Canopy Growth Reports Full Year and 4th Quarter Fiscal 2020 Financial Results; Provides Strategic Review Update Generated Net Revenue of $399 million in FY 2020, up 76% over FY 2019 In connection with previously announce

Canopy Growth Reports Full Year and 4th

Quarter Fiscal 2020 Financial Results; Provides Strategic Review Update

Generated Net Revenue

of $399 million in FY 2020, up 76% over FY 2019

In connection with previously

announced organizational and strategic review, recorded impairment and restructuring charges of $743 million; the majority of which

are non-cash charges

Gross Margin of (85)%

in Q4 FY2020; excluding restructuring and other charges, achieved Adjusted Gross Margin of 42%

Net Loss of $1.3 billion;

Adjusted EBITDA loss of $102 million in Q4 2020

SMITHS FALLS, ON, May 29, 2020 /CNW/ - Canopy

Growth Corporation ("Canopy Growth" or the "Company") (TSX: WEED) (NYSE: CGC) today announced its financial

results for the fourth quarter and full twelve-month fiscal year ended March 31, 2020. The Company is also sharing details

of its new strategic plan aimed at winning in priority markets and categories and executing a path to profitability. All

financial information in this press release is reported in millions of Canadian dollars, unless otherwise indicated. The fourth

quarter and full twelve-month fiscal year 2020 financial results presented in this press release have been prepared in accordance

"Through the COVID-19 pandemic we have

worked hard to ensure the health and well-being of our teams and customers and the continuity of our business. During this

time, our team has rolled out our exciting new cannabis-infused beverages and vape products in Canada and a portfolio of CBD products

in the US," shared CEO David Klein. "True to key priorities that I have outlined for Canopy, we have taken steps to align

our capacity with the current market demand and focus our resources against the core markets with the largest and most tangible

near-term profit opportunity."

Added Klein, "I am excited to implement

our strategy reset and organization redesign over the course of fiscal 2021. We have a renewed strategic focus and a clear

change agenda that is already underway. We are building what we believe is the best cannabis company in the world by putting the

consumer at the heart of everything we do and are re-aligning our organization to be faster and more agile."

Strategic and Organizational Update

Canopy Growth's overall strategy is to unleash

the full potential of cannabis, capture sizable market share in focus categories and markets and execute a path to profitability

to build sustainable, long-term shareholder value.

The Company no longer strives to be the first

to every market, but strives to the best and become a leading consumer insights and product development company in select priority

markets, that matches products and consumer preferences in the cannabis space. To achieve this, Canopy Growth will focus on:

Becoming a relentlessly consumer-centric organization

by building world-class consumer insights and analytics, coupled with focused, leading-edge R&D and innovation to produce a

differentiated product portfolio that will delight consumers. The Company will bring these products to the hands of consumers through

best-in-class sales execution;

Markets and product categories with the highest and most

tangible profit opportunities in the near term. Core markets will be Canada, US and Germany with focus on recreational and medical.

To capture future opportunities in emerging markets and categories outside the core, Canopy Growth will deploy an asset-light approach;

Driving quality in all aspects of our operation and be

positioned to deliver the right product at the right time at the right price from the right facility; and

Continuing to lead the industry and set industry standards.

This includes spearheading the next phase of the cannabis industry evolution and shaping how the industry evolves. The Company

will continue to give back to neighbors and communities through its Grow Good Together initiatives.

Canopy Growth expects Fiscal 2021 to be a transition

year as the Company resets its strategic focus, rolls out a new organizational design, and implements a comprehensive operational

and supply chain productivity program. Given this, as well as the significant COVID-19 related uncertainties that exist, the Company

is withdrawing its previously communicated milestones for achieving positive Adjusted EBITDA and Net Income. Depending on

the impacts of COVID-19, Canopy Growth may provide new metrics by which to measure the Company's performance in the second half

Fourth Quarter Fiscal 2020 Corporate Financial

Revenues: Net revenue in Q4 2020 decreased 13%

versus Q3 2020 driven primarily by lower Canadian recreational revenue.

Gross margin: : Reported gross margin, including

one-time restructuring and other charges, was (85%). Adjusted gross margin, excluding one-time restructuring and other charges

and inventory step-up costs, was 42% in Q4 2020, representing an increase of 1,100 bps from Q3 2020. Adjusted gross margin performance

in Q4 2020 was positively impacted by higher facility utilization and growth in high margin international medical cannabis sales.

Operating expenses: SG&A expenses in Q4 2020

increased 17% over Q3 2020 driven primarily by a combined $15 million increase in General & Administrative and Sales &

Net Loss: Net loss of $1.3 billion in Q4 2020,

primarily driven by impairment and restructuring charges, other impairment charges which were primarily identified during our annual

impairment testing, and other non-cash fair value changes.

Adjusted EBITDA: Adjusted EBITDA loss of $102

million in Q4 2020, a $5 million wider loss versus Q3 2020 driven by lower sales and higher operating expenses.

Cash Position: Gross cash balance was $2.0 billion

at March 31, 2020, down from $2.3 billion at the end of Q3 2020 reflecting the EBITDA loss, capital investments and mergers and

acquisitions activities.

Restructuring and Impairment Costs: In line with

our previous announcement (March 4, 2020), we recorded a pre-tax restructuring and impairment charge of $743 million in Q4 2020,

of which $28 million is estimated to be a cash charge. Additionally, we recorded impairment charges of $100 million Q4 2020, which

were primarily identified during our annual impairment testing process.

Business & Operational Highlights

COVID-19 response: Management has been closely

monitoring the impact of COVID-19, with a focus on the health and safety of our employees, business continuity and supporting our

communities. The majority of non-production related staff continue to work from home; we implemented daily screening process for

production facility access; temporarily closed corporate-owned retail stores in mid-March but re-opened 20 stores with reduced

hours as well as click & collect ordering; rolled out click & collect to 100% of all Tokyo Smoke and Tweed licensed stores

and added same day delivery for Tokyo Smoke partner stores.

UL certified Juju Power 510 battery as well as 510 vape

cartridges under Tweed and Twd. brands, representing a total of five SKUs, are available in the Canadian recreational market.

UL certified Tokyo Smoke Luma pod-based vape devices,

Luma "Go" pods and Luma "Pause" pods are available in the Canadian recreational market.

Ready to Drink ("RTD") beverages under Tweed

and Houseplant brands, representing a total of three SKUs, are available in the Canadian recreational market.

Company has expanded offering of Hemp-derived CBD products

with the launch of a line of First & Free topical creams in select states in the US and the launch of This Works' line of clinically-proven

CBD Booster skin products in the United Kingdom, Germany and select states in the US.

On May 1, 2020, an indirect wholly-owned subsidiary of

Constellation Brands (NYSE:STZ) exercised warrants for approximately C$245 million , representing approximately 5.1% of our issued

and outstanding common shares.

Recreational B2B sales in Q4 2020 decreased 31% from

Q3 2020 as growth in softgels, oil, and Cannabis 2.0 products was more than offset by an overall decline in flower and pre-roll

Recreational B2C sales in Q4 2020 decreased 14% from

prior quarter due to the expected off peak seasonal demand decline and the closure of corporate-owned retail stores late in the