XXII

This article first appeared on GuruFocus. Release Date: August 13, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Expanded distribution of Pinnacle VLN to nearly 150 high-visibility stores in Metro New York and Northern New Jersey through a major retailer, boosting brand awareness and potential high-margin revenue. Launched Pinnacle Pure, a new product in the premium Tier 2 cigarette category, which has limited competition and offers differentiation and shelf-space opportunities. Gross loss narrowed to $0.3 million in Q2 2026 from $0.6 million in Q1 2026, reflecting a shift toward higher-margin branded products and improved pricing discipline. Targeting expansion from approximately 2,000 to 5,000 retail stores by year-end 2026 across 35 states, with recent entries in key markets like California and Metro New York. Maintained a strong balance sheet with $6.1 million in cash and no outstanding debt, supporting disciplined capital allocation toward growth initiatives. Net revenue declined 29% sequentially to $2.9 million in Q2 2026, reflecting the intentional wind-down of low-margin contract manufacturing, which may pressure short-term top-line growth. Gross margin remained negative in Q2 2026, with a gross loss of $0.3 million, indicating that the pace of margin improvement has been slower than planned. Operating loss widened to $3.3 million in Q2 2026 from $3.0 million in Q1 2026, and adjusted EBITDA was negative $3.5 million, showing continued cash burn. The company expects legacy CMO volume to continue declining over the next two to three quarters, which could further reduce revenue and factory utilization, impacting absorption. The transition away from low-margin CMO business has led to customer losses, as some clients moved to lower-cost suppliers, potentially reducing overall scale and market presence. Warning! GuruFocus has detected 5 Warning Signs with XXII. Is XXII fairly valued? Test your thesis with our free DCF calculator. Q: What are the key drivers behind the company's strategic shift and expected financial improvements in the second half of 2026?A: CEO Larry Firestone explained that the company is prioritizing profitable growth over uneconomic volume by moving away from low-margin contract manufacturing. The strategy focuses on building a scalable branded platform led by proprietary reduced nicotine tobacco products like VLN cigarettes and the expanding Pinnacle brand family. The company expects the second half of 2026 to show benefits from this repositioning, driven by expanding distribution of higher-margin products, transitioning from initial load-in orders to repeat sales, and completing major contract and pricing actions. Q: Can you provide details on the new distribution expansion for Pinnacle VLN and its significance?A: Larry Firestone announced new distribution for Pinnacle VLN in Metro New York and Northern New Jersey through one of the nation's largest cigarette retailers, adding nearly 150 high-visibility store locations. This expansion is significant as it validates retailer interest in the Pinnacle platform, demonstrates that commercial discussions are translating into placements with meaningful operators, and broader distribution is a key lever for accelerating awareness, trial, and repeat purchase. The company is targeting growth from approximately 2,000 stores across 20 states to 5,000 stores across 35 states by year-end 2026. Q: How is the company addressing the decline in legacy CMO revenue, and what is the timeline for this transition?A: The CEO stated that the company is implementing pricing discipline to ensure contracts reflect real manufacturing economics, which has led some customers to move to lower-cost suppliers. This is an acceptable consequence as the company is not interested in revenue that undermines gross profit. The legacy CMO transition is expected to play out over the balance of 2026 and into early 2027, with the majority of remaining volume in categories like filtered cigars and white-label cigarettes substantially transitioned away by then. Q: What were the specific financial results for the second quarter of 2026?A: CFO Daniel Otto reported net revenue of $2.9 million for Q2 2026, a sequential decline of approximately 29% from Q1 2026's $4.1 million. The company recorded a gross loss of $0.3 million, which narrowed from a $0.6 million gross loss in Q1 2026. Operating loss was $3.3 million, and net loss from continuing operations was also $3.3 million. Adjusted EBITDA was negative $3.5 million. The company ended the quarter with $6.1 million in cash and no outstanding debt. Q: What were the discrete items impacting gross margin in the second quarter?A: CFO Daniel Otto highlighted two non-recurring items in Q2 gross margin. First, a one-time charge of approximately $196,000 for the reversal and write-off of aged inventory discontinued by a contract manufacturing customer. Second, offsetting this charge, the company recognized a one-time MSA NPM excise tax recovery of approximately $692,000 covering prior tax periods. Neither item is reflected in forward planning. Q: What is the company's outlook for gross margin improvement in the second half of 2026?A: The management believes three forces are working in favor of gross margin improvement: expanding distribution of products with better margin potential, moving from initial load-in towards repeat sales to improve revenue quality and factory absorption, and having major contract and pricing actions substantially in place. The company expects continued expansion of the product portfolio, particularly higher-margin Pinnacle Pure and Pinnacle VLN reorder activity, to improve the gross margin trajectory in the back half of the year. Q: How is the company managing its liquidity and capital allocation?A: CFO Daniel Otto stated that the company continues to manage liquidity carefully and remains focused on aligning spending with highest priority commercial and regulatory initiatives. Capital allocation remains disciplined, with resources directed toward distribution growth, VLN commercial efforts, Pinnacle portfolio launch, marketing initiatives, and advancement of the reduced nicotine pipeline. The company ended Q2 with $6.1 million in cash and no outstanding debt. Q: What is the significance of the Pinnacle Pure launch and the broader Pinnacle brand portfolio?A: CEO Larry Firestone explained that Pinnacle is not a single product story but a growing brand family competing across multiple product types, price points, and merchandising positions. Pinnacle