Planet 13 Holdings Inc (CNSX: PLTH) (OTCMKTS: PLNH) (FRA: Y7Q) has decisively exited the California cannabis market. Following years of financial issues, the company has transferred its Orange County dispensary to Catalyst Cannabis.
The Nevada-based operator, known for having the world’s largest marijuana store in Las Vegas, shuttered its sprawling 55,000-square-foot Santa Ana SuperStore location. The facility made its debut in 2021 with high expectations.
Executives cited persistent cash burn as the primary driver, with the store and an associated Coalinga cultivation facility draining resources without delivering worthwhile returns.
By divesting these assets, Planet 13 eliminated operations that accounted for a minor slice of overall revenue but imposed hefty monthly losses ranging between US$300,000 to US$350,000. This handoff has streamlined Planet 13’s focus toward its distribution infrastructure in Florida and Nevada.
“P13 was a pleasure to work with on this deal,” stated Catalyst Cannabis CEO Elliot Lewis. “But objective, we did steal that sh*t.”
He views the acquisition as a bargain and his company has taken swift control. Catalyst plans to revamp the space and scrap certain features it perceives as gimmicky, such as a smoke-emitting Volkswagen bus. Lewis is targeting US$1 million in monthly revenue with less cash registers and a condensed footprint.
Planet 13 company leaders emphasized that shedding California’s complexities bolsters liquidity and redirects capital toward expansions with higher potential. The deal involved selling retail and distribution licenses, along with the Coalinga property, and finalizing the cultivation license transfer.
The shift highlights broader challenges in California’s cannabis sector, where overhyped ventures have faltered despite massive investments. Planet 13’s stock, once valued at US$1.3 billion in 2021, plummeted to around US$50 million by 2026, mirroring failures at peers like MedMen or with smaller state ventures like Jay-Z’s luxury weed line.
Cresco Labs Inc (CNSX: CL) (OTCMKTS: CRLBF) (FRA: 6CQ), Trulieve Cannabis Corp (CNSX: TRUL) (OTCMKTS: TCNNF) (FRA: T0A) and Curaleaf Holdings Inc (TSE: CURA) (OTCMKTS: CURLF) are other MSOs that have called it quits in the state.
Planet 13’s experience with its enormous California pot shop demonstrates a valuable lesson: bold visions must yield profits to survive.
Read more: Owner of world’s largest dispensary Planet 13 inks cannabis topical deal with Ovation Science
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