Canopy Growth shares surged nearly 12% Tuesday as the Canadian cannabis giant reported better than expected results in its latest quarter and delivered unexpected and upbeat guidance for investors.

Revenue jumped more than 23% over the same quarter last year to top C$152 million ($119.6 million USD) and the company reported its third straight quarter of shrinking losses. Perhaps even more importantly, Canopy also returned to issuing forward guidance to point toward projected adjusted profitability by the back half of the company’s next fiscal year, citing cost-saving measures instituted under CEO David Klein.

On Canopy’s earnings call, Klein also officially moved forward his timeline for when the company expects U.S. cannabis federal permissibility, saying the expectation is that reforms could be delivered by Congress in 2021. Klein had previously first revealed that updated guidance in a Yahoo Finance interview in January.

Pointing to a joint statement from Senate Majority Leader Chuck Schumer and others, Klein said he expects that Canopy could move beyond selling its CBD products in the U.S. this calendar year and begin selling products containing the psychoactive compound THC currently sold by licensed U.S. operators.

“The interesting point is that the forward guidance doesn’t include anything related to U.S. permissibility. That would be upside to our profit projections and our revenue growth projections,” Klein told Yahoo Finance in a Tuesday afternoon interview.

Nonetheless, Canopy revealed a hot start for products it can currently sell in the U.S., including its Martha Stewart-branded CBD products which launched last September. On the earnings call, Klein highlighted data that showed the brand was already outselling over 94% of all CBD brands in the U.S. in the four months since launch. Klein also told investors that the growth there coupled with medium-term catalysts on the cannabis beverage side provided a buffer to ensure confidence in projecting their new medium-term guidance to not only hit that adjusted profitability target, but also positive operating cash flow for its full fiscal year 2023.

In its new guidance, Canopy projected net revenue to achieve a compounded annual growth rate over its next two fiscal years of 40 to 50%. That guide was of particular importance, according to top analyst and Cowen Managing Director Vivien Azer, who had expected just half that heading into earnings.

“We find this growth to be particularly encouraging, as our pre-earnings published model only looked for a 22% CAGR over the same time horizon,” she wrote in a new note.

Cannabis reform hopes have sparked an incredible rally for cannabis stocks in 2021. The Canadian-focused Alternative Harvest ETF MJ has already doubled year-to-date while the U.S.-focused AdvisorShares Pure US Cannabis ETF has gained 40%. That rally began when it became clear Democrats won control in the Senate, giving them the go ahead for progressive reforms that could include changes to marijuana policy at a federal level. As of Tuesday’s close, Canopy Growth shares have surged nearly 90% since the beginning of the year.

Zack Guzman is an anchor for Yahoo Finance Live as well as a senior writer covering entrepreneurship, cannabis, startups, and breaking news at Yahoo Finance. Follow him on Twitter @zGuz.

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