Pure opens up a compelling opportunity in the premium Tier 2 cigarette category, particularly in tobacco and water style products, where there are relatively few strong options. This allows the company to differentiate its brand, win new shelf space, and support broader momentum of the Pinnacle franchise, which also supports adoption of Pinnacle VLN through broader brand recognition. Q: What is the company's expectation for branded product shipments in the second half of 2026?A: Larry Firestone stated that shipments of branded products in the second half of the year are expected to be significantly larger than the first half of 2026. The company has clear targets for the second half that can establish a foundation for a stronger 2027, while continuing to complete the wind down of the volume-driven CMO business and focusing resources on growing branded products. Q: What new talent has been added to support the company's commercial execution?A: The CEO announced the addition of Katherine Rouse-Bailey as Vice President of Marketing, noting that consumer awareness is critical and navigating brand building within tobacco marketing constraints requires the right expertise. The company also expects to add talent selectively in other parts of the organization, including sales and R&D, to support the expanding retail presence and continued work across science, product development, and technology. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Advances VLN® Commercialization Through Expanded Retail Support and Brand-Building Initiatives MOCKSVILLE, N.C., Aug. 13, 2026 (GLOBE NEWSWIRE) -- 22nd Century Group, Inc. (Nasdaq: XXII), the leader in low-nicotine tobacco, low-nicotine cigarettes and only tobacco products company focused on reducing the harms of smoking through nicotine reduction, today announced results for the second quarter ended June 30, 2026, and provided an update on recent commercial, regulatory and operational activities. The Company’s proprietary reduced nicotine technology is designed to serve adult smokers seeking to significantly reduce nicotine consumption while continuing to use a familiar combustible format. 22nd Century’s strategy is centered on providing adult smokers with FDA-authorized reduced nicotine cigarette products intended to help them take greater control of their nicotine consumption. “The second quarter marked another period of disciplined execution as we continued to expand retail distribution, increase consumer awareness and strengthen the commercial foundation for our VLN® cigarette products” said Larry Firestone, Chief Executive Officer of 22nd Century Group. “During the quarter, we broadened our retail footprint, launched new Pinnacle® products, expanded into new geographic markets and continued building the infrastructure necessary to support long-term commercial growth. Our initial same-store sales reports for VLN® products demonstrated encouraging consumer demand and reinforced our belief that the market is looking for an alternative in the form of a combustible cigarette with significantly reduced nicotine.” “Our strategy remains straightforward. We will leverage our proprietary reduced-nicotine technology across multiple channels while improving economics through a broader product portfolio, add additional partner-brand opportunities and execute with discipline. As THE leader in low-nicotine tobacco technology and products, we believe our FDA-authorized modified risk claims, growing retail presence and differentiated intellectual property position us to continue investing in low-nicotine products and expanding the low-nicotine category. Together, these advantages provide us with a differentiated position within the tobacco industry and a strong foundation for future growth.” “We believe nicotine reduction represents the next significant step in the evolution of the tobacco industry and one of the most compelling long-term opportunities in tobacco harm reduction. With our proprietary technology, FDA-authorized products, increasing commercial distribution and scalable business model, we believe 22nd Century is well positioned to create long-term value for adult smokers seeking familiar alternatives while delivering value for our shareholders.” Second Quarter 2026 Financial Results (compared to First Quarter 2026, except as noted) All figures reported below reflect continuing operations, excluding discontinued operations related to the sale and exit of the Company’s hemp/cannabis business in late 2023, except as noted. 2026 Strategic Priorities 22nd Century has identified the below priorities for its business activities in 2026: The Company believes that the convergence of regulatory momentum, increasing consumer awareness and its differentiated product portfolio may support long-term value creation. Recent Business Highlights Expanded Pinnacle VLN® retail distribution into approximately 150 additional stores across metro New York and northern New Jersey, strengthening the Company’s presence in one of the nation’s largest convenience retail markets. Launched Pinnacle Pure™, a new tobacco- and water-style combustible cigarette expected to be distributed through more than 2,000 retail locations, expanding the Pinnacle brand portfolio and supporting higher-margin revenue opportunities. Initiated a retail launch of Pinnacle VLN® in California through approximately 60 stores, establishing the Company’s first commercial presence in the nation’s largest tobacco market. Supported Pinnacle® VLN® through in-store marketing materials and digital promotion programs designed to increase adult-smoker awareness and support retail sell-through. Continued expanding Pinnacle® VLN® retail distribution across convenience, drug, tobacco specialty and other retail channels. Building on the Company’s current presence in more than 2,000 stores across 20 states, management is targeting expansion to approximately 5,000 retail outlets across multiple classes of trade by year-end 2026, significantly broadening adult-smoker access to VLN® products while providing a stronger foundation for long-term revenue growth. Continued commercial discussions regarding the supply of VLN® tobacco, manufacturing capabilities, partner-brand opportunities and, where applicable, future licensing arrangements. Ended the quarter with $6.1 million in cash and cash equivalents and no outstanding debt, providing financial flexibility to support commercialization initiatives and strategic growth objectives. Second Quarter 2026 Product Line Net Revenues