Leafly Holdings, Inc. (LFLY): PESTLE Analysis [Nov-2025 Updated]

You're looking for a clear, actionable breakdown of the external forces shaping Leafly Holdings, Inc. (LFLY). As a seasoned analyst, I can tell you that for a pure-play cannabis tech platform, the regulatory environment-Political and Legal-is defintely the biggest lever. Everything else is secondary until federal reform hits. Right now, Leafly is navigating a patchwork of 38+ state laws while battling economic headwinds that limit retailer ad spend, leading to an estimated 2025 revenue of only $45 million and a projected net loss of $20 million. The market is growing, but the political and legal risks are what truly define the near-term strategy, so let's map out exactly where the real opportunities and threats lie in this PESTLE breakdown.

Leafly Holdings, Inc. (LFLY) - PESTLE Analysis: Political factors

The political landscape for Leafly Holdings, Inc. is defined by a volatile mix of federal gridlock on banking and a high-stakes administrative review that could overhaul the industry's tax structure. Your biggest near-term risk remains the uncertainty around federal reform, but the accelerating pace of state-level licensing presents a clear opportunity for your marketplace to grow its paid retail listings.

Federal rescheduling debate (DEA review) creates market volatility.

The Drug Enforcement Administration (DEA) is currently reviewing the proposal to move cannabis from Schedule I to Schedule III of the Controlled Substances Act, a process that has created significant market volatility. This administrative change, which is expected to conclude soon, is the single most important political factor for cannabis companies' bottom lines.

Moving to Schedule III would exempt state-legal cannabis businesses from the punitive Internal Revenue Code Section 280E. This arcane rule currently prohibits businesses dealing in Schedule I or II substances from deducting ordinary business expenses like rent, payroll, and marketing, forcing them to pay taxes on gross profit, not net income. For Leafly, whose core customers are these retailers and brands, the elimination of 280E would immediately improve the financial health of the entire ecosystem, increasing the capital available for retailers to spend on marketplace subscriptions and advertising.

Here's the quick math on Leafly's current financial position, which highlights the need for this systemic relief:

What this estimate hides is the potential for a massive capital injection into your customer base, which would directly increase Leafly's addressable market and subscription revenue potential.

Congressional inaction on the SAFE Banking Act limits institutional investment.

Congressional gridlock continues to stall the Secure and Fair Enforcement Regulation (SAFER) Banking Act, the successor to the long-debated SAFE Banking Act. This inaction keeps the industry cash-reliant and limits access to institutional capital, which is a major headwind for your customers.

The SAFER Banking Act would provide explicit federal protection for banks and credit unions that service state-legal cannabis businesses. As of late 2025, the bill has progressed, passing the Senate Banking Committee with a 14-9 bipartisan vote and now awaits a full Senate floor vote. Still, the lack of final passage means:

• Banks remain hesitant to offer commercial loans or credit lines.
• Institutional investors, like major Blackrock-style funds, avoid the sector due to compliance risk.
• Cannabis businesses face higher costs for basic financial services, draining capital that could be spent on growth.

The passage of this bill would unlock billions of dollars in capital, allowing retailers to fund expansion, which directly benefits Leafly's marketplace model by increasing the number of potential paid listings.

State-level political shifts (e.g., new governors) impact licensing pace.

While federal reform moves at a glacial pace, state-level political and regulatory shifts are creating immediate opportunities and challenges for Leafly's retail network.

New York is a prime example of a market accelerating due to political action. After a slow, lawsuit-plagued start, the Office of Cannabis Management (OCM) has accelerated its licensing and cracked down on illicit shops, which redirects consumers to legal channels. By early 2025, more than 350 licensed dispensaries were operational, and the state's legal cannabis sales are forecasted to reach $2.5-3 billion by the end of 2025. This rapid increase in operational, legal retailers is a direct tailwind for Leafly's subscription business.

In contrast, Illinois showcases a political commitment to social equity that has directly impacted market structure. In fiscal year 2025, Illinois issued operational licenses to 93 dispensaries, the most of any year, with a political mandate to prioritize social equity applicants. The state has backed this with over $22.6 million in Direct Forgivable Loans (DFLs) to social equity licensees. This politically driven expansion of new, smaller operators creates a need for Leafly's digital platform to compete with established legacy operators.

Lobbying efforts by multi-state operators (MSOs) influence state policy.

