Constellation Brands cuts outlook as Trump tariffs pressure beer, spirits business 

USA – Constellation Brands has issued a profit forecast for fiscal 2026 that falls below Wall Street expectations, as new import tariffs announced by the Trump administration are set to impact its beer and spirits business.  

The company expects comparable earnings per share to range between US$12.60 and US$12.90, lower than analysts’ average estimate of US$13.97. 

The brewer, which imports all of its beer from Mexico, said it anticipates a decline in organic net sales of up to 2%, or a possible increase of just 1%.  

Its core beer business, which includes top-selling brands such as Modelo, Corona, and Pacifico, is projected to experience flat growth or expand up to 3%. 

Constellation also revised its medium-term guidance for fiscal years 2027 and 2028, lowering projected enterprise sales growth to between 2% and 4%, down from the previously expected 6% to 8%.  

The company plans to reduce capital expenditures significantly in the coming years, now projecting a 40% drop in spending in fiscal 2027 and a further 35% reduction in fiscal 2028, compared to earlier projections. 

Constellation divests collection of wine brands 

The fiscal pressure comes as the company also continues to streamline its portfolio. Constellation has announced the sale of a collection of mainstream wine brands to California-based The Wine Group.  

Although financial terms were not disclosed, the deal includes popular brands such as Cook’s, J Rogét, Meiomi, Robert Mondavi Private Selection, SIMI, and Woodbridge. 

Additionally, three production facilities and approximately 6,600 acres of vineyards in California will transfer to The Wine Group. 

Once the transaction is completed, Constellation’s remaining wine offerings will primarily fall into the premium category, with most bottles priced at US$15 or more.  

CEO Bill Newlands described the move as a strategic effort to reshape the company’s focus on higher-end wines and craft spirits, aligning with changing consumer preferences. 

The Wine Group’s CEO, John Sutton, expressed enthusiasm for the acquisition, noting that the new assets would strengthen its portfolio and reinforce its position in the market.  

The deal represents another step in Constellation’s transformation as it adapts to external economic pressures and shifts in consumer demand. 

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