10 Cannabis Industry Trends Driving Growth in 2025–2026

The cannabis industry is heading into 2026 with both momentum and uncertainty. Growth hasn’t stopped, but the easy-money era is over. Pricing is volatile, states are tightening rules on hemp products, and federal rescheduling could change tax models overnight. Meanwhile, consumer demand is shifting, compliance technology is evolving, and sustainability is moving from “good practice” to regulatory requirement.

For cannabis operators, success is no longer about producing more flower; it’s about protecting margins, staying compliant, and making faster, smarter decisions in an industry where the rules, prices, and consumer preferences shift by the quarter.

Here are the top 10 cannabis industry trends shaping 2025 and 2026; and how operators can adapt.

1) Pre-rolls surge, beverages find footing

Flower remains the foundation of cannabis sales, but pre-rolls are the fastest-growing category. Multi-packs and infused pre-rolls are winning with consumers who want convenience and consistency. Beverages are still a small slice, yet they’ve carved out loyal demand with low-dose, sessionable formats for social settings.

Operator tip: Track velocity by sub-segment, not just category. Multi-pack and infused pre-rolls often serve different customers than singles, while beverages require careful placement to turn. Build planograms with those distinctions in mind.

2) Rescheduling could end 280E

The DOJ is still reviewing the move of cannabis from Schedule I to Schedule III. If finalized in 2026, this would eliminate IRS 280E, allowing cannabis operators to deduct normal business expenses. It won’t legalize adult-use federally, but it would change cash flow and profitability overnight.

Operator tip: Model your P&L under both scenarios. Build a version with 280E intact and one without. Prioritize projects that strengthen margins in both cases, so you’re ready either way.

3) Banking reform stalls

The SAFER Banking Act continues to attract bipartisan attention but hasn’t crossed the finish line. Without reform, cannabis operators remain stuck with limited banking access, higher fees, and heavy reliance on cash. That keeps capital scarce and expensive.

Operator tip: Build redundancy into your banking strategy. Work with more than one institution and document AML/KYC rigor. Banks that view you as a low-risk client are more likely to extend credit and maintain accounts.

4) State map shifts slowly

As of late 2025, 24 states plus DC allow adult use, and 40 plus DC allow medical. Florida’s adult-use ballot measure failed, stalling the next mega-market. New York is scaling licensed dispensaries and ramping up enforcement against the illicit market. Expansion decisions remain complicated and state-specific.

Operator tip: Don’t chase every new market. Focus on states with clear licensing paths, active retail networks, and supportive enforcement. Expansion capital is best spent where the infrastructure to succeed is already in place.

5) Prices stay volatile

Wholesale prices vary dramatically by state. Oregon and Colorado face ongoing oversupply and margin compression. Limited-license states like New Jersey maintain premium pricing. Treating cannabis pricing as uniform nationally will lead to surprises.

Operator tip: Review contribution margins weekly by state and SKU. Adjust promotions and discounts locally rather than applying blanket pricing strategies across markets.

6) Compliance tech updates

Metrc has rolled out new workflows, like sublocations and faster harvest entries, while its partnership with BioTrack may influence future state contracts. Compliance remains a moving target, and reporting errors still trigger costly fines.

Operator tip: Map compliance-critical tasks to user roles within Metrc and enterprise resource planning (ERP). Limit permissions and enforce daily reconciliations between ERP, Metrc, and financial systems. This reduces audit risk and catches issues before they escalate.

7) Sustainability rules tighten

Indoor cultivation is resource-heavy, and regulators are taking notice. Massachusetts already mandates energy reporting, and other states are exploring similar rules. Consumers also expect real action, not just marketing claims. LEDs and HVAC optimization are proving to be some of the fastest ROI sustainability investments.

Operator tip: Benchmark energy, water, and HVAC use now. Start with efficiency upgrades that pay back fastest — LED retrofits and HVAC optimization — while preparing for more rigorous state requirements.

8) Hemp loopholes closing

Delta-8, THCA, and other intoxicating hemp products surged in popularity, but loopholes are closing. States are imposing age limits, packaging restrictions, or bans. At the federal level, Congress is considering new definitions that could limit these products significantly. Enforcement is also rising from the FTC and FDA.

Operator tip: Treat hemp-derived THC like regulated cannabis. Use validated testing, child-safe packaging, conservative labeling, and robust compliance documentation. Getting ahead of regulation now protects licenses and revenue.

9) Jobs flatten, revenue grows

The cannabis industry supports about 425,000 full-time jobs in 2025, slightly fewer than in 2023. Revenue, however, continues to rise, thanks to new markets like New York, Maryland, and Ohio. Operators are becoming more efficient, leaning on automation and cross-training to keep teams lean.

Operator tip: Build staffing models around SKU- and room-level labor standards. Cross-train cultivation and post-harvest staff so you can flex resources with harvest cycles without adding headcount.

10) Data discipline drives margins

Operators that centralize data into ERP, analytics, and compliance platforms are outpacing the rest. Daily reconciliations across seed-to-sale, financials, and bank feeds reveal true costs and protect margins. Without this, small leaks in yield, pricing, or compliance compound quickly.

Operator tip: Implement daily three-way checks between ERP, Metrc, and bank feeds. Get SKU-level cost visibility and use it to guide pricing, promotions, and resource allocation.

FAQ: Cannabis Operators’ Top Questions for 2025–2026

Will rescheduling to Schedule III eliminate 280E?
Yes. If cannabis is rescheduled, 280E would no longer apply, allowing operators to deduct normal business expenses. This won’t legalize cannabis federally, but it will materially improve margins.

Which product categories are growing fastest?
Pre-rolls, especially infused and multi-packs, are the fastest-growing segment. Beverages remain small but are gaining ground with consistent low-dose formats.

How volatile are prices heading into 2026?
Very state-dependent. Mature markets face oversupply-driven compression, while limited-license states sustain premiums. Pricing strategies must be state-specific.

Are cannabis jobs still growing?
Jobs have plateaued at around 425,000, but revenue is still climbing. Operators are prioritizing efficiency and cross-training rather than adding headcount.

What should operators prioritize for 2026?
Data visibility, margin protection, and regulatory readiness. Consolidated systems and daily reconciliation are essential for staying profitable in a volatile market.

Final Thoughts

The cannabis industry will continue to evolve. New categories will rise, regulations will shift, and margins will face pressure. The operators who succeed in 2026 won’t chase every headline; they’ll focus on building resilience, protecting profitability, and staying ready for the next round of change.

That means tightening compliance workflows, using data discipline to safeguard margins, and preparing now for rescheduling and banking reform.

Velosio helps cannabis operators put that strategy into practice. By consolidating compliance, ERP, and financial workflows into one system, operators gain true cost visibility, faster decisions, and the agility to scale with confidence.

The right time to modernize your cannabis operation is now.

Talk to our Cannabis Experts to get started