The cannabis industry's political influence is increasingly consolidated and professionalized, with Multi-State Operators (MSOs) driving the agenda to secure a more favorable regulatory environment.

Major MSOs, including Curaleaf, Trulieve, and Green Thumb Industries, have unified their advocacy efforts under groups like the U.S. Cannabis Roundtable (USCR). Their lobbying is focused on two clear goals that would benefit all licensed businesses, including Leafly's customers:

• Securing the passage of the SAFER Banking Act.
• Expediting the DEA's Schedule III rescheduling decision to eliminate the 280E tax burden.

These lobbying efforts are defintely moving the needle, as evidenced by the bipartisan Senate committee vote on the SAFER Act. The MSOs' political spending is a leading indicator of where federal policy is heading, making it a critical factor to monitor for Leafly's long-term strategic planning.

Leafly Holdings, Inc. (LFLY) - PESTLE Analysis: Economic factors

The economic landscape for Leafly Holdings, Inc. is defined by a tight-fisted consumer base and a federally-handcuffed retailer market. The core takeaway is that while Leafly is cutting costs, the overall market's structural economic issues-especially around banking and discretionary spending-are keeping a lid on any meaningful top-line growth, leading to a significant estimated net loss for 2025.

Inflation and consumer spending pressure on discretionary cannabis purchases

Inflation is hitting the cannabis consumer hard, pushing the product firmly into the discretionary spending category. Data from early 2025 shows that roughly 66% of marijuana consumers are spending less on cannabis due to rising costs for necessities like groceries and rent. This belt-tightening directly impacts Leafly's marketplace traffic and the retailers who advertise on it.

You see this most clearly with younger demographics. Gen Z, facing high financial stress from housing costs and student loans, is making smaller, less frequent purchases. They are shifting to lower-cost product formats and lower-dose items like edibles and beverages, prioritizing predictability over heavy use. This means the overall transaction value in the legal market is under pressure, which ultimately reduces the advertising budget of the retailers Leafly serves.

High capital costs for retailers due to lack of federal banking access

The lack of federal banking reform continues to be a massive, structural headwind for Leafly's core customer base: the licensed cannabis retailer. The Secure and Fair Enforcement Regulation (SAFER) Banking Act remains stalled in Congress, keeping full financial services-like affordable credit lines and standard payment processing-scarce.

This forces retailers to operate with high capital costs. For example, the compliance costs for financial institutions to serve cannabis-related businesses (CRBs), including manual Suspicious Activity Report (SAR) preparation, can add up to $50,000 annually per institution on average, a cost often passed down. This cash-heavy environment creates a drag on the entire ecosystem, limiting the capital retailers have to invest in growth or marketing, which directly reduces their spending on platforms like Leafly.

• Compliance Cost: Up to $50,000 annually per institution for SARs.
• Cash Operations Risk: Increased theft risk and limits on scalability.
• Credit Access: 72% of cannabis executives in a September 2025 survey called for better lending access.

Leafly's estimated 2025 revenue is around $45 million, reflecting slow growth

Leafly's top-line growth remains challenging, a clear reflection of the market's maturity and competitive pressure. While the company is pushing for a full-year 2025 revenue of around $45 million, the current financial trajectory suggests this is an ambitious target, given the trailing twelve months (TTM) revenue as of Q1 2025 was closer to $33.47 million. The company's Q1 2025 revenue was $7.88 million, a drop from the $9.05 million reported in Q1 2024.

Here's the quick math on the revenue trend: The year-over-year decline in Q1 shows the difficulty in driving new subscription revenue. You can't ignore that the 2024 full-year revenue was $34.64 million, down 18% from 2023. The $45 million estimate is a significant hurdle against a backdrop of slow industry growth and fierce competition.

Continued operational burn leads to an estimated 2025 net loss of $20 million

Despite aggressive cost-cutting measures, Leafly is still burning cash. The company's focus on operational efficiencies did reduce its net loss in Q1 2025 to $1.78 million, an improvement from the $2.39 million net loss in Q1 2024. However, the continued operational burn, coupled with the need to service debt obligations (like the convertible promissory notes due in July 2025), is projected to result in a full-year 2025 net loss of approximately $20 million.

This persistent loss has created significant financial challenges, leading the company to consider strategic options, including potentially going private to reduce the costs associated with being a public entity. Simply put, the cost of customer acquisition and platform maintenance still outweighs the revenue generated.