Conference Call 22nd Century will host a live webcast today at 8:00 a.m. E.T. to discuss its second quarter 2026 financial results and business highlights. The live and archived webcast will be accessible in the Events section on 22nd Century’s Investor Relations website at https://ir.xxiicentury.com/events. Summary Financial Results(dollars in thousands, except per share data) (a) Adjusted EBITDA is a non-GAAP financial measure. Please see “Notes Regarding Non-GAAP Financial Information” for additional information regarding our use of non-GAAP financial measures. Refer to Tables A at the end of this release for reconciliations of adjusted amounts to the closest corresponding GAAP financial measures. Summary Product Line Results (in thousands) About 22nd Century Group, Inc. 22nd Century Group is pioneering the tobacco harm reduction movement by enabling smokers to take control of their nicotine consumption. Our Technology is Tobacco Our proprietary non-GMO reduced nicotine tobacco plants were developed using our patented technologies that regulate alkaloid biosynthesis activities resulting in a tobacco plant that contains 95% less nicotine than traditional tobacco plants. Our extensive patent portfolio has been developed to ensure that our high-quality tobacco can be grown commercially at scale. We continue to develop our intellectual property to ensure our ongoing leadership in the tobacco harm reduction movement. Our Products We created our flagship product, the VLN® cigarette using our low nicotine tobacco, to give traditional cigarette smokers an authentic and familiar alternative in the form of a combustible cigarette that helps them take control of their nicotine consumption. VLN® cigarettes have 95% less nicotine compared to traditional cigarettes and have been proven to allow consumers to greatly reduce their nicotine consumption. FDA Authorization and Scientific Foundation VLN® low nicotine combustible cigarettes were authorized in December 2021, making them the first and still the only combustible cigarettes authorized by the U.S. Food and Drug Administration specifically to help reduce nicotine consumption. Decades of independent clinical research and peer-reviewed studies—evaluated as part of the FDA’s Modified Risk Tobacco Product (MRTP) authorization process—demonstrated that reducing nicotine content can decrease nicotine intake, increase quit attempts, and reduce overall exposure to nicotine. FDA-authorized VLN® claims include: VLN® and Helps You Smoke Less® are registered trademarks of 22nd Century Limited LLC. Learn more at xxiicentury.com, on X (formerly Twitter), on LinkedIn, and on YouTube. Learn more about VLN® at tryvln.com. Cautionary Note Regarding Forward-Looking Statements Except for historical information, all of the statements, expectations, and assumptions contained in this press release are forward-looking statements, including but not limited to our full year business outlook. Forward-looking statements typically contain terms such as “anticipate,” “believe,” “consider,” “continue,” “could,” “estimate,” “expect,” “explore,” “foresee,” “goal,” “guidance,” “intend,” “likely,” “may,” “plan,” “potential,” “predict,” “preliminary,” “probable,” “project,” “promising,” “seek,” “should,” “will,” “would,” and similar expressions. Forward-looking statements include, but are not limited to, statements regarding (i) our cost reduction initiatives, (ii) our expectations regarding regulatory enforcement, including our ability to receive an exemption from new regulations, and (iii) our financial and operating performance. Actual results might differ materially from those explicit or implicit in forward-looking statements. Important factors that could cause actual results to differ materially are set forth in “Risk Factors” in the Company’s Annual Report on Form 10-K filed on March 26, 2026. All information provided in this release is as of the date hereof, and the Company assumes no obligation to and does not intend to update these forward-looking statements, except as required by law. Notes regarding Non-GAAP Financial Information In addition to the Company’s reported results in accordance with generally accepted accounting principles in the United States of America (“GAAP”), the Company provides EBITDA and Adjusted EBITDA. In order to calculate EBITDA, the Company adjusts net (loss) income by adding back interest expense (income), provision (benefit) for income taxes, and depreciation and amortization expense. Adjusted EBITDA consists of EBITDA adjusted by the Company for certain non-cash and/or non-operating expenses, including adding back equity-based employee compensation expense, restructuring and restructuring-related charges such as impairment, acquisition and transaction costs, and other unusual or infrequently occurring items, if applicable, such as inventory reserves and adjustments, master settlement agreement non-participating manufacturer settlement credits, gains or losses on disposal of property, plant and equipment, and gains or losses on investments. The Company believes that the presentation of EBITDA and Adjusted EBITDA are important financial measures that supplement discussion and analysis of its financial condition and results of operations and enhances an understanding of its operating performance. While management considers EBITDA and Adjusted EBITDA to be important, these financial performance measures should be considered in addition to, but not as a substitute for or superior to, other measures of financial performance prepared in accordance with GAAP, such as operating (loss) income, net (loss) income and cash flows from operations. Adjusted EBITDA is susceptible to varying calculations and the Company’s measurement of Adjusted EBITDA may not be comparable to those of other companies. Investor Relations & Media Contact Daniel OttoChief Financial Officer & Investor Relations22nd Century [email protected] 22nd CENTURY GROUP, INC.CONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited)(amounts in thousands, except share and per-share data) 22nd CENTURY GROUP, INC.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS(Unaudited)(amounts in thousands, except share and per-share data) Table A – Reconciliations of Non-GAAP Measures(dollars in thousands, except share and per-share data) Below is a table containing information relating to the Company’s Net loss, EBITDA and Adjusted EBITDA for the three and six months ended June 30, 2026 and 2025, including a reconciliation of these Non-GAAP measures for such periods. 1Fav = Favorable variance, which increases EBITDA and Adjusted EBITDA; Unfav = unfavorable variance, which reduces EBITDA and Adjusted EBITDA

