Effectively immediately, Bruce Linton will no longer be the CEO of Canopy Growth Corporation (NYSE: CGC), one of the largest cannabis companies in the world. He called CNBC today and confirmed that he was in fact fired as CEO of Canopy Growth Corporation. Bruce Linton has become the face of the global cannabis industry speaking at conventions around the world as one of the true pioneers of legal cannabis. He founded Tweed Marijuana Inc. in 2013. along with the now sole CEO Mark Zekulin, in an abandoned chocolate factory in Ontario, Canada in 2013. They changed the name to Canopy Growth Corporation in 2015 and received massive funding of roughly $5 billion from the alcohol distributor Constellation Brands (NYSE: STZ) shortly afterwards. Constellation Brands owns 28% of Canopy and chose 4 out of the 7 company board members.

Canopy Growth Corporation was tardy in reporting 4th quarter earnings having reported them late in June. They turned out very poorly netting a $247 million loss and an 8.3% loss in share price since then. Their EBITDA (earnings before interest, tax, depreciation and amortization) resulted in over a $74 million loss to the company. EBITDA is a measure of operating performance and of course as the CEO of the company, many eyes turned towards Bruce Linton. Canopy produced 4 times the amount of cannabis in the 4th quarter of 2018 versus the same time period one year prior. The demand for that cannabis is just not there yet.

Canopy also committed to a massive bond purchase of Acreage Holdings this year, one of the largest cannabis license holders in the United States, contingent on cannabis becoming rescheduled in the U.S. However, when or if that will ever happen is still unknown. While many bills floating around Congress could either reschedule or deschedule cannabis from the Controlled Substance Act, promise of that has waned as of late. The bill that had the best chance of passing is the STATES Act, which would free states to make laws concerning cannabis without interference from the federal government and pave the way for interstate commerce. However, despite early support from the President, concerns that democrats may come out of the woodwork to vote for state ballot initiatives legalizing cannabis may have caused the Republican party to shy away from the bill.

The cannabis industry is unique for many reasons, one of which is that it’s growth has been very rapid.This is due to many factors, not the least of which is that the industry is still new. Cannabis only became legal nationally in Canada in October of 2018. The roughly 33 million people living in Canada is still Canopy’s largest consumer base despite contracts to distribute medical marijuana to European countries and Australia. The United States and Europe have a much larger consumer base which is very promising for the future, but the legalization process has been slower than Canopy had obviously anticipated.

Mark Zekulin will take over as the sole CEO of Canopy Growth Corporation for now. John Bell has also been appointed as the Board Chair while the company considers its next steps. As the first cannabis producer to be listed on the New York Stock exchange under symbol CGC and accepting funding from a massive company like Constellation Brands, Canopy is in new territory. If the cannabis industry wanted to know what it is like to go mainstream, Canopy is giving it one of its first good looks. Other Canadian cannabis companies like Aurora Cannabis (NYSE: ACB), Tilray (NASDAQ: TLRY) and OrganiGram Holdings (CVD: OGI) have also begun to slide as demand for cannabis up in Canada has slowed.