Non-Alcoholic Beer Buoys Spirits for AB InBev Investors
Shares of the beermaker soared after it reported modest sales growth in its most recent quarter on Tuesday driven by its NA beer labels.
Sign up for smart news, insights, and analysis on the biggest financial stories of the day.
To tweak a famous proclamation delivered by one Homer J. Simpson: Teetotaling may be the cause of, and solution to, all of AB InBev’s problems.
Shares of the beermaker soared after it reported modest sales growth in its most recent quarter on Tuesday, driven in large part by surging demand for non-alcoholic and non-beer options.
What’s All This Brew-haha About?
When we say modest growth, we mean it. Sales volume increased just 0.8% for the brewing giant behind Budweiser, Michelob, Corona and Stella Artois. But even as small a gain as that trumped analysts’ expectations that a three-year streak of declining sales would continue. The company has been hammered as the world starts to lose its taste for alcohol; just 54% of US adults told Gallup they drink alcohol in a survey published in August, a record low and 13 percentage points below a previous survey published in 2022.
Shares of the company leaped nearly 9% after the Tuesday morning earnings call as investors raised a glass to the good news, though the results didn’t exactly show Americans are loving alcohol again:
- Net revenue for the company’s non-alcoholic beer options soared 27% year-over-year, with its Corona Cero line growing 46% and Michelob Zero growing more than 100%. The company claims those figures best an industry-wide 8% growth rate for non-alcoholic beer.
- Meanwhile, the firm’s “beyond beer” portfolio, which includes very-much alcoholic beverages such as canned cocktail line Cutwater and hard seltzer line NÜTRL, grew 37%. Beer may be on the outs, but alternatives remain in demand.
Goooaaaaal: The good news continued: The company forecast adjusted EBITDA growth of 4% to 8% this year. CEO Michel Doukeris said AB InBev is “well-positioned for 2026,” thanks to a summer season featuring the World Cup, an event sure to deliver plenty of reasons for both celebratory toasts and commiseration drinks.