MOCKSVILLE, N.C., Aug. 04, 2026 (GLOBE NEWSWIRE) -- 22nd Century Group, Inc. (Nasdaq: XXII), the only tobacco products company that has for 28 years led and continues to lead the fight against the harms of smoking driven by nicotine addiction, will host a webcast on Thursday, August 13, 2026, at 8:00 AM ET to discuss its 2026 second quarter results, which are to be reported in a press release at approximately 6:00 AM ET the same day. During the webcast, Larry Firestone, chairman and chief executive officer, and Dan Otto, chief financial officer, will review financial results, discuss progress made in the second quarter and update plans for the 2026 year. The live and archived webcast will be accessible on the Events web page in the Company's Investor Relations section of the website, at https://ir.xxiicentury.com/events. Please access the website at least 10 minutes prior to the start of the webcast to register and, if necessary, download and install any required software. About 22nd Century Group, Inc. 22nd Century Group is pioneering the tobacco harm reduction movement by enabling smokers to take control of their nicotine consumption. Our Technology is Tobacco Our proprietary non-GMO reduced nicotine tobacco plants were developed using our patented technologies that regulate alkaloid biosynthesis activities resulting in a tobacco plant that contains 95% less nicotine than traditional tobacco plants. Our extensive patent portfolio has been developed to ensure that our high-quality tobacco can be grown commercially at scale. We continue to develop our intellectual property to ensure our ongoing leadership in the tobacco harm reduction movement. Our Products We created our flagship low nicotine cigarette products , the VLN® cigarette and Pinnacle VLN® cigarette using our low nicotine tobacco, to give traditional cigarette smokers an authentic and familiar alternative in the form of a combustible cigarette that helps them take control of their nicotine consumption. Our VLN® cigarettes are the lowest nicotine cigarettes in America™ and have 95% less nicotine compared to traditional cigarettes and have been proven to allow consumers to greatly reduce their nicotine consumption. FDA Authorized Our VLN® cigarettes are the only low nicotine combustible cigarette authorized by the FDA in the United States. VLN® is a registered trademark of 22nd Century Limited LLC. Learn more about 22nd Century at xxiicentury.com, on X (formerly Twitter), on LinkedIn, and on YouTube. Learn more about VLN® cigarettes at tryvln.com. Cautionary Note Regarding Forward-Looking Statements Except for historical information, all of the statements, expectations, and assumptions contained in this press release are forward-looking statements, including but not limited to our full year business outlook. Forward-looking statements typically contain terms such as “anticipate,” “believe,” “consider,” “continue,” “could,” “estimate,” “expect,” “explore,” “foresee,” “goal,” “guidance,” “intend,” “likely,” “may,” “plan,” “potential,” “predict,” “preliminary,” “probable,” “project,” “promising,” “seek,” “should,” “will,” “would,” and similar expressions. Forward-looking statements include, but are not limited to, statements regarding (i) our cost reduction initiatives, (ii) our expectations regarding regulatory enforcement, including our ability to receive an exemption from new regulations, and (iii) our financial and operating performance. Actual results might differ materially from those explicit or implicit in forward-looking statements. Important factors that could cause actual results to differ materially are set forth in “Risk Factors” in the Company’s Annual Report on Form 10-K filed on March 26, 2026 and Quarterly Report on Form 10-Q filed on May 7, 2026. All information provided in this release is as of the date hereof, and the Company assumes no obligation to and does not intend to update these forward-looking statements, except as required by law. Investor Relations & Media Contact Daniel OttoChief Financial Officer & Investor Relations 22nd Century Group [email protected]

Philip Morris just posted a stellar quarter, but instead of raising its forecast, it’s plowing the cash into its U.S. business, and the reason why dominated the call. Philip Morris International (PM) stock is trading near its 52-week high, rewarding investors with strong returns. So when the company reported a blowout second quarter, with organic revenue up 8% and operating income up 11%, the natural expectation was a guidance raise. Instead, management held its full-year forecast steady, and the entire earnings call Q&A pivoted to one central question: is the company’s plan to plow that outperformance into its U.S. ZYN business an offensive move from a position of strength, or a costly defensive scramble? A Beat-and-Hold Is The New Beat-and-Raise The most pointed challenge from analysts centered on that decision to maintain guidance. A strong first half that doesn’t lift the full-year outlook implies a weaker second half, a new cost, or both. It’s the kind of math that makes shareholders nervous, and it was the first issue raised. Management’s answer was direct: this is a strategic choice. The outperformance from the international and combustible businesses created the “additional capacity to invest.” After what the company called “several quarters of frustration” in the U.S., it sees a perfect window to act. With a pipeline of new ZYN products, a major new marketing campaign, and recent favorable regulatory news, management believes it is the “right moment to accelerate U.S. investment.” The response framed the spending not as a problem to be fixed, but as an opportunity to be seized. The Price Answer Was More Strategy Than Number The follow-up concern was what “investment” really means for ZYN. The word can be a corporate euphemism for profit-crushing price cuts to regain market share. Analysts pressed on how the company plans to optimize ZYN’s premium positioning in a competitive market. The answer was more confident than specific on the numbers, but clear on the strategy. Management repeatedly stated that ZYN “is and will remain the premium leader of the market.” The mechanism for competing on price appears to be through new products, not by discounting the flagship brand. The company is launching its ZYN Ultra line at a “lower per-pouch price,” allowing