- Strong beer sales helped Constellation Brands beat profit and revenue forecasts, but demand for wine and spirits fell.
- Modelo Especial, which overtook Bud Light as the top beer no longer sold in the United States following the negative reaction to Bud Light' The partnership with Dylan Mulvaney saw sales increase by 9%.
- Wine and spirits sales have faced headwinds as consumers shift to more premium brands.
Constellation Brands (STZ) reported better-than-expected quarterly results and raised its forecasts as its beer business benefited from backlash from rival Anheuser-Busch Inbev (BUD) over its partnership with the company. transgender influencer Dylan Mulvaney. However, concerns about Constellation's other alcohol offerings sent shares lower.
The company reported a profit per share (EPS) of $3.70 for the second quarter of fiscal 2024, with revenue increasing 7% to $2.84 billion. Both were above expectations.
Sales of its beers jumped 12%, with shipments up 8.7%. Sales of Modelo Especial, which overtook Bud Light as the top-selling beer in the United States thanks to the Mulvaney partnership, increased 9%. Sales of Modelo Chelada brands increased by 42%.
Wine and spirits sales fell 14%, with the number of cases sold to retailers by a distributor down 7.8%. CEO Bill Newlands noted that the unit continues to face demand challenges, particularly among its mainstream products, as consumers choose to buy more premium brands.
The company strengthened its outlook of EPS for the year at $9.60 to $9.80, compared to $9.35 to $9.65 previously.
Constellation Brands shares have fell 3.2% on Thursday, but is up 6% year to date.
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