USA: Constellation Brands beat quarterly profit expectations although beer sales drop

Constellation Brands beat quarterly profit expectations on October 6 but reported weaker beer sales as pressure on its core Hispanic consumers and softer U.S. demand has weighed on shipments.

The maker of Modelo and Corona posted earnings of $3.63 per share for the second quarter ended August, above analysts’ estimates of $3.48.

Revenue slipped 2% to $2.48 billion, missing expectations of $2.51 billion.

Beer sales fell 7%, driven by an 8.7% drop in shipment volumes as distributors cut inventories and consumers pulled back on spending. Operating margin for the beer unit fell 200 basis points to 40.6% due to higher costs and aluminum tariffs.

Constellation maintained its fiscal 2026 outlook, expecting overall earnings of $11.30 to $11.60 per share. The company continues to forecast beer net sales to decline 2%–4% and operating income to fall 7%–9%.

CEO Bill Newlands said the company remains focused on “distribution gains, disciplined innovation, and investing behind our brands,” adding that Constellation continues to lead the U.S. beer industry in dollar share gains despite the challenging environment.

Shares rose 2.5% in extended trading.