Good morning.
Careful readers will notice the inclusion of “Cultivated Calendar” down below. We’ll be sharing upcoming Cultivated events there so you don’t miss anything.
Let’s get to it.
-JB, JR, ZH
Today’s newsletter is 890 words or about a 7-minute read.
THIS NEWSLETTER MADE POSSIBLE BY:
💡 What’s the big idea?
CALIFORNIA
CA pulls in $255 million of tax revenue in Q4 💰
Driving the news: The California Department of Tax and Fee Administration announced it collected $255.1 million in cannabis tax revenue from retailers during the last three months of 2025. The quarterly report capped off a year in which California sales, at $3.9 billion, dipped below $4 billion for the first time in years.
That total included about $145.5 million in excise taxes and $109.6 million in sales tax. The excise tax dropped from $177.7 million in the third quarter of 2025, but that;s due to the 19% excise tax in effect for just those three months.
The tax reverted to 15% when Gov. Gavin Newsom signed a bill reversing the tax hike on Sept. 22, 2025.
Total sales increased to $978.9 million during the quarter compared to $944.7 million between July and September.
A spokesperson from the state’s Department of Cannabis Control declined to comment ahead of press time.
Why it matters: California sales have generated more than $7.87 billion in tax revenue since the market launched in January 2018. That total includes $500.6 million in cultivation taxes that were collected until that tax was eliminated on July 1, 2022.
Cannabis sales in California peaked in the first half of 2023 when it hit $1.138 billion in the second quarter of that year, according to the state's tax revenue data. Since then sales have slowly declined. Sales dipped below the $1 billion mark in the first quarter of 2025.
📣 Quotable
“This is about reining in the government’s constant attempt to get just a little bit more out of people. Lansing must realize that growing government by taxing businesses into oblivion has never been, and will never be, a way to encourage a healthy Michigan economy," said Michigan State Senator Jonathan Lindsey who submitted a bill that would eliminate the recently-enacted 24% wholesale tax on cannabis sales in the state, in a statement to the Detroit Metro Times.
🥐 Join Us in Atlantic City: Cultivated @ MJ Unpacked
We’ll be at MJ Unpacked this May at the Hard Rock Atlantic City — and we want Cultivated readers there with us.
When you register using our promo code, you’ll get:
20% off your ticket by using cultivated20 at check out
An invite to a Cultivated readers-only breakfast
Coffee, conversation, and connections with operators, founders, and investors
The breakfast is sponsored by Aquinnah Capital Partners and will be a relaxed kickoff to the event with the Cultivated community.
We hope to see you there.
⏩ Quick hits
New York's Office of Cannabis Management issued a recall notice on Feb. 26 for 54 products tested by Keystone State Testing New York with potentially incorrect test results for the presence of Aspergillus, a harmful mold. The product list can be found here.
The Community Anti-Drug Coalitions of America sent a letter to lawmakers ahead of Tuesday's markup session for the 2026 Farm Bill urging officials to maintain the Nov. 12, 2026 start date for the federal ban on almost all hemp products.
Wisconsin Democrats filed a new legalization bill that would also make hemp beverages with more than 10mg per 12 oz. serving into regulated cannabis.
63% of Massachusetts voters oppose the upcoming ballot effort to repeal legalization, while only 20% support it, according to a new poll from the University of New Hampshire's Survey Center.
💰 Earnings roundup
Rythm reported a $13.6 million loss on $10.6 million in revenue for Q4. The company is still newly reformed, so it’s difficult to draw reasonable comparisons between quarters or year-over-year data. $RYM ( ▲ 8.19% )
🤝 Deals, launches, partnerships
Pax launched the PAX Four vaporizer.
Safe Harbor Financial announced a 29% increase in deposits from cannabis businesses over the 12-month period that ended Feb. 4, 2026. The increase in deposits came from the growth of younger markets in New York, Ohio and Kentucky, as well as older, but expanding markets in New Jersey, Illinois and Florida. $SHFS ( ▼ 5.44% )
🧳 People moves
High Tide announced that Kathleen Skerrett and Menashe Kestenbaum have replaced Nitin Kaushal and Andrea Elliott on its board of directors, effective March 2.
📰 What we’re reading
He Was Sentenced to 55 Years for Weed. Now He's the Connector Behind Trump's Cannabis Push | High Times
Florida's kids shouldn't be the test case for intoxicating hemp | Tampa Bay Times
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