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You are at:Home»Business»Beer demand weakens, Corona and Modelo seller says
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Beer demand weakens, Corona and Modelo seller says

Buddy DoyleBy Buddy DoyleSeptember 2, 2025No Comments4 Mins Read
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Beer demand weakens, Corona and Modelo seller says
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Constellation Brands lowered its outlook for its current fiscal year as consumer demand for beer weakened, particularly for high-end beer purchases, amid a “challenging” economic climate.

Constellation, which is the U.S. importer of Corona and Modelo, revised its net sales forecast for beer downward to a decline of 2% to 4%, after its prior outlook showed growth being flat to positive in the 0% to 3% range. It cited incremental macroeconomic headwinds affecting consumer demand as the key driver of the change.

The company’s operating income for beer was also revised down to a decline of 7% to 9% when its prior outlook showed gains in the 0% to 2% range. The impact of lower volumes, additional tariffs and operating deleveraging were cited as driving the shift.

“We continue to navigate a challenging macroeconomic environment that has dampened consumer demand and led to more volatile consumer purchasing behavior since our first quarter of fiscal 2026,” said Constellation Brands CEO Bill Newlands. 

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“Over the last several months, high-end beer buy rates decelerated sequentially, as both trip frequency and spend per trip declined,” Newlands said. 

“Notably, high-end beer buy rate declines for Hispanic consumers were more pronounced than general market declines, which has an outsized impact on our beer business compared to the broader beer category,” he added.

Bump Williams, CEO of Bump Williams Consulting, told FOX Business that the main reasons behind the decline in beer consumption have been the increase in health concerns about the impact of drinking, fewer social gatherings at public venues where beer is sold, as well as consumers reaching the legal drinking age who are more interested in organic, natural products like cannabis and health drinks.

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A six-pack of Modelo Especial beer bottles

“All beer brands are suffering from these distractions, but the biggest volume/share decliners are the older, legacy brands like Bud, Miller, and Coors (Coors Banquet is an exception) that have the most volume to lose,” Williams said. “Beer brands with flavor (Twisted Tea, Mike’s Hard, Smirnoff Ice), healthier attributes (Michelob Ultra, EIGHT, Yuengling Flight) and non-alcoholic brands (Michelob Ultra ZERO, Heineken 0.0 and Athletic’s portfolio) are finding ways to win.”

Ticker Security Last Change Change %
STZ CONSTELLATION BRANDS INC. 151.25 -10.71 -6.61%

Williams said that in the case of Constellation’s leading brands like Corona and Modelo, the loss or decline of business from Hispanic family shoppers has “negatively impacted the Constellation portfolio due to its affinity with the Mexican family.”

“Constellation has been winning at retail with Pacifico, Corona Premier, Sun Brew, Victoria and Familiar; but not enough gains from these winners to offset the losses of their bigger brands,” he added.

Budweiser beer

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Economic factors have also contributed to the decline in beer sales, with Williams saying that beer brands have been failing to attract more shoppers, getting shoppers to buy more frequently or purchase more products.

“Consumers are feeling the pinch of higher prices at retail, not just for beer, but across the entire consumer packaged goods industry. Beer has always been labeled as an ‘affordable luxury’ but when it comes to paying $40 per case for your favorite beer brand, that just seems to be the pinch-point,” he said.

“What we have seen is the consumer trading down in size from 24- or 30-packs to smaller packages like single-serve offerings and 12-packs. It’s a way for consumers to enjoy their favorite beer at an affordable price point,” he said.

Beer glasses

Williams said that consumers pivoting away from beer have turned to a wide variety of alternatives, ranging from beverages that tout health benefits, energy drinks, spirits and cannabis-derived refreshments.

“What I think ails beer the most: we are losing consumers to energy drinks, water, pre/post/pro-biotics, healthier beverages, all-natural juices, vitamin-enriched recovery drinks, low-carb/low-calorie/ less-sugar drinks and gluten-free alternatives,” he said.

“The biggest gainer of lost beer shoppers has been the spirits-based ready-to-drink business led by Surfside, Sun Cruiser, VMC, NUTRL, Cutwater, High Noon and a myriad of other players,” Williams said. “The other big winner is cannabis/THC drinks and I think this particular offering has a long road of growth ahead of it.”

Read the full article here

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