Pernod Ricard sales fall 3.9% as U.S., China spirits markets remain challenging
Pernod Ricard expects subdued spirits demand in the U.S. and China while India delivers stronger growth and supports the group’s global performance.
FRANCE – Pernod Ricard has reported a sharp decline in sales across the United States and China, warning that recovery in the two spirits markets will remain challenging and limiting its sales growth expectations through 2029.
The wine and spirits group reported a 3.9% decline in organic sales, its third consecutive yearly contraction. Performance was also affected by disruption to tourism linked to the prolonged conflict in the Middle East.
For the current fiscal year, which began on July 1, Pernod Ricard expects organic net sales to be broadly stable, with demand in the U.S. and China remaining under pressure.
Chief Executive Officer Alexandre Ricard said Pernod does not expect the U.S. spirits market to return to growth until after 2029, in line with expectations from rival Diageo. The company expects sales growth only at the lower end of its 3% to 6% target range through 2029.
“The assumptions that drive that kind of outlook are based on a U.S. market which is not in growth over that period and which is quite soft,” Ricard told Reuters.
He said Pernod Ricard’s geographic reach would help support performance as the company manages weakness in its markets.
The maker of Absolut vodka, Jameson whiskey and Martell cognac generated €9.4 billion (US$11 billion) in sales during the 12 months through June. Reported sales were 14% lower than the previous fiscal year, while organic sales declined 3.9%.
The U.S. and China recorded organic sales declines of 14% and 19%, respectively. Excluding the two markets, sales increased slightly from a year earlier, with India among the markets delivering solid revenue growth.
Pernod Ricard attributed the U.S. decline to a spirits market slowdown with economic moderation and subdued consumer confidence. In China, the group cited a challenging macroeconomic environment, continuing weak consumer sentiment and regulatory measures impacting demand.
India provided stronger performance, with sales increasing 9%. Pernod Ricard said the market benefited from strong momentum reflecting underlying consumer demand and premiumisation trends. The group owns Royal Stag, which it identifies as the world’s biggest-selling whisky by volume.
Pernod Ricard reported recurring operating profit of €2.42 billion for fiscal 2026, down 5% year on year. Its recurring operating margin fell to 25.8%, reflecting weaker price mix, trade tariffs and higher input costs, partly offset by operational savings.
The group kept its 2026 dividend unchanged at €4.70 per share. Ricard said Pernod expects to complete its €1 billion restructuring programme a year ahead of schedule. The company has cut 3,600 jobs since fiscal 2024 as part of the restructuring effort.
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