Constellation Lowers Revenue Forecast Again

The latest quarterly figures from the U.S. giant show continued weak performance in the wine and spirits segments.

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Constellation Brands suffers losses primarily in the lower-priced wine and spirits segment. (Photo: Constellation Brands)
Constellation Brands suffers losses primarily in the lower-priced wine and spirits segment. (Photo: Constellation Brands)

Last week, Constellation Brands, the publicly traded beverage giant, released its Q3 2025 results (ending November 2024). Alongside the figures, President and CEO Bill Newlands announced a downward revision of the company’s forecast, citing “short-term uncertainty regarding when consumers will return to normalized spending.” Constellation now expects organic net sales growth of 2–5%, down from its earlier forecast of 4–6%.

The wine and spirits segment continued to underperform, particularly in lower price categories. Compared to the previous year, sales volumes in this segment dropped by 16%, while revenue fell by 14% to $431.4m (€419.1m), and operating income plunged by 25%. As a result, Constellation adjusted its projected decline in net sales for wine and spirits from 4–6% to 5–8%.

However, according to The Drinks Business, CEO Newlands highlighted improved performance and market share growth for less price-sensitive brands, such as Robert Mondavi. The luxury wine portfolio grew by 6% during the quarter, supporting the company’s ongoing premiumization strategy.

Constellation Brands managed to hold its revenue steady compared to the same quarter in fiscal 2024, reporting $2.46bn (€2.39bn). However, this fell just short of analysts’ expectations of €2.46bn. The company even achieved a slight increase in operating income, primarily driven by its beer segment, with strong performances from Mexican brands Corona and Modelo.

Despite this, the company is apprehensive about potential challenges tied to the inauguration of Donald Trump, who has threatened tariffs on Mexican imports. Investors reacted sharply to the results and outlook, with Constellation’s stock dropping 14% following the announcement. SP

Insights

Dr Tom Croghan, winemaker and medical doctor, weighs in on the recent announcements from the USA.

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