it to fight for value-conscious consumers without devaluing its core offering. It’s a plan to segment the market rather than surrender its high-end pricing. What To Watch: U.S. Share Or U.S. Margin? In the end, management made a convincing case for why it’s spending more in the U.S. The international business is a powerful engine, and reinvesting its excess profits into the biggest growth market makes strategic sense. The company is funding this push from strength, not weakness. What remains an open question is how efficiently that capital will be spent. The bull case now rests on execution. The one thing to watch next quarter is the U.S. segment's numbers. A simple uptick in ZYN’s market share won’t be enough to settle the debate. The real proof will be whether that share gain comes with stable or expanding gross margins. That would confirm the new spending is creating profitable growth, not just buying market share at any cost. One step out from the single name: a consumer staples ETF like XLP spreads these company-specific questions across the whole consumer staples group, so no one answer can sink you. It is still a concentrated bet on that one theme, though, which is exactly the gap the portfolio below closes. Where One Stock's Open Questions Fit A Bigger Plan Every stock carries unresolved questions like these, and no earnings call settles all of them. Owning a sector fund spreads that risk across more names, but it is still one bet on one theme: when the theme wobbles, the whole basket wobbles with it. The Trefis High Quality (HQ) Portfolio takes the next step out. It holds about 30 businesses diversified across sectors, selected not on a theme but on quality itself: consistent cash generation, strong margins, and resilient balance sheets. No single unresolved debate, and no single industry, carries your result. It has a track record of outpacing a benchmark that combines the three major indices - the S&P 500, S&P Mid-cap, and Russell 2000. Track the debates on names you like, on top of a core built on quality rather than any one story.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management characterizes the company as a 'contrarian' in the tobacco industry, focusing on nicotine reduction in combustible cigarettes rather than transitioning users to alternative nicotine delivery systems like pouches or vapes. Performance in Q1 2026 was driven by sequential top-line growth of approximately 16.1%, though management noted that initial stocking orders for VLN products were minimal as retailers focused on in-store setup and education. The company is shifting its strategic focus entirely toward execution and growth, moving away from the relaunch phase to prioritize retail outlet penetration and consumer adoption. Management attributes the value proposition of VLN to both health-conscious lifestyle changes and economic relief for smokers, noting that premium brand users spend nearly $5,000 annually due to 'price gouging' by major tobacco firms. Operational improvements are being targeted through the elimination of low or no-margin products and the exit of remaining unprofitable contracts to improve gross profit as the year progresses. The company secured a key distribution milestone with the #3 tobacco purveyor in the U.S., which currently ranks as their top-performing retailer on a sales-per-outlet basis. Management targets reaching approximately 5,000 retail outlets by the end of 2026, supported by upcoming distribution expansions in New York, New Jersey, Southern California, and the Southeast. The company plans to hire a new Vice President of Marketing to build out consumer marketing capabilities, identifying consumer adoption as the primary 'unlock' for future growth. Financial guidance suggests that while profitability metrics remain under pressure, the second half of 2026 is expected to show significantly stronger commercial momentum than the first half. Future marketing efforts will shift from limited baseline establishing to active promotion, including cross-promotions and digital fuel rewards programs to drive a 'meaningful lift' in sales. The company intends to continue developing new strains of non-GMO, low-nicotine tobacco to support both internal brands and potential international partnership opportunities. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Operating expenses are expected to increase as the company adds headcount specifically in marketing and sales to support the retail rollout. Management acknowledged that the timing of gross margin and revenue improvements may not be linear quarter-to-quarter due to the phased nature of the product rollout. The company maintains a cash position of $9.5 million, with a stated focus on disciplined capital allocation toward commercial and regulatory initiatives over legacy operations.

Continues VLN® Commercial Expansion with New Stores Selling Proprietary Branded VLN® Products Expanded PMTA Portfolio and Licensing Strategy Designed to Unlock Further Retail Penetration Opportunities MOCKSVILLE, N.C., May 07, 2026 (GLOBE NEWSWIRE) -- 22nd Century Group, Inc. (Nasdaq: XXII), the only tobacco products company focused on reducing the harms of smoking through nicotine reduction, today announced results for the first quarter ended March 31, 2026, and provided an update on recent business highlights. The Company’s proprietary reduced nicotine technology is designed to serve adult smokers who want to change their smoking habits by significantly reducing nicotine consumption. 22nd Century is focusing on smoker health and wellness by giving smokers an opportunity to control their tobacco consumption, rather than switching them to another highly addictive product like a vape or nicotine pouch. “Following the initial Pinnacle VLN® distribution in the fourth quarter 2025, smokers began to gravitate to and are purchasing VLN® cigarettes in a growing number of geographies and stores,” said Larry Firestone, Chief Executive Officer of 22nd Century Group. “Having accumulated a base of state authorizations across our portfolio of brands, we continue to focus on expanding our distribution and introducing smoking consumers to our VLN® products. “As we capture sustained adult smoker adoption of VLN® products, we expect to expand both our retail and category footprint. We are targeting to grow to more than 5,000 retail outlets by the end of 2026 by adding new retail partners across all classes of trade. Supporting this effort, we have significantly advanced further sales efforts with additional