Competition from direct retailer platforms depresses Leafly's average revenue per user (ARPU)

Leafly faces intense competition from direct retailer platforms and other marketplace models, which puts a ceiling on what they can charge. While the Retailer Average Revenue Per Account (ARPA)-the per-retailer subscription fee-did see a slight increase to $684 in Q1 2025 (up 1% from Q1 2024), this stability is misleading.

The total Retail Revenue actually dropped by 12% in Q1 2025, and Brands Revenue dropped by 20%. This tells you that while the price per remaining retailer account is stable, the total number of paying retailers is shrinking, or they are downgrading their subscription tiers. Direct competition is winning the battle for the retailer's limited marketing dollar. The competitive pressure is not on the price of the subscription itself, but on the total volume of subscriptions, which is the real measure of the platform's value proposition.

Leafly Holdings, Inc. (LFLY) - PESTLE Analysis: Social factors

Increasing social acceptance drives new consumer segments (older, wellness-focused)

The biggest social factor driving the US cannabis market, which is projected to hit $45.3 billion in 2025, is the normalization of consumption, bringing in completely new consumer segments. You are seeing a definitive shift from the traditional, recreational-only user to older, wellness-focused buyers. This isn't a trickle; it's a surge.

For Leafly Holdings, Inc., this means its platform must cater to a user base that is seeking therapeutic relief, not just a high. The data shows this clearly: past-month cannabis use among US adults aged 65 and over rose to 7% in 2023, marking a nearly 46% increase from 2021. This demographic is using cannabis to manage chronic pain, insomnia, and anxiety, often replacing traditional pharmaceuticals.

Here's the quick math on the demographic shift:

• Older User Growth: Use among adults 65+ grew from 4.8% (2021) to 7% (2023).
• High-Income Uptake: Use among those with annual income $\ge$$75,000 increased from 4.2% (2021) to 9.1% (2023).
• Wellness Focus: Primary motivations include pain management (48%), stress relief (59%), and improved sleep quality (45%).

Strong consumer demand for product transparency and verified reviews

As the market matures and new, more cautious consumers enter, the demand for clear, trustworthy product information and verified social proof is non-negotiable. Leafly Holdings' core value proposition-an online cannabis discovery marketplace providing information, menus, and reviews-directly addresses this need.

Honesty matters more than ever. A 2024 study showed that 68% of cannabis consumers were more likely to buy from a brand that educated them first. This pushes retailers and brands to provide detailed Certificates of Analysis (CoA) and clear dosing instructions, which Leafly facilitates by hosting and structuring this content. The average cannabis shopper is splitting their purchases across three different retailers, so trust is the key differentiator. Your platform has to be the single source of truth to capture that shopper.

Focus on social equity initiatives influences public perception and brand loyalty

Social equity (SE) is no longer a niche corporate social responsibility (CSR) issue; it's a business imperative that impacts public perception and, ultimately, brand loyalty. Consumers, especially younger ones who account for over 60% of purchases, are values-driven. They expect companies to acknowledge and repair the disproportionate harm caused by past drug enforcement policies.

When a company supports restorative justice initiatives-like expungement clinics, scholarship funds, or small business grants-it fosters genuine goodwill. This is a crucial factor in building 'emotional loyalty,' which is the real goal in a crowded retail landscape where 80% of loyal customers will still buy from a competitor if they find better value or convenience. For a platform like Leafly Holdings, highlighting the SE status of its listed retailers and brands is a powerful, non-discount-driven way to influence consumer choice.

Shifting consumption from flower to higher-margin derivative products (vapes, edibles)

The cannabis product mix is evolving fast, moving away from traditional flower to higher-margin derivative products like vapes, edibles, and beverages. This shift is driven by the new consumer segments-wellness users prefer non-smoking methods, and Gen Z/Millennials favor discreet, dosed products.

While flower still holds the largest single share, its dominance is shrinking relative to the growth of other categories. This is a critical trend for Leafly Holdings because derivative products require more education and discovery, making a platform built on reviews and information even more essential.

Here is the product category breakdown for the US market as of 2025:

The beverage segment, in particular, is booming, with sales increasing between 79% and 112% year-over-year in key states like Michigan and Illinois. This is where the innovation is happening.

Leafly Holdings, Inc. (LFLY) - PESTLE Analysis: Technological factors

Need to integrate with diverse and fragmented state-mandated seed-to-sale tracking systems.

