“We’re Always Interested in Looking at Texas”: Village Farms Q3 Results Reveal Cannabis Expansion Plans

Burn After Reading The 30-second intel for operators and investors ⏱ 0:30

Village Farms is mobilizing plans to bring its 30-acre Monahans, Texas greenhouse into cannabis production, after record Q3 cannabis revenue of $55 million. Any conversion still depends on regulatory approvals and the commercial viability of Texas' medical market.

• Operators: Greenhouse conversion is Village Farms' model: its Delta, B.C. site was retrofitted from tomatoes and cucumbers. Texas medical demand alone may not justify full capacity, so scale plans may need to look beyond one state.
• Investors: Texas is an option, not an announced expansion. Q3 cannabis gross margin narrowed to 48% from 55%, adjusted EBITDA fell to $18.2 million, and timing, economics and scale of any conversion remain uncertain.
• Do now: Check whether your own facilities or licenses could be adapted for cannabis, and review the Texas Department of Public Safety's license eligibility list and rules before committing capital to any Texas plan.

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Village Farms International (NASDAQ: VFF) is advancing its plans to enter the Texas cannabis market, announcing on November 9 that it is mobilizing efforts to bring its 30-acre greenhouse in Monahans into cannabis production.

“We’re actively mobilizing plans to operationalize our standalone 30-acre greenhouse in Monahans, Texas, for cannabis production,” Village Farms President and CEO Michael DeGiglio said in the company’s earnings announcement.

The initiative was disclosed alongside Village Farms’ third-quarter 2026 results, which included record cannabis revenue of $55 million, a 75% year-over-year increase in international exports to $20.8 million, and approximately $10 million in net income.

Consolidated revenue remained virtually flat at $66.9 million, while adjusted EBITDA declined to $18.2 million from $20.7 million a year earlier. Cannabis gross margins narrowed to 48% from 55%, and operating cash flow from the cannabis business fell to $7.3 million from $20.6 million. The company ended the quarter with nearly $80 million in cash, marking its sixth consecutive profitable quarter.

The Texas initiative represents a potential new growth opportunity for a company increasingly focused on international cannabis markets. However, bringing its agricultural infrastructure into cannabis production remains subject to applicable regulatory requirements and the commercial development of the state’s medical cannabis market.

In an exclusive interview with IgniteIt conducted before the November 9 announcement, Deepak Anand, Village Farms’ vice president of government affairs, discussed the company’s interest in Texas and the regulatory considerations shaping its U.S. strategy.

“We’re always interested in looking at Texas,” Anand said. “We just have to figure out what the regulations look like in terms of the regulatory environment.”

Those comments reflected the company’s considerations at the time of the interview. Village Farms subsequently announced a more concrete operational initiative for Monahans, with management outlining an approximately 12-month target for bringing the facility online during its third-quarter earnings call.

The distinction is significant: Anand discussed the regulatory and commercial conditions surrounding the company’s broader U.S. ambitions, while the subsequent announcement identified a specific Texas facility for operational planning.

Village Farms has substantial greenhouse infrastructure in West Texas. Its newly announced plans focus specifically on the 30-acre Monahans facility, which management has identified as one of its most advanced agricultural assets.

How Village Farms’ Greenhouse Experience Informs Its Texas Plans

Village Farms’ experience in Canada provides the foundation for its interest in Texas.

The company’s cannabis operations in Delta, British Columbia, were developed by converting greenhouses originally used to grow vegetables.

“The existing facility in Delta, B.C., was not purpose-built for cannabis,” Anand explained. “It was retrofitted from tomatoes and cucumbers.”

That experience is particularly relevant to the company’s Texas properties, where existing agricultural infrastructure offers an opportunity to apply cultivation and greenhouse conversion expertise developed in Canada.

“We’re always looking at ways in which we might be able to participate there,” Anand said during the interview.

The company’s subsequent announcement regarding Monahans provides a concrete example of that strategy moving into operational planning.

Anand also discussed the relationship between the potential size of the Texas medical cannabis market and the scale of Village Farms’ broader greenhouse holdings.

“You need more than just Texas to be able to turn that thing on and get it going,” he said.

In the interview, Anand was specifically referring to the economics of activating approximately 2 million square feet of greenhouse capacity in the company’s broader Texas portfolio.

His remarks addressed the market conditions necessary to support large-scale production, rather than the specific 30-acre Monahans initiative announced afterward.

The distinction matters because preparing an individual greenhouse for cannabis production and determining the commercial opportunity for a much larger agricultural footprint involve different investment and market considerations.

