Beverages firm Constellation Brands reported increases in sales and earnings per share last quarter, but issued weaker-than-expected guidance for the next fiscal year.
Its net sales increased by 1% to US$2.16 billion in the fourth quarter of its 2025 fiscal year, surpassing Zacks estimates of $2.13 billion. Its comparable diluted net earnings per share were $2.63, above estimates of $2.28.
“In a tough socioeconomic environment we are taking decisive actions designed to continue to support our industry-leading Beer Business, reset our cost base, and redefine our portfolio,” according to Constellation Brands. “In fiscal 2025, despite a softer consumer demand backdrop largely driven by what we believe to be non-structural socioeconomic factors, we continued to deliver Enterprise net sales growth, realised substantial comparable operating margin improvement, and achieved double-digit comparable EPS growth.”
“Looking ahead, while we expect these non-structural socioeconomic factors affecting consumer demand to gradually stabilise and subside, we remain focused on driving distribution gains, launching disciplined innovation, and deploying incremental marketing investments to support the growth of our Beer Business while continuing to deliver best-in-class operating margins.”
The company’s beer division posted stable net sales last quarter at US$1.7 billion, while its net sales across the 2025 fiscal year grew by 5% to reach $8.54 billion.
Over the fiscal year, sales for its Modelo Especial, Pacifico, and Modelo Chelada brands increased significantly, though demand fell in its final quarter.
Its wine and spirits division saw net sales rise by 5% to US$460 million, but reported a decline of 6% across the prior fiscal year.
Six of the company’s wine brands will be acquired by The Wine Group, including Cook’s and J. Rogét, with the transaction set to close after the next fiscal quarter. Constellation will refocus its wine portfolio on brands priced at or above US$15, the company said.
Constellation’s guidance for the next fiscal year includes comparable earnings per share of US$12.60-12.90, below estimates of $13.97. The company also revised its projected enterprise sales growth in fiscal years 2027 and 2028 to 2-4%, down from 6-8%.
The guidance reflects both its divestment from several wine brands and the anticipated impacts of the newly imposed United States and Canadian tariffs, Constellation said.
Constellation Brands’ (NYSE: STZ) share price closed at US$183.40, up from its previous close at $170.96, after the U.S. government announced changes to its tariff plans. Its share price then fell by 3.5% in extended trading. Constellation’s market capitalisation is $33.15 billion.
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