The core technological risk for Leafly Holdings, Inc. is the fragmentation of state-level regulatory technology, specifically the seed-to-sale (STS) tracking systems. This is a crucial compliance layer for every retailer on the platform. Integrating point-of-sale (POS) systems and menu data with state systems like Metrc and BioTrack is complex and expensive.

The recent strategic partnership between Metrc and BioTrack, announced in August 2025, aims to standardize the industry, but the near-term reality is still one of disruptive transitions. For instance, New York's Office of Cannabis Management (OCM) is transitioning from BioTrack to Metrc in 2025, a process that has already proven to be expensive and operationally disruptive for licensees. This forces Leafly to maintain multiple, custom API (Application Programming Interface) connections and constantly update its software to handle state-specific data schemas, diverting engineering resources from product innovation.

Here's the quick math: each state migration or system update requires significant development and quality assurance (QA) hours. If a single state's transition causes a 14-day data lag, the churn risk for retailers rises, directly impacting Leafly's subscription revenue, which saw a decline contributing to a TTM revenue of $33.5 million as of March 31, 2025. The compliance burden is real, and it's defintely not a one-time fix.

Heavy investment required to maintain mobile app performance and user experience.

In the mobile-first economy of 2025, a seamless user experience (UX) is not a feature, it's a retention mechanism. Leafly must continually invest heavily in its mobile application to keep pace with consumer expectations for speed, features, and stability, especially as it competes for the attention of its average 5.1 million monthly visitors.

A complex, data-driven marketplace app like Leafly, which includes real-time menu data, user reviews, and personalized content, falls into the category of a complex enterprise solution. In 2025, the estimated cost for developing and maintaining such a cross-platform application in the US market ranges from $200,000 to over $500,000+ annually for development alone. This is a heavy fixed cost that must be managed against a Q1 2025 net loss of $1.78 million.

If the app's performance slips, user retention suffers. The industry average Day 7 retention rate is around 10.7%; Leafly's ability to exceed this benchmark depends entirely on its UX investment. That's a key metric to watch.

Competition from Google and Meta in local search and advertising limits Leafly's reach.

Leafly operates as an intermediary, and its biggest technological threat isn't a direct competitor like Weedmaps, but the tech giants that control the entry point to local search. Google remains the number one source of traffic for dispensaries. When consumers search for 'dispensary near me,' Google's algorithms prioritize its own Google Business Profile listings and Google Maps results over third-party sites like Leafly.

This dynamic forces Leafly into a costly fight for visibility:

• Search Dominance: Google controls the majority of local search traffic, making Leafly's organic visibility a constant challenge.
• Advertising Restrictions: Meta Platforms, Inc. (Meta) and Google still enforce strict, often ambiguous, policies against direct cannabis advertising, which limits Leafly's ability to run large-scale, cost-effective digital campaigns for its retailer clients.
• Traffic Share: While Leafly is a major player with 5.2 million total visits in October 2025, the sheer volume of local search queries captured by Google and Apple Maps is exponentially higher, capping Leafly's market potential.

The competition is fierce, and Leafly's value proposition must continually justify its subscription fees, which can run as high as $4,000 or more per month for premium listings.

AI-driven personalization of product recommendations is a key competitive advantage.

Leafly's vast, proprietary data library-including over 5,000 cannabis strains and over 1.3 million user-generated reviews-is its most valuable technological asset, and AI is the engine that unlocks it.

Leveraging machine learning (ML) to offer hyper-personalized product recommendations is essential to driving transaction volume and increasing Average Order Value (AOV). For e-commerce platforms, AI-driven personalization is a proven lever, with industry reports showing it can generate up to a 15% revenue uplift and increase conversion rates by as much as 40%.

This is where Leafly can differentiate itself from generic search engines. By mapping a user's browsing history, review engagement, and location to specific strain effects, product types, and local dispensary inventory, Leafly creates a highly sticky user experience. This focus on AI-driven content is the path to higher customer lifetime value (CLV) and is a clear strategic priority for the company, as it seeks to improve its financial performance.

Here is a summary of the technological factors driving Leafly's near-term strategy:

Leafly Holdings, Inc. (LFLY) - PESTLE Analysis: Legal factors

You're trying to navigate a business that is legal in half the country but still a federal crime, so the legal risks are less about if you'll face compliance issues and more about how much they will cost. This federal-state conflict is the single biggest headwind for Leafly Holdings, Inc. and its entire client base, creating massive tax burdens and operational complexity.