Village Farms’ November 9 announcement establishes a more immediate operational objective for Monahans without necessarily resolving the longer-term questions surrounding its broader Texas assets.

Texas Medical Cannabis Licensing Remains a Hurdle

Texas has been expanding its Compassionate Use Program, which allows qualifying patients to access certain low-THC cannabis products through licensed dispensing organizations.

The state’s evolving regulatory framework has attracted interest from cannabis operators seeking to participate in the medical market.

For Village Farms, the availability of existing greenhouse infrastructure creates a potential advantage, but agricultural capacity alone does not establish authorization to cultivate cannabis.

The company must still secure an applicable regulatory pathway before commencing cannabis production at Monahans.

During the interview, Anand discussed the importance of understanding how state and federal licensing requirements could affect the company’s participation in the U.S. market.

“We’re definitely looking at the United States very closely,” he said. “We pay very close attention to everything that’s happening.”

Those comments preceded the company’s announcement that it was actively mobilizing plans for Monahans.

Management’s subsequent statements provide a more specific operational direction while leaving the applicable licensing requirements and timing of authorized cannabis production as important considerations.

Why Federal Reform Matters

For Village Farms, the U.S. opportunity extends beyond Texas’ current medical cannabis program.

Anand described the United States as a substantially larger potential market than individual European countries, while noting that federal restrictions continue to complicate how internationally active cannabis businesses can participate.

“Are we interested when the U.S. legalizes cannabis at a federal level? It’s a natural fit for us because the Texas asset is there,” he said.

His comments addressed the company’s broader U.S. ambitions and the potential opportunities created by federal reform. They did not establish federal legalization as a prerequisite for every possible Texas initiative.

Village Farms’ subsequent Monahans announcement represents a more immediate effort to pursue opportunities within the evolving U.S. regulatory environment.

The company is also monitoring the federal cannabis rescheduling process, although moving cannabis to Schedule III would not, by itself, establish a nationwide adult-use market or automatically authorize interstate cannabis commerce.

Anand discussed the importance of future regulatory rules governing cultivation, imports, exports, and domestic distribution.

Those questions are particularly relevant to Village Farms because the company already exports medical cannabis from Canada and operates across multiple international regulatory environments.

Canada’s earlier legalization also gave Village Farms time to develop cultivation, compliance, and international trade capabilities that could become relevant in a more open U.S. market.

For the company, Texas represents both a potential domestic market and an opportunity to apply the greenhouse cultivation experience developed through its Canadian operations.

From a Strategic Option to an Operational Plan

Village Farms has previously expressed interest in activating its Texas greenhouse assets for cannabinoid production, subject to applicable laws and regulatory requirements.

Anand’s interview provided insight into the regulatory and commercial considerations surrounding that strategy before management announced its specific plans for Monahans.

“We feel very strongly positioned to enter that market once there is certainty on the regulatory pathway,” Anand said.

His assessment reflected the company’s broader approach to U.S. market participation at the time of the interview.

The November 9 announcement marked a subsequent development, with Village Farms confirming that it was actively mobilizing plans to operationalize its 30-acre Monahans greenhouse for cannabis production.

During the third-quarter earnings call, management also described an approximately 12-month target for bringing the facility online.

That target reflects the company’s operational intentions, not confirmation that regulatory approvals have been secured or that cannabis production has begun.

The announcement moves Monahans beyond a long-term infrastructure opportunity and into active planning. At the same time, the regulatory pathway, commercial conditions and execution of the project remain relevant to its eventual development.

For investors, the distinction is between an announced operational initiative and a cannabis production business that is already licensed, operating and generating revenue.

Village Farms brings substantial greenhouse infrastructure, experience converting agricultural facilities to cannabis cultivation and an established international cannabis business to its U.S. strategy.

Its latest announcement provides a clearer direction for Monahans, while Anand’s earlier comments offer additional context on the regulatory and commercial considerations surrounding the company’s broader Texas holdings.

Together, the interview and the subsequent earnings announcement illustrate how Village Farms’ U.S. strategy is developing, from evaluating regulatory opportunities to preparing a specific facility for potential cannabis production.

The future of U.S. cannabis regulation and the investment opportunities it could unlock will be central topics at IgniteIt’s Cannabis Capital & Policy Summit in Washington, D.C., on November 18. Join industry executives, investors, and policymakers to discuss the regulatory changes, capital strategies, and market opportunities shaping the next phase of the cannabis industry.