Shares of Tilray Brands (TLRY 5.75%) were flying higher on Wednesday. The company's stock gained 7.5% as of 2:25 p.m. ET but gained as much as 20% earlier in the day. The leg up comes as the S&P 500 gained 0.2% and the Nasdaq composite lost 0.1%.

Tilray stock received a boost from the release of fellow cannabis company Aurora Cannabis' positive earnings. This comes on the heels of the cooling of trade tensions with Canada.

The numbers

The cannabis business at large has struggled for years now as the market was flooded with entrants and proved much softer than many had hoped. However, Aurora, a major Canadian player, just posted numbers that show things may be turning a corner. The company reported 37% sales growth year over year for the fourth quarter of 2024 and, critically, record net income of $31.2 million. The company expects positive free cash flow through the end of the year.

This sort of sales growth, positive income, and relatively upbeat guidance sent Tilray's stock higher as investors hope its numbers will follow suit.

Cooling tensions

Tilray has extensive operations in the U.S. and Canada. The recent trade tensions surrounding the uncertainty of tariffs early this week put downward pressure on Tilray's stock. However, at least for now, the tariffs will not go into effect and it looks likely a more permanent retreat to free trade will prevail. Any tariffs between the U.S. and Canada would cut into the cannabis industry's already razor-thin margins.