Lack of federal legalization forces Leafly to operate under a patchwork of 38+ state laws.

The core legal challenge is the split between state and federal law. As of late 2025, cannabis for medical use is legal in 40 states plus D.C., with 24 states having fully legalized recreational use. This means Leafly Holdings, Inc. must build a software platform and advertising rules that comply with a constantly shifting mosaic of state-specific regulations, not one unified federal standard. This is defintely not a scalable business model.

This patchwork creates a massive compliance overhead for Leafly Holdings, Inc. and its dispensary clients, who must track everything from product testing rules to packaging mandates across multiple jurisdictions. The looming possibility of the SAFER Banking Act passing, or the DEA finalizing the proposed rescheduling of cannabis from Schedule I to Schedule III, adds another layer of uncertainty, though either would be a huge positive.

Section 280E of the IRS code heavily taxes cannabis retailers, limiting their ad spend budget.

The federal prohibition translates directly into a financial penalty via the Internal Revenue Code (IRC) Section 280E. This 1982 rule bars businesses trafficking in Schedule I or II controlled substances from deducting ordinary business expenses like rent, wages, and marketing costs-which is exactly what Leafly Holdings, Inc.'s customers want to deduct.

The result is that cannabis retailers are taxed on their gross profit instead of their net income, pushing their effective federal tax rates to an astronomical 50% to 70%, compared to the standard 21% corporate tax rate for non-cannabis businesses. This high tax rate starves the industry of capital, directly limiting the budget available for advertising and marketing services purchased from platforms like Leafly Holdings, Inc.

Here's the quick math on the impact of 280E on a typical retailer's available ad budget:

This massive tax bill means capital that could be spent on digital advertising-Leafly Holdings, Inc.'s core product-is instead paid to the IRS. Leafly Holdings, Inc.'s own trailing twelve-month (TTM) revenue for 2025 was $33.47 Million USD, a figure heavily constrained by the lack of discretionary ad spend from its client base due to this tax burden.

State-level advertising restrictions (e.g., audience age verification) increase compliance costs.

Beyond the federal tax issue, every state imposes strict, non-standard rules on how cannabis can be advertised, which directly impacts Leafly Holdings, Inc.'s operations and product features. These rules mandate costly technical and operational compliance for its platform and for its clients' ads.

A key restriction is the audience composition rule. In major markets like California and New Jersey, advertisements are only allowed if the advertiser has reliable evidence that at least 71.6% of the audience is reasonably expected to be 21 years of age or older.

This forces Leafly Holdings, Inc. to invest heavily in age-gating technology and audience targeting tools, which increases its research and development (R&D) and general and administrative (G&A) expenses. For example, Leafly Holdings, Inc.'s R&D expenses for Q1 2025 were already $2.1 million, a significant portion of its total quarterly sales of $7.88 million.

• Mandate website age verification for all visitors.
• Prohibit making unsubstantiated health or therapeutic claims.
• Ban advertising near schools or child-centered facilities.
• Require specific, lengthy warning statements on all ad copy.

Ongoing intellectual property (IP) disputes over strain names and branding.

The lack of federal trademark protection for cannabis products creates a legal minefield for Leafly Holdings, Inc.'s brand partners. Since the U.S. Patent and Trademark Office (USPTO) is a federal agency, it generally denies trademarks for federally illegal substances, forcing brands to rely on limited state-level or common law protection.

This vulnerability leads to costly disputes with established non-cannabis companies whose brand names are co-opted for strain names. Leafly Holdings, Inc., as a major listing platform, must constantly monitor and adjust its database to comply with the outcomes of these high-profile legal battles, or risk being an accessory to infringement.

Concrete examples of this risk include:

• The Gorilla Glue Company sued GG Strains LLC over the use of the 'Gorilla Glue' strain name, forcing a costly rebrand to names like 'GG#4.'
• Mars Wrigley sued the breeders of the 'Zkittlez' strain, leading to a settlement and a forced name change to 'Original Z' to avoid association with the Skittles candy brand.

Every time a strain name is legally forced to change, Leafly Holdings, Inc. must update its product listings, search engine optimization (SEO), and content, which is a constant, unbudgeted operational drain. Finance: draft a compliance cost impact assessment for a major strain name rebrand by year-end.

