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MOCKSVILLE, N.C. - 22nd Century Group, Inc. (NASDAQ:XXII), a small-cap company with current revenue of $23.87 million, announced Tuesday an expansion of its Pinnacle product manufacturing and marketing agreement with a top-5 convenience store chain, introducing four new products including low-nicotine cigarettes and moist snuff products.
The agreement includes the launch of Pinnacle VLN Gold cigarettes and Pinnacle Menthol VLN cigarettes, which contain 95% less nicotine than traditional cigarettes. These products will be sold at approximately 1,700 stores across 27 states, with sales expected to begin in late summer and early fall of 2025 pending state approvals. According to InvestingPro analysis, the company appears undervalued at current levels, with analysts projecting sales growth and improved net income for the coming year.
Additionally, two varieties of Pinnacle moist snuff products in straight and wintergreen flavors are planned for release in the second half of 2025, subject to regulatory approvals.
"We are very excited to launch our second partner VLN product and branded moist snuff products, leveraging the well-known Pinnacle brand sold at one of the largest convenience store chains in the U.S.," said Larry Firestone, 22nd Century Group Chief Executive Officer.
The new partner-branded Pinnacle VLN cigarettes will be produced at 22nd Century’s manufacturing facility in North Carolina using the company’s proprietary reduced-nicotine tobacco strains. The company will handle distribution to retail stores and state tax stamp compliance through its existing distribution agreements.
22nd Century Group provides the Pinnacle brand name, manufacturing services, and predicate tobacco blend for conventional Pinnacle products that launched in 2023. The moist snuff products are expected to be produced using a third-party model similar to the company’s cigarillo products.
The information is based on a press release statement from 22nd Century Group. InvestingPro offers deeper insights into 22nd Century Group’s financial health, with over 20 additional exclusive ProTips and comprehensive analysis available through their detailed Pro Research Report, helping investors make more informed decisions about this evolving company.
In other recent news, 22nd Century Group reported a significant rise in net revenue for the first quarter of 2025, reaching $6 million, a 50% increase from the previous quarter. Despite this growth, the company recorded a net loss of $3.3 million, with earnings per share at a loss of $1.89. The company also executed a capital raise of $5.4 million, with the potential for an additional $3.3 million, to support its growth initiatives for the rest of the year. In another development, 22nd Century Group announced a 1-for-23 reverse stock split to comply with NASDAQ listing standards. This stock split will adjust both the authorized and outstanding shares but will not affect the company’s authorized preferred stock. The company has also reduced its operating expenses to the lowest level since its turnaround, indicating improved financial management. Furthermore, 22nd Century Group aims to achieve EBITDA breakeven by late 2025, with expectations of continued volume growth and positive gross margins in the upcoming quarters. The company is expanding its product distribution across more states, which could enhance its growth trajectory.
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