Constellation Brands beats Q3 earnings estimates as Modelo, Corona drive resilient beer demand 

USA – Constellation Brands has reported third-quarter sales and profit that exceeded Wall Street expectations, supported by steady demand for its key beer brands, including Modelo Especial and Corona, despite ongoing pressure in the US alcohol market. 

For the quarter ended November 30, the company posted net sales of US$2.22bn, representing a 10% year-on-year decline.  

Analysts had expected a steeper fall of 12.4% to US$2.16bn, according to data compiled by LSEG. Adjusted profit came in at US$3.06 per share, beating market estimates of US$2.63 per share. 

The company has benefited from improving demand across several of its beer brands, including Pacifico, Victoria, Corona Sunbrew and Corona Familiar. Constellation Brands said performance was supported by more competitive pricing and sharper marketing, allowing it to defy a challenging backdrop for alcoholic beverages in the US. 

Beer net sales declined 1% during the quarter, primarily due to a 2.2% drop in shipment volumes. However, this marked an improvement from the 7% volume decline recorded in the previous three-month period.  

The company said its beer business continued to gain dollar and volume share in tracked channels and expanded distribution points. 

Alcohol consumption in the US has faced headwinds as Hispanic consumers reduced spending amid President Donald Trump’s immigration crackdown. In addition, economic uncertainty and stretched household budgets weighed on demand for higher-priced wine and spirits.  

The company also flagged cost pressures from US trade policy, noting that Trump’s decision to double tariffs on aluminium imports to 50% from 25% affected spirits producers, as 41% of Constellation’s Mexican beer packaging relies on aluminium. 

Net sales in the Wine and Spirits business fell 51% during the quarter. The decline was driven by a 70.6% drop in shipment volumes, reflecting the impact of the SVEDKA divestiture, the 2025 wine divestitures, strategic pricing actions on selected brands and changes in distributor contractual obligations. 

Commenting on the results, Bill Newlands, president and chief executive officer, said: “The operating environment during the quarter remained unchallenged, which was in line with our expectations and relatively consistent with the prior quarter.”

“Our beer business delivered dollar and volume share gains in tracked channels and gained incremental distribution points, while our wine and spirits business continued to outperform the US wine industry.” 

Following the earnings release, Constellation Brands forecast full-year earnings per share of between US$9.72 and US$10.02, compared with its previous guidance of US$9.86 to US$10.16.  

The company reaffirmed its expectation of an organic net sales decline of 4% to 6% for the year ending February 28. 

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