Emerging Growth Research Releases Q1 2025 Update Report on 22nd Century Group

New York, New York--(Newsfile Corp. - May 21, 2025) - Emerging Growth Research today released its latest quarterly update report on 22nd Century Group, Inc. (NASDAQ: XXII), following the Company's Q1 2025 results. The report reflects the continued operational progress made under new management and the outlook for meaningful financial improvement in 2025.

22nd Century Group Q1 2025 Financial Highlights:

• Q1 2025 revenue of $6.0 million, up 48% from Q4 2024

• Q1 2025 gross profit improved to $(0.6) million from $(1.3) million in Q4 2024

• Operating loss narrowed significantly to $(2.6) million from $(4.4) million in Q1 2024

• EBITDA improved to $(2.5) million from $(4.2) million in Q1 2024

• Debt reduced to approximately $3 million as of May 7, 2025, now in net cash positive position

• Management reaffirms guidance for EBITDA breakeven by Q4 2025

According to Emerging Growth Research's analysis, the 22nd Century Group reported Q1 2025 revenue of $6.0 million, down 8% year-over-year from $6.5 million in Q1 2024, but up significantly by 48% compared to $4.0 million in Q4 2024. This sequential growth indicates the Company has regained some previously lost volume following 2024 CMO price hikes, with profitable contracts now in place.

The full report details Emerging Growth Research's analysis of 22nd Century Group, a U.S.-based pure-play contract manufacturer for combustible tobacco products and the sole provider of VLN® reduced-nicotine cigarettes. Emerging Growth Research maintains a bullish outlook on XXII based on its recent performance and strategic positioning.

The Emerging Growth Research report highlights that 22nd Century Group's cash position has strengthened following a Q2 2025 partial warrant inducement that generated $5.4 million in gross proceeds, of which $1.0 million was used to repay outstanding debt obligations. This transaction has reduced total debt by $3.8 million year-to-date to approximately $3 million as of May 7, 2025, leaving the Company in a net cash positive position. The analysis indicates that cash reserves now appear sufficient to maintain operations through year-end 2025.

The Company noted that its VLN® cigarettes, which contain 95% less nicotine than conventional cigarettes, continue to gain traction in the marketplace as awareness grows about their potential role in helping smokers reduce their nicotine consumption. Management estimates that just 223,000 VLN® cartons (representing only 5% of XXII's production capacity) are needed to reach profit breakeven, marking a potential sea-change moment for the Company.

22nd Century Group is moving ahead with plans to launch additional products, including VLN® SKUs within private label CMO customer brand families, such as the Smoker Friendly VLN contract. While significant growth was not yet evident in Q1 results, management anticipates that the impact of CMO re-growth and VLN emerging growth will become more apparent in the second half of 2025.

For a copy of the full quarterly report, please visit:

https://EmergingGrowth.com/wp-content/uploads/2025/05/XXII_Update_5.21.25.pdf

or

http://www.EmergingGrowth.com/profile/xxii/ (on the right side of the page as you scroll down)

About 22nd Century Group, Inc.

22nd Century Group, Inc. (NASDAQ: XXII) is a U.S.-based pure-play contract manufacturer for combustible tobacco products and the sole provider of VLN® reduced-nicotine cigarettes. The Company has undergone significant restructuring since 2023, divesting certain material business lines to focus on its contract manufacturing operations (CMO) and VLN® product line. While CMO provides an ongoing operational base and upside manufacturing capacity, VLN® provides most growth potential by offering smokers an innovative path to reduce nicotine consumption. Headquartered in Mocksville, North Carolina, the Company was founded in 1998. For more information, please visit www.xxiicentury.com.

Forward-Looking Statements

This press release contains forward-looking statements concerning business operations and financial performance as well as plans, objectives and expectations for business operations and financial performance that are subject to risks and uncertainties. All statements other than statements of historical fact are forward-looking statements. These statements include but are not limited to statements regarding the expected timing of 22nd Century Group's EBITDA breakeven point, the future growth of its CMO and VLN® business segments, and longer-term revenue expectations. These forward-looking statements are subject to a number of risks, uncertainties and assumptions. Actual results could differ materially from those projected in the forward-looking statements.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/252892