New York, New York--(Newsfile Corp. - August 22, 2025) - Emerging Growth Research today released its latest quarterly update report on 22nd Century Group, Inc. (NASDAQ: XXII), following the Company's Q2 2025 results. The report reflects ongoing operational restructuring under new management and revised outlook for EBITDA breakeven pushed to Q2 2026 due to slower-than-expected CMO stabilization and VLN® rollout timing.

22nd Century Group Q2 2025 Financial Highlights:

• Q2 2025 revenue of $4.1 million, down 49% year-over-year from $7.9 million in Q2 2024

• Q2 2025 revenue declined 31% sequentially from $6.0 million in Q1 2025

• Gross loss remained stable at $(0.6) million compared to $(0.6) million in Q1 2025

• Operating loss increased to $(3.0) million from $(2.6) million in Q1 2025 due to higher VLN® promotional spending

• EBITDA was $(2.8) million compared to $(2.5) million in Q1 2025

• Net debt reduced significantly to $0.7 million from $3.3 million in Q4 2024 following warrant exercise

• Management now expects EBITDA breakeven in Q2 2026 (previously Q4 2025)

According to Emerging Growth Research's analysis, 22nd Century Group's Q2 2025 results missed expectations due to slower CMO stabilization and VLN® rollout timing. Despite near-term headwinds, the firm maintains a Buy-Emerging rating with a revised $5.00 price target, citing the Company's strategic focus on higher-margin operations and significant long-term growth potential.

The report highlights key developments including a warrant exercise that generated $5.1 million in proceeds, reducing net debt to $0.7 million and providing sufficient cash to fund operations through year-end 2025. VLN® cigarettes are now shipping following state registrations, with management noting that only 223,000 cartons (5% of production capacity) are needed for breakeven profitability.

New management now projects EBITDA breakeven in Q2 2026, with longer-term revenue growth expectations of +127% in 2026, +68% in 2027, and +39% in 2028 driven by VLN® market penetration in the $12 billion tobacco market.

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

https://EmergingGrowth.com/wp-content/uploads/2025/08/XXII_Update_8.21.25.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 the greatest 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 (now Q2 2026), the future growth of its CMO and VLN® business segments, longer-term revenue expectations, and the Company's ability to maintain operations through year-end 2025. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including potential additional share issuance, warrant exercise dilution, and debt refinancing requirements. 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/263574