Constellation Brands Inc. reaped the benefits of a Bud Light consumer revolt, with sales of the Modelo brand boosting results in the most recent quarter.
(Bloomberg) — Constellation Brands Inc. reaped the benefits of a Bud Light consumer revolt, with sales of the Modelo brand boosting results in the most recent quarter.
Constellation’s beer business reported an 11% net sales increase for the period ending May 31, with growth in Modelo products as well as Corona Extra and the Pacifico beer label. The Victor, New York-based company’s first-quarter sales beat analyst expectations.
Read More: Dylan Mulvaney Says Bud Light Never Reached Out to Her Following Anti-Trans Backlash
Anheuser-Busch InBev NV’s Bud Light has struggled since controversy exploded over the brand’s sponsored Instagram partnership with transgender influencer and actor Dylan Mulvaney. Bud Light has since fallen from the top spot as the best-selling beer by dollar sales in the US, giving up the title to Modelo. Bud Light has released a new ad campaign focused on backyard barbecues in an effort to move past the backlash.
Constellation executives said on the Friday earnings call that Modelo’s move to number one happened sooner than expected. For the back half of the year, the company expects its products to have more room on store shelves, thanks to the growth of its labels and declines for others.
Despite the gains in beer, Constellation maintained its 2024 outlook. Shares slipped less than 1% at 12:13 p.m. New York time.
“We continue to view guidance as conservative given the strength of Constellation’s underlying business,” wrote Goldman Sachs analysts led by Bonnie Herzog. Any stock weakness is “a buying opportunity,” according to the note.
–With assistance from Diana Carolina Bravo.
(Adds earnings commentary in the fourth paragraph, updates shares in fifth paragraph.)
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