Is Tilray's Brewdog Bet Already Backfiring? Collapsing UK Sales Suggest Yes.

Tilray is attempting to expand its business well beyond marijuana, aiming to transform into a brand manager.

Tilray may have its work cut out for it if Brewdog's recent performance is any indication.

Tilray (NASDAQ: TLRY) started its life in the marijuana sector. A few years ago, marijuana was a hot investment theme, and the stock soared on lofty investor expectations for the increasingly legal drug. Realty didn't match expectations, however, and marijuana stocks like Tilray have tanked (it is down more than 95% from its all-time highs).

The company has shifted gears. The recent move to buy Brewdog is an example of the direction change, but it doesn't look like a great decision right now. Here's what you need to know.

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Tilray isn't exiting the marijuana space ; it is expanding into other areas, most notably craft brewing. The goal is to shift from being a pot stock to being a brand manager, describing itself as "a global lifestyle and consumer packaged goods company." The packaged goods just happen to be marijuana, CBD, and alcohol.

So the decision to buy Brewdog, a well-known craft brewer, makes logical sense. And the price was fairly modest, with the U.K. side of the business costing around $44 million. The company didn't announce a cost for the U.S. side, but it is unlikely that Tilray, which is itself a fairly small company, paid a huge sum.

That said, Brewdog's U.K. business hasn't been doing very well. Since Brewdog started the sales process, its own sales have fallen 22.5% with volumes down nearly 22%, according to The Grocer. The declines have been accelerating, according to that industry watcher. That's bad news for Tilray and suggests that it stepped into a bit of a mess.