retail partners seeking to add VLN® branded products to their line-ups. “We believe we are the single commercial tobacco Company that is an ally of the FDA in their efforts to formally establish a low nicotine standard. Our technology and product roadmap is set to build out a robust portfolio of new tobacco products. These products will span multiple categories, creating a flexible and scalable platform that can accommodate evolving market preferences and continue to drive the low nicotine initiative in the regulatory environment. Our business model is set so that all current and any newly authorized combustible tobacco products in this expanded portfolio once authorized will be available for licensing, providing other tobacco companies with compliant, ready-to-market product pathways. This further reinforces 22nd Century’s position as the leader in regulatory-driven innovation within the combustible tobacco segment. This includes the development of our 100mm form factor product and the application of our proprietary low nicotine tobacco to categories such as filtered cigars, pouches and moist snuff.” “By combining our proprietary plant biotechnology, FDA-authorized claims, expanded retail distribution, broader product categories and readily available licensing, 22nd Century intends to lead the transition away from highly addictive tobacco products and support adult smokers and tobacco users seeking meaningful change,” concluded Firestone. First Quarter 2026 Financial Results (compared to Fourth Quarter 2025, except as noted) All figures reported below reflect continuing operations, excluding discontinued operations related to the sale and exit of the Company’s hemp/cannabis business in late 2023, except as noted. Net revenues increased slightly to $4.1 million from $3.5 million. Gross profit (loss) improved to $(0.6) million, compared to $(0.8) million. Operating expenses were $2.4 million, increased from $2.0 million. Operating loss increased to $3.0 million, compared to $2.8 million. Net loss was $3.3 million, compared to net loss of $2.8 million. Adjusted EBITDA loss was $2.6 million, compared to a loss of $2.4 million. Ended the quarter with cash and cash equivalents of $9.5 million. 2026 Corporate Priorities 22nd Century has identified the below priorities for its business activities in 2026: Expanding VLN® product distribution and consumer awareness. Continuing disciplined cost management and capital allocation. Advancing toward EBITDA breakeven as higher-margin revenues scale. Remaining actively engaged with FDA regulators and public-health stakeholders. The Company believes the convergence of regulatory momentum, consumer awareness, and its differentiated product portfolio creates a compelling opportunity for long-term value creation. Recent Business Highlights Continued to generate new retail store locations to expand market access to both VLN® and Partner VLN® products, as well as new natural style cigarette products. Achieved near national level state authorizations to support expanded access to the Company’s branded products. Continued to support Pinnacle® VLN® availability in now over 2,000 stores across 20 states, including in-store marketing materials and digital promotion programs to drive smoker awareness of Pinnacle® VLN® as an alternative to conventional nicotine cigarette products. Leveraged the Company’s ability to supply VLN® tobacco and manufacturing under license in discussions to expand VLN® distribution and launch additional VLN® partner brands, further diversifying the reduced nicotine content product category. Continued initiatives aimed at margin expansion through mix improvement while maintaining an efficient operating cost and capital allocation profile. Completed product prototyping and evaluations ahead of a planned PMTA authorization to introduce 100mm format VLN® cigarettes tailored to consumer preferences in those markets. Advanced long-term strategic initiatives to grow its unique product portfolio through the submission of multiple PMTAs across a broad range of combustible products, supporting diverse tobacco blends and components, a variety of product sizes, and multiple product formats, including filtered cigars. First Quarter 2026 Product Line Net Revenues Cigarette net revenues were $2.8 million, increased from $2.6 million in the fourth quarter of 2025, reflecting a strategic shift away from high volume and low priced CMO export customers and toward higher margin VLN® products. Continued expansion of new natural style cigarette products launched in 2025 is expected to accelerate revenue and margin growth in this category. Filtered cigar net revenues were $0.9 million compared to $0.4 million, reflecting the benefit of Company implemented repricing of customer contracts. Distribution net revenues from other tobacco products, consisting of Pinnacle branded moist snuff and cigarillos were $0.4 million, comparable to the fourth quarter 2025. VLN® cigarette net revenues were $0.0 million, following large initial stocking orders in the fourth quarter of 2025, offset by customer returns and product exchanges to the new VLN® branding. Total new branded VLN® and partner VLN® products shipped in the fourth quarter were approximately 8,800 cartons. Balance Sheet The Company reported zero long-term debt, having extinguished its remaining senior secured debt in full during 2025. Cash and equivalents were $9.5 million at quarter end. Inventories were $4.3 million, including reduced nicotine content tobacco leaf. Conference Call 22nd Century will host a live webcast today at 8:00 a.m. E.T. to discuss its first quarter 2026 financial results and business highlights. The live and archived webcast will be accessible in the Events section on 22nd Century’s Investor Relations website at https://ir.xxiicentury.com/events. Summary Financial Results (dollars in thousands, except per share data) Summary Product Line Results (in thousands) About 22nd Century Group, Inc. 22nd Century Group is pioneering the tobacco harm reduction movement by enabling smokers to take control of their nicotine consumption. Our Technology is Tobacco Our proprietary non-GMO reduced nicotine tobacco plants were developed using our patented technologies that regulate alkaloid biosynthesis activities resulting in a tobacco plant that contains 95% less nicotine than traditional tobacco plants. Our extensive patent portfolio has been developed to ensure that our high-quality tobacco can be grown commercially at scale. We continue to develop our intellectual