Bud Light’s Sales Take a Big Hit
Anheuser-Busch InBev Reports Decline in Bud Light Sales, but Worldwide Earnings Rise
Anheuser-Busch InBev revealed that Bud Light sales in the third quarter led to a 13.5 percent decrease in the company’s U.S. revenue. However, the brewing giant reported an increase in worldwide adjusted earnings for the same period.
In a report released on Tuesday, Anheuser-Busch stated, “Revenue declined by 13.5 percent with revenue per hl [hectoliter] increasing by 4.9 percent driven by revenue management initiatives.” The company also noted a 17.6 percent decline in sales to wholesalers and a 16.6 percent decline in sales to retailers.
The decline in sales was primarily attributed to the volume decrease of Bud Light and the impact of shipment phasing ahead of a price increase in October of the previous year. As a result, the company’s U.S. earnings before interest, taxes, depreciation, and amortization (EBITDA) dropped by 29.6 percent for the quarter.
Related Stories
- UFC Faces Boycott Calls After Announcing Bud Light Partnership – 10/25/2023
- Bud Light Offering Major Perks to Keep the Beer on Shelves – 10/20/2023
The report attributed approximately two-thirds of the revenue decrease to market share performance and the remaining third to productivity loss, increased sales and marketing investments, and support measures for wholesaler partners.
This is the second quarter in which Bud Light sales have been impacted by controversy in the United States. In August, Anheuser-Busch InBev reported a drop in profit due to the backlash.
Despite the decline in Bud Light sales, the parent company reported a 4.1 percent increase in adjusted earnings for the quarter, reaching $5.4 billion, with revenues climbing 5 percent to $15.6 billion.
The report also highlighted the growth of the company’s mainstream portfolio in South Africa, Colombia, and the Dominican Republic, offsetting the decline of Bud Light in the U.S. The mainstream brands maintained or gained market share in most key markets.
Bud Light sales experienced a significant decline following a controversy involving a commemorative can sent to transgender influencer Dylan Mulvaney. The brand lost its position as America’s best-selling beer after more than two decades, dropping to second place behind Modelo Especial.
According to Nielsen data compiled by Bump Williams Consulting, U.S. dollar sales of Bud Light were down 29 percent in the four weeks ended Oct. 21 compared to the previous year. Sales for the year-to-date were down nearly 19 percent.
In an effort to rebuild its image, Bud Light recently announced a “multiyear marketing partnership” with the Ultimate Fighting Championship (UFC). The company has also increased its visibility at NFL games and collaborated with Kansas City Chiefs tight end Travis Kelce for commercials.
While the Bud Light-UFC deal has faced some backlash, UFC CEO Dana White emphasized that the partnership was not solely driven by money but by shared values.
As the boycott calls continue, the financial details of the Bud Light-UFC partnership have not been disclosed. However, sources suggest that the deal is worth over $100 million.
The Associated Press contributed to this report.
How did Anheuser-Busch InBev manage to report an increase in worldwide earnings despite the decline in Bud Light sales?
Esalers and retailers. Despite the decline in Bud Light sales, Anheuser-Busch InBev reported a positive outlook for its worldwide earnings.
The decline in revenue was primarily driven by a decrease in Bud Light sales, which resulted in a 13.5 percent decrease in U.S. revenue for Anheuser-Busch InBev. The company also experienced a decline in sales to wholesalers and retailers, with a decrease of 17.6 percent and 16.6 percent, respectively.
Anheuser-Busch InBev attributed this decline to the volume decrease of Bud Light and the impact of shipment phasing ahead of a price increase in October of the previous year. As a result, the company’s U.S. earnings before interest, taxes, depreciation, and amortization (EBITDA) dropped by 29.6 percent for the quarter.
However, despite the decline in Bud Light sales, Anheuser-Busch InBev reported an increase in worldwide adjusted earnings for the same period. According to the company’s report, revenue per hectoliter increased by 4.9 percent, driven by revenue management initiatives. This indicates that the company’s strategies to manage revenue were successful on a global scale.
The report stated that approximately two-thirds of the revenue decrease can be attributed to market share performance, while the remaining third is due to productivity loss, increased sales and marketing investments, and support measures for wholesalers and retailers.
While the decline in Bud Light sales may be concerning for Anheuser-Busch InBev, the company’s ability to generate increased worldwide earnings highlights its resilience in the face of challenges. With strategic revenue management initiatives in place, the company remains optimistic about its future growth and profitability.
In conclusion, Anheuser-Busch InBev reported a decline in Bud Light sales, resulting in a decrease in U.S. revenue. However, the company also reported an increase in worldwide earnings, indicating its ability to navigate challenging market conditions. With a focus on revenue management and support for wholesalers and retailers, Anheuser-Busch InBev remains optimistic about its future prospects.
" Conservative News Daily does not always share or support the views and opinions expressed here; they are just those of the writer."
*As an Amazon Associate I earn from qualifying purchases
Now loading...