owners less than two years after it was acquired.” But forget the semantics, let’s talk strategy, because it’s pretty complicated. Just kidding: we’re cutting costs, kids!
Shortly after cobbling together its island of misfit breweries from the wreckage of macrobrewers’ salad-days craft beer ambitions, Tilray embarked upon Project 420, which is not the Heritage Foundation’s plan to make smoking weed a capital offense but rather a goofily named corporate savings strategy. (SweetWater Brewing, its first major acquisition in the segment in 2020, does a 420 Extra Pale Ale and a 420 Fest, too. You get it.) Midway through 2025, the firm’s garrulous chief executive, Irwin Simon, told investors that he was targeting some $33 million in cuts, which doesn’t sound like a lot until you remember it’s almost half of what he paid for an eight-brand gaggle of Anheuser-Busch InBev also-rans just a couple years prior. By the end of February 2026, the company’s filing reads, “we considered the Project 420 plan to be completed due to reaching the cost savings target that we had set out to achieve even though there are still ongoing initiatives relating to additional cost savings, SKU rationalization and distributor rationalization.” Whether Terrapin’s closure is technically part of Project 420, or whatever its new-and-reduced successor program is called within the halls of Tilray headquarters is irrelevant for our purposes. It’s another cut.
Pour one out for Terrapin’s poor workers and fans, who have been through the wringer over the past decade as the company went from a Southeastern craft-brewing darling to an odious sellout to big bad Molson Coors, to a cast-off has-been when Simon and company came calling in the summer of 2024. But where there’s sorrow, there should be little surprise. Simon’s “regional jewel” thesis for batting cleanup on the craft-brewing industry’s second boom, which he articulated to Hop Take in December 2024, never made sense without major cuts, even at the bargain-basement purchase prices he was able to command from the bigs as they bolted for flavored malt beverages and spirits-based canned cocktails. This wasn’t something Tilray was openly talking about at that point, mind you, but it was evident even then. As I wrote:
Whatever Tilray does to burnish its “regional jewels” in bars, restaurants, and sports venues will ultimately have to be judged by whether it successfully repositions those brands for distributed sales — and whether it can actually drive down its costs like Simon claims.
The latter is absurd on face: Tilray lacks the buying power of ABI or MC (or Constellation, Heineken, Pabst… ), and its operations are scattered across many small locations rather than a few big ones. Simon concedes that point to Hop Take, but insists that Tilray can unlock savings anyway by integrating these brands into a national operation in a way their former corporate masters failed to.
More than a year and a half later, whatever sweet synergies Tilray has been able to capture with its mid-major scale have paled in comparison to those savings it has been able to extract from the business in the form of layoffs, plant closures, and portfolio weed-outs. This hasn’t come cheaply, mind you. As my VinePair colleague Stephen Bradley noted, “Tilray disclosed it spent $6.8 million in Project 420 restructuring costs in fiscal year 2026, which ended May 31.” That’s on top of the $8.5 million it already spent on the slash-a-rama in 2025, per the 10-K.
This spend-and-shed pattern has become a bit of a calling card for Tilray, which earlier this year acquired BrewDog at the rock-bottom price of~ $54 million and announced a deal to brew Carlsberg stateside shortly thereafter. Even as it was culling its craft-brewing herd, in other words, it was adding to it. The results have been mixed. The company’s beverage business grew net revenue by six percent year-over-year for its 2026 fiscal year, which ran through May; its gross profit was down two percent for the same period. But that’s including the big ol’ boost that BrewDog delivered to its stat-sheet. (Here too, another calling card of Simon and company: before the dust can really settle on the previous fiscal year’s acquisitions, he’s already bought something else, juicing the topline numbers while making it harder to benchmark the firm against its actual performance in the marketplace.) The drinks business remains “one of Tilray’s most important growth engines,” Simon told investors on an earnings call late last month, and is “still in the early stages of unlocking the full potential of this business.”
That may sound good to Wall Street. (Or not: Tilray’s troubled stock declined a smidge following the July 28 call, before rallying more recently.) But it rings ominous when you consider how the company has made it this far on its craft-brewing side-quest. While it waits and hopes for federal legalization of recreational cannabis, it has to make its mismatched semi-national network of breweries produce meaningful revenue. It can only book the savings from closing each brewery once. At some point, Tilray must squeeze actual, consistent profit out of these brands. I thought — and still do — that the company had lined up plenty of runway by buying into the segment at such firesale prices. It has lined up more still with all its cuts. But whether anybody wants what’s left on the other side of the butcher counter remains to be seen. The sales data suggest, ah, maybe not. Year-to-date through July 12, Tilray’s portfolio is down 13.7 percent in dollars and 14.8 percent by volume in multi-outlet grocery, mass retail, and convenience stores tracked by the market research firm Circana. Those declines dramatically overshadow the overall beer category and the craft-brewing segment
This is the rub. “With robust brewing operations across the country, this transition allows us to continue serving customers efficiently while leveraging the scale and capabilities of our broader brewery footprint,” chief corporate affairs officer Berrin Noorata told Brewbound in a statement. The optimization jargon tracks with the basics of the brewing business: it is a scale business. But while sending Terrapin’s brewhouse to the Hopsecutioner may carve out costs, it also hollows out the brand itself. Even with healthy brands — which Tilray’s, by and large, are not — it’s hard to tell muscle from fat. But in a down market this competitive, shuttering a hometown brewery promises some real rough turbulence.
This was always where Tilray was headed. Where it goes next remains to be seen.
🤯 Hop-ocalypse Now
Summer 2026 has not been kind to Bud Light, what with its bleak bloodsport-’n-bigotry sponsorship of the Trump administration’s Ultimate Fighting Championship circus on the White House lawn, and of course the brand’s ongoing declines as both the American drinking public and parent company Anheuser-Busch InBev shift their focus to stuff like Michelob Ultra, Cutwater, and BeatBox. Complicating matters further, one of the celebrities the brand hired to chud up its image in the wake of 2023’s right-wing transphobia tantrum, comedian Shane Gillis, last week spoke out against Truth Social’s transparently corrupt scheme to sell early access to Trump’s posts on the platform, calling it “literally insider trading.” And on an episode of “The Joe Rogan Experience,” no less! Awkward stuff for a brand that has been desperately cozying up to the MAGA-verse for the past three years.
📈 Ups…
TailGate Brewery is telling a Tennessee success story, up 40 percent in distribution year-over-year through the first half of 2026… Garage Beer released an apple-flavored version, because who doesn’t want free money?… Hi-Wire Brewing is taking over production and sales for Appalachian Mountain Brewery as craft consolidation continues…
📉 …and downs
Boston Beer Company’s chief financial officer is headed for the exit… Ardagh Metal Packaging is on the auction block…
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