The maker of Corona and Modelo beers delivered better-than-anticipated financial results for its latest quarter, driven by consistent consumer interest in its Mexican beer portfolio including Pacifico and Victoria brands.
Constellation Brands managed to outperform Wall Street expectations despite ongoing challenges across the alcohol industry, with strategic pricing adjustments and enhanced marketing campaigns boosting sales of flagship products like Modelo Especial and Corona Sunbrew.
The beverage company reported quarterly revenue of $1.92 billion for the period ending February 28, representing an 11% year-over-year decline that was less severe than the 13% drop analysts had predicted. Wall Street had forecast revenues of approximately $1.88 billion.
Per-share adjusted earnings reached $1.90 for the quarter, surpassing analyst expectations of $1.72 and providing a bright spot amid broader industry turbulence.
Company leadership expressed optimism about recent performance trends across its beer, wine, and spirits divisions, though executives acknowledged continued market volatility and limited visibility for future quarters.
The alcohol industry continues facing headwinds as consumers reduce discretionary spending amid economic uncertainty. In January, outgoing CEO Bill Newlands cautioned that beer sales would face pressure due to weakening demand among Hispanic consumers. Newlands will step down April 13, with Nicholas Fink taking over leadership.
Recent developments have provided some relief for the company’s cost structure. Under a new U.S. government announcement this month, Constellation’s products are exempt from aluminum tariffs beginning April 6, which should ease margin pressures moving forward.
The company is banking on product innovation to drive future growth, including new offerings like Modelo Chelada Suprema and Limon y Sal non-alcoholic beverages, along with expanded packaging options.
Looking ahead, Constellation projects fiscal 2027 organic sales will range from a 1% decline to 1% growth, a significant improvement from the anticipated 10% drop in fiscal 2026. Annual adjusted earnings are expected to fall between $11.20 and $11.90 per share for fiscal 2027, below analyst estimates of $12.36.
Company shares, which have declined approximately 38% in 2025, dropped an additional 1.5% in after-hours trading following the earnings announcement.