property to ensure our ongoing leadership in the tobacco harm reduction movement. Our Products We created our flagship product, the VLN® cigarette using our low nicotine tobacco, to give traditional cigarette smokers an authentic and familiar alternative in the form of a combustible cigarette that helps them take control of their nicotine consumption. VLN® cigarettes have 95% less nicotine compared to traditional cigarettes and have been proven to allow consumers to greatly reduce their nicotine consumption. FDA Authorization and Scientific Foundation VLN® low nicotine combustible cigarettes were authorized in December 2021, making them the first and still the only combustible cigarettes authorized by the U.S. Food and Drug Administration specifically to help reduce nicotine consumption. Decades of independent clinical research and peer-reviewed studies—evaluated as part of the FDA’s Modified Risk Tobacco Product (MRTP) authorization process—demonstrated that reducing nicotine content can decrease nicotine intake, increase quit attempts, and reduce overall exposure to nicotine. FDA-authorized VLN® claims include: “95% less nicotine” “Helps reduce your nicotine consumption” “Greatly reduces your nicotine consumption” “Helps you smoke less” VLN® and Helps You Smoke Less® are registered trademarks of 22nd Century Limited LLC. Learn more at xxiicentury.com, on X (formerly Twitter), on LinkedIn, and on YouTube. Learn more about VLN® at tryvln.com. Cautionary Note Regarding Forward-Looking Statements Except for historical information, all of the statements, expectations, and assumptions contained in this press release are forward-looking statements, including but not limited to our full year business outlook. Forward-looking statements typically contain terms such as “anticipate,” “believe,” “consider,” “continue,” “could,” “estimate,” “expect,” “explore,” “foresee,” “goal,” “guidance,” “intend,” “likely,” “may,” “plan,” “potential,” “predict,” “preliminary,” “probable,” “project,” “promising,” “seek,” “should,” “will,” “would,” and similar expressions. Forward-looking statements include, but are not limited to, statements regarding (i) our cost reduction initiatives, (ii) our expectations regarding regulatory enforcement, including our ability to receive an exemption from new regulations, and (iii) our financial and operating performance. Actual results might differ materially from those explicit or implicit in forward-looking statements. Important factors that could cause actual results to differ materially are set forth in “Risk Factors” in the Company’s Annual Report on Form 10-K filed on March 26, 2026. All information provided in this release is as of the date hereof, and the Company assumes no obligation to and does not intend to update these forward-looking statements, except as required by law. Notes regarding Non-GAAP Financial Information In addition to the Company’s reported results in accordance with generally accepted accounting principles in the United States of America (“GAAP”), the Company provides EBITDA and Adjusted EBITDA. In order to calculate EBITDA, the Company adjusts net (loss) income by adding back interest expense (income), provision (benefit) for income taxes, and depreciation and amortization expense. Adjusted EBITDA consists of EBITDA adjusted by the Company for certain non-cash and/or non-operating expenses, including adding back equity-based employee compensation expense, restructuring and restructuring-related charges such as impairment, acquisition and transaction costs, and other unusual or infrequently occurring items, if applicable, such as inventory reserves and adjustments, gains or losses on disposal of property, plant and equipment, and gains or losses on investments. The Company believes that the presentation of EBITDA and Adjusted EBITDA are important financial measures that supplement discussion and analysis of its financial condition and results of operations and enhances an understanding of its operating performance. While management considers EBITDA and Adjusted EBITDA to be important, these financial performance measures should be considered in addition to, but not as a substitute for or superior to, other measures of financial performance prepared in accordance with GAAP, such as operating (loss) income, net (loss) income and cash flows from operations. Adjusted EBITDA is susceptible to varying calculations and the Company’s measurement of Adjusted EBITDA may not be comparable to those of other companies. Investor Relations & Media Contact Matt Kreps Investor Relations 22nd Century Group [email protected] 214-597-8200 22nd CENTURY GROUP, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (amounts in thousands, except share and per-share data) 22nd CENTURY GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) (amounts in thousands, except share and per-share data) Table A – Reconciliations of Non-GAAP Measures (dollars in thousands, except share and per-share data) Below is a table containing information relating to the Company’s Net loss, EBITDA and Adjusted EBITDA for the three months ended March 31, 2026 and 2025, including a reconciliation of these Non-GAAP measures for such periods. 1Fav = Favorable variance, which increases EBITDA and Adjusted EBITDA; Unfav = unfavorable variance, which reduces EBITDA and Adjusted EBITDA

MOCKSVILLE, N.C., May 04, 2026 (GLOBE NEWSWIRE) -- 22nd Century Group, Inc. (Nasdaq: XXII), the only tobacco products company that has for 28 years led and continues to lead the fight against the harms of smoking driven by nicotine addiction,, will host a webcast on Thursday, May 7, 2026, at 8:00 AM ET to discuss its 2026 first quarter results, which are to be reported in a press release at 6:00 AM ET the same day. During the webcast, Larry Firestone, chairman and chief executive officer, and Dan Otto, chief financial officer, will review financial results, discuss progress made in the first quarter and update plans for the 2026 year. The live and archived webcast will be accessible on the Events web page in the Company's Investor Relations section of the website, at https://ir.xxiicentury.com/events. Please access the website at least 10 minutes prior to the start of the webcast to register and, if necessary, download and install any required software. About 22nd Century Group, Inc. 22nd Century Group is pioneering the tobacco harm reduction movement by enabling smokers to take control of their nicotine consumption. Our Technology is Tobacco Our proprietary non-GMO reduced