Total Cannabis Sales in Arizona Drop More Than 11% in 2024 Compared to Previous Year

Two years after Arizona retailers hit an all-time high in cannabis sales, the state is witnessing a clear decline in both recreational and medical marijuana revenue. In 2024, licensed cannabis operators in Arizona sold $1,257,437,802 worth of marijuana products—down 11.4% from the $1,419,696,375 recorded in 2023, according to an MJBizDaily analysis of Arizona Department of Revenue data.

Consecutive Decline Marks a Shift from Arizona’s Record-Breaking Cannabis Boom in 2022

This marks the second straight year of declining annual cannabis revenue in the state. Arizona dispensary operators reached their peak in 2022 with $1,428,257,533 in cannabis product sales, according to reporting by the Arizona Mirror. Since then, both segments of the market—medical and adult-use—have shown signs of contraction.

Medical Cannabis Market in Arizona Suffers Major Losses While Adult-Use Slips Modestly

The sharpest revenue drop occurred in medical marijuana (MMJ) sales, which fell by a staggering 31.8% year-over-year, totaling $243,866,819 in 2024. That’s a nearly 53% decline compared to MMJ sales in 2022, indicating a steep erosion of the medical consumer base.

In contrast, adult-use cannabis sales remained relatively stable, slipping 4.5% year-over-year to $1,013,570,983, softening the overall revenue hit.

Arizona’s Market Trends Reflect National Pattern of MMJ Decline After Adult-Use Legalization

Arizona’s sales trajectory mirrors a broader national trend observed in states that have legalized recreational marijuana. According to a February special report from the Marijuana Policy Project, MMJ patient counts tend to drop by about one-third on average following the launch of adult-use markets. This shift significantly impacts how businesses approach marketing, product development, customer retention, and revenue projections.

Medical Cannabis Sales Also Weigh Down Cannabis Revenue in Illinois

Arizona is not alone. In Illinois, early 2025 figures show a similar slump in medical cannabis revenue. From December 2024 through February 2025, Illinois cannabis retailers recorded $488.7 million in total sales—down from $501.7 million during the same period the year before. The decrease is also attributed to falling MMJ sales, despite the state reaching record highs just months earlier.

Cannabis Operators Must Adapt to Post-Medical Market Realities

As the cannabis industry continues to evolve, operators in Arizona and across the U.S. face critical decisions. With recreational sales becoming dominant, companies may need to adjust their product mix, pricing models, and target demographics to remain competitive. The decline in MMJ markets could also spur consolidation, innovation, or renewed efforts to differentiate medical-grade products from recreational offerings.

Want insights like this delivered regularly?

Subscribe to the Cannabis Risk Manager for data driven forecasts, regulatory analysis, and cannabis industry trends you can trust.