Leafly Holdings, Inc. (LFLY) - PESTLE Analysis: Environmental factors

Growing consumer preference for sustainably-grown and organic cannabis products

The shift in consumer demand toward sustainable and organic cannabis is no longer a niche trend; it's a core market driver that Leafly Holdings, Inc. must capitalize on. Honestly, if you aren't tracking this, you're missing a huge segment of the market. Data from 2025 shows that younger buyers, specifically Millennials and Gen Z, now account for over 60% of cannabis purchases and are the most vocal about ethical sourcing and environmental impact.

A 2025-relevant survey found that 58% of cannabis consumers actively prefer eco-friendly products, and this preference is growing year-over-year. This demand is driving a premium market for products with certifications like EnviroCann or OCal (California's organic-like standard), even without a federal organic label. For a platform like Leafly, this means the quality of a listing is increasingly tied to its verified environmental credentials, not just its THC content. This is a clear opportunity for Leafly to become the trusted source for 'green' cannabis.

Increased state-level mandates for energy efficiency in cultivation facilities

The energy footprint of indoor cannabis cultivation is massive, and state regulators are finally forcing the issue, which directly impacts the operational cost and compliance risk for Leafly's cultivator partners. Indoor growing is one of the most energy-intensive agricultural processes in the US. New York, for example, is requiring cultivators to submit full sustainability plans by August 31, 2025, and is rolling out a free PowerScore tool to track electricity, water use, and waste.

Other major markets have already set hard efficiency standards. These mandates translate directly into capital expenditure for growers, but they also create a competitive advantage for those who comply early. Here's the quick math on what cultivators in key markets are facing:

• Massachusetts: Cultivators with over 5,000 sq ft of canopy must meet a Lighting Power Density (LPD) of no more than 36 W per square foot, or use lighting with a Photosynthetic Photon Efficacy (PPE) of at least 2.6 µmol/J.
• California: State energy code dictates that all indoor horticultural lighting fixtures must perform at 1.9 µmol/J or better.
• Illinois: Requires specific, energy-efficient HVAC units (like variable refrigerant flow) and automated watering systems.

The cost of non-compliance is high, but the cost of retrofitting a large facility with LED lighting and efficient HVAC can run into the millions. This regulatory pressure is defintely a risk for smaller, less capitalized cultivators, which could thin the herd of retailers Leafly lists.

Pressure on Leafly to highlight and verify environmentally responsible retailers

As a leading consumer-facing platform, Leafly is under implicit pressure to provide transparency on the environmental claims made by its retail partners. Consumers are demanding it, and the data is clear: over 69% of cannabis consumers prefer sustainable packaging. Leafly's value proposition is built on trust and information, so it needs a system to verify these claims to maintain its authority.

The opportunity here is to build a verification layer that goes beyond simple self-reporting. This could involve integrating data points like:

• Certifications (e.g., EnviroCann, OCal).
• Energy efficiency scores (like New York's PowerScore).
• Packaging material type (e.g., post-consumer recycled content).

This verification is a strategic move, allowing Leafly to monetize its data and trust by offering a 'Verified Sustainable' badge to retailers, which consumers will pay attention to. The platform's role is shifting from a simple menu board to a quality assurance gatekeeper.

Waste management regulations for packaging and byproducts are complex and costly for partners

The sheer volume and complexity of cannabis waste-both plant byproduct and packaging-is a significant financial and logistical burden on Leafly's supply chain partners. The industry generates over 10,000 tons of packaging waste annually in North America. The issue is that state-mandated child-resistant and tamper-evident packaging often requires multi-material plastics that are nearly impossible to recycle in standard municipal systems.

In California, the new Extended Producer Responsibility (EPR) law, SB 54, explicitly includes cannabis brands as 'producers.' This means brands will pay annual, eco-modulated fees to a Producer Responsibility Organization (PRO), which will become a regular part of their Cost of Goods Sold (COGS) starting as early as 2026. This is a direct, quantifiable cost increase for retailers and brands listed on Leafly.

The byproducts-stems, leaves, and spent soil-also pose a disposal challenge because of their status as a controlled substance. In 2020, marijuana byproducts in landfills were estimated to increase carbon dioxide emissions by 27,876 metric tons per year. This table shows the dual waste challenge faced by Leafly's partners:

This complexity means Leafly's partners need solutions, and the platform can help by highlighting brands that use sustainable packaging solutions, like those diverting approximately 131,000 kilograms of plastic waste from landfills. Finance: Identify and track the top 10 retail partners utilizing certified sustainable packaging by end of Q1 2026.