Constellation Brands withdraws FY2028 outlook as Q4 sales fall 11%
Constellation Brands pulls its FY2028 outlook as declining sales and macroeconomic uncertainty weigh on demand, despite continued momentum in its core beer business
USA – Constellation Brands has withdrawn its previously issued fiscal 2028 outlook, citing weaker demand and continued uncertainty in the macroeconomic environment, even as it reported fourth-quarter results that exceeded analyst expectations.
The maker of Modelo and Corona said it remains encouraged by momentum in its beer and wine and spirits businesses during the fourth quarter, but noted that broader economic conditions remain volatile.
“We expect the operating environment to remain dynamic given the evolving socioeconomic backdrop and limited near-term visibility,” the company said in a statement.
For the fiscal fourth quarter ended February 28, Constellation reported net sales of US$1.92 billion, down 11% from the previous year. The figure came in above analysts’ expectations of a 13% decline to US$1.88 billion, according to LSEG data.
The company posted earnings of US$1.90 per share, surpassing analysts’ estimates of US$1.71 per share, according to FactSet.
Constellation’s beer segment continued to demonstrate resilience, with sales rising 1% to US$1.73 billion. Shipments increased 1.1%, supported by favorable pricing, though partially offset by an unfavorable product mix.
The company said that lower prices and a sharper marketing strategy helped sustain demand for key brands such as Modelo Especial and Corona Sunbrew.
However, performance in the wine and spirits segment declined significantly. Sales in the division fell 58% to US$194.2 million, driven by a 72.9% drop in shipment volumes. The company attributed the decline to product divestitures, changes in distributor contractual obligations, and strategic pricing actions on select brands.
For the full fiscal year 2026, Constellation reported earnings of US$11.82 per share on net sales of US$9.14 billion, representing a 10% decline from the previous year. While earnings exceeded the company’s prior guidance range of US$11.30 to US$11.60 per share, they were below the US$13.78 recorded in fiscal 2025.
Bill Newlands, President and CEO, said the company maintained focus despite challenging conditions. “Despite the dynamic operating environment in fiscal 2026, we remained focused on the factors within our control and executed with discipline,” he said.
“That execution enabled our Beer Business to continue to be the #1 dollar share gainer across U.S. tracked channels, and our remaining portfolio in our Wine & Spirits Business to deliver depletion growth during the year,” Newlands added.
Looking ahead, Constellation expects continued uncertainty. “As we look ahead to fiscal 2027, we expect consumers will continue to navigate a shifting macroeconomic environment, but we remain encouraged by the momentum we saw in the fourth quarter,” Newlands said.
The company forecasts fiscal 2027 earnings in the range of US$11.20 to US$11.90 per share, below analyst estimates of US$12.36. It also expects organic net sales to range from a 1% decline to 1% growth.
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