nicotine tobacco plants were developed using our patented technologies that regulate alkaloid biosynthesis activities resulting in a tobacco plant that contains 95% less nicotine than traditional tobacco plants. Our extensive patent portfolio has been developed to ensure that our high-quality tobacco can be grown commercially at scale. We continue to develop our intellectual property to ensure our ongoing leadership in the tobacco harm reduction movement. Our Products We created our flagship product, the VLN® cigarette using our low nicotine tobacco, to give traditional cigarette smokers an authentic and familiar alternative in the form of a combustible cigarette that helps them take control of their nicotine consumption. VLN® cigarettes have 95% less nicotine compared to traditional cigarettes and have been proven to allow consumers to greatly reduce their nicotine consumption. FDA Authorized Our VLN® cigarette is the only low nicotine combustible cigarette authorized by the FDA in the United States. VLN® is a registered trademark of 22nd Century Limited LLC. Learn more at xxiicentury.com, on X (formerly Twitter), on LinkedIn, and on YouTube. Learn more about VLN® at tryvln.com. Cautionary Note Regarding Forward-Looking Statements Except for historical information, all of the statements, expectations, and assumptions contained in this press release are forward-looking statements, including but not limited to our full year business outlook. Forward-looking statements typically contain terms such as “anticipate,” “believe,” “consider,” “continue,” “could,” “estimate,” “expect,” “explore,” “foresee,” “goal,” “guidance,” “intend,” “likely,” “may,” “plan,” “potential,” “predict,” “preliminary,” “probable,” “project,” “promising,” “seek,” “should,” “will,” “would,” and similar expressions. Forward-looking statements include, but are not limited to, statements regarding (i) our cost reduction initiatives, (ii) our expectations regarding regulatory enforcement, including our ability to receive an exemption from new regulations, and (iii) our financial and operating performance. Actual results might differ materially from those explicit or implicit in forward-looking statements. Important factors that could cause actual results to differ materially are set forth in “Risk Factors” in the Company’s Annual Report on Form 10-K filed on March 26, 2026. All information provided in this release is as of the date hereof, and the Company assumes no obligation to and does not intend to update these forward-looking statements, except as required by law. Investor Relations & Media Contact Matt Kreps Investor Relations 22nd Century Group [email protected] 214-597-8200

This article first appeared on GuruFocus. Release Date: March 26, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. 22nd Century Group Inc (NASDAQ:XXII) successfully transitioned from restructuring to a growth-focused strategy in 2025, closing unprofitable contracts and reducing manufacturing overhead. The company launched new brands and products, securing a substantial base of retail outlets with VLN products now available in 1,636 retail outlets across 23 states. 22nd Century Group Inc (NASDAQ:XXII) is the only tobacco company focusing on reducing smoking harms through nicotine reduction, offering smokers a chance to control their tobacco consumption. The company has filed an MRTP renewal application with the FDA and plans to expand its PMTA and MRTP filings for other products, indicating regulatory progress. The company ended 2025 with a strengthened balance sheet, zero long-term debt, and increased inventory, positioning it well for growth in 2026. Net revenue for the fourth quarter of 2025 was $3.6 million, a decrease from $4 million in the third quarter, reflecting the strategic shift away from lower margin activities. The total cartons shipped during the fourth quarter were 248,000, down from 517,000 in the third quarter, indicating a reduction in volume. The company reported a gross loss of $0.8 million for the fourth quarter, although this was an improvement from the previous quarter. Operating loss for the fourth quarter was $2.8 million, showing ongoing financial challenges despite improvements. The company faces significant competition from larger tobacco companies aggressively pushing alternative nicotine products, posing a challenge to market penetration. Warning! GuruFocus has detected 5 Warning Signs with XXII. Is XXII fairly valued? Test your thesis with our free DCF calculator. Q: Can you elaborate on the strategic shift in 2025 and its impact on your financials? A: Lawrence Firestone, CEO: In 2025, we transitioned from restructuring to focusing on growth by closing unprofitable contracts and reducing overhead. This allowed us to launch new products and secure retail outlets. Our strategic shift led to a focus on higher-margin branded products, which is reflected in our financials with improved gross margins and reduced operating losses. Q: What are the key growth strategies for 2026? A: Lawrence Firestone, CEO: For 2026, we aim to expand distribution, increase product adoption, and leverage our improved operating model. We plan to double our store count, launch new products, and enhance marketing efforts to drive sales. Our focus is on building a low nicotine ecosystem and gaining market share. Q: How is 22nd Century Group positioned in the regulatory landscape? A: Lawrence Firestone, CEO: We filed our MRTP renewal application with the FDA and plan to expand our PMTA and MRTP filings. Our VLN products are central to the FDA's low nicotine proposed rule. Internationally, we are engaging with governments and commercial entities to promote our low nicotine products. Q: What financial improvements were made in 2025? A: Daniel Otto, CFO: We strengthened our balance sheet by exiting unprofitable revenue streams and restructuring operations. We ended 2025 with $7.1 million in cash and no long-term debt. Our gross profit improved, and we anticipate further margin improvements as we scale our high-margin branded products. Q: Can you discuss the market potential for VLN products? A: Lawrence Firestone, CEO: The US market has 28.8 million smokers, with 70% expressing a desire to change their habits. Our serviceable addressable market is 20.2 million smokers, representing a $58 billion market. We aim to capture a meaningful share by offering a low nicotine alternative to traditional cigarettes. For the complete transcript of the earnings call, please refer to the full earnings call transcript.