Diageo Revises Full-Year Sales and Profit Outlook
Diageo lowered its forecasts for full-year sales and profits, citing weakness in Chinese white spirits and reduced demand in North America.
2026 Financial Expectations
The company now anticipates organic net sales for 2026 to be flat or slightly declining. This outlook reflects the negative impact from Chinese white spirits and a softer-than-expected consumer market in the US. Organic operating profit growth is predicted to be in the low to mid-single digits.
First Quarter Performance
In the first quarter, Diageo reported flat organic net sales. Organic volume grew by 2.9%, but this was nearly offset by a 2.8% negative price/mix effect. The decline was mainly driven by an unfavorable sales mix in the Asia Pacific region, due to weaker results in Chinese white spirits. Excluding these effects, price/mix would have remained relatively stable.
CEO Comments
“Net sales were flat organically in Q1, with growth in Europe, Latin America & Caribbean (LAC), and Africa balanced by weakness in Chinese white spirits and a softer US consumer environment than planned for.
We are not satisfied with our current performance and are focused on what we can manage and control; acting with speed to drive efficiencies, prioritising investment and adapting more quickly to an evolving consumer environment.
We are well advanced in sharpening our strategy, and we are developing and already implementing clear plans to drive growth across the broader portfolio, ensuring that we meet relevant consumer occasions of the future.”
Author's summary: Diageo faces challenges from lower demand in Chinese white spirits and the US market, prompting adjustments in their 2026 sales and profit forecasts while reshaping